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Even if an indicator isn’t there, there’s always the option to import it to the MT4 platform
via the Custom Indicators feature. The only trick is to have the indicator saved in the
right format (.ex4 or .mql)
Just go to File, find the Open Data Folder tab, and paste the new indicator under the
Indicators folder. Don’t forget to close the MT4 platform, as the change will become
effective only when reopening.
The Market Watch or the so-called trading dashboard shows the broker’s offering. Here’s
where all the trading instruments appear, from currency pairs to commodities, indices,
and cryptocurrencies.
For the cryptocurrency traders, JAFX offers no less than sixteen pairs, starting with the
all-important Bitcoin and continuing with well-known coins like Ethereum, Litecoin,
Ripple, and so on.
Charting is easy and straightforward. Pick a pair from the Market Watch list and drag in
on the main MT4 window.
Or, even better, right-click on it and choose the Chart Window option.
Below is the BTCUSD daily candlesticks chart. It shows green and red candles for every
day of the week.
In trading, the green color is associated with a market’s advance, while red with a
market’s decline. Traders can quickly change the timeframe to one that suits the trading
style.
A relevant example appears above. Traders choose the symbol or the market (LTCUSD),
the volume, the order type (at the market) and the two big quotes are the bid and ask
prices.
Before opening the trade, traders can set the stop loss and take profit levels. However,
this can be done even after the trade is active.
In this case, if we buy at the market, the take profit is 118.99 and the stop loss 116.30.
When the market reaches either of them, the MT4 automatically closes the trade.
Other orders to use are:
• Buy stop – if you want to buy ONLY when the price reaches a higher level. For
example, you can set a pending buy stop order for the LTCUSD at 118.10 and set
the stop loss and take profit levels.
• Buy limit – buying happens from lower levels than the current market price
• Sell stop – selling occurs from lower levels than the current market price
• Sell limit – selling takes place from higher levels than the current market price
These are pending orders, and the broker will execute them only if the market moves to
the entry point. They indicate a trading plan and are great money management tools.
This Demo account offered by JAFX had a Balance of 9998.97 USD. It will remain the
same until an open trade is closed.
Hence, it has the potential of misleading traders, as it doesn’t reflect the reality in the
trading account.
Equity does. It will fluctuate with how the trade/trades evolve. If the sum of the open
trades is positive, the Equity will be bigger than the Balance, reflecting the potential
profit. If not, it indicates the potential loss.
For every trade, the broker blocks a margin. It acts as collateral if you want.
The bigger the trade size, the bigger the margin blocked. The free margin, on the other
hand, shows the margin available for new trades. Obviously, the bigger, the better.
Retail trading is done on leverage. For example, a trading account with 1:500 leverage,
means the trader moves in the market five hundred times the amount traded.
It is a feature introduced first by Forex brokers, as an alternative that allows retail traders
access to the interbank market.
In the meantime, the LTCUSD trade hit the take profit. Here are the position and the
effect.
Traders can check the account history, latest news, and many other features the MT4
platform offers.
From left to right, every bounce comes from a classic support level. After the pair breaks
below, the support becomes resistance that can be projected on the right side of the chart.
It is foolish to ignore it and being long at a resistance level may have damaging
consequences for the trading account. The natural reaction is to close any long trade or,
even simpler, to go short.
How about dynamic levels? The dynamic nature of support or resistance comes from the
fact that it follows the price action. The easier explanation is that it doesn’t form on the
horizontal.
This NEOUSD hourly chart shows what a trend looks like. If the market keeps making
lower lows and lower highs the bearish trend will continue.
Fighting a trend is a costly adventure. Why fighting it when you can ride it?
Trend reversal patterns do exist, but they fail as often as they succeed. The only way to
make sure a trend reversed, is to check if the lower highs (in a bearish trend) or higher
lows (in a bullish trend) series is broken. Until then, the market will keep falling or rising.
Another way to trade with it is to spot trend reversals. Because the RSI follows the highs
and lows of a market, traders look for divergences between the two.
Ripple vs. Bitcoin hourly chart shows a terrible bearish divergence. While the price keeps
advancing and makes two highs, the RSI fails to confirm the second one.
That’s a bearish divergence, and traders go short.
The black line on the BTCUSD daily chart from above is the SMA (14). It means that the
MA averages the closing prices for the previous fourteen days and plots a value on the
chart.
The SMA (14) acted both as resistance and support, providing excellent opportunities to
go long or short.
Another way to use MA’s is to look for golden and death crosses. This strategy requires
two SMA’s: the 200 and 50.
When the SMA (50) moves above the SMA (200), it is said that the price entered a
bearish market, the cross bearing the name death cross. On the other hand, a death cross
forms when the SMA (50) moves below the SMA (200).
The recent DASHUSD price action confirms the strength of this strategy, as both longs
and shorts worked fine with the Bollinger Bands. But there’s another way to use this
indicator.
Perhaps the main feature of the bands, they signal a potential breakout. The thing to do is
to check the distance between the UBB and LBB regularly. When it narrows, the new
trend is stronger than usual, as it proved with the recent bearish trend.
The following is, in order of its importance, data to watch when trading cryptocurrencies
that have the U.S. dollar in their componence:
Federal Reserve of the United States (Fed) interest rate decisions
Retail Sales
Housing data
Luckily, all data is released following an established economic calendar. And, the
information is free and easy to find.
Therefore, before trading any of the cryptocurrency pairs that have the U.S. dollar in their
componence, make sure you know the importance of the economic data and the potential
impact on the market.
The Monero against the USD four-hour chart formed a classic double top in the middle of
January 2018 that had all the elements needed: a prior bullish trend, the market failed two
times at the same spot (around the 450 level) then it broke lower, filling the measured
move.
Was it a reversal pattern? If you consider that two months later the XMRUSD trades
below the $200 mark, then yes, it was.
A triple top or bottom follows the same rules, with the only difference being that the
market fails three times at the same level. However, financial traders have a saying: the
triple top or bottom rarely holds, meaning the price may return to the level after reaching
the measured move.
The IOTUSD recent four-hour chart illustrates the power of a wedge. A rising wedge
formed on a trend that saw the pair rising from $1.2 to $2.2.
However, instead of staying on the long side, traders that spotted the wedge formation
just waited for the price to break to the lower side of it. Next, they placed a stop loss at
the top of the pattern.
Finally, traders integrate the risk in a stable money management principle, targeting a
risk-reward ratio of 1:3.