If the Martingale system is a joke – then the anti-Martingale is a seriously bad joke. As risk-management it leaves something to be desired.

The anti-Martingale is exactly as the name suggests, the Martingale in reverse, and again it comes out of roulette ‘theory’ – any game where there’s roughly a 50/50 win/lose. Instead of doubling up on your lot size following a losing trade, you double on a successful trade. Continue the doubling and watch the money mount up.
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Housing starts data measure the number of residential units on which construction is begun. These, taken with related figures, (Pending Home Sales, Construction Spending m/m) go a long way to make up the economic backdrop that affects USD.

In the UK, other indices, for example, Mortgage Approvals, the Halifax House Price Index m/m also play a major part in the fundamental strength of GBP.
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You’ve just bought, for a reasonable amount of cash, an expert advisor to run your MetaTrader – it’s going to give you cast-iron signals about when to open and close trades, it’ll run automated, it may make you $10,000 in 100 days of forex trading, or so they say…

But, as it so happens, unless you’ve been the first one to buy a very unpopular piece of software – a few other copies of this EA have been sold.
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Here’s a forex market movement for our times:-

Despite forecasts for a depreciation of the Dollar, many economists are now saying that the negative housing data released from the United States yesterday may actually bolster the USD.

Let’s state the effect in the simplest possible terms.

Bad news for the US economy, lower jobs, lower GDP, leads to lack of confidence
Which leads to a rush towards safe haven currencies…
Which leads to buying USD – because USD is in itself, considered a safe-haven currency…
So bad US news leads to USD going up.

This rush to a safe haven, any safe haven, after every news announcement is creating some weird effects. It flies in the face of logic, well, simple logic anyway – and is a sign of the present dominance of USD

No, I don’t know of any name for this upsidedown, wrong-way-round, echo, reverb effect – but it certainly ought to have a name…
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Camarilla Pivot Points are (unfortunately) covered in the same mystique as Fibonacci retracement – involving higher mathematics to produce a magic formula that somehow the markets are bound to follow – well, to be honest, the math involved is more simple arithmetic than anything else.

8 levels, 4 of resistance, 4 of support, are produced, using High, Low and Close data for a preceding time period.

R4 = (H – L) x 1.1 / 2 + C
R3 = (H – L) x 1.1 / 4 + C
R2 = (H – L) x 1.1 / 6 + C
R1 = (H – L) x 1.1 / 12 + C
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Balance of trade figures are another important facet of fundamental economic analysis. The trade balance compares exports versus imports for a given economy – sometimes the figures are broken into separate balances covering goods and services

Positive
A positive balance of trade = exports higher than imports. Exports good – money coming into an economy, a trade surplus.

Negative
The opposite of this is a trade deficit, or trade gap – more goods are being imported the exported. Imports bad – money going out an economy to pay for them.

Balance of trade has historically been a critical issue in the Japanese economy, which is heavily based on exports. The financial management of the economy is geared towards stimulating exports wherever possible – keeping the value of the Yen low, low interest rates etc. – so JPY tends to be more sensitive to good/bad balance of trade figures than other currencies – on average…

Japan is a good example of a mature economy and these always tend to run a trade surplus – other examples include Germany and Canada, (sometimes unfairly referred to as stagnant economies), running generally at a lower expectation of growth. But the strong growth economies eg. United States, Australia run regular trade deficits, simply to fuel this growth.

When it comes to pure economic theory – as usual, economists are divided. Some say that trade deficits have to be tackled as they will inevitably bring an economy down, others say it’s a necessary evil to stimulate some growth, and a few even reckon a trade deficit matters not at all…

The markets, however – and it’s always the markets we’re interested in when it comes to forex trading – will tend to go classic picture, trade surplus good, trade deficit bad.

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ETFs, exchange-traded funds, grew out of the older style, mutual funds or unit trusts.

Since ETFs trade on the market, investors can use the same trading tools as they can with a conventional stock, for example, limit orders, stop-loss orders, margin/leverage, selling short, and no restriction on lot size.

ETFs retain the valuation feature of a unit trust, which can be purchased/redeemed at the end of each day for its net value – but you’re not limited to trading at the close price. An ETF is continually priced through market trading hours and so intra-day trading becomes possible. (Not something that ever went on with unit trusts or mutual funds).
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Pivot points are a quick method of assessing trend and likely levels of support or resistance – they’re not all you’ll ever need to know, just another weapon in the forex armory, particularly useful in the short-term.

We’ve added to a pivot point calculator to our free tools section – at the moment, just for standard (floor) pivot points – the more exotic formulae, De Mark pivots, the Camarilla system, will be following shortly.
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Bollinger bands are a great way of understanding market movements if you’re new to the forex game. Everybody uses them, and overall, the concept is relatively easy to understand. And your charting software will do all the work for you – so at first, no need to go into all the math involved.

And here’s a nice enough example. GPB/USD 30-min chart – the currency pair becoming range-bound, candlesticks shortening and then breakout – here, to the downside.

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The boring stuff that you probably ought to know - if you’re going to make a successful trader.

There’s quite a few people who trade on the retail forex market every day, who watch their charts go up and down, click on their trades, but only have the very vaguest idea of what’s happening in the big wide world out there. Here’s the very simple version – how the retail forex market works in relation to the world of the big players, banks, institutions, the people we love…

Two quick points to clarify first (which you may well know already).

1. Watching pairs go up and down – you aren’t seeing ‘the forex market’ – you’re seeing your chosen broker’s version of that market. Which is a completely different thing.
2. Liquidity. If you buy something, there must be someone willing and able to sell you it first – the stuff has to a) exist and b) be owned, even if it is a fairly notional ownership at times. Otherwise, no forex deal.

The Interbank Level
The top level of the fx market is known as the Interbank level. It’s not a centralised exchange, in the same way as stocks usually will have an exchange, with intermediate brokers entering the market on behalf of clients – the Interbank level is essentially a collection of bids and offers existing at any one time in order to make potential currency transactions.
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