BUSINESS ERA

This paper is dedicated to offer a few strategies that can help in such cases.

Here are the traditional methods of limiting the losses:

1. Stop order: The freeze order shall establish control over the passive losses. When you open a position, you can immediately place a stop order. One of the rules for placing stop orders for the purchase, for example, it would be a stop-order on the previous wage, or at the level of support. When selling, you have to stop a warrant for a previous maximum or on the level of resistance. This allows you to control the loss against extreme movements. However, this does not guarantee the exact performance, because, depending on your broker, the majority of stop orders become market orders when they are activated. In extreme movements, your stop order will be activated, and in fact met, when the price may be too far away. The negative feature of stop orders that recent levels of support and resistance is often tested with a view to increasing the stop-orders. Many faced with a situation where the position is closed by a stop-order, and then the market started to move in a direction which was originally expected.

2. Stop-turn: In this option, you open the position to buy or sell and post stoporder with an additional lot. For example, when buying a lot of euro 86.50, you place an order for the sale of two lots of Euro 85 95. This strategy keeps you in the market, and expands your position. Of course, this does not protect you from possible re-turn the market in the initial direction in which you will find yourself on the wrong side.

3. There is no stop-orders. You open a position and leave her alone. This strategy allows the market to work. There are two disadvantages: a) when the market intensely moving, you remain attached to the wrong side. b) you have to test their patience. A bit long, people may look at the position, which continues to build up their losses. The advantage is that the currency pairs fluctuate over time and have a wide range. If you focus on the longer time scale, the price will tend to remain in the direction of the trend, which is dominant.

Fortunately, there are alternatives to these strategies. Traders are not limited to these three strategies. We'll call this new technique for risk management - Simultaneous buying and selling. Some companies that provide services in the FOREX market offers this feature. Company "FXSOL" is one of the brokers and their trading platform podserkivaet it. We recently spoke with Tom rafts from "FXSOl" on this approach.

"There are several reasons to open a multidirectional stand on the same currency pair," said Raft. First - this is the psychological advantage of the fact that to always be involved in the market. Even though the position zahedzhirovana, and the customer can not lose money because of adverse market movements, it is still emotionally involved in the market and can tailor the hedge in accordance with how the situation develops in the market. The second relates to the ability to remain involved in the market during a limited range of the market. It helps a trader to avoid quick turn, are worst enemies of traders. "

In this strategy you open a position and, if the market moves against you, then you open an opposite position. They will not vzaimozakryvat each other. The position on the purchase, there is the account in conjunction with the position to sell. What makes this really - fix the situation and allow the trader is not the time to manage risk. Say, for example, the position moves in for the purchase of lucrative direction. You can leave a position to sell as is and add to positions on a purchase.

If the market starts to move back, the position on the sale can be closed when it becomes profitable. The advantage of this approach is that it allows the trader quietly assess market conditions and does not become hostage to these conditions. Trader can choose how to balance between these positions. A full hedge occurs when a position in the buying and selling equivalent. This freezes the ratio of profits to losses. But it does not freeze position.

If the profit from the position at one side quickly reaches a certain level, they may be closed for a fixed profit. You can add more to one side and to increase one direction than another.

One of the best applications of this technique is possible when trading ranges. When there is no certain clarity in which direction to go, you can open the position to buy and to sell and let the market come to you for help. To do this, you do not need to test its strength.

While it is not absolutely oshibkoustoychivoy technology, it certainly deserves attention. Ability to be on both sides of the market at the same time is rarely used, but probably could be applied more effectively by most traders.

Within-day Scalping market can vary quite a different traders. It may be 10 - 20 deals with several points during the day, 3 - 4 deals with a dozen points or something mean? By educating traders, I always emphasize that the rule - regardless of what system or method of a trader wants to use, it must be compatible with its risk tolerance. Simply put, this means that if a trader does not have the patience to allow the transaction to promote the movement of a few tens or even hundreds of items, which will take a whole day and not just one, and it should not use methods with the corresponding approach.

On the other hand, if a trader seeks to avoid over-trading and focus on better deals, it does not make sense to use a strategy of rapid skalpirovaniya to trade many times a day with a small profit.

Therefore, knowing yourself as a trader, and understanding their tolerance of risk, both in money (ie, how far can be set to stop) and psychologically (ie, how long you are willing to stick to the deal before accepting the loss) is critical in the choice of trading method or system.

There are methods of intra-day skalpirovaniya, which are based on a trader's risk tolerance and the number of transactions, it would make for one trading day. Commercial installation and time settings can be changed to adapt them to a particular style and preferences of the trader. The proposed method uses the 2 main trading tool, which can be intuitively easy to follow, as well as using graphics software.

Tools

Linear regression

Using a statistical technique called the method of least squares, linear regression builds a line that best corresponds to a series of data points, where the data points deviate less. Regression of trying to predict future prices by using the continuation of this line. Can then be constructed regression channel, by placing the bands above and below the center line, using the standard deviation. Fortunately, today's traders should not be experts in statistical analysis to perform this procedure, because most graphics programs can automatically build a line of linear regression channels. For the purposes of this article, we will use the channel of linear regression as the primary indicator of trend.

Channel linear regression (slope of the channel shows the direction of the trend)

Example teak graphics (meaning the price can quickly move between extrema)

5-minute schedule ES (arrow shows the entrance to the longest side)

1-minute schedule for ES, 50-channel regression periodny (trade executed in the direction of slope)