Forex multi account manager | Use your trading account operating, investing, trading | Assist in self management of family office investment
To determine whether there is counterparty betting behavior in the foreign exchange investment trading market, one can observe from the product types provided by the platform.
If the platform is all about contracts for difference (CFD), then there may be counterparty betting situations, but this does not necessarily mean it is legal. Some platforms use zero interest spread as a promotional point and claim to be legally regulated by small island countries. However, it should be noted that the population size of some small island countries may be much smaller than that of a town in China. Some large foreign exchange platforms also have CFD business, which to a certain extent reflects that the platform may have some counterparty betting mechanisms. Even for foreign exchange banks, according to CFD rules, they may also engage in counterparty betting business because the platform may become the counterparty in transactions. For platforms that are all CFDs and engage in counterparty betting operations, investors should be cautious and stay away as much as possible. The number of foreign exchange platform providers that can operate stably for more than 10 years is relatively limited. In addition, it is also necessary to consider whether the platform can withdraw funds normally. Some platforms that have been in operation for many years are gradually approaching black platforms in terms of development trends, which indicates that foreign exchange platform providers face difficulties in making profits and may be forced to transform into counterparty betting platforms when they cannot achieve profitability, because this way can obtain benefits in the short term. But in the long run, this is undoubtedly drinking poison to quench thirst. Eventually, it will inevitably decline due to loss of trust, just a matter of time. If investors want to conduct real transactions, they can choose foreign exchange bank platforms regulated abroad to ensure that funds truly enter the market rather than engaging in counterparty betting with the platform. As long as there is counterparty betting, in addition to common means such as widening spreads and reducing leverage when trading is inactive, the platform may also use many other ways to damage the interests of investors. For foreign exchange margin platform traders without overnight fees, they may harm investors through means such as slippage, modifying quotes, paying taxes, and margins.
In the foreign exchange investment trading market, the stop-loss and take-profit positions set by short-term traders often become the entry signals for long-term traders.
This phenomenon fully reflects the basic trading principle of the market, that is, there is a interdependent relationship between buyers and sellers. Analyzed from the perspective of trends, the stop-loss point of short-term trading, that is, its selling position, can be regarded as the buying opportunity for long-term traders. Similarly, the take-profit point of short-term trading can also be an opportunity for long-term traders to intervene with light positions. In naked candlestick trading, the setting of stop-loss points should be based on the lows or highs of historical prices to ensure the effectiveness of trading strategies.
When choosing a foreign exchange trading platform, it is of crucial significance to give priority to large platforms with banking qualifications and a good reputation.
Currently, the number of untrustworthy business personnel in the foreign exchange investment trading market may exceed the number of real foreign exchange investment traders. In foreign exchange investment betting transactions, if one party obtains a large amount of profit, it usually means that the other party, that is, the foreign exchange investment trading platform, will bear corresponding losses. Therefore, one should not deny everyone indiscriminately. Instead, one should focus on the transaction itself and avoid spending too much time in the process of screening and distinguishing platforms.
According to statistics, the average operating time of foreign exchange investment trading platforms is about three years. If someone claims to have twenty years of trading experience and tells you that platform selection is not important when there is no profit, then this person is likely not a real foreign exchange investment trader. Because the number of platforms that can operate stably for twenty years is extremely limited. In these twenty years, many companies that claim to be large platforms have already gone bankrupt.
Some foreign exchange investment trading platforms attract customers through low transaction spreads, but may artificially widen slippage to trigger customer stop-losses, thus causing customers to suffer losses while the platform makes profits, and even leading to customer margin calls and then obtaining profits. This behavior is unacceptable and a highly irresponsible manifestation to customers.
In addition, the marketing behavior of some platforms is too frequent, causing great distress to customers. They constantly disturb customers and waste customers' precious time, and this behavior is obnoxious.
Finally, the foreign exchange industry may be undergoing some changes. In some regions with relatively loose supervision, more low-cost licenses may appear. On these platforms, the funds in customer accounts may be relatively small, while the financial strength of some large individual foreign exchange investors may far exceed that of these foreign exchange platform providers. Therefore, when choosing a foreign exchange platform, investors should be more cautious and choose platforms with strong financial resources, strict supervision, and good reputation for trading.
In the field of foreign exchange trading, support and resistance levels are commonly used tools in technical analysis. They predict future price trends based on historical price data.
However, the effectiveness of these tools in practical applications may vary. The reason is that the market is influenced by multiple factors, including economic data, political events, and market sentiment.
Fibonacci retracement and the golden ratio are tools used in technical analysis to identify potential support and resistance levels. Fibonacci retracement is based on the Fibonacci sequence, which is found in both nature and the financial market. The golden ratio is dividing the whole into a larger part and a smaller part so that the ratio of the two is equal to the ratio of the whole to the larger part. It is approximately 1.618 and is regarded as an ideal ratio in aesthetics. It is also applied in financial market analysis.
In actual trading in the foreign exchange market, when the price breaks through the "support level", it may turn into a "resistance level"; vice versa, when the price breaks through the "resistance level", it may turn into a "support level". In addition, Fibonacci retracement and the golden ratio are often used to predict potential turning points in prices. In some cases, they may provide strong support or resistance. However, these analysis tools are not always accurate and may even be subject to artificial misinformation that misleads foreign exchange investment traders.
Foreign exchange investment books carry the author's viewpoints. Readers need to think carefully and put them into practice when reading, and must not blindly imitate.
In the field of foreign exchange investment and trading, the publication of investment and trading books is often controversial. Some commentators believe that if a trader needs to publish a book to demonstrate their analytical ability, it may imply that their ability is not as excellent as they claim. They point out that the effectiveness of trading skills is binary, either being able to continuously generate profits or not being able to do so. For traders who cannot continuously replicate profitable strategies, the reliability of their skills may be questionable.
However, even top foreign exchange investment traders will try their best to avoid risks. Publishing books entails almost no risk, and for those who have achieved success, publishing books can increase their popularity or leave a valuable legacy. Some people may think that foreign exchange investment traders who publish books have poor skills, but this may reflect the limitations of their own vision and cognitive level. Only those who truly obtain huge profits through foreign exchange investment and trading have the state of mind and ability to share their experience and wisdom. Unfortunately, most people may never have such an opportunity.
Foreign exchange investment and trading books reflect the author's cognition, and what readers obtain from them is their own understanding. Only through in-depth thinking and practice can this knowledge be transformed into personal wisdom. This needs time to be verified, and sometimes it even takes a lifetime to prove.
The content of foreign exchange investment and trading books reflects the author's viewpoints, but the author is not perfect. Many readers may lack the ability to distinguish the author's level. Among foreign exchange investment and trading books, most books sold on the market may not provide much substantial help. Authors may be criticized for the thickness of books, because book thickness is usually related to price, and thicker books may bring higher profits to authors. This phenomenon is also relatively common on some platforms, such as requiring posts to reach a certain number of words at least before they can be published or recommended.
Bad foreign exchange investment and trading books may have a negative impact, just like the allusion of "Imitating another person and losing one's own individuality". People who were originally able to walk independently can only crawl in the end because they imitate useless things. In the field of foreign exchange investment and trading, if wrong methods are learned, it may cause originally profitable foreign exchange investment traders to be unable to trade or even suffer losses. Therefore, when learning foreign exchange investment and trading, one should be cautious and avoid blind imitation.
In foreign exchange investment and trading, price behavior analysis, especially nake candlestick trading and Pinbar strategy, may not have as remarkable practical effects as advertised.
Although candlestick charts are praised as "the most expensive artworks" for their unique visual presentation, in the actual trading process, their role may not be as strongly attractive as their appearance. For N-shaped patterns, whether standard or extended, their practical utility may be overestimated. In N-shaped patterns, the only thing that may have certain value is setting trading orders by using previous highs and lows, but this is not the entire connotation of candlestick analysis.
In addition, another function of candlestick charts in foreign exchange investment and trading is to assess market strength and weakness, mainly achieved by observing the length and direction of shadows. However, when the candlestick intervals are too dense, the information value they provide will be greatly reduced. Excessive attention to the details of a single candlestick is like counting the hairs of a cow or studying a single leaf in a forest, which is very likely to distract traders and then lead to confusion in thinking. This phenomenon is somewhat similar to the field of education. Sometimes, excessive learning can instead make thinking become rigid and dogmatic.
There are a large number of books on candlestick analysis on the market, but this does not mean that every one is worth spending time studying. Even the most experienced traders are well aware that risk management is a crucial part of foreign exchange investment and trading. Publishing books entails almost no risk, and novice traders often find it difficult to distinguish which contents have practical value. As trading experience accumulates, even the least sensitive foreign exchange investment traders will gradually recognize the limitations of the practical utility of some analysis methods.
In foreign exchange investment and trading, one should not rely solely on candlestick charts. Combining other technical indicators such as moving averages to assess trading trends may provide more comprehensive and reliable information.
In foreign exchange investment transactions, when operating with a light position on the left side of a long-term investment, it is possible to go against the trend appropriately. When operating with a heavy position on the right side of a short-term investment, it is essential to follow the trend.
For long-term light position operations in foreign exchange investment, leverage tools must not be used. The reason is that long-term transactions have a relatively long time period. During this period, there is greater market uncertainty. Once leverage is employed, the risk will increase significantly. If there are adverse fluctuations in the foreign exchange investment market, it is highly likely to lead to serious losses. In this case, for long-term foreign exchange transactions, one can consider gradually building positions through left-side trading. Left-side trading means making an early layout based on analysis and judgment of the market when the trend is not completely clear. Although there is a certain risk, when the analysis is accurate, positions can be established at a relatively low cost, laying the foundation for future returns.
In heavy position short-term transactions of foreign exchange investment, the contrarian method must not be used resolutely. Short-term transactions have a short time period. The market changes rapidly and fluctuates intensely. Contrarian operations are easily impacted by the rapidly changing market conditions and face extremely high risks. Short-term foreign exchange transactions should only build positions through right-side trading. Right-side trading is to start operations after the trend is clearly manifested, which can reduce uncertainty to a certain extent. When there are obvious upward or downward trend signals in the market, building positions in line with the trend can better grasp short-term trading opportunities. For heavy position short-term transactions, due to the heavier position, the risk is correspondingly higher. Therefore, the judgment of the trend and the grasp of timing need to be more accurate. At the same time, strict stop-loss and take-profit points must be set so that when there are adverse changes in the market, stop-loss can be implemented in time and profits can be locked in to avoid serious losses caused by a single wrong operation. Only in this way can we fully utilize the advantages of right-side trading in challenging short-term transactions and improve the transaction success rate and profit possibility.
In gold and currency trading, using a breakout strategy to achieve profitability seems relatively easy in theory, but extreme caution must be maintained in the actual operation process.
The possibility of a breakout in the gold market is usually higher. The main reason is that a large number of investors around the world participate in it, and the trading volume is extremely huge, which makes the authenticity of the breakout at a relatively high level. In comparison, the number of participants in the currency market is relatively small, and it is also affected by the regulation of central banks, and its trading volume is relatively small.
It needs to be emphasized that the above analysis is only a speculative view. Therefore, investors who plan to adopt a breakout strategy should maintain a cautious attitude. A breakout in the currency market may be triggered by the intervention of central banks. According to the mean reversion theory, prices may quickly pull back. On the other hand, if a breakout in the currency market is driven by economic data or political events and there is no intervention by central banks, then this breakout may not be affected by human factors.
In the current foreign exchange investment market environment, the breakout trading strategy has certain feasibility.
When the price breaks through key support or resistance levels and enters the market, traders can obtain profits by leveraging market momentum. Naked candlestick breakouts can provide a more rapid entry signal because they do not rely on any indicators and directly reflect price behavior. In a rapidly changing market, speed is usually a crucial factor.
However, the space for breakout trading in foreign exchange investment may be relatively limited. Therefore, focusing on identifying false breakouts may reveal more real breakout opportunities. In a market with a smooth trend, breakout trading is particularly effective. There is a gradually accelerating breakout pattern, which may indicate that the market is accumulating momentum.
Fluctuations in the foreign exchange investment market can be divided into two types: wide fluctuations and narrow fluctuations. Wide fluctuations may mean that the market is active but there are large differences. Narrow fluctuations may indicate that market trading is inactive and there are relatively small differences. The speed of fluctuation reflects the size of order flow. Rapid fluctuations usually mean that there is a large amount of orders flowing, while slow fluctuations may indicate a smaller order flow. Prices usually move in the direction of least resistance, which is a principle generally recognized by market participants.
In the oscillation range after the end of the foreign exchange investment trend, the foreign exchange market often presents a state of wide fluctuations, including V-shaped reversals. To form a new trend, fluctuations in the foreign exchange investment market may gradually narrow, forming a convergent form or a narrowed state of parallel intervals. The formation of foreign exchange investment trends is often the result of reduced market differences, reduced reverse amplitudes, and shortened lateral time. On the contrary, the end of foreign exchange trends is usually accompanied by an expansion of reverse amplitudes and an extension of lateral time, eventually leading to market stagnation and entering a state of large oscillations.
The challenges currently faced by the foreign exchange investment market include the high-speed circulation of information, making it difficult to distinguish true and false news, and investors' doubts about the authenticity of data. For example, concerns about the possible existence of falsified economic data in dollar-denominated countries make it difficult for investors to establish confidence in long-term holdings.
In the field of foreign exchange trading, the continuity of market dynamics is generally rather limited. It usually appears rapidly in an extremely short period of time and then quickly returns to a fluctuating state.
This rapid change is often closely related to political stability and is particularly significantly influenced by large market participants such as central banks. For investors with large amounts of capital, due to their huge capital volume, the market fluctuation risk they face is also relatively high, which may lead to psychological uneasiness and anxiety. To alleviate this situation, investors can consider giving up the use of leverage and instead choose carry trade, especially choosing high-interest currency pairs for carry operations.
Price fluctuations of currency pairs often occur within a short period of time, and most of the time they are in a relatively stable oscillating state. The effectiveness of trend-following strategies depends on the volatility of asset prices. However, the current foreign exchange market does not always have this kind of volatility. Therefore, investors may need to explore new methods beyond traditional trend-following strategies.
The fundamental characteristics of the foreign exchange market often make trends less obvious. Political turmoil may trigger violent fluctuations in the market. However, government agencies usually monitor the foreign exchange market and intervene when necessary to stabilize the market. Despite these challenges, the foreign exchange market still attracts many investors, partly because it provides a high leverage ratio, providing investors with potential opportunities to amplify investment returns.
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