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thekid

90% Analysis/10% Money Managment

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Anyone else out there that goes by this?

 

I'd give 50 or even more percent of importance to money management. Many traders lose because of incorrect money management even if their analysis is correct. You may have 5 profitable trades and then take risk and lose everything for one trade even your trading analysis was in 80% correct.

Just my two cents.

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Kid,

 

Explore what you mean by "Money Management". One typically mistake is to subsume / conjoin 'risk management' and 'sizing' under MM and then try to use the very similar processing methods to ascertain both.

 

It’s system dependent - but generally if you know how to size correctly and if you know how to manage risk correctly then you hardly need ‘analysis’ at all - especially not the common analysis styles promulgated by the ‘voice of trading’. That bold assertion is further strengthened by the reality that for most systems the actual price action following (and trade result of) a signal generated by a high quality 'analysis' may turn out just fine one time and completely different the next... ie for identical signals, the market will invariably give you radically different results.

 

hth

 

zdo

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The kid...

 

As zdo has pointed out... it is all system specific...

 

Not to get too deep in the weeds, but throughout my trading day, I'm constantly in a state of analysis (even when I'm in a trade). I will often take trades that I consider to be of higher initial risk than other trades (an assessment that goes on in my simple, and often flawed mind). I do this because (1) I'm skilled, and (2) you have to have money "on" to make money (risk). From that moment, I rely on trade management to control risk (again constant analysis). For me and my style of trading "trade management " is "risk management"... the two are not separable.

 

As to the term "money management", my position size is always the same. I trade on a very short time frame. For someone who trades on a longer time frame, scaling in and out of trades may make sense (there again; you are controlling risk... initial risk and tail end risk). If you have deep pockets, and are willing to take on the risk, then money management takes on a greater importance. For me "money management" doesn't really come in to play.

 

In the end it all comes down to controlling risk... and it is system specific. For me it's 100% analysis... every day, during the entire session.

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Kid,

 

The amount you put at risk in a single trade needs to be insignificant to either or both you and the amount of funds you commit to trading.

 

A really bad day trading should only impact you emotionally; financially, you should not lose >1% of the total funds you commit to trading. Size each trade accordingly. As you approach 1% in loses, stop trading for the day.

 

The above is just an example.

 

It is different if you are a long term trader/investor with multiple positions, but you are a day trader when you first enter a long term trade. With any trade you enter, long term or short term, long or short, start chopping the size of the trade if it gets red right away. You can always reenter lower or higher at a better or worse price.

 

Analysis Snalysis. It makes no difference which system you design. Eventually, any and every system will produce something. If so, then money management is nearly 100% of trading. You risk of ruin needs to be zero. If it is not, then eventually, you will get caught with your pants down. There are a lot of brilliant, knowledgeable traders who are broke, because the market did either what it shouldn't have done or what it had never done before.

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One typically mistake is to subsume / conjoin 'risk management' and 'sizing' under MM and then try to use the very similar processing methods to ascertain both.

 

zdo

 

What do you mean by this? All other things being equal, a larger position size means more risk doesn't it?

 

To me it seems that position sizing is how we control risk. Often people seem to confuse stop losses with 'managing risk', but that's nonsense - a trader might not use stop losses at all and yet still control risk.

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MM succinctly said what I was basically trying to say ...

However, I will add to his “The above is just an example.” -

That 1% rule is basically a lazy beginner trick... ie if you continue to use that 1% rule, you’re sizing and risk management will be about as effective MM as is simple moving average signaling effective 'analysis' in the long term...both is looser :) !

ie You need to engineer and fine tune your risk and sizing methods to your individual system(s) ... just like fuel injection,etc. need to be engineered and fine tuned to the engine it’s on top of, etc...

 

 

...

 

 

 

In my earlier post I encouraged Kid to explore what he meant by Money Management.

Now it’s time to encourage an exploration of what he meant by Analysis.

Typically Analysis is ‘entry’ dominant... yada yada the analysis born of the ‘voice of trading’ propaganda etc etc

BUT

The most important ‘analysis’ is the one that finds the system that best matches your true nature. If you are trading a system that is not a match with your true nature you are stressing your sympathetically aroused primal structures, mutating them to be LESS adaptive, resilient, ‘tough’ ...and your technique will inevitably gradually and suddenly erode.

The below is just an example

Someone manually trading a system that has some level of entry signal ‘ambivalence’ who is not suited to trading a system that has that level of entry signal ‘ambivalence’ will ultimately find a way to be a ‘dropout’ from the system. For an example from an otherwise perfectly fine method - most of the variable signal ambivalence in DBP’s SLTAMT is sourced in the individuals’ brains, not in the method itself.

Some students will simply encounter less signal ambivalence than others.

AND

Some students will be able to handle more signal ambivalence than others

Those who can’t handle a certain threshold of both will comprise a large percentage of the method’s ‘dropouts’ / failures

 

This means not making the typical beginner mistake of exploring/flirting with analysis / systems in isolation.

AND

This doesn’t mean means exploring your self in isolation.

It means exploring your self and systems in parallel... not easy...

Edited by zdo
it was fkt up

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The amount you put at risk in a single trade needs to be insignificant to either or both you and the amount of funds you commit to trading.

 

A really bad day trading should only impact you emotionally; financially, you should not lose >1% of the total funds you commit to trading. Size each trade accordingly. As you approach 1% in loses, stop trading for the day,

 

I don't know that I've ever used the 1% rule (strictly)... except possibly when I was starting out (it's one of those things that kind of makes sense). Now... I tend to apply the "it's time to head to the house rule". I suppose it comes with experience, but there are some days that you just don't get it, and you are not going to get it. Best to head for the house...

 

Money management in it's most base form...

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The most important ‘analysis’ is the one that finds the system that best matches your true nature. If you are trading a system that is not a match with your true nature you are stressing your sympathetically aroused primal structures, mutating them to be LESS adaptive, resilient, ‘tough’ ...and your technique will inevitably gradually and suddenly erode.

 

True words...

 

I've come to question as to whether or not I could (would) teach my methods to someone else... the answer is "no". It took me a long time to come up with what I do. It's an amalgam of getting my ass kicked, who I am, and continuously seeking out sound fundamentals. It is something of my own understanding, and I think that (in large part) is why it's successful (for me... in this time and place).

 

No one ever said this was easy (well, some have said it... I think they were not telling the entire truth).

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I don't know that I've ever used the 1% rule (strictly)... except possibly when I was starting out (it's one of those things that kind of makes sense). Now... I tend to apply the "it's time to head to the house rule". I suppose it comes with experience, but there are some days that you just don't get it, and you are not going to get it. Best to head for the house...

 

Money management in it's most base form...

 

It's a good rule to help you survive. I risk less than that now and I don't get in and out in a day unless something is really wrong with my "analysis".

 

It's same as heading for the house. If you get short a few times and there isn't anyone willing to sell lower than you did, then, well you had better go home.

 

I have no positions at this time. Seems like a lot of chop that I want to avoid in the frame that i am trading.

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It's a good rule to help you survive. I risk less than that now and I don't get in and out in a day unless something is really wrong with my "analysis".

 

It's same as heading for the house. If you get short a few times and there isn't anyone willing to sell lower than you did, then, well you had better go home.

 

I have no positions at this time. Seems like a lot of chop that I want to avoid in the frame that i am trading.

 

To kind of make it back to the "kid" and the OP. It's not often successful to apply axioms to trading. As a for instance: you (mm) are sitting out right now because of the chop... as for me, I revel in the "chop"... I'm geared for chop, and I love it. The days that frustrate me are the days that the market grinds higher. It's a difference in temperament and style.

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I dont really like the term "money management", but if you mean adopting some sort of sensible risk management strategy to minimise risk of ruin, and that can be any position sizing method you like really, IMHO money management is pretty much irrelevant

 

I used to buy into the argument that you optimised MM based on your strategy. It makes some sense, a strategy with a 80% strike rate, and a strategy with a 20% strike rate are going to require a different approach to position sizing, but any kind of specific detail below that is completely irrelevant.

 

The didtribution in trading returns is pretty much random for most people, and the optimum MM approach during period X is going to differ from the optimum approach in period Y. This inherant randomness in returns kind of makes any MM optimisation pretty much redundant

 

Its also probably worth pointing out that psychology can often play a part, and you may not actually be able to trade your optimum MM strategy. How many people could trade a sizable account using something like optimal F for example, would you really tolerate a 98% drawdown on an 8 figure account even if its exactly the right thing to do ?

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I dont really like the term "money management", but if you mean adopting some sort of sensible risk management strategy to minimise risk of ruin, and that can be any position sizing method you like really, IMHO money management is pretty much irrelevant

 

I used to buy into the argument that you optimised MM based on your strategy. It makes some sense, a strategy with a 80% strike rate, and a strategy with a 20% strike rate are going to require a different approach to position sizing, but any kind of specific detail below that is completely irrelevant.

 

The didtribution in trading returns is pretty much random for most people, and the optimum MM approach during period X is going to differ from the optimum approach in period Y. This inherant randomness in returns kind of makes any MM optimisation pretty much redundant

 

Its also probably worth pointing out that psychology can often play a part, and you may not actually be able to trade your optimum MM strategy. How many people could trade a sizable account using something like optimal F for example, would you really tolerate a 98% drawdown on an 8 figure account even if its exactly the right thing to do ?

 

There is no rational way to recover from a 98% drawdown. Personally, I would have to ignore some rules I have in place and I would have to experience about 100 years of consistent losses to achieve a 98% drawdown. I am 1/2 way to 100 now. I would assume at some point my surviving family members would get power of attorney on my account well before I turned 150 years old.

 

Anyone who would embark upon a strategy that could experience a 98% drawdown is trying to use the market to solve his problems. Usually that individual ends up solving the markets problem; it's thirst for liquidity.

 

So the answer is I would not get involved in the first place (98% drawdown).

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What do you mean by this? All other things being equal, a larger position size means more risk doesn't it?

 

To me it seems that position sizing is how we control risk. Often people seem to confuse stop losses with 'managing risk', but that's nonsense - a trader might not use stop losses at all and yet still control risk.

 

Emily,

 

Isn’t using position size to “control risk” in effect just a convoluted ‘dollar stop’ ?

 

zero lag reply time ;)

 

zdo

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Noobs,

The status quo / the ‘voice of trading’ sugar coats it. They would have you apply very general rules to MM (see http://www.traderslaboratory.com/forums/money-management/19267-90-analysis-10-money-managment-2.html#post200085 for example)... and mix the "logic" of sizing and ‘stays’, etc etc. An alternative way to look at it is -

‘Stays’ (where to exit / “stop out” in adversity plus where to exit with profits) are best based on individual system stats.

Sizing is best done with portfolio (of systems) level stats.

Ie ‘stays’ levels are best derived from a different set of calculations from the calculations of optimal ‘sizing’ ------- and yes, that’s even if your portfolio of systems is only one system!

 

... and fwiw, imo your portfolio of systems should never be just one system :)

Edited by zdo

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Noobs,

The status quo / the ‘voice of trading’ sugar coats it. They would have you apply very general rules to MM (see http://www.traderslaboratory.com/forums/money-management/19267-90-analysis-10-money-managment-2.html#post200085 for example)... and mix the "logic" of sizing and ‘stays’, etc etc. An alternative way to look at it is -

‘Stays’ (where to exit / “stop out” in adversity plus where to exit with profits) are best based on individual system stats.

Sizing is best done with portfolio (of systems) level stats.

Ie ‘stays’ levels are best derived from a different set of calculations from the calculations of optimal ‘sizing’ ------- and yes, that’s even if your portfolio of systems is only one system!

 

... and fwiw, imo your portfolio of systems should never be just one system :)

 

I'm totally in agreement about the distinctions that you make between portfolio and system based stats. Its a very good point, and its very good advice.

 

The points that I was trying, and probably failing to make were as follows:

 

Any "statistic" derived from a trading strategy needs to be more along the lines of rough estimates, rather than high precision statistics. I'm sure there are people out there using insanely complcated statistical approaches, but thats probably beyond the realm of most retail traders.

 

I'd also probably argie that the units used to derive any statistics are probably best based on some sort of market based values rather than points, or dollar amounts.

 

The main point that I was trying to make is that if you take a simple analysis tool like Software for Position Sizing Optimization : Forex Trading Systems : Stock Trading Online : Adaptrade Software and you attempt to optimize any MM strategy its simply a matter of fact that different strategies are going to perform differently at different times and in different market conditions. Over a diversified portfolio of systems, and enough time, things tend to average out, so you might as well go for an MM strategy thats easy to understand an impliment, and that you can actually trade (my example of optimal f hopefully illustrates the point that the optimum strategy isnt necessarily the best strategy)

 

The problem of course is that you dont know, what you dont know, and I am prepared to accept that there are systematic traders out their who's level of sophistication in the implimentation of their MM is way beyond mine, and that they are possibly able to dynamically optimise their MM approach based on market conditions, and that such an approach might potentially form a part of their edge.

 

I'm a system trader these days, and I tend to associate with other system trades who share similar views to my own, which is possibly shortsighted, but it cuts out a lot of extraneous noise. However I started out staring at a screen, and there are times when you are definately in tune and on a roll, and you know it. I never reached the point where I had quite enough confidence to push the gas a little harder during these periods, but I suspect that if I'd continued along that route, eventually I almost certainly would have done, and I know guys who regularly do that based on nothing more than intuition

 

However, on the other hand, in my limited experience, organisations who employ multiple traders tend to handle the risk aspects on a far higher level of abstraction than that that of an individual trader or individual strategy, and I suspect that they've almost certainly done a lot more work that I have on this stuff, so if they cant do it, who can.

 

the concepts of minimising the risk of ruin for a single system isnt rocket science, nor is the idea of diversifying risk across a portfolio of systems. What is rocket science, is the implimentation of those methods. I however would argue that the inherent randomness in returns pretty much invalidates all assumptions on which even the most complex of those models are built. Take 1000 guys trading a simple % fixed fraction, and a thousand quants implimenting the most complex of MM strategies, and after 30 years, I suspect the distribution in final PnL from the two populations wont be too disimilar

 

I'm not attempting to sugar coat anything, I'm saying there is no MM silver bullet, you have to take the rough with the smooth. Im not advocating that people shouldnt reseach these issues, I still spend a fair proportion of time looking at MM, despite previous reseach being completely fruitless, and I suspect that I'll continue to do so

 

I even make the point that you'll need a different approaches based on system metrics, but getting bogged down in unnecessary optimisation is in my experience not the best use of time

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off topic re 'report':

Well - that “2” was fun... and right back where we started - as usual...:roll eyes:

 

 

 

 

back on topic...

 

zupcon, make the “final PnL from the two populations” very “dissimilar”

 

... that they are possibly able to dynamically optimise their MM approach based on market conditions, and that such an approach might potentially form a part of their edge.

That is IT! Precisely.

Long ago I was lucky enough to realize that I needed to take a bassakwards philosophy / approach and MarketType (tmz) the auction first prior to any “analysis” and use that framework as a basis to fluctuate relative weights for each system across a portfolio of 12 (most of them very simple) automated systems ... with the intent of sizing each trade to the ‘odds’ of the opportunity.

Even if the exposure to many of the opportunities is relatively small, the ultimate functional purpose is to not miss ANY opportunities... which would be an operational impossibility for me to accomplish manually...

 

Now turning to ‘risk’ (... and I’m assuming we’re focusing here on the ‘trade itself’ type of risk across a series of trades)

re

different strategies are going to perform differently at different times and in different market conditions.

and

the optimum MM approach during period X is going to differ from the optimum approach in period Y. This inherant randomness in returns kind of makes any MM optimisation pretty much redundant

zup, while I hear what you’re saying about the ‘limits’ of MM and I understand why you’re saying it, from my experience, I can categorically recommend traders not be discouraged by the realities of “inherant randomness”. Rather, they should meticulously find and tune a system's ranges of “ the optimum MM approach during period X [which] is going to differ from the optimum approach in period Y” (brackets mine) and stay within them...

It would be better for a trader to even randomize his or her ‘MM’ decisions within those ranges than utilize vastly simplified ‘stay’ decisions or - worst - base them on ‘psychological ease’

 

 

 

kwikblurb1...

Again...

Base Sizing on opportunity ... algorithmically derive sizing from portfolio (of systems) level stats.

Base ‘Stay’ (or not - in profit or in loss) on ‘risks’ ... algorithmically derive them from individual system probabilities.

 

Kwikblurb2...

re“inherant randomness”

Fwiw, It is only randomlike - not really “randomness”. Big difference in the long run.

 

 

Kwikblurb3...

for sizing, Optimal f, etc is a starting point - nowhere near the finishing point

 

blurb4

re “I'd also probably argie that the units used to derive any statistics are probably best based on some sort of market based values rather than points, or dollar amounts.”

NONE of my systems have ever ‘optimized’ stays to dollar targets or to dollar stops. Almost all my systems ‘stay’ decisions are founded on ‘price action’ patterns... with some of them throwing in some ‘order flow’ stuff, some of them throwing in some ‘indicators’ work (WOT?!) (btw, nothing ‘off the shelf’ used... ), some of them throwing in some ‘scaling out’ work... etc etc.

 

Kwikblurb5...

The higher the hit rate for a system, the more closely ‘stays’ (ie stops and profit taking) must be finely calibrated. etc etc

 

blurb6

(Very very Generally) --- Re the Drawdowns allowed issue.

True trend systems can be allowed a 60% drawdown before shutdown.

Quasi - trend following systems can be allowed ~ 40% drawdown before shutdown.

Momentum/coattail systems (and the 'equally' successful strat of fading the system's signals :rofl:) can be allowed ~ 30% drawdown before shutdown.

Regardless of ‘testing’ results, just about all other systems should never be allowed to run past 20% drawdown before shutdown ... :haha: considering most of them are losers to begin with etc...

 

 

 

 

 

 

 

“And then the day came when the risk it took to remain tight in a bud was more painful than the risk it took to blossom.” Anais Nin

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"If something is worth doing, it's worth doing badly." Leslie Buckland

 

Most system developers first turn to ‘ volatility’ as primary driver of ‘condition specific’ sizing... and get stuck there...

(btw, my advice = in sizing work, skip 'volatility’ completely ...you'll naturally be brought back to when and how to include it properly later ) ... and ...

 

Most of these developers turning to volatility as primary driver of ‘condition specific’ sizing get sucked into using measures of range (ATR, etc.) as a measure of volatility. A better (however more complicated) measure utilizes studies of passage through price brackets/zones ... number brackets traversed, time duration in each, etc...and ... btw

 

Most developers never realize the high reliability of cyclicity in properly measured ‘volatility’

 

A $million+ ©TA offers this: Improving Trading System Performance Using a Meta-Strategy

 

A $billion+ CTA offers this: "I have a staff of PhD's researching volatility based position sizing. They haven't come up with anything."

 

" You cannot teach a man anything; you can only help him find himself." Galileo

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70-30, trade small and more frequently, big bets will get you at the end.

 

sergso,

"70-30, trade small and more frequently,... “ may be perfect advice for anyone trading the exact same system as you, on the same instruments, and with the same capitalization... etc

 

“70-30” may be correct --- but only for you, your financial state, and your system. There is no way you or anyone else can pigeon hole everyone else into that ratio. The usefulness of that advice is not ubiquitous even to someone trading a single method on a single instrument with single contract size... And past a certain system specific threshold of capitalization, the practicality of such advice goes completely microscopic. Keep going ... and past a certain threshold in the diversity / complexity of one’s portfolio, regardless of the ‘analysis’ methods used, flipping this 'advice' to “30-70” will not be nearly enough to manage dynamic sizing and allocations... especially with leveraging or in opm cases...etc etc. ... and ... At this point I won’t even go into the variability in the depth / time / etc. of ‘analysis’ between traders - besides to say it’s another reason pushing out a generalization about the correct or dominant ratio of analsis and money manglement is pitiful.

 

“trade small and more frequently” If limiting size and goosing frequency improved the performance of your trading that’s really great - but, come on man! - You can’t deal out advice like that as if it applies to all systems. It is a disservice to your peers ... at the very least a waste of their time. Traders need to trade as closely as possible the optimal size for their system(s). And a trader needs to trade at the exact frequency a system calls for without inserting trades (ie “more frequently”) or omitting trades (ie “I missed that trade” or “I didn’t take that trade”)... randomly / arbitrarily goosing or limiting frequency and / or size is just another loop ride on the loop around Looserville.

 

“big bets will get you at the end”. You may be shooting for some brevity with this one... so I’ll almost give you a pass -. Almost  ... still , let’s look at a couple of the words you used and some possible ‘presuppositions’

Re: the word “bets” - at a some point in each type of betting game, the “window closes” and from that point forward the results to your equity are completely out of your hands. In the trading game up until the time your broker liquidates your position(s), the ‘window’ stays open...with trades you still have possibility to influence the results to your equity.

 

And re: “big” The crucial variable here is not “big” or “small” (/ size). The crucial variable is positive expectancy.

so more accurately - and hopefully just as succinctly

If you have a positive expectation, the only thing that will get you is holding losses until they are “big”

 

I can’t think of a field where ‘general guidelines’ are less applicable than in trading - yet the ‘voice of trading’ continues to deliver ‘truths’ that are actually only true in ~1% of instances ...by the tens of thousands....media, forums, books, articles, seminars, etc etc...

 

sergso, almost all the good posters are gone now... it’s up to us average posters to do a better job...

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Most system developers first turn to ‘ volatility’ as primary driver of ‘condition specific’ sizing... and get stuck there...

 

And ironically, many traders employing this approach end up taking their largest positions (and losses) at times of low volatility, and thats generally the time that the types of systems typically traded by the retail crowd tend not to do particularly well

 

Still trading "educators" will continue to peddle this crap, and people lap it up. You cant blame them really (the vendors that is) :rofl:

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    • 4 months in and Marketsmith has done really NOTHING for me......still waiting for that stock that will make the year worth it and pay for the $1500 dollar price tag......the paper has become virtually useless......especially since I used it for Political mostly political reference with Issues and Insights.......the rest of the paper is mostly geared to Stock advisers.....not the regular guy........way to boring saying nothing but how to treat guys like me.........this could be my last year.
    • Date : 22nd July 2019. MACRO EVENTS & NEWS OF 22nd June 2019.No deal Brexit risks will continue to unsettle markets next week as the two candidates hardened their rhetoric in end stages of the party elections. The ECB however will stand out as the event of the week,with Brexit uncertainty an important part of the overall outlook. Have a look at the most important events of the coming days in our usual weekly publication. Tuesday – 23 July 2019   The announcement of the next Prime Minister of the UK – Event of the week – Original Brexit campaigner Boris Johnson remains the front runner in the race and is widely expected to be confirmed as the new Prime Minister next Tuesday. Housing Data (USD, GMT 14:00) – A steady rate is anticipated for existing home sales in June at the firm 5.340 mln pace seen in May. The median sales price is estimated to ease to $275,000, for a y/y gain of 0.4%, down from 4.8% in May. In Q1, we saw an average sales pace of 5.207 mln. In Q2, a better 5.297 mln pace is expected. Wednesday – 24 July 2019   Services and Manufacturing PMI (EUR, GMT 07:30) – Preliminary Composite PMIs for Eurozone and Germany are expected to fall in July, to 51.8 and 52.5 respectively, while the Manufacturing PMIs are forecasted at 48.0 and 45.4 respectively. Services and Manufacturing PMI (USD, GMT 13:45) – Preliminary Manufacturing and Services PMIs are expected to decline in July, to 50.4 from 50.6 and 51.0 from 51.5 respectively. Thursday – 25 July 2019   German IFO (EUR, GMT 08:00) – German IFO business confidence is expected to slip to 96.7, after it held steady the past 2 months around the 97 barrier. Event of the week – Interest rate Decision and Conference (EUR, GMT 11:45) –The ECB is meeting on July 25, – shortly after the confirmation of the new PM in London and ahead of the Fed, which is widely expected to cut rates again at the end of the month. On balance, markets see more merit in keeping official rates unchanged next week, while moving to an official easing bias and promising that rates will be at “current or lower” levels well into next year. ECB Monetary Policy Statement (EUR, GMT 12:30) -The July meeting will clearly be a “live” one with doves and hawks battling it out over when to deliver the now widely expected easing measures. It is expected that the majority will see more merit in keeping policy settings unchanged, but change the guidance to introduce a clear easing bias. Durable Goods (USD, GMT 12:30) – Durable goods orders are expected to rise 1.0% in June, after a -1.3% figure in May. Transportation orders should rise 2.7%. Boeing orders rose to only 9 from just zero in May, with weakness due to the hit from problems with the Boeing 737 Max that prompted buyers to delay new purchase commitments. Vehicle assemblies should ease to 11.1 mln from an 11.3 mln pace in May. Durable shipments are expected to rise 0.5%, and inventories should rise 0.6%. The I/S ratio is expected to hold steady at 1.67 since April. Friday – 26 July 2019   Gross Domestic Product (USD, GMT 12:30) – Gross Domestic Product is expected to grow 1.8% in Q2, with a sturdy 2.4% growth rate for final sales thanks to solid growth rates of 3.9% for personal consumption and 4.3% for government purchases, alongside a big $27 bln unwind of the Q1 inventory pop. Always trade with strict risk management. Your capital is the single most important aspect of your trading business.Please note that times displayed based on local time zone and are from time of writing this report.Click HERE to access the full HotForex Economic calendar.Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!Click HERE to READ more Market news. Andria Pichidi Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
    • WHEN A CHECK/DRAFT IS PAID INTO YOUR ACCOUNT They say it’s a rule from CBN. When a check/draft is paid into your account, especially from someone using another bank, you will receive a credit alert.   The credit alert will be there as an SMS alert, email alert and if you even login to your Internet banking area, you see it there. The name of the sender is not included.   THE STATUS OF YOUR CREDIT The reality is that, the credit will never be added to your available balance. The book balance would be different from the available balance and you won’t be able to use it until after 48 hours. This would give your bank the time to confirm the cheek/draft. If it is genuine, the money would be added to your available balance. If it’s fake, the money would be removed from your account.   Sadly, most members of the public are not aware of this fact. Once many people see credit alerts from their banks, they believe it’s real money and they fall into traps. And scammers know that most people don’t know.   HOW BANKS AID AND ABET SCAMMERS Some banks will send credits alert to you, as soon as a check is deposited into your account. This is wrong, and it’s the loophole that the scammers capitalize on. Why should banks send credits alerts for checks that have not been cleared (checks that have not been confirmed)?   It currency takes up to 48 hours to confirm a check or draft and banks should not send alerts to their customers until that is done. So, if the checks are later proven to be forged/spurious, the money would then be removed from your account. Many customers are not aware of this.   Sane employees of sane banks, know that it saves a lot of things, when a check/bank draft is confirmed before alerting customers. If the one who pays, or the payee is really in a hurry, then they should look for other ways to transfer money. Yes, there are other and better ways to transfer money… And insisting on draft/check should raise suspicion.   A bank that alerts customers without confirming a check is really adding and abetting scammers.   SCAMMERS ARE DIFFICULT TO CATCH Yes, scammers are difficult to catch. Be suspicious of anyone who changes their numbers too often. Once they dupe someone and the person is threatening them, they remove the SIM and that person can never reach them again.   A scammer can pay one-year house rent and spend only a few months  - only to change accommodations. Changing offices is not a big deal to them. They try their best to erase all traces to them and they do their best not to come in your way again, forever.   They’re good at forging documents and using fake addresses and fake things. Until you’re convinced that you’ve been duped, they’ll be giving you guarantee that all is well, and no problem and anything going wrong would be corrected.   Meanwhile, while they’re fooling you that there’s no problem, they’re packing away from their locations.   I can tell you that some (and most of these scammers) are married with children. Some of them are elderly people. Some of them are really gentlemen in society and they still dupe people.   They know about the loopholes in Nigerian laws and they know that if you can even catch one of them, you can never catch the rest of them.   WHAT NIGERIAN BANKS AND CBN CAN DO CBN should instruct Nigerian banks that they should stop giving alerts to customers until the bank drafts and checks paid into their accounts, are confirmed to be valid. If a customer or those who may think they’re in a hurry, then they should use an electronic method or direct cash deposit to pay.   Yes, if they think they cannot wait for 48 hours or you can’t wait for 48 hours, for the bank draft to be cleared, then they should use another means of payment.   In this digital/electronics payment age, when banking technology has advanced so much, how can someone insist on using a bank draft or check to pay people?   Bank officials that don’t alert customers or put “locked” credits in their accounts until the checks have been cleared, are saving lots of lives. Bank officials that send credits alerts, when checks/drafts have not been cleared, are really not doing the right thing.   When banks start to refuse to credit or alert any customers (based on drafts or checks brought in their names), until the checks and the drafts are cleared and confirmed to be genuine, then scammers who forge checks and drafts will go out of the business. That’s the only way.   WHAT SCAMMERS DO AND HOW THEY BEHAVE When people want to scam you, they usually pose as honest, dependable and trustworthy people. They do everything in their capacity to prove to you that you’re safe when doing business with them.   They’ll always tell you that they’ve been duped in the past, and they don’t want to be duped again. They’ll be asking you to confirm that you’re honest and safe to do things with.   They pretend to be very religious.   They pose like lawyers, accountants, bishops, imams, etc. They claim to be holding very high positions in society. They claim to have international experience and connections. They “prove” to be close friends with those who’re working at Chevron, Head of Bureau the Change or a senior nurse at LUTH. etc.   They put on corporate dresses and use cars to deceive people.   They pretend to be who they’re not. They assume titles of the positions you respect. They spend a lot of energy, days and resources (which could have been channeled into other productive things) trying to dupe you.   The best way they get you is through someone you know very well. They may be a family member, a church member, a neighbor, a friend, a customer, etc. Someone you think you can trust. They will come to you through that person, as the one who introduces them to you. You won’t know that the person has a money sharing deal with the scammers.   The premise is: The person you know, who introduces others to you, usually for business or contracts or projects, is presumed by you, as someone who will not deliberately betray you, because you’ve been dealing together for some time.   Some of them may call you through the phone number of the person you know, who introduces you to them.   Sometimes, they insist on using drafts or checks only, to pay you, for a flimsy reason. No matter how, they won’t give up on you until they succeed in duping you.   You won’t know what people are capable of doing, until you find yourself at their mercy.   The best thing is not to fall into their traps in the first place.     HOW THE PUBLIC CAN PREVENT THIS SCAM One of the most effective ways to stop these scoundrels from their usual business and from destroying people’s life, is to create awareness and educate the public on how to guard themselves against these people.   1.         No matter what they say… No matter what they claim to be… No matter where they come from… No matter how they try to convince you… NEVER NEVER accept bank draft or check payment from anybody or any company or organization. Never allow such a thing to be used to pay money into your account.   2.         If no-one can do business with you unless they use a check or a bank draft, please forget about that business, no matter how “safe,” attractive or lucrative it may be.   3.         If they cannot pay by cash or electronic money transfer, then they should forget about doing business with you. Or they can use the draft to pay one of their own people, and then the person can pay you with cash or electronic transfer.   4.         Prevention is better than cure. It’s better to be safe than to be sorry. It’s better not to make money or not to do business, than to do what you will regret for the rest of your life.   5.         If you must accept a bank draft or a check, please disregard any alerts that come to you in any form. Wait for at least, 72 business hours, and then, contact your account officer to confirm if the money from that check has been cleared and added to your available balance. You must ensure that you are able to use that money before you deliver anything to those who used the checks/drafts to pay.   Beware of anyone making it seem to be in a hurry to do business with you. If they’re really in a hurry, then they must use another means other than a bank draft or check to pay you. Never release anything or send anything until you’re able to confirm that you’re completely safe.   Please save people from penury and financial ruin. Save them from pains and losses. Share this information on websites, social media, WhatsApp, Skype, Telegram and Facebook groups.   Forward it to your exchangers and their customers and all those who deal in goods and services in return for payment. You don’t know whether the next person you’ll save is your loved one. Save someone today with this information.   Thanks for reading….
    • Hi everyone, The latest Commitments of Traders review is out. Platinum COT Change (52W) / C - 18%, LS – 20% / FTG Score / D -7.4, W -19.4, M -16.1 / The larger than average change in Large Specs and Commercials positions, together with the negative reading from FTG suggest we could see some weakness from platinum in the coming days… Bitcoin (CME) COT Extreme / LS – All Time COT extreme / FTG Score / D 25.0, W 60.3, M 24.5 / We do not have such a history of cot data to be certain that we have cot signal that we can act upon, nevertheless it is interesting to see Large specs continuing to increase their net short positions, seeing Commercials net short and only Small specs taking the long side of the market. The all time extreme signal in LS would be generally considered a bullish signal, small spec net long a bearish FTG scores, especially the weekly show significant support for further rally in the market. Canadian Dollar COT Extreme / C - 72, LS – 68 report COT extreme / FTG Score / D 37.5, W -26.2, M -25.7 / In the past few weeks we have witnessed traders changing their positions towards a more bearish situation. The example from May 2017 to October the same year suggests that we could see this trend continuing for some time before the market dips back down. Daily FTG scores seem to back this, although the weekly and monthly already expect changes happening to the CAD. All the best,  Dunstan COT Charts FOREX Trading Futures Trading
    • Bitcoin Price Prediction: Long-term (BTC) Value Forecast – July 20   BTC/USD Long-term Trend: Ranging Resistance  $10,500, $11,000, $11,500 Support levels: $10,000, $9,500, $9,000   The BTC/USD pair had been trading in the bearish trend zone after facing resistance at the $13,000 overhead resistance level. On July 10, the BTC price reached a high of $13,000 but was resisted. The bears broke the 12-day EMA and the 26-day EMA as the price fell to the bearish trend zone. In the previous resistances, the price fell within the bullish trend zone. On the upside, if the bulls break above the EMAs, the crypto’s price will rise to retest the $13,000 resistance level.   On the other hand, if the bulls fail to break above the EMAs.  the crypto's price  will commence a range bound move below the EMAs,Meanwhile, the MACD line, and the signal line are above the zero line which indicates a buy signal.     The views and opinions expressed here do not reflect that of BitcoinExchangeGuide.com and do not constitute financial advice. Always do your own research   Source:  https://bitcoinexchangeguide.com
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