FOREX for Beginners

................................................................................................................................................................................................ 4

First thing first, What are you? ........................................................................................................................................................... 5

Investment Psychology ...................................................................................................................................................................... 6

Deriving Crowd Psychology from Bars ................................................................................................................................................. 8

Trend Is Your Friend ....................................................................................................................................................................... 10

................................................................................................................................................ 14

The Last 'M' (or) Trade Management ................................................................................................................................................ 17

STOP! ............................................................................................................................................................................................. 18

Candlesticks - Part I ........................................................................................................................................................................ 20

Candlesticks - Part II ....................................................................................................................................................................... 26

Two is better than One .................................................................................................................................................................... 29

How to Stop .................................................................................................................................................................................... 32

.......................................................................................................................................................................... 34

Moving Average .............................................................................................................................................................................. 37

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MACD / Mac D ................................................................................................................................................................................ 40

Triangle Breakout ............................................................................................................................................................................ 44

Combining Crowd Thinking with Crowd Commitment ......................................................................................................................... 45

(၁) ........................................................................................................................................................................... 48

(၂) ........................................................................................................................................................................... 50

.......................................................................................................................................................................... 52

Psychology of Losing ....................................................................................................................................................................... 55

Short with me ................................................................................................................................................................................. 57

How to Trade Like a Professional ..................................................................................................................................................... 57

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 FOREX for Beginners

႔ Trader ႔ Methods, Mindset ႔ ႔

Trading Methods (Technical Analysis) ႔
႔ ႔ Trading ႔ ႔ ႔ ႔ ႔ Methods
႔ ႔ ႔ ႕ Trading History ႔ ႔ Winning Trade Losing Trade

Methods ႔ Technical Analysis ႔ Fundamental Analysis ႔

႔ ႕
႕ ႔ Trading 95% of traders lose money ႔ ႔ Mindset
႔ Trade Management ႔ ႔

႔ Mindset ႔ Trade Management ႔ ႔ ႕ Mindset ႔

႔ ႔ Trading ႔ ႔ ႕ Mindset
႔ Trade Management

႔ ႔ Ko Aung Myo Htet (aungs.investment@gmail.com) ႕ www.aunginvestment.blogspot.com

Trading ႔ ႕ ႕ ႔ ႔ Trader ႔ Ko
Aung Myo Htet

Naing Aung Soe

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 FOREX for Beginners
First thing first, What are you?

Investment ႕ Investment Objective

႔

Spender

Investment Credit Card

Saver

Risk free Interest rate ႔ Saver ဝ ႔ Inflation

) ႔ Tax( ) ႔

Part-time/Passive Investor

Stock Market Real Estate ႔ Gold ႔ Foreign Currency

Investor Part-time Buy-and-Hold ႔ Investor Short-
term/Temporary ႔ Return on Investment (ROI) ႔
Part-time Investor Day Job ႔ Finance Newsletter Subscribe

Full-time/Active Investor/Trader

Day Job ႔ ROI ႔ - Short-term ႔

႔ Price Fluctuation Advantage ROI ႔ Liquidate
Economic Data Investment Stragegy Risk Manage
Financial Freedom Retirement

႔ Spender ႔ Saver ႔ Investing/Trading ဝ Investment

Objective Define ဝ Risk Investing ႔ ဝ ဝ

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 FOREX for Beginners
Investment Psychology

Investment Seriously 3M 3M Mindset, Methods ႔ Management Investor 3M

Topic Mindset ဝ ႔

Investing Get Rich Quick Scheme ႔ You got to be really a financial genius.
Realistic ႔ ႔ Investing ႔

/ ႕ ႔ ႕
႔ Apply ႔
Self-Confidence

Reason ႔

Sacrifice Education Lifestyle

႔ ႔ ႔ TV Facebook Club ႔

႔ Spending ႔ Saving

႔ ဝ Western Economy ႔ ႔
႔ Personal Debt ႔ Investment Debt Personal
Investment Debt ႔ Credit Card
Investment

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 FOREX for Beginners
Isn't Investing same as Gambling

3M M ၁ % Every Investment Risk Risk Analyse ႔

Manage ႔ 3M Investment Risk Risk

It takes a Genius to become rich

Absolutely Rubbish Average IQ ႔ Investor Reasonable Objective ႔

႔ Financially Common Sense Self-
discipline Genius Brave ႔

Plain ႔ ႔ ႔ Spouse/Partner
Educate ႔ ႔ ႔ Single
Invest ႔ ဝ ႔ ဝ

Reason ႔ Investing Concept

Mindset
႔ Mindset Robert Kiyosaki ႔ Dr. Alexander Elder ႔ Material ႕
Reference

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 FOREX for Beginners
Deriving Crowd Psychology from Bars

Topic 3M Method Method ႕ Income, Expenses, Debt, Tax,

Dividend, Shareholder Equity, Net Tangible Assets Analysis Fundamental Analysis(FA) ႔ FA ႕
Data Earning Expense Affect Significant

FA Active Investor
Trader ဝ FA ဝ Technical Analysis(TA)
TA Stock ႕ Price ႔ Volume Analysis

Two types of Crowd

Price Two types of Crowd (Bulls ႕ ဝ ဝ(Bears Bulls

Bears Investing Bear
for now, let's stick to Bulls. Professionals Stock Bullish
Bearish ႔ Market Bull Market ႔
Bear Market ႔

TA Price ႔ Volume Chart ႔ Represent ႔ CNBC ႔ Media Line Chart Line Chart
Generally close price Close Price ႔ ႔ Period
Open, High, Low, Close ႔ OHLC ႔ Open ႔ Close ႔
High ႔ Low Period ႔ OHLC Bar Chart
Type OHLC Represent

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"Period " ႔ ႕ Period ႔ ႔ 5min,

15min, 1hr, 1day, 1week, 1month ႔ ႔ Period ႔ OHLC Bar Open
Close Bar Point

TA FA Translate ႔ Interpretation Trader ႔

Generally Open Amateur Professional Normally ႔
႕ High Bulls ႔ ဝ ဝ ႔
Low Bears ႔ ႔ ႔ Low Close
Professional Institutions Define ႔ ႔
ဝ Pro Institutions

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႔ Volume Volume Volume Period Units

Very Bullish Day Volume Average ဝ ႔
႔ OHLC TA ႕ Holy Grail OHLC Topic Serious
Investor Analyse Bar ႔ Market Crowd Psychology Guess
႔

Trend Is Your Friend

OHLC Bar Trend Line Trend Price ႕ Direction ႔

Trend Line Price Trend within normal range
Confirmation ႔ Trend Line ႔ Price Trend ႔

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Technical Analysis Indicators Confirm Trend Line Generally Priority ႔ Trend Line

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Trend obviously Bull/Up Trend ႔ Up Trend Professional
Up Trend Analyse Period Lowest Low Low before the most recent Highest Low
႔

Up Trend Low Down Trend High Down Trend Rule Period Highest High High
before the most recent Lowest High downward slope line ႔ Apply
႔ Up Trend rule ဝ Up Trend ႔ Down Trend
Up Trend Reverse ႕

Down Trend ( Up Trend Apply ) Highest High Bar

High Reliable
႔ ႔ Price Trend Slope ႔
Generalise ႔ ႔

႔ Translate Trend ႔ ႔ Baseline ႔ Up Trend

ဝ

၁ ႔ Close Trend Line Close

Confirm
Confirm

၂) Trend Hold ႔ ႔ Price ႔ Near Future

၃) Lowest Low Horizontal Angle Angle Momentum Angle

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 FOREX for Beginners

Rule Down Trend Rule

၁ ႕ Close Close Trend Line

Generally Confirm Technical Indicator
Confirm Confirm ဝ

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 FOREX for Beginners
၂) Trend Hold ႔ Future Date ႔ Price ႔ Near Future

၃) Highest High Horizontal Angle Angle Momentum Angle

Correction

Technical Analyst Topic Stock Price limit ( ႔)

႕ Technical Support and Resistance ႔ Support ႔ Resistance
႔ Support Break Resistance ႔

Support ႔ Resistance Horizontal Line ၉၉%

Support ႔ Resistance Detail Typical Stock Price Price
Straight

Price - - - - Pattern ႔
Price Support ႔ Resistance
႔

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 FOREX for Beginners

Support ႔ Resistance Crow Psychology Bulls ဝ

ဝ Bulls ႔ဝ ဝ Herd Mentality ႕
ဝ ႔ Resistance Bulls ႕ Realise ႕
Resistance Stock ႔ ဝ
ဝ ႔ ႔ ႔

႕ ႕ ႔ ႕ Support
ဝ Bull ဝ ႕ Cycle

႕ Resistance ႔ ႔
႔ ႕ Bearish Cycle Support ႔ Resistance
Drive Crowd Psychology

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 FOREX for Beginners
Support ႔ Resistance Resistance High/Close ႔
Period Reliable Support Low/Close Stock Significant Support &
Resistance Event Support & Resistance Breakout

Investor ႔ ႔ Annoucement Resistance Break ႔

Data Annoucement
Potential ဝ ဝ Support Floor
Buy-and-pray ႔

Major Support ႔ Resistance Support ႔ Resistance ႔ Breakout ႔

Support Resistance Resistance

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The Last 'M' (or) Trade Management

3M Method ႔ ႔ Another M M
Mindset Method Basic ႕ 3M ႔
Management

Management ႔ ႔ Trader/Investor ႔ Management

၁) Trade Management

၂) Portfolio Management

၃) Tax Management

၄) Wealth Management ႔ Trade Management ႔

Trade Management Trade Management ႔ ႔ ဝ

ဝ ဝ ဝ ဝ
Trading Plan
Trading Plan Main Field

၁) Entry Price - ႔ဝ

၂) Profit-taking price -

၃) Stop-loss price -

၄) If Entry price is not achievable with initial bids, how far you would go chasing it? - Entry Price ဝ

၅) ( ႔) Stock Quote ႔ Record ႔

Trading Plan Follow ႔ Self-discipline Trader

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 FOREX for Beginners
3M – Management Introduction
Preparation ဝ ႕
Plannig Investor Stock ဝ Trading Plan ႔

STOP!

Topic ႔
- - - ႔ -
- - Finance Section Recommend
ဝ ဝ Buy-and-pray Model ႔ ႕

Stop-loss target Market

႔ ႔ - - -
Plan B

ဝ ႔ - - - ဝ ဝ
- - -
% ဝ ၅% ၁ % ( ႔) ၁၅%

႔ Investment/Trading capital Stock trading

Concept Total Capital 2% 3% Trade

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 FOREX for Beginners
Risk ႔ Trader $100,000 capital ႔ ၂ ၃ ႔
Risk ႔ ဝ Plan

Main Idea behind this concept Trader ႔ Rule No.1 Profit ႔ Capital Preservation
၂% Risk ႔ ၄၉ Trade (၂% x ၅ =၁ %) ၃% ၃၂ St
% Amount Survival ႔ Market Loser
႔ Stock Price Risk
ဝ Capital ၁ ႔ Assume

Stock Price $ 30 30 30 30 30

Acceptable loss as % of price 5% 10% 15% 20% 25%

Acceptable $ loss over price 1.5 3 4.5 6 7.5

Capital $ 10000 10000 10000 10000 10000

Acceptable loss as % of capital 3% 3% 3% 3% 3%

Acceptable $ loss over capital 300 300 300 300 300

Position Size / Units / Volume 200.00 100.00 66.67 50.00 40.00

Position $ 6000 3000 2000 1500 1200

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 FOREX for Beginners
Conclusion ႔ Risk Amount Fixed ႔ ႔ Risk ဝ
႕ Stop-loss ဝ ႕

Stop-loss Professional ႔ - - - Stop-loss

Stock price ႔ Risk Position size Stop-loss Helmet
႔ Trading Stop-loss ႔ Position size Define ႔ ႔

Candlesticks - Part I

ဝ Stock Trading ဝ Candlesticks OHLC Bar ႔

Trading signal Trader ႔ Entry ႔ Exit Timing Bar
Candlestick Confirmation

Candlestick ႔ ႕ Candlestick
၁ ၅ Munehisa Homma ႔ Homma ႔ ႕
Financial ႔ ႔ Financial Consultant ႔ ဝ Samurai ႕
Candlestick Technique ႕ ၂ Steve Nison ဝ
႔ ႔ Homma
Refine Technical Analysis Wal-mart Store(WMT) Bar ႔

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 FOREX for Beginners

Candlestick ႔ OHLC data Candlestick Open ႔ Close Open ႕ Close

Open Close ႔ Close
Body Real Body ႔ High ႔ Low Upper Shadow ႔ Lower
Shadow ႔ Candlestick ဝ ႕

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 FOREX for Beginners

Candlestick ဝ Trend Reversal Confirm Intro ႔ Trend

Reversal Signal Candlestick type ႔ Hammer ႔ Hanging Man ႔
Trend ဝ Candle Hammer ႔ Trend Down Trend
Down Trend Candle Lower Shadow Real Body Height Upper Shadow ( ႔)
Hanging Man Up trend Real Body ႔ Lower Shadow Length Ratio Hammer ၁၂
Hammer ႔ Hanging Man Circle

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 FOREX for Beginners

Hammers in AMD chart

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Hanging Men in Black & Decker Chart

Crowd Psychology Hammer ႔ Bear ႔

Close Low ႔ ဝ ဝ Bull ႔
Idea ႔ Down Trend Line Breakout Signal ႔ Confirm Trade ဝ ႔ Hammer Bears ႔
႔

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 FOREX for Beginners
Hanging Man Psychology Up Trend ႔ Hanging Man
Formation Bears Attack ႔ ႔ Hanging Man Bull
႔ Hanging Man Following Day
Candle Confirm Hanging Man Following Candle Black real body Hammer White real
body

Hanging Man ႔ Hammer White Hammer ႔ Black Hanging Man

Potent ႔ Hanging Man ႔ Hammer Candle Formation ႔ ႔ Candle
Formation Candlesticks Technique Part II single-candle formation

Candlesticks - Part II

Part I Single-candle Formation Formation

Shooting Star

Shooting Star formation

႔ Bearish reversal signal Shooting Star Hanging Man
Up Trend Upper Shadow Length Real body Real body Low Crowd
Psychology Example Psychology

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 FOREX for Beginners

Shooting Star formation ႕ ႔ Up trend reverse ႔ Long Upper Shadow Bull

Attempt Bear Close High ႔ Low ႔
႕ Upper Shadow Bull Bull ႔ Bear Bull
Trend Reversal Shooting Star Real body

Belt-hold lines

Belt-hold Sumo Wrestling term "Yorikiri" ႔ Opponent ႔

ဝ ႕ ႔ Trading context Bull ႔ Bear ႔

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 FOREX for Beginners
Down Trend ႔ Up Trend Belt-hold candle Bullish Belt-hold ႔ Bearish Belt-hold ႔
Belt-hold candle major characteristic

Bullish Belt-hold candle down trend Open Low ႔ Close High Bearish
Belt-hold candle up trend ႔ Open High ႔ Close Low ႔
Bullish Belt-hold White Opening Shaven Bottom ႔ Bearish Belt-hold Black Opening
Shaven Head ႔ Belt-hold candle Real body More reliable Up Trend/Down Trend
Same color, long real body candle Reliable Belt-hold candle ႔ Crowd Psychology
႔ Risk Trader Reversal Sign ႕ ႔ Action
Conservative Investor ႔ next day candle Signal
Candlestick Power ႔ Candlestick chart Bar chart ႔
Steve Nison Candlestick Techniques Reference Refer

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 FOREX for Beginners

Two is better than One

Powerful Candlestick - ႔
Candle Formation Candle -
႔ Trend Reversal
Confirm ႔ ဝ

Bullish / Bearish Counterattack Pattern - Weak reversal signal

Bullish Counterattack Downtrend Bearish Counterattack Uptrend

႔ Bullish ႔ Bear Downtrend
Downtrend Duration ၄-၅ ႔ Close Open White
Candle Close White Candle Open ႔
Crowd Psychology
Close ႔ Close ႔ ႔ Formation Weak Signal ႔

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 FOREX for Beginners

Piercing Pattern and Dark Cloud Cover Pattern - Good Reversal Signal

Counterattack ႔ White Candle Close ႔ Black Candle Close

Black Candle Real Body Black Candle Open
Piercing Pierce ႔ Dark
Cloud Cover Up Trend Sunny ႔

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Bullish / Bearish Engulfing Pattern - Strong Reversal Signal

White Candle Open ႔ Black Candle Close White Candle Close Black Candle Open
Strongest Reversal Signal Engulfing /ဝ Technical Analysis Outside Day ႔
႕ Volume ႔

Second Candle Volume ႔ Trading Signal Trend Line Support ႔ Resistance

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 FOREX for Beginners

How to Stop

႔ ဝ Base ၅ ၁
Trend Line ႔ Support ႔ Resistance Professional Stop Loss
Technical Analysis(TA) Stop order

Broker Broker Stop order ႔ Internet Broker Broker

Website Usability Generally Define

၁) Stop price - Sell order Market ႔

၂) Limit price – Market Sell Price ႔ ႔ Generally, it should be less than or equal to the Stop price. Market ႔ ႔
႔ ႔ ႔

၃) Position Liquidate ဝ Number of Units to sell

၄) Order expiration – Trigger ႔ Market Order ? Generally, Day order or GTC (Good Till Cancel)
Day order ႔ Purge GTC Cancel (
normally )

TA Ford (F) Chart Stop Define ႔ Trend Long term trend

Close Major Trend ႔

Ford Primary Trend 16/9/2009 ႕ (Primary Trend )

Long term Horizontal Support line 6.75 Side-way ႕ ) Bull ႕ Bear ႔
9/11/2009 ( ) Minor Up Trend 25/11/2009 Close
Just above Minor Up Trend ႕

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 FOREX for Beginners

Volume Minor Up Trend Declining Volume ႔ ႕ Bull Commitment Bull

ဝ ဝ ႕

Horizontal Blue line at 8.95 Major Resistance Close Major Resistance ႕ 3/8/2009
Pull back ႕ Ford ႔

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 FOREX for Beginners
႔ 8.95 Resistance Preferably, Close Original Primary Trend
Primary Trend Break out ႔ ႔ Minor Up Trend
Resistance ႔ ႔ Volume Improvement

Data Ford 8.95 Resistance ႔ Trader 8.95 ဝ Profit

Medium Term Investor 6.75 1 or 2 ticks Stop Order Tick Y-Axis
Tick ႔ Long Term Investor 5.00 ( ဝ 1 or 2 ticks ႔ 1 or 2 ticks
Professional Major Support ႔ Resistan ႔ Point Stop order
Setup Stop Trigger

Trend ႔ Support ႔ Resistance Investor

Stock Current Momentum TA Stop Order

Technical Analysis(TA) ႔ Trader Setting Line/Bar Chart

Scale

႕ Line/Bar Chart Scale Linear Scale ႔ Linear Stock Price Plot

၅ ၁ ၅ ( ႔) ၅ ႔ ၅ ၅၅ ၅ ( ႔) ၅
ticks ၅ ၁ Gap ႔ ၅ ၅၅ Gap Distance Exactly the same
Scale Linear Scale ႔

Scale Semi-Log scale ႔ ႕ Logarithmic ႔ Charting

Percentage Bar/Candle Height ၅
၁ ၁ % ႔ ၅ ၅၅ ၁ % ႔ Australia
Commonwealth Bank (CBA) Bar Chart Scale

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Linear Scale

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 FOREX for Beginners

Semi-Log Scale

Trend Line Date Linear Scale ႔ Trend

Price Trend Ok ႕ Semi-Log Scale Trend Sideways ႕ Question
/ Scale Semi-Log ႔ Linear Outcome Semi-log
Long Term Trend

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 FOREX for Beginners
Long Term Trend Semi-log ႔ ၅
Price Amount Gap ႕
႔ Semi-log Long Term Trend ဝ ႔

Charting Software Y-axis Scale Feature Yahoo website Chart Settings Scale
Link Chart Scale TA ႔

Moving Average

Technical Analysis ႔ one of the most effective methods Moving

Average (MA) ႔ MA Subcategory Simple MA ႔ Exponential MA ႔ MA ဝ Trend
average price ဝ MA
MA Formula Sum of
Prices / No. of Days

Simple MA (SMA) Formula ႔ ႔ Simple ႔ Price ႔ Price

High, Low, Close Open ၉၉% Close
SMA10 ႔ ၁ Close ၁ ႔ ႔

Exponential MA(EMA) google ႔ EMA

Most Recent Price Weight ႔ Price ႔
႔ Depend Pro EMA EMA

Dow Jones Industrial (DJI) index EMA10 ႔ EMA10 Bar Close

EMA10 Close EMA10 Short-term uptrend ႔

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Technical Indicator Bearish Signal ႔
Ready

MA No. of days Recent Price Activity ႔ Matching Recent Price ႔

EMA15 Short-term MA ႔ 15 MA Medium to Long-term trend ႔ Short-term EMA
Traders Long-term EMA Investors Technical Indicator

Short-term ႔ Long-term Group (Traders & Investors) Overall Sentiment ႕ Short-term Long-
term Uptrend Momentum ႔ Downtrend ႔
Concept MA Crossovers Short Long Long

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Downtrend ဝ ႔ Reverse Short Long
Downward direction ႔ ႔

MA value EMA30, EMA60, EMA100, EMA200 ႔ Close EMA100 ႔ EMA200 Investor

႔ EMA200 Market
DJI EMA10 EMA30 April EMA crossover Signal
2009 January Bearish Crossover ႔ MA Power
MA Derive Advanced Technical Indicator

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MACD / Mac D

Advanced MA technique ႔ MACD (Moving Average Convergence Divergence)

Mac D ႔ MACD Gerald Appel late 1970s Technical Analysis Beauty
ဝ ႔ outdate

MACD ႔ MA Chart Obama Healthcare bill ႔ ႔

Aetna Health Insurance Example ႔

Typical MACD Chart MACD ႔ Signal ႕ MACD Histogram Equaliser Bar

MACD

MACD = EMA12 - EMA26

Signal Line = SMA9 of MACD

MACD EMA12 ႔ EMA26 ႔ Crossover EMA12 EMA26 MACD

႔ MACD
႔ EMA12 ႔
Crossover MACD Chart ႕ EMA Difference MACD ႔ ႕ MACD Chart
႕ Crossover MACD ႔ Signal Line Signal Dotted Line ႔ typically
Simple Moving Average Weight
Signal ႔ Buy/Sell Signal ႔ MACD Signal
Latest MACD
Momentum ၉ Average / ဝ ႔ Signal Line
Trader SMA9

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 FOREX for Beginners
MACD Histogram (MACD_H) ႔

MACD_H = MACD - Signal Line

႕ Equaliser Bar ႔ MACD_H MACD Signal Difference size

MACD Crossovers, MACD_H ဝ Wave Slope Price
Chart Trend Slope ႔ ႔ Divergence ႔ Slope Direction Convergence
႔ Divergence Disagreement Convergence Agreement MACD ႔

To buy

 MACD Negative Positive

 MACD Signal Bullish Crossover

 Price Trend Downward Slope MACD( ႔) MACD_H ႔ Upward slope

႔ Rule MACD Silver Bullet Analysis

ဝ Paper Trade ႔ Aetna Signal

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Triangle Breakout

Triangle Breakout Technique Dow Jones Industrial Average Index ႔ DJI

Technical Chart Candle ႔ MACD cha Triangle ႕

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 FOREX for Beginners
Triangle Breakout
Downtrend Uptrend ႔ Price Triangle
Obviously Bullish
Bearish

Crowd Psychology ႔ Triangle ႔ Bears ႔ ႔

Translate
႔

DJI EMA200
Near term market outlook Technique Market Direction
႔ ႔

Combining Crowd Thinking with Crowd Commitment

Technical Analysis method Indicator Money Flow Index (MFI) ႔ Laszlo Birinyi, Jr.
MFI ႔ Price Volume MFI ႔ Charting Software Web
Site Standard ႔

MFI Formula

၁ Average Price = (High + Low + Close) / 3

၂ Money Flow = Average Price x Volume

၃ Period Money Flow 14-period

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 FOREX for Beginners
၄ Positive Money Flow = ၃ No. of Periods Average Price Previous Average Price
Average Price (Cumulative Total, in other word)

၅ Negative Money Flow = ၃ No. of Periods Average Price Previous Average Price
Average Price (Cumulative Total, in other word)

Money Ratio = Positive Money Flow / Negative Money Flow

Money Flow Index (MFI) = 100 - (100 / (1+ Money Ratio))

MFI Formula Step 7 MFI Value -၁ Range Bound Design MFI value 20 Oversold (Bullish) ႔
MFI value 80 ႔ MFI 20 Stock
႔ 80 ဝ ႔ Trader Profit-taking ႔ ႔
႔ Oversold/Overbought Stock Fundamental Data Oversold/
Overbought Technical Analysis Technique Trading Decision Common sense
Stock ႔

Dow Jones Industrial Candle Chart, MFI MFI ၁၄ MFI ႔

Up trend Candle Chart Trend Bearish Divergence ႔ Bearish
Divergence Trend Line MFI Bullish Divergence Trend ႔ -

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 FOREX for Beginners

Stock Investor ႔ Thinking

Commitment Price what the crowd thinks ႔ Volume what the crowd commits ႔
Price Volume MFI Index ဝ
MACD_H indicator Price action Analysis ႔ ႔ MFI Indicator Crowd Psychology

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 FOREX for Beginners
Trader ႔ Divergence Indicator Divergence Signal

႔ Trading Money Management

ဝ Title ႕ Concept Robert Kiyosaki ႔ Dr. Alexander Elder Intellectual Property

Trading vs. Investing

Trading ႔ Investing Trading Short-term focused Investing Long-term

Stock Investing Day job Financial Advisor, Broker Tips ႔
ဝ ႔ Generally Definition ႔ ဝ
Stock Market Directly ( ႔) Indirectly Invest Investing Direct Investing
ဝ Stock solid bluechip stock ( ၃ ၃ )
Dividends ႕ Time in the Market is More Important than Timing in the Market
" " ႔ Invest You are going
to need a lot of LUCK.

Trading is a totally different ball game

Stock Trading ဝ Market Washed Out Long-term investing mindset Trading area
႔ Trading ႔ Totally different mindset 3M (mindset, method, management)
Technical Analysis(TA) ႔ Fundamental Analysis(FA) TA ႔ FA ႔
mindset ႔ management ႔ ႔

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 FOREX for Beginners
Mythbusting

Trading ႔ Myth Stock Market Analysis

Report ဝ Myth Trading

 Analysis Entry ဝ

 ႔ ဝ ႔

 ဝ

Trading ႔ Chance ႔ ႔
႔ ႔ Market Trade Professionals Institutions
" ႔ "
Net balance Positive

Lose Less, Make More

Trading Core Principle Loss Manage ႔ Loss Profit

Automatic handle Stop-loss, Stop-loss ႕ Trading Book
႕ Discipline
႔ Weight ႔ Weight

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 FOREX for Beginners

Stop-loss Technical Analysis ႔ Long-term Fundamental based investor Technical Analysis

Stock Invest Shorting Simply Long
Stock )

Oldest and Simplest are the Best

Technical Analysis ႔ Trend line, Support, Resistance Stop-loss, Profit-taking point Define ႔
႔ Trade

 Profit is made at the Entry, not at the Exit. ( ဝ )

 Support ႔

 Support Close Support ႔ Volume

 Trade Open Support ဝ Stop-loss ႔ Trade ဝ Cut

Loss ႔

 Trade Open

႔ Nearest Resistance Profit-taking ႔

Resistance Trade Interval
႔ Exit Uptrend Clearly Broken Sign

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 FOREX for Beginners
Mindset

႔ Technical Analysis trading risk ႔ ႔ ႔

ဝ Entry Chart Profitable Trade ႔ ႔ ႔
Technical Analysis too good to be true ႔

Gambler and Lotto Player

Stock Trading ဝ
Mindset Trader Realistic decision
႕ ႔ ႔

You can't stop-loss! ႔ ႔ Probability 1 in a several millions

Mindset Trading
႔ Stop-loss ႔

Can't bear the feeling of losing money

႔ ႕
(Realised Loss) ႔ Trading Bad
Feeling Perspective ႔

Think like a business man

Business Employee ႔ ႔ Probability

Business Income Expense Expense ႔
႔ No way unless it's your daddy's business. Contribution
Employer Business The famous "L" word Layoff!

Business Owner Loss Business Expenses ႔ Profit

Revenue/Income Stop-loss Trader Expense Business Run ႔ ႔ Trade

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 FOREX for Beginners
Trade Sack Technical Analysis Analysis
႔ Resume ႔ ႔ ႔ ႔
Professional trader ႔ ႔

Stock Open, High, Low, Close, Volume Technical Analysis ႔ Closing

Price ႔ OHLC, Volume
Technical Analysis Dimension Minute, Hour Daily, Weekly,
Monthly Linear Dimension X-axis

Closing Price Stock Major Support ႔ Resistance Analysis Technique Point & Figure
(P&F) ႔ Bank of America (BAC) Chart

Chart P&F ႔ Stock ႔ ႔ ႕

Stock
႔ ႕ Amount Amount Multiplier ႔ Personal Choice
၁.၅ ႔ ၁ Daily Range x 1.5 times Box size ႔ Box size Chart Cross ႔
Circle Amount Cross Circle

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 FOREX for Beginners

BAC ႔ ၄ Range Box size 40c x 1.5 = 60c BAC P&F chart Cross/Circle
Cross Circle, Circle Cross ႔ Column

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 FOREX for Beginners
႕ ႔
Reversal ႔ reversal box amount Rule of Thumb 3 boxes Chart
BAC ၁ / Symbol

Cross/Circle ႔/ ႔ Stock price box size ႕ ႕ ႔

Reversal amount Violent Trend ႔ Symbol Switch Reversal amount 3 box
3 4 box 4

X-axis Linear Scale ႕ ႔ ႔ Box size amount

Closing Price Chart Update ႔ ႔ Alphabet initials ႔ ႔
Reversal Compressed P&F ႔
Metastock Software ႔ Box size ႔ Reversal amount Input P&F
႕ ႔ Data P&F ဝ BAC ၂ ၅ Data ႔

P&F ဝ Circle Reversal Major Support ႔ Cross

Major Resistance ႔ BAC Chart Major Support P&F Stock

 Box size = Average daily movement range of a stock price x multiplier (multiplier is personal choice and mine is 1.5) ႔ ၁.၅
Daily Range Price action Capture ႔

 Reversal boxes = 3 or 4 times of Box size (again, it's personal choice)

 Time scale is no longer linear on X-axis

 Mainly used to identify long term major support and resistance. Resistance Cross (X) Support
Circle(O)

 Better to use charting software help to draw P&F

 P&F Major resistance/support P&F ႔

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 FOREX for Beginners
 P&F Price Major resistance/support Verify ႔

 P&F ႔ Technical Analysis ႔

Psychology of Losing

Stock Trading Beginner Stop-loss ဝ

Paper Loss/Unrealised Loss Chance Stop-loss Realised
Money Loss Perspective Palatable

Forget about $$$

Manage ႔ ႔ Point ႔ Casino Chip ႔

႔ ႔
Point Down ႔

Casualty of War

Civillian Idea Trading

Remember how you learned riding a bike

Helmat
Trading Stop-loss Helmat
Trader Trading Millionaire
႕

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 FOREX for Beginners
Learn from Beckham

Beckham Twist ႔ Free kick Penalty Goal Kick

Beckham ႔ Personality ႔ Achievement ႔ Losses ႔
ဝ ႔ Soccer
Round 1 ႔ Chance Total ႔ Goal First-half
Second-half Beckham
Market Take a break Analyse

႕ ဝ ႔ Defense
႕ ဝ ႔ ႔ ႔ ႔
ဝ ႔ .....

On Sale

Department Store Further off Trader

Retailer Further Reduced cut
loss Retailer

It's only in your mind

Losing Trading special case mindset

Trade Losing is only in your
mind and you have to manage losses. Don't let losses manage you.

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Short with me

Trader Market ႔ ဝ Market

႔ Long(buy low, sell high) Short(Sell high, buy low)

How to Trade Like a Professional

trading ဝ
Analyse Method ႔
Method Software ႔ Data (၁) Trader Method ႔
႔ ႔ Topic
႔
Knowledge Apply Professional trader ႔

Fact No. 1

Method ႔ Professional Trader Market ဝ Money Management Skill

Develop ႕ Market Analyse Trade
See the catch word here? " " ႔
Professional Trader small managed losses
Good Money Management Skill

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 FOREX for Beginners
Fact No. 2

Amateur Trader Market ဝ Big Profit ႔ ဝ Professional ႔ Big Losses ႔

Professional Loss Manage Profit Auto Amateur
Dr. Alexander Elder "A fool and his money can throw
one hell of a party" Market Profit ဝ Market Fool
Seriously, Manage your losses and have a good money management discipline.

One example of good money management: R-multiple system

Dr. Van Tharp R-multiple management system money management R-multiple system
R Risk Trader Trade ဝ Define
Trade ၂% ၅% ၂%-၅% Market Amount
Trade total cost Professional ၂% ႔
၂% Practical ၂%-၅% ႔

R Trader R amount ႔ cut loss ႔ ႔ R amount multiple Profit taking

႔ determine 2R or 3R amount R $200 2R $400 R-multiple ႔
Trading system Trading system Entry, Exit rules Technical, Fundamental generate MACD
crossover ဝ trend line ဝ No system is perfect but
there has to be some probability of success of your trading system. system %

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 FOREX for Beginners

# Invest Capital Risk or R Win/Lose Reward Multiplier

1 2000 10000 200 L 2

2 2000 9800 200 L 2

3 2000 9600 200 L 2

4 2000 9400 200 L 2

5 2000 9200 200 L 2

6 2000 9000 200 W 2

7 2000 9400 200 W 2

8 2000 9800 200 W 2

9 2000 10200 200 W 2

10 2000 10600 200 W 2

NET 11000

Table Figure Total ၁ Trader Trade ၂ ႔ R

၂ Total ၂% ၂-၅% range Conservative range Reward multiple 2R Risk
Method(Technical,Fundamental) Probability Example 50%
System ၅ % Market 90% ႔ Example

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 FOREX for Beginners
၅ % System Probability ႔ ၅ % Trade ၅ ၅
Key R amount 2R

၁ ၁ % return Trader weekly, fortnightly frequency ႔ Trade

period ၁ % ၁ % , ၄ %

 R total equity/cash

 Trade R amount cut

 R-multiple amount profit taking

 Method(Technical, Fundamental Probability system ႔ ႔ Success rate ၅ %

 Method continually refine

Van Tharp R-multiple system very simple Professional Trade Pro

၂၁ ႔ Trade Financial Freedom example Trade ၁
Risk R ၂ , 10 trade ၁ total profit 5R ႔ 5R 10 trade ႔ 0.5R average
Van Tharp Trader's life expectancy ႔ Life expectancy
႕ ႕ equity

Amateur ႔ Market Washed out Example ႔ Table Risk 2R R amount ႔

႔ ၄ ၂ ႔ ၁ -0.5R
expectan Key point Amateur Hope ႔ 2R+ R amount
႔

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 FOREX for Beginners

# Invest Capital Risk or 2R Win/Lose Reward Multiplier

1 2000 10000 400 L 0.5

2 2000 9600 400 L 0.5

3 2000 9200 400 L 0.5

4 2000 8800 400 L 0.5

5 2000 8400 400 L 0.5

6 2000 8000 400 W 0.5

7 2000 8200 400 W 0.5

8 2000 8400 400 W 0.5

9 2000 8600 400 W 0.5

10 2000 8800 400 W 0.5

NET 9000

"Cut your losses fast and Let your profit run". R-multiple system Trade Probability system
Different money management trader ႔ Concept
Professional Trader ႔ Happy Trading!

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