A look at the day ahead in U.S. and global markets by Samuel Indyk
The relentless recovery in the S&P 500 from early August’s post-payrolls trough finally took a pause on Tuesday after eight straight up days, and futures are not giving too much indication about the direction of travel on Wednesday.
Morning Bid: Relentless rally pauses for breath
USDJPY 4 HOUR CHART – KUDOS
Kudos to JP and Monege for catching the trade off of 145 as all the action has been in the JOY.
If you take a step back, the broad range is 141.69=149.39 and any stops within it do not land the punch of breaking this range.
Otherwise, the bounce from just below 145 confirms this as the pivotal level with a move above 147.34 needed to negate the current downside risk. A conspiracy theorist would say the BoJ is in covertly to prevent another run at the low.
If you narrow the range ti 145-148, then 146.50 would be a neutral midpoint.
Rode the short all day from early US and hit the bid at 155.00 even, prime t/p is 145.90 to be safe. The Asian session bias is at equilibrium at 145.25 and non-committal to breaching 145.60 or 144.90 decisively headed into the second half. Europe should be interesting.
Of interest to me is how democrats/FED are going to explain away the almost 1 million job losses they just confessed to that they hid from plain sight. Saxo Bank and Goldman just publicly voiced the same interest in an explanation on Bloomberg.
JP, If I told you that there was a large order in the market to buy EUR and sell GBP would you be looking to sell EURUSD and buy GBPUSD, do the opposite or step aside as the order gets executed?
How You Can Use Currency Crosses to Trade Spot Forex
HOW WRONG is Justin Lahart ?
Kamala Harris Wants to Ban Price Gouging. What Do Economists Say? The line between gouging and normal market forces can be pretty thin. And stopping it is no easy feat either. – By Justin Lahart in WSJ
Lets see…
Price gouging solves itself when 1) the first gouger runs out of supply and when “me too” opportunists arrive with new supply.
2) price gouging, in its pure certified form, gets solved when the gouger gets either shot by pissed gougee or by govt price-control enforcement forces.
TRADER ALERT
A downward revision of 1 million jobs would reduce employment creation to 1.6 million jobs for the year, from 2.6 million, said Marc Chandler, chief market strategist at Bannockburn Global Forex in New York.
“That’s why I think that the market is still pricing in about a 25% chance of a 50-basis-point cut in September,” Chandler said. “People thought the Fed was behind the curve in raising rates, and now many people think the Fed is behind the curve in cutting rates.”
Greta … where tfk ARE you ?!
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What is Risk Management in Trading – Forex Forum
For any trader, managing risk is essential to success. But what exactly is risk management? In this blog post, we’ll explore what risk management is and how it can help you become a successful trader.
We’ll also look at some common mistakes that traders make when it comes to managing their risks. After all, if you’re not managing risk appropriately, you’re just a gambler. So if you’re ready to learn more about risk management, read on!
What is Risk Management in Trading?
Risk management is the process of assessing, controlling, and managing risk within a trading portfolio. This involves defining trading goals and understanding potential losses that could occur as part of the trading process.
It also includes identifying potential risks, such as market volatility or sudden changes in the market, understanding how these risks can affect your profits, and taking steps to limit potential losses.
In general, risk management should be a priority for all traders. By properly managing your risks and using effective strategies, you can minimize potential losses and increase the chances of making successful trades.
Common Mistakes When Managing Risk in Trading
Unfortunately, many traders make mistakes when it comes to managing their risks. Here are some of the most common mistakes that traders make when it comes to risk management:
Not Setting a Trading Plan:
Many traders don’t have a detailed trading plan, which is a key component of risk management. Without a trading plan, traders are more likely to take risks that could have otherwise been avoided. It’s important to establish clear trading goals and a plan for how to reach those goals.
Not Understanding Risk:
Many traders fail to understand the risks associated with certain trades, which can lead to serious losses if they don’t take the time to research and understand the risks involved. It’s important to have a thorough understanding of the markets you’re trading in before taking any risks.
Not Taking Advantage of Stop Losses:
Stop losses are an essential component of risk management, as they help to limit potential losses in the event of a market downturn or sudden changes in the market. However, many traders don’t take advantage of stop losses and end up taking larger risks than necessary.
Over-Trading:
Over-trading is a common mistake made by many traders. This involves taking too many trades, which can lead to losses if the market turns against you. Look, all traders love the price action. It’s exciting to take a position and watch your P/L go up and down. But don’t become addicted to the price action for the sake of just having a position. It’s important to only take trades when the setup is right and avoid over trading.
Not Diversifying Risk:
Diversification is another important part of risk management. By diversifying your trades, you can spread out risk and limit potential losses if the market turns against you.
Why is Risk Management Important in Trading?
Risk management is a critical factor in success when trading in the markets. It involves understanding and controlling what could potentially impact your trades and actively analyzing scenarios that may occur.
Without proper risk management, traders are leaving themselves vulnerable to potential losses which could be catastrophic for their investments.
Good risk management also allows traders to effectively assess opportunities and make better decisions that take into account volatility or leading indicators of future market performance.
Simply put, risk management can provide peace of mind so traders can enjoy the highs of profitable investments while minimizing losses when markets start to dip.
What are Some Common Risk Management Strategies?
Common risk management strategies used by traders include setting stop-loss orders, limiting capital exposure, and diversifying investments to minimize volatility.
Another essential approach for traders is to set predetermined targets for both profits and losses to help stabilize your exposure. To further limit potential losses and maximize gains, traders should always be aware of economic news and other world events that might affect the market.
How to Implement Risk Management in your Trading Plan
Implementing effective risk management into your trading plan is incredibly important for successful and profitable trading. It can help you to control the amount of draws you take in any given trade, and it can also protect against large losses which could potentially wipe out your entire trading account.
A good risk management plan should include determining the amount of capital at risk on each trade, setting predetermined stop-losses to limit downside exposure, and having a strict, disciplined approach towards minimizing losses:
never increasing position size
never risking more than you are comfortable with, and always controlling potential risk-reward ratios.
Taking the time to set up a comprehensive yet flexible risk management plan will put you in a better position when it comes to positive returns in the long run.
Risk management is an important part of trading. It allows you to trade with less stress and more confidence. There are many different risk management strategies, so it is important to find one that fits your trading style.
Proper risk management can help you make money in the long run by preserving your capital and preventing you from making careless mistakes.
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