Sunday June 13, 2004 - 02:18:07 GMT
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I-Knowindices - i-knowindices.com
EURO and GBP are expected to spike up for a week before the reverse....
EURO and GBP went for a tailspin to induce the long position holders to cut loss or stop out due to market fear.... but who bought all the selling near the low? The smart traders – the operators, understood the market and turned as higher-level sellers, when all turned long in EURO and GBP after the short covering, there was no one to buy at higher levels. Then the slide and drop happened...now the small traders developed the feel that EURO and GBP could drop more and when they turn short in them they will be trapped again by the big players...this leads to directionless trading, lack of understanding of market players’ intentions leads to this situation. Because the players also use the similar charts and find before hand when the emotional traders will make huge buying at higher levels and or sell at lower levels.... the operators create the market sentiments using the news, breaking news, statements, data etc. as attributes and when the traders are committed with positions aiming for good profit, they turn the market other way giving some other interpretations and analyses. The media helps them a lot to spread the new derivations – why the market behaved differently after the news. Operators always act against the market sentiment to earn their money.
If you do any specific directional trade - any pair- buy near the low and sell near the high set for the day and move stop to entry once the profit is seen, the success will be seen...
This week 14-18 Jun, EURO and GBP are expected to swing and rise more and more when the entire market is expecting further fall...
USE a simple strategy of buy once the low is set and not cut for more than 30 min and book profit once the high is formed and not cut for 30 min and more.... don’t try to do either way trades...many traders fail to understand the operators limitations and lose what they earned in the earlier trade.... to sustain the profit earned - once a profit is booked in a position give minimum 30 min gap to take next position, your emotional decision making in taking positions will be averted.
Avoid comparing the current move with the past move; because the conditions are not same to make such comparisons...hence the charts do have the limitations in explaining the market trends and directions...more during trend reversals...
Hence the analysts use various parameters and project the expected trend and finally try to attribute the cause on the news or rumor when the deviation is seen from the expectations.
Then the next level analyses is comparing the market condition for similar news breakout in the past and project the expectations. Then when divergent are seen in the market as unexpected, again the analysts change the view and give diagonally opposite views. But the traders holding the positions based on the past expectations could not take a decision whether to cut the unfavorable position or to add more position in the same direction...it is very important for the analysts to help in this situation the traders with good trading advice for their pending unfavorable positions...........
Forecast based trade with damage control and profit making trading solutions from time to time to make the trading a continuum will be the ultimate tool for the traders to earn from the market...
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