It been a few days since i initially read this thread and today i came across this webvideo that talks about how the big boys use alot longer time frames in their positions. well it also talks about alot of other things but its about using fibonacci retracement lines to find this information. Maybe some of u guys have seen this video.

here is the link http://www.jeff-parks.com/html/fibo_s_2.html

the video is pretty convincing on its usuage of the fibonacci lines.

what do u think of these fibonacci lines minime?
also minime i have another question here in the US if there is a resolution on the immigration issue. and also now that there has been an increase on minimum wage to $7.25/Hr, do u think that this could help out the dollar? that would be alota workers at $7.25/Hr. and also what if these two things happened and the US also pulled its troops out from iraq? would this help alot the dollar? if no... what are the problems with the dollar? minime these questions just for fun for me to learn more about how these things work.
thanks in advance! hope u havent forgotten about this thread!!

I was planning to make the next video this week but I am bit depressed after reading a book recommended by a friend, it’s called Hedge Hogging some of the stories appeal to me and reminded me with the losses I had in my first trading years, it’s a feeling I forgot but when I read the book I got those feeling back again. I am sorry I am off the subject but being in the winning side for a long time made me forget those feelings.
One of the reasons I am trying to pass the little knowledge I have learned is help new traders avoid those feelings, anyhow I will continue this thread in the next few days when I feel better.
elitecamper : Your question was supposed to be answered in the next video but I will give you the answer now since you came and asked.

First of all, if you ever heard of the term self a fulfilling prophecy, that why Fibonacci works!!
Fibonacci is the biggest lie in forex but since more and more people believed in it then the lie becomes true.
Let me explain:
supposed that this Fibonacci level is formed over a long period of time , and it certainly is , it was formed over weeks and months , so a lot of people has been following this situation , lot of people has the opportunity to draw the same line , on the main traders desk around the world , all of the has draw the same lines and they came up with the same Fibonacci levels .
So everybody assumes there will be support at 38.2% level what they are going to do when the price reaches there? they are going to buy and if there is enough buying pressure at that point , that will cause the price to go back up  , and this will be the self fulfilling prophecy.
In other words in a sense ,the support was formed because enough people believed there will be a support line over there , and place their orders accordingly , that could be one explanation for it.
No magic in here , but Fibonacci is part of the culture of Forex market its very widely followed , and anything is widely followed is easy predictable

About your second question in the US economy, EVERY down would be followed by an up this is how the market works, the reasons for the weak US dollar is well known, and I will just put some facts about the US dollar
US Dollar
- Largest Economic power in the world
- 40% of capital market assets from foreign investments
- 90% of all currency transactions involve the US dollar
- Gold and US dollar has inverse relationship
- Highly influenced by US Stock and Bond Market ( when the Bond and stock market of a country starts to heat up , that means more money flowing into that country which means strength of the country currency)
- Can be changed with the oil price ( inverse relationship)

If you want to understand how an economy of a country works, look at the flow of the money, if the money flow into the country ( Japan, US ) then there will be boost in the economy , interest rates, stocks , currency ect. If the money is running away from the country ( where there is war ) then the economy is falling apart
Now lets put some facts
Trade flows :
Negative: Import outweigh export ( US )
Positive: Export outweigh import ( Japan )
Capital flows:
Negative: Domestic outflows exceed foreign inflows
Positive: Foreign inflows exceed domestic outflows ( US , lots of money flows in to the US market to take advantage of the country economy )
Balance of Payments
Trade flows + Capital flows
Positive = Appreciation of the currency
Negative = Depreciation of the currency
Back to US, in the last couple of years the manufacturing sector was boosted because of the security sector not the service sector, at the same time the dollar lost its value cause the nation is jumping from one war to another, at the same time the Bush administration wanted the dollar to lose its weight so they can export more products, and import less, however the Chinese and Japanese products found a good market in US and the US government understand the threat coming from the far east. The only way around this problem was to enforce higher taxes at imports, anyhow the factors that played the rule to lower the value of the US dollar are weaker now and after the Gulf war, US is considered the world number one major power in the world, that means people will put their trust US dollar.

Now even though the US government wants a lower value for the US dollar they can’t escape the fact that more than 90% of currency transactions are in US dollar, the immigration issue gives the US even more power since now it’s a democratic country , the guys comming from the iraq war who were well paid now wants to get married and buy houses, this in my opinion gives more power to the US as a nation and as a currency.

I think the next war for the US is in China, I am trying to make an ending to my long answer but I can’t it’s a long debated issues; each person has his own opinion about it. in short I think it’s the era where the US dollar will gain its power back

__________________
“Risk comes from not knowing what you're doing”
“Never argue with an idiot. They drag you down to their level then beat you with experience”

quick and very thorough response MiniMe!! im glad i asked u those questions hehe.

Your welcome elitecamper, very nice link you had in the previous post, I may just refer to it and rest doing nothing. I have seen part of it and seems very good

__________________
“Risk comes from not knowing what you're doing”
“Never argue with an idiot. They drag you down to their level then beat you with experience”

Hi minime,

Thanks for sharing with us ....i am now still following your this thread...

Hope all of us here can get more consistence winning PIPS


Judy

Your welcome Judylim
in post 16 I said "
The trick is that (80% of the times) central banks revel their intensions way before their meetings and before they issues any statements, hoping this will push the currency to the level they want when they publish their decisions / statements "

two years ago when the dollar was falling down we heard lots of statements from big banks on thier intesion to move thier reserve from US to EU, those statements supported the down move for the US, now I want you guys to follow up with the statements we will see in the next few months, this is a good site to see the news, and its a good time to understand the news:
http://www.bloomberg.com/index.html?Intro=intro3
you will notice more statements from the big boys to support thier moves and postions.
rumors has a small effect in forex but it shows the direction of the currency move, especially if those rumors and reports came from the big guys the do it to support thier positions and we have to understand that those guys look for long trading so thier moves will add weight to the market.

__________________
“Risk comes from not knowing what you're doing”
“Never argue with an idiot. They drag you down to their level then beat you with experience”

Rosie O'Donnel leaves 'The View'?

i clicked on bloomberg professional and it took me to rosie o'donnel left the view! hehe. MiniMe i have a question, How can i spot the big boys in the news? thanks minime!

The above link was for the bloomberg news site, not for the view , on post 15 I have defined who will be considered as a big boy.

two years ago when I had a project in Dubai, we kept hearing on the news ( more than once ) that the Gulf Countries ( Oil producers ) will change big part of their reserve from US to EURO, at the same time there was the news from the China planning to break the link between their currency and the Dollar, also at the same time there was the oil shortage due to Iraq war ....etc all these bad dollar news
Now if we consider that the oil was overpriced and there is no demand for the Gold as the world is a safe haven (people buy gold and Swiss frank when there is war or disaster), and if we consider that the historical maximum price ( not the very max but one of the max turning points) was reached, all of which will indicate that its time for the US to gain power back.
Let suppose that the smart guys have already took a position when the EU/US reached 1.3679 by the end of April giving a double top on the 4H chart and double top on the monthly chart, now if I took that position my first target would be at 1.2959 then we might see the price calm down as this is the second fib level and a strong support line, now lets speculate more and say the price will go through this line then we will see another stop at 1.2427, further another stop at 1.1635 ( these are fib levels and historical support lines ) . This may sound crazy as I am drawing a chart for the price in the future, I am not a magician I just read the charts and I love the weekly and monthly charts, and when you spend so much time looking at the charts you see things you didn't see before, its like knowing what wrong with you car without looking under the hood.

Now suppose my theory was right ( again suppose ) that mean those guys don’t want to stop at these points, as we said earlier those guys look for long term traders they are not scalpers, therefore once we start seeing thier statements in the news, signaling their intensions to support the US dollar that will expose their positions in the market either long or short.

Those guys like what I said in post 15 can be big banks analysts, central banks, governments, big companies from EU buying small companies in US … etc
Now remember this is my personal point of view, and this is for long term trading and as I always say I might be right or I might be wrong it’s a very debated issue and is subject to lots of politics.

__________________
“Risk comes from not knowing what you're doing”
“Never argue with an idiot. They drag you down to their level then beat you with experience”

when I talk about Oil, Gold and Swiss I presume you know those have inverse relationship with the dollar.

How the above info could be useful to day trader ?
Trick:
Get the worst EA in forex ( but it has to work ) and set it to be short only in the next few months and see the performance.

__________________
“Risk comes from not knowing what you're doing”
“Never argue with an idiot. They drag you down to their level then beat you with experience”