Here’s a post going the other way – if you fancy yourself as a gambler, don’t learn about the forex business, it’s not for you.

Hey, it’s like poker.
It’s not like poker – just one of the many things it shouldn’t be like is poker.
You think that edge-of-the-seat stuff, adrenalin rushes, a bit of healthy panic are going to be integral and vital to the whole game? If you think that’s how the big guys do it, operating as if supercool, suave casino habitués, then you’d be way wrong. The big guys are nerds. They wouldn’t know what the hell they were doing in a real casino.
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There’s a distinct group of people in forex trading – they do ok, they probably make some money every week. They spend a lot of time comparing signals, calculating and working out their entries – and almost no time at all considering their exit signals.

We all can be guilty of it – decide to place a trade and then completely overlook the second part, deciding on the stops, take-profit or stop-loss – and this part is just as important in determining your profits (or limiting losses) at the end of the day.
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Fairly obvious – at the moment, investors, rather than traders, need something that isn’t going to go down the pan – if the future is uncertain, and more importantly, with news events coming in thick and fast, making it impossible to make any sensible long-term decisions, what do you do? Give up and head for the nearest safe haven.

Any major traded currency, for example USD or CHF, is going have a natural inbuilt advantage.
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Spend your time looking at 1-hour candlestick charts and then switch to a 5-minute chart and what happens?

Suddenly, all these exciting trends jump out at you, making you think that here’s some action, better get on it… Major movements, established trends, breakouts? None of these. Remember the vertical scale – these are just a few pips here and there, the illusion is of faster, more dramatic activity. If you switch back to the longer period charts it all comes back into perspective.
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Floor pivot points are the simplest type of pivots used in forex.

From the previous period: H = high, L = low, C= close

Pivot (P) = (H + L + C) / 3

Resistance R1 = 2P – L
Resistance R2 = P + H – L
Resistance R3 = H + 2(P – L)

Support S1 = 2P – H
Support S2 = P – H + L
Support S3 = L – 2(H – P)

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Twin peaks return… here’s a chart, a real life example.

The price has reached a level of resistance, bounced back off it… and then returned to test the idea one more time for luck… It didn’t work and now there’s a pronounced downtrend forming.

This is the double top, and, as usual, what holds true for the double top will also be so in reverse for the double bottom, which is even less polite.
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A dodgy alliteration, but now the heat has turned on Hypo – so what does the German government do, rushes to the rescue, guaranteeing savings everywhere. Other countries in the Euroland won’t be too unhappy about this, but the UK definitely will be.
This is now socio-political concerns completely overriding the economic forces – ie. very definitely not a free market and not capitalism.
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