Algorithmic and High Frequency Trading - The Future of FX Market Analysis?

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Algorithmic Trading

Program, or algorithmic, is simply the use of computer programs to enter trading orders to the market, with the computer algorithm calculating such inputs as timing, price and the quantity of the order to be placed and this these systems are designed to operate without human intervention.

They can be long or short term but most are short term and look to make quick profits normally within a day. The logic behind them is that they can detect price discrepancies and profit from them and unlike a human there not subject to emotions and save the operator time as they run automatically.

High Frequency Trading HRT

The term High-Frequency Trading (HFT) basically means "trading with the system firmly focused on speed of execution". A HFT systems can decide to take an execute and order in under a second and is being used by many institutions. The idea is to get the order in ahead of the crowd and take advantage of price discrepancies and make money from them. The idea is not only to execute orders quickly but in high volume, so that the system can liquidate the trade quickly. All trades are normally closed in minutes or hours and no position is normally held overnight.

Doesn't it all sound so impressive and the future of trading?

Well as an experienced trader I would say that people have been trying to beat the market since trading started and no one has succeeded yet and the reason is obvious is markets don't move to mathematical models and a computer cannot think it can only react. A computer can only react to change not anticipate it so a simple system will work better than a sophisticated algorithm - period.

New Names for Losing Forex Strategies

Algorithmic trading is just another word for robot trading which has lost its flavour a bit due to the huge amount of systems sold for public consumption with fake track records which lose money.

Even more ridiculous is high frequency Forex trading which places the emphasis on - orders in a nano second to beat the market and make quick profits. All this does is make sure the transaction costs are so high, that there is no chance of making money. Didn't this used to be called scalping or day trading? Of course, these names are not flavour of the month either, due to the amount of systems which have been sold and lost money, so marketers have to find a new name to catch the public's imagination.

Beating the market with a computer is nothing new and algorithmic and high frequency Forex trading, are just the latest hype which claim to beat the market but see users lose.

How to Win at Forex Trading

If you want to win at Forex trading, go the old fashioned route which makes money which is to learn the basics which are easy to learn and then think for yourself and you will be able to enjoy Forex trading success.

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Source by Kelly Price

How to Trade Online

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The information provided in this article aims to help anyone interested in online trading get started. This material can be easily applied to any market. It has been designed for those who might have heard that online trading is a great source of income, but have no idea how it works.

Choosing a Way to Trade

Since high-speed internet has become available for almost everyone, online trading is very popular these days. Today anyone can trade anywhere any financial instrument.

If you are an online trading novice, there is no need to worry, because there is a huge amount of trading platforms, products, markets, and brokers. For a beginner it is better to use a popular trading method.

Spread Betting

It is simple. A dealer offers a Buy and a Sell price for the market you are trading. The difference is the spread. If you believe the market will grow, you open a trade at the Buy price, which is known to be going long. But if you think the market will fall, you open a trade at the sell price which goes short.

CFDs

CFD is the abbreviation for Contracts for Difference. Similar to spread-betting, CFDs allow to benefit from rising and falling markets with buy and sell prices set by the dealer.

CFD traders would trade a particular amount of shares or lots at a certain buy or sell price. CFDs have tighter spreads if compared to spread-betting, but funding taxes and dealer commission are applied.

ETFs

ETF is the abbreviation for Exchange Traded Fund. ETFs are like shares, but rather than purchasing a stake in an individual firm, you buy a share is a fund that tracks the price of a commodity. ETFs are bought and sold similar to stock market shares, paying commission to a broker.

As opposed to CFDs and spread-betting, ETFs don't provide the opportunity to leverage, although this means that losses cannot exceed your initial investment.

Choose Your Market

It is very important to decide what to focus on and then become a specialist.

Forex

Forex represents a form of global exchange that estimates the relative value of various currencies compared one against another. Forex trading is popular all over the world and operates 24 hours, except weekends.

Every market is represented as a currency pair. For example GBP/USD is the value of the British pound against the U.S. dollar. When trading the forex, you speculate on the value of one currency against the opposing pair.

Indices

Indices are used to measure the value of the chosen selection of the stock market. For example, the FTSE 100 index represents a rating of the top 100 companies that are listed on the UK stock exchange. When trading indices, you speculate on the rise or fall of the value of any selected index.

There is much more to learn, but for novices in this industry it is important at least to have some idea to start with and after that dig deeper into the philosophy of online trading.

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Source by Matthew N Stamper

How to Use the Relative Strength Index to Make You a Better Trader

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Every experienced Forex trader should know the four Relative Strength Index (RSI) trends in a currency cycle. The four cycles are: the positive and negative phases of divergence and reversal. These 4 RSI cycles have a direct correlation with determining the trend of a currency.

In the Positive divergence cycle, the price of the currency moves upwards and is considered to be bullish. This upwards movement helps the currency gain momentum. With momentum comes an increase in volume helping the currency price to keep climbing. As you identify this upward trend, you should enter the trade by purchasing the currency and keeping it until it hits its peak. Once the currency hits the peak of uptrend, a negative reversal starts to develop.

A negative reversal starts when the positive divergence loses momentum. Even if the price continues to increase, you will see a slow-down of momentum and a decrease in volume. When both momentum and volume decrease, that is signal that a negative reversal is developing. The negative reversal starts once the price stops moving upwards and starts to fall. At this point the price hit the highest and you should close your open trades to pocket your profits. Of course, at this point you will see this cycle turn into a negative divergence.

A negative divergence happens when the sentiment of the market turns from bullish to bearish and the price goes on a downfall or down trend. Many traders like to try to make profit in both movements by selling or shorting the currency here. However, a more advisable strategy is to sit and wait until the price hits rock bottom and a positive reversal starts to develop.

A positive reversal may be the most profitable position in your chart. At this point, the currency price hit rock bottom and it is starting a reversal and moving upwards again. Once you identify a positive reversal, you should buy the currency again. This cycle points the cheapest price of a currency and, in the long run, will yield you the most profits by following these simple steps.

As you can see, divergence and reversal cycles are an integral part of a currency behavior. By mastering the 4 RSI cycles, you could make great profits. Every trader should have a "go to" strategy when everything else seems to fail. This simple strategy may be that "go to" strategy and should be integrated to your trading toolbox.

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Source by Luis Nieves

Forex Robot - Building Your Own Automatic Trading System for Triple Digit Gains!

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There are two main criteria which you have to program rules for and they are - Market Entry and market exit or your stop. You can use a huge number of indicators to time your trades but on an automatic trading system, you need to use as few as possible an here I am going to show you how to build a 1 rule system simply based upon trading volatility.

A very simple system would be one based on the standard deviation (volatility) of price. The Bollinger Band for example, shows a mid average band and the two outer lines, are standard deviation from the norm or average, as volatility increases the bands widen away from the average. You can easily construct a simple volatility system with your own settings so here is what you do..

You would have to decide a mid line moving average to start. This is where prices will find support in a bull market and resistance in a bear market. A buy signal, would be generated (and held) in a bull market when the average is hit, the outer bottom band would provide the stop level.

What you need to do is to test various moving averages and standard deviation settings for the outer bands but this is easy to do with today's software. You would then, need to decide a spread of currencies to trade it on and test it back over time, to see how successful it is - because it only has one rule, it will show a realistic back test of performance.

The logic of the above system is easy to understand and below, you will find how to generate a buy signal and stop in a bull market.

In a strong bull trend, prices may go away from an average price but they will normally find support against into the average. If volatility takes prices through the mid band to the outer bottom band, the supply and demand situation is probably changing from bullish to bearish and a stop can be placed

You have to do a bit of research and you can add additional filters if you wish but a volatility based system if traded on a spread of uncorrelated contracts will work (they very rarely work on a single contract).

I have seen people make huge profits with simple automatic systems and you can too. Sure you have to spend some time researching and testing and also as with any system trade long term but if you do a bit of work, you can easily build your own Forex automatic trading system and make some great profits in under 30 minutes per day.

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Source by Kelly Price

Forex Aggregation - Advantages

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Foreign currency market continues to remain non-centralized and fragmented. While the collective daily volume in spot, forward and swap foreign exchange market is around 3 trillion, lack of transparent price discovery and liquidity amongst numerous institutional Forex dealing platforms still remains a prime concern due to the fragmented nature of Forex market. Given the increasing interest in online foreign exchange dealings, new and improved trading venues are becoming available.

Due to the decentralized, segmented and over-the-counter nature of Forex market, liquidity has always been dispersed. However, in the last ten years the number of sources from where liquidity can be sourced has increased enormously. Forex Liquidity Aggregators are tools that enable market participants to view all of the various sources of liquidity on one screen. Following are some of the advantages of Forex Aggregators:

Virtual Forex Exchange

A Liquidity Aggregator acts as a centralized trading portal by accepting and normalizing several data feeds, feeding that data into algorithmic engines and receiving orders and routing them into the market. By presenting the liquidity in a single and consolidated order book, Aggregators act as a 'Virtual Forex Exchange' for buy-side traders. Traders can get a complete picture of available liquidity in a single trading environment, which enables them to have maximum control over their order flow by easily sorting, analyzing and making profitable decisions.

Limiting Transaction Costs

By accessing multiple sources of liquidity, Forex Aggregators put back the market together for buy-side traders. Besides lowering transaction costs and time spent for searching liquidity, they also limit the potential risks involved by placing all execution orders in one order ticket. The cost of aggregation services will be offset as traders spend less time searching for the best price.

Increasing Trading Efficiency

By employing Aggregators, traders will no longer require to subscribe to multiple portals on their desktops. By aggregating the functionality, pricing and liquidity under one portal, traders can save on the cost of staff and infrastructure which they would have otherwise employed for managing various portal connections under traditional execution system. A major challenge faced by traders using traditional execution process is the 'last look provision'. Bank portals have a waiting period of several hundred milliseconds to several seconds before a deal is executed. Seconds can make a huge impact on profitability especially for algorithmic trading system. However, by aggregating various liquidity sources, last look provisions can be minimized, thereby increasing trading efficiency.

Better Price Discovery

Forex Aggregators internally match trade orders between all buy-side traders and liquidity providers thus providing better price discovery, greater liquidity. This further improves the response time and order confirmations for the users.

Maintaining Anonymity

Buy-side firms prefer maintaining anonymity while trading in Forex marketplace as they do not prefer reveal their trading strategies. Forex Aggregators enable them to execute daily currency flows without revealing their position or identity.

Smart Order Routing

Forex Aggregators also allow for 'smart order routing', wherein buy-side firms can continuously observe all the liquidity sources to determine where the best market opportunities lie. After an order is executed, the Aggregator automatically decides where to route, how much of the total amount to send to which venue and what orders to send. Also, users can refer to only one screen instead of referring to several single or multi-screen portals at the same time, thus saving on cost of employing systems for each trading venue. Besides delivering efficiency gains, this technology also enables market players to retain more trading value. Forex players are therefore giving increasing services that deliver a single point of access to market liquidity, combined with a common trading record.

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Source by Geetika Sharma

Blockchained Web Hosting

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The notable recent increase in Bitcoin prices has rekindled the imagination of many investors, but Blockchain technology is not merely about the money. In this article, we will take a look at how significant an impact this revolutionary technology will have on classic web hosting services.

The concept of cryptocurrency is not rocket science. In fact, this medium of exchange is no more complicated than traditional currency. However, it nonetheless needs a secure and trusting environment in which it can operate, and that is provided by Blockchain.

What is Blockchain? There are many misunderstandings relating to it, but, for the purposes of this article, we will simply define it as a distributed spreadsheet. We are all familiar with Excel or Open Office spreadsheets, but what makes Blockchain so attractive is the way it is distributed.

Just like the files in Torrent, Blockchain is a peer-to-peer network where it is not necessary to ensure trust between parties. Thanks to modern cryptography, the trust is instead maintained on the level of a single record rather than the party hosting it.

Okay, so now we understand the basics of the cryptocurrency revolution, but how, we may ask, does it affect web hosting services? Essentially, in its simplest form, this would suggest not only selling your services in your local currency, but also in Bitcoin and other cryptocurrencies.

However, this is not the end of the revolution. Bitcoin and other digital currencies need electronic wallets to operate, and there is thus huge potential for traditional web hosting vendors. If you have the trust of your customers and are hosting their sites, then why not host their electronic valets?

Each operation in cryptocurrency is a de facto transaction between two electronic valets. Every exchange is maintained through the wallet and you can also provide an interface for your customers to access it. This factor is pivotal in order to fully understand the impact Blockchain can have on your web hosting business.

This said, Blockchain is not only about money. The newest versions of its protocols also provide the opportunity to enact any form of contract between the parties, whether this is a subscription to cable television or indeed any other type of bill. They all need to be stored somewhere, and there is a place for web hosting companies to be involved.

The wallet is thus the key to fully utilizing the potential of Blockchain. Once you understand this, what then should be your next steps?

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Source by Artur Radosz

This Hated Commodity Could Make Huge Gains in 2018

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The forecast showed an extra 20 million pounds of uranium production for 2018... with no buyers. As you can imagine, the uranium price plummeted.

It hit its lowest price in October 2016 at $18.75 per pound. That touched a 13-year low price.

The downtrend began back in 2011. The uranium price peaked at $72.50 per pound in January 2011. It fell steadily since then, down a total of 74%.

This is a shocking result for an energy source that many embraced as a "green" rescue from hydrocarbons just a few years ago. Nuclear power creates safe, carbon-free energy.

The problem is, it can cause huge disasters. That's what we discovered when the Fukushima disaster struck Japan.

The Demise of Nuclear Power

An earthquake and tsunami damaged the Fukushima Daiichi nuclear power plant in March 2011. The earthquake damaged a reactor. Then the tsunami inundated the area, destroying vital backup generators.

Without the backup power, cooling water couldn't get into the plant. That caused a runaway reaction, a meltdown - the greatest fear for all nuclear power plant operators.

A series of human errors compounded the damage. The operator, Tokyo Electric Power Company, was completely unprepared for the situation.

The result killed the nuclear power industry.

Fukushima turned the world against nuclear power. Germany shut down all its reactors in response. Demand for uranium fell, and the uranium price collapsed.

This finally led major uranium producer Cameco Corp. to cut production in early November 2017. The company's earnings fell and fell. It struggled to maintain profitability. It finally announced that it would suspend operations at its flagship McArthur River mine for 10 months.

Cameco's decision cut the surplus to just 5 million pounds... and then the unthinkable happened: The world's largest uranium producer followed suit. Kazakhstan's state-owned uranium miner Kazatomprom cut production by 20% for the next three years.

The result could be a massive bull market in uranium.

The Uranium Price and a Windfall for Uranium Producers

Shares of Uranium Participation Corp., which hold physical uranium for investment, soared in response. Shares are up 30% in just a month and a half.

Shares of uranium companies surged too. However, this is just the beginning. Analysts that cover the uranium sector believe these cuts could add $30 per pound to the price of uranium. That's more than double the current spot price.

For uranium producers, this will be a windfall. Companies like Cameco and Ur-Energy Inc. will see revenue and earnings rocket higher.

This appears to be great news for the uranium sector. It's a story we'll continue to watch in 2018.

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Source by Matt Badiali

Which Time Frame Should You Choose to Trade and Which Is Most Profitable?

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Most Forex traders have no idea of how or why Forex prices move and make key errors in the way the time frames they trade. In this article, we will look at three popular time frames and see which is the best time frame to trade in your trading strategy.

In Forex markets, all the fundamentals supply and demand news will be shown in the price action and so to will the views of all the traders, so lets break the price action down into 3 time frames.

Long Term Trends

The big trends in currencies which last for a few weeks to many months and they reflect the economic and political health of the country's currency. These big fundamentals change slowly from expansion to contraction and that's why these trends last so long.

Intermediate Term Trends

While the big fundamentals prevail over the long term, in the shorter term traders emotions can spike prices to far up or down and these can be seen in intermediate trends, within the big trend which can be either with the major trend or opposite to it. Typically, these trends will last a few days to around a week.

The Short Term Trend

This is the action within a day and is really not a trend at all its simply random price action. In a day prices can go anywhere and they do.

Which is the Best Time Frame to Trade?

From the above its clear that trading the long term trends can give you the biggest amount of profit with the least amount of work. All you do is get in on the trend and hold it - but long term trend following, only really suits a trader who is patient and disciplined.

Trading the intermediate term trends can be very profitable and requires less patience and discipline than trading long term trends. You can make money in both time frames and the one you choose, will simply be down to your personality.

I haven't mentioned day trading yet and its the most popular time frame to trade in but it offers you no real chance of success. There is a big industry that sells junk robots and other, so called low risk day trading and scalping strategies but they don't make money and day traders lose.

If you want to win at Forex trading, don't make the mistake the majority do and trade short term - trade longer term and you will have the odds on your side and be able to make a great second income.

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Source by Kelly Price

Historic Light Crude Oil Price

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The price of light crude oil (LCO) is likely to be affected by incidents. The Gulf War fought in the Middle East was one of the incidents that caused the price of the light crude to skyrocket to a higher amount. Disasters like the hurricane Katrina also caused the light crude to increase. In the beginning of 2002, the price of light petroleum was at $ 20 for a barrel.

It climbed to more than $ 70 at the close of August 2006 in the wake of hurricane Katrina. The release of 6 missiles in mid-2008 also caused the price of oil to rise to $ 78. At the writing of this article, the price of oil fluctuates within the range of $ 70 to $ 78 per barrels. May God help the common man on the raise of the prices of light petroleum and may God help USA and Iran to come to good terms because that will lower the prices of crude.

Diverging touchstones of crude oil

In US: The trenchant designation of heavy and light crude diverges. This is as a result of the categorization of crude which is founded mainly on practical bases more than theoretic. The New York Mercantile Exchange sets light petroleum which is produced in the US as containing an API gravity ranging from 37 degrees to 47 degrees. It determines the light crude oil which is produced outside the US as ranging from 32 degrees to 42 degrees.

In Canada: The government agency in Canada which is responsible for energy referred to as NEBC sets light petroleum as containing a density lower than 30.1 degrees.

In Mexico: Pemex which is an oil agency own by the Mexico government sets light petroleum as containing a specific API gravity of 27 degrees to 38 degrees.

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Source by Ositadimma Muodozie

Technical Indicators Will Make You a Successful Trader

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Trading indicators will help you predict the market behavior and, by default, make you a better trader. No trading chart should be created without some technical indicators to help a trader with his/her decision. In most cases, these technical indicators use old mathematical formulas applied to the current price compared to market conditions such as volume or momentum to determine the right direction of the price.

The technical indicators for Forex trading are divided in various groups. Among them, a momentum indicator can help determine the currency price direction. A volume indicator can also help determine price movement. Implementation of these indicators in technical analysis help traders determine the direction of currency prices and when to enter a trade.

Momentum indicators help determine when a trend is coming to an end and a new trend, more likely, is developing. Some of the most commonly used indicator are the commodity channel index (CCI), relative strength index (RSI), stochastic oscillator, and changes momentum oscillator. Relative strength index usually is responsible for the uptrend and downtrend move relation measurements. These measurements are indicated in three distinguished categories. This includes an overbought currency level that is from 70 upwards whereas at 30 or below, is an indication that the currency is oversold. The role of volatility, as an indicator, is to describe the effect of fluctuation on a currency price as it compares to the current price. According to research, the volatility indicators can be an excellent to help determine the state of market activity.

Currently, the best volatility indicators you can find in the market are chaikins volatility and Bollinger bands among others. They are able to provide and measure trend directions to the traders. This can be achieved in many ways which include a linear regression indicator and moving averages. According to research, a trader's perception towards these indicators signals will, however, matter as they may provide false signals on occasion.

The ultimate indicators will comprise of forecast oscillator, simple moving average, MACD, and, parabolic SAR. Just to mention, in a previous article, we discussed MACD at length.

The Volume Indicators

They are used for different functions in trading. This includes confirming trends and pressure in buying, selling and many more. In this case, the increase in volume is what will always determine the increase in price. A trader is, hereby, granted a chance to reversal if in case there is lack of indicators to confirm the volume. Preferably, it is important to use demand index, Chaikin volatility, and volume ROC for better results. They are stable with less fluctuation on the currency price, thus are recommendable for accuracy in your trading.

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Source by Luis Nieves

The Stochastic Oscillator Should Be a Part of Your Trading Toolbox

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The world of Forex trend analysis uses many technical indicators and Stochastic is one of them. The Stochastic Oscillator was developed by George Lane in the 1950s and has since become an essential tool for comparing the current currency price with the most recent highs and lows.

To understand how a Stochastic Oscillator works, let's take Stochastic (7) for example. In this case, it means the current position of the currency price is being defined by the analysis of the last 7 bars in relation to the corresponding high and low range of those 7 bars. 1 bar represents 1 day. So when the daily chart shows the Stochastic (7) being too close to the zero line, it means the current price has hit the all-time low level in the past 7 days. In case the same chart has its stochastic line close to 100, it means the current security price is at an all-time high in the last 7 days period.

According to the theory of technical analysis, the market is described to have been oversold if the stochastic line hits below the 20 point. If it hits above the 80 point, the market is described to have been overbought. However, you need to be careful not jump into conclusions. For instance, a stochastic line dipping below 20 doesn't always mean the market trend will reverse. It only serves to tell you that the currency price is close to the 7-day low. Your currency pair can unpredictably go down during the whole of the 7 day period or can stay flat only to dip on the 7th day and so on. Your currency can hit the 7 day low for various reasons but you can't be assured your stock will soar as a result.

Is Stochastics reliable after all?

The unpredictable swing doesn't mean Stochastics is an unreliable technical indicator for your Forex strategy. All you need to do is to know what it entails and how to use it. You need to carefully monitor the indicator once it gets above 20 after having a stint below that mark and when it gets below the 80 point after it has stayed above it for some time. This is a better way of making conclusions than simply making judgments once it drops below 20 or soars above 80.

A stochastic crossing the 20 point means that the currency price has just started rising after hitting the bottom but that doesn't mean it will keep that trajectory. At least, it shows that market sentiments have changed since hitting the bottom.

One last thing...

Just like other indicators, remember to pay attention to your currency pair's volatility because indicators tend to rely on it. Furthermore, it is prudent to use this indicator alongside others. The fact that Stochastics is based on price means you should consider using it in combination with a volume based Forex technical analysis.

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Source by Luis Nieves

Benefits of Hiring a Bitcoin Broker

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Bitcoin is a payment system that is gaining prominence in the financial market. It is gaining popularity because it is person-to-person payment system powered by users, but without intermediaries or a centralized authority. Payments are generally facilitated digitally. From users' standpoint, it is similar to cash payment system via the internet. In other words, it is cash for the internet. Furthermore, it can be advanced as a prominent triple-entry bookkeeping system. Ideally, investors are encouraged to know how to use its charts and calculator. However, this requirement can be eliminated by engaging the services of professional Bitcoin brokers.

The value

It is common knowledge it is improving the way transactions are being settled. The Bitcoin value relies heavily on how well the transaction fees are minimized; way below the transaction costs prevailing in the market. A professional broker understands better the value, which can help a great deal in ensuring sustained profits. The positive feedback being submitted daily on the benefits of brokers is creating a lot of enthusiasm. Many companies are relying on brokers because of the vast potential present within the arena of crypto currency. The system offers a quick and efficient way of executing financial transactions.

Advantages of the software

It offers a lot of payment freedom because it is possible to receive and send money instantly anywhere around the world and at any given time. The idea of bank holidays is not experienced, no imposed limits and no borders. Therefore, it enables traders to take control of their own money. Furthermore, it offers the benefit of very low fees. Payments are often executed with extremely small fees or no fees at all. Nevertheless, to gain from priority processing, it is advisable to cater for fees to guarantee a quick confirmation of financial transactions by the network. Furthermore, the brokers exist to help investors to process transactions. They also come handy in converting bitcoins into flat currency. Furthermore, they help with depositing funds into the investors' bank accounts daily. These services are often offered for low fees; lower than credit card networks or PayPal.

Acquiring the software

Bitcoin can be acquired as payment for products/services, by way of purchasing at the exchange or through the process of exchanging with another person near you. It can also be acquired through competitive mining. As you take part, you will soon discover payments via this system are much easier that making credit or debit card purchases. Furthermore, payments can be received without having a merchant account. All payments can be executed from an application on a Smartphone or computer, ones you enter the recipient's address and payment amount, before pressing send.

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Source by Imma Sila

Crypto Currencies Volatility, a Profitable Rollercoaster

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This year we can observe that cryptocurrencies tend to move up and down even by 15% of value on a daily basis. Such changes of price are known as a volatility. But what if... this is totally normal and sudden changes are one of the characteristics of the cryptocurrencies allowing you to make a good profits?

First of all, the cryptocurrencies made it to the mainstream very recently, therefore all the news regarding them and rumors are "hot". After each statement of government officials about possibly regulating or banning the cryptocurrency market we observe huge price movements.

Secondly the nature of cryptocurrencies is more like a "store of value" (like gold had been in the past) - many investors consider these as backup investment option to stocks, physical assets like gold and fiat (traditional) currencies. The speed of transfer has as well an influence upon volatility of the cryptocurrency. With the fastest ones, the transfer takes even just couple of seconds (up to a minute), what makes them excellent asset for short term trading, if currently there is no good trend on other types of assets.

What everyone should bear in mind - that speed goes as well for the lifespan trends on crypto currencies. While on regular markets trends might last months or even years - here it takes place within even days or hours.

This leads us to the next point - although we are speaking about a market worth hundreds of billions of US dollars, it is still very small amount in comparison with daily trading volume comparing to traditional currency market or stocks. Therefore a single investor making 100 million transaction on stock market will not cause huge price change, but on scale of crypto currency market this is a significant and noticeable transaction.

As crypto currencies are digital assets, they are subject to technical and software updates of cryptocurrencies features or expanding blockchain collaboration, which make it more attractive to the potential investors (like activation of SegWit basically caused value of Bitcoin to be doubled).

These elements combined are the reasons why we are observing such huge price changes in price of cryptocurrencies within couple of hours, days, weeks etc.

But answering the question from the first paragraph - one of the classic rules of trading is to buy cheap, sell high - therefore having short but strong trends each day (instead of way weaker ones lasting weeks or months like on stocks) gives much more chances to make a decent profit if used properly.

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Source by Mike Alexander

About the Bitcoin Market

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For those not familiar with what bitcoin is; it is basically a digital currency for which no banking system or even a government is needed. Open source software is used to operate the transactions. Many people are investing money in the bitcoin market because ever since it was introduced in 2009, it has become extremely popular among traders and investors. Even many merchants have started to accept bitcoins. For example, you can buy a web hosting service or even order a pizza with your digital currency.

When you are trading in the bitcoin market, you can trade anonymously. The currency is not tied to any particular country and there are even no regulations designed for it. Even small businesses are using bitcoins because there is no transaction fee involved in the exchange. If you have some savings, you can invest that money to buy bitcoins and to gain profit because the value of this digital currency is predicted to go up.

The market places where digital currencies are exchanged are called bitcoin exchanges. They are the places where people buy and sell bitcoins by using the currencies of their respective countries. You simply need a wallet software, open an account, and then buy bitcoins from the money you have in your account in order to become ready for the exchanges. People are even transferring digital currencies through their Smartphones. There are mobile apps available for this purpose. You can either purchase bitcoins from online exchanges or get them from special ATMs.

Mining is another option used in the digital currency market. It is a process in which traders have to solve mathematical puzzles to win bitcoins. It's a tough and time taking process, but if you get it right then you will win 25 bitcoins. This can just happen in 10 minutes.

Once you are into the trading game, you will get to store your digital currencies in a digital wallet. It will be your virtual bank account where you will store all your bitcoins. It is not necessary for you to disclose your name while you are exchanging bitcoins. You will trade with your bitcoin ID. It is meant to ensure privacy of the transactions. So, you can buy or sell anything and nobody can trace your transaction. The digital currency transactions are verified through cryptography. It is a series of mathematical algorithms, which can only be solved by powerful computing. That is what secures the system. So trading in the bitcoin market is purely safe and legal.

The system and the market itself have perfect control on how much bitcoins are being created. The system adjusts itself by making the mathematical problems difficult to solve and hence, only specific amount of bitcoins are awarded.

Bitcoin is not just some currency to invest your money in. In the near future, more and more businessmen are going to use it instead of credit cards just to avoid the transaction fee. It's going to be widely used form of currency in the coming days.

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Source by Emma A John

How to Get Bitcoin

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If you're looking to get into the game of Bitcoin and hold your own coins, there are many options available. Here are some of the different methods available for acquiring some Bitcoin of your own.

Buy them from an exchange

One of the most common ways to acquire bitcoins is through an exchange. Websites like Bitstamp, BTC-E, or Cavirtex here in Canada, allow you to purchase Bitcoin. They don't sell Bitcoin themselves, but how it works is the exchanges pair you as a buyer with a seller who's selling for whatever price you're looking for.

This sounds like a great option, and in some ways it is, but it has its disadvantages as well.

One of the major ones is that the exchanges require you to add your personal information to them via Know Your Client legislation that's present in many countries in regards to currency-related businesses. This might not be a concern for everyone, but in a post-NSA scandal era, it's becoming more and more clear, at least to me, that data you put out there is more accessible than you think.

I might be a little paranoid, but who knows what might happen in the future. After all, just ten years ago the idea that the government is spying on everything we do was purely the realm of tin foil hat conspiracy theorists, and now it's just common knowledge. Who knows what's next?

As you can tell, I'm not a big fan of the exchanges. The idea that I have to give up my personal information to an entity which might have to release that information seems to go against the spirit of Bitcoin.

Fortunately, there are other options.

Mine them

Of course, there's only one place Bitcoins really come from; mining. Every Bitcoin you'll ever own, see, or hear about, was at one point mined via the Bitcoin mining network.

If you find yourself in possession of a mining rig, go ahead and mine away! Or if you have a computer fast enough to make it worthwhile, that's cool too.

But be careful! If your computer isn't cooled properly, you run the risk of overheating it, which could potentially brick it.

Frankly, mining with your computer isn't really worth it. Not anymore. As the mining difficulty increases, it becomes more and more difficult to gain any profit from it. And unless you have a dedicated mining rig, your chance of getting any sort of return from mining is pretty low.

Some argue that mining is on its way out, and even buying a dedicated mining rig isn't really a valid option anymore. I disagree, but that's a topic for another day.

Buy them from a private broker

If you're able to find a private broker, you can hook up with them and exchange. This has some obvious benefits, but it also has drawbacks.

First off, it's completely anonymous. Even if you meet in person, there's no reason you need to use your real name, or any details about yourself other than your wallet number so they can transfer the funds to you. And if you pay cash, the banks can't trace it either. So if that's a concern for you, you're in business.

But of course with anonymity comes some risk as well. Dealing through an exchange, the risk of getting ripped off is lower. Of course, exchanges have disappeared in the past, taking everyone's Bitcoins with them, but the bigger, more established exchanges have had time to build their brand and prove themselves as more trustworthy.

You may pay a price premium for that anonymity as well. From my experience, it can be as much as 15-20% higher than average exchange prices. But again, if anonymity is important to you, that's a small price to pay.

When you trade with someone anonymously, you don't have the security of the exchanges. They could be legit and honest, but they could just as easily be shady and willing to rip you off. That said, buying from a private broker is my preferred method of purchasing Bitcoin. But it's important to have safety measures in place, otherwise you're leaving yourself open to getting burned.

Accept them as payment for goods and services

This one is so obvious, yet often people forget about it. Amidst all the investors getting involved with Bitcoin and the excitement around the movement, it's easy to forget that Bitcoin is not just a hot commodity or high value stock. It's designed as a form of currency. And if you run a business, you can accept Bitcoin as payment instead of cash.

There are many different businesses which accept Bitcoin as a form of payment. If you live in Canada, check out this directory of businesses which accept Bitcoin.

In fact, several directories have popped up to help people find local businesses which accept Bitcoin. And, if you're a denizen of the web (and if you're reading this, you obviously are), there are tons of places which accept Bitcoin as payment. Tiger Direct, Reddit, and WordPress are just a few of them.

In short, there are many different ways to acquire Bitcoin. Some are easier than others, but with so many options, you're certain to find something which works for you. Get into the game now, don't miss out!

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Source by Brad S Edwards

Comments: Online Bitcoin Trading: Discover The Keys To Earning A Formidable Income Trading Bitcoin

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First Steps in Understanding Volume Analysis and How It Leads Price

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Basically, volume is a measurement tool that reflects the overall activity in an instrument based on the number of buyers and sellers in the market. In other words, volume shows the enthusiasm of buyers or sellers during a specified period, as well as the liquidity of the instrument. Although volume may be displayed differently on charts, it is typically displayed as a single, non-directional, histogram which represents the total number of buyers and sellers for a given period. Non-directional means that as price is making higher highs or lower lows, the volume bars will typically be making new highs.

Typical volume indicators represent the overall number of buyers or sellers for each specified bar. A trader may look at this type of volume representation to evaluate the liquidity of the instrument. This tells him or her whether there is sufficient activity to enable one to enter or exit a position easily.

Volume can also be displayed as Volume Up (buyers) or Volume Down (sellers). This type of volume bar shows the volume displayed as two separate indicators, Volume Up (green histogram bars) and Volume Down (red histogram bars). By displaying volume in this manner, a trader can compare the buying volume to the selling volume for a specified period.

By comparing the two volume displays, a trader can assess whether there is more enthusiasm shown by the buyers or by the sellers during a specified period. In an uptrend, buyers should have more enthusiasm than sellers. When a market reaches a top, buyers will lose enthusiasm and sellers will take over. In a downtrend, sellers should have more enthusiasm than buyers. At the bottom, sellers will lose enthusiasm and buyers will take over.

The biggest issue for new traders, when studying volume, is identifying these specific patterns -- or volume divergence as it is referred to. The first step is simple -- understanding volume divergence.

Volume divergence is when price goes in one direction and volume goes in the opposite direction. For example, a few types of volume divergence that are revealed when using a non-directional volume indicator (all volume histogram bars are plotted above a zero line):

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  Price is making a higher highs
  
  
  
  • Volume is making lower highs



• Price is making equal highs
  
  
  
  
  • Volume is making higher highs



• Price is making lower lows
  
  
  
  
  • Volume is making higher lows



• Price is making equal lows
  
  
  
  
  • Volume is making higher lows

When volume divergence is identified, then the trader can expect an immediate short-term reversal. For example, when volume divergence occurs on the highs, the trader would anticipate a reversal to test for sellers. In order for price to reverse and create a downtrend, sellers must show interest. If no interest is shown, then price will continue on its original path.

As with most other trading indicators, volume can be as complex or as simple as a trader chooses to make it. Today, there are many types of volume indicators available. Some are based on averages of actual transactions of buyers versus sellers over a specified period. Others are based on order flow, a measurement of buyers versus sellers from actual order flow. Some are more complicated than others and there is no one volume indicator that is magical. The efficacy of a volume indicator is more dependent upon how well the trader can understand and interpret the volume at any given period than on the indicator itself.

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Source by Gail Mercer

Is the Bitcoin an Alternative to Fiat Currency?

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Recently there has been a lot of talk about a new virtual currency called the Bitcoin that is growing very rapidly, its gaining a lot of media attention and its value has increased dramatically.

The current financial turmoil in Europe and around the world has also made people invest in alternatives to fiat currency such as the Bitcoin. For most people it is strange that someone can take seriously a currency that is not backed by a Government or central institution, but that is the precise advantage of this coin.

Bitcoin developers spoke to the Guardian's James Ball at their home in central London and these were some of their comments:

Bitcoin is a virtual currency just like dollars, pounds, euros but at the same time we have a type of currency that isn't control by central institutions, its completely decentralized. I can send money to whoever I want, whenever I want, wherever I want in the world and no one can stop me.

The Bitcoin is a very interesting concept that is gaining acceptance by many companies on the internet like PayPal, WordPress, Reddit, Microtronix and many others. In fact ATM machines are already on the way to be used.

Some of the critics of Bitcoins say that they are facilitating buying drugs on the internet, the developers say that the virtual currency is just a tool and you can use it for good or bad.

Fiat currency has the disadvantage that central institutions can print as much as they want, therefore it is always losing purchasing power. The same principle applies if you have money in the bank. Instead what you should do is put your money on an asset that keeps its value or increase it.

At this moment the Bitcoin seems a good option because its increasing its value, however this can change in the future. Another alternative is to invest your money on something productive like a business or land that increases in value or invest it in gold.

Even though the virtual currency is a good way to diversify your portfolio and not depend on paper money or bank deposits, you need to look for a way to store value that is secure against financial hedge and the best option is Gold, because its the ultimate money. Gold has been a store of value for centuries and will always be, because its valuable, its limited in quantity, its easy exchangeable and its a store of value.

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Source by Ray Fristenson

Forex Megadroid Review - Performance Versus Price of Forex Megadroid Trading Robot

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Before purchasing a trading robot, you should understand how to rate a trading robot based on its performance and price. There are robots that are expensive but do not have the capability worth of its price. On the other hand, there are robots that are being sold for a small price but do not work well. This article will review a trading robot called Forex Megadroid, and will show you whether your $97 will be worth it for purchasing Forex Megadroid.

Forex Megadroid was released in March 31 2009, and since then, a lot of traders are already supporting this trading robot in return for the great results that this robot gave them. However there are still some people who are wondering whether this trading robot really has the capability to deliver the results that were promised, and re hesitating to purchase this trading tool. That is the reason why the developers of Megadroid offer a trial version that will allow its potential customers to try the product first before purchasing the actual product. The trial version will help you determine whether the robot really has the capability to enhance your trades and increase your profits.

$97 is not cheap, and it is normal to doubt a product first. However Forex Megadroid, is by far, the cheapest trading robot today, and will all the claims of its users, why not give it a try and see for yourself whether this robot really works. I have tried Forex Megadroid and I know you will still doubt me if I say that this robot really works. It will be best if you experience its performance first hand. As the saying goes, you cannot learn how to ride a bike just by reading a book about how to ride a bike.

After purchasing the actual product, you will be given a set of instructional videos that will show you how to install and configure the robot properly. Following these videos will help you have better results using Forex Megadroid. Aside form these videos; you will also be given a 60-day money back guarantee, which gives you the right to demand for a refund whenever you feel that Megadroid does not work well with your trading style.

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Source by Nicole Anne Smith

Choosing a Bitcoin Exchange

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The financial world has evolved over time, and now involves various complex exchanges. Among these advancements is the emergence of online trading whereby people can perform transactions on the internet with others who are thousands of miles away. In fact, the bulk of international business is carried out on the virtual platform where large amounts of money are transferred at the click of a button. Most businesses have online sites to cater to distant clients, while there have emerged businesses that are solely online and have no physical addresses.

Among these online exchanges are the use of bitcoins to trade in property and stock. It would be cumbersome to use them as an individual, and you need the help of a bitcoin broker. They are normally found in bitcoin brokerage firms that cater to clients' needs. The following are guides to choosing a bitcoin broker:

Liquidity

You will need to find a firm that is stable enough to handle your bitcoins to ensure maximum returns on your investment. The credibility of a broker is measured using the liquidity index. This is the ability of a firm to trade in your bitcoins and give profit while retaining its value. A broker with a high number of sellers and buyers has increased liquidity. To get the broker with the highest liquidity, search for the one that has the highest trading volume.

Cost of trading

Brokers rely on the volume of bitcoins to sustain their trade. The more bitcoins they trade in, the more the profit they make. They charge a certain percentage on the trader depending on the number of bitcoins. However, the method of calculating costs by way of percentage proves to be very expensive to the broker over time. Choose the firm that uses more stable rates to avoid sudden fluctuations in profit.

Proximity

The trade in bitcoins is a relatively new concept. This means that there are not yet any regulations governing their exchange due to its lack of highlighting by the media. However, some countries have started assuming control over the activities of brokerage firms to prevent the proceeds from being channeled into illegal business such as drug, money laundering and fraud. Choose a firm that is nearest to your locality to enable fast contact in case of anything.

Accessibility

Being an online exchange method, bitcoins are prone to hacking by malicious parties. Hacking would be primarily to alter figures, cause a drop in the value of bitcoins, and profit the hackers. Choose a firm that uses the latest anti-hacking software to ensure the safety of your money.

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Source by Simon M Kate