Improve Trading Skills

Written by JS T. Alexander | 13 March 2010

Identifying reports that weigh more in the market place.

The recent retail sales figures were better than most have expected. Although, the University of Michigan numbers were not as significant showing a slight decline on consumer confidence. The mix report have not change any real sentiments in the market as it was waiting for the report and hopefully create a market volatility which everyone was hoping for.

As there has been lack of interest from the previous market movements since most traders are reluctant to create and additional positions. The decline on the Euro and the British Pound has been in the limelight since the Greek financial crisis erupted in the news and the huge Euro sales in the open market equivalent to 12Billion versus the US dollar.

The irony for that matter is that a breaking news report came out from JP Morgan's market outlook on a negative US economy in the near term and even making an unsolicited and negative Euro direction before the retail sales report. For some analyst following fundamental market reactions would be skeptical as to why such reports from JP Morgan would come out prior to a major report. Is it a balancing report outcomes  whenever one may be positive or negative. Sometimes we wonder, as currencies are susceptible to market news and reacts from such reports. Weighing which one will heavier than the other is what needs to be understood.

However, the end-result of having the USD move and corrected slightly lower in spite of the overall good news was prominent during the late trading hours in the US session. Remember, that news coming out on the last 2 trading days of the week may sometimes fall short of the traders reaction. As trading sessions are shortened from the time the reports are out in the open market. On the other hand, spill overs on the next trading week would be anticipated, but may not be have as much as a significant impact to the market prices if it was within the middle of the week.

Traders taking position trades based on a fundamental report may find themselves in an awkward stance within a certain time frame with trading volumes may be declining more often, than any build-up specially at the last trading day. Position trading a few days before or a lack of any major news may even be an advantage. Whenever a trade is correctly in place and additional momentum occurs through volume build up, could only confirm a profitable trade is made. Meanwhile, that position is way ahead of the crowd just getting in with new open trades while your about to get out on a profitable settlement. For others, maximizing a profitable trade maybe called as being greedy. But by applying hedging and /or averaging positions with other currency pairs that would protect and maximize these positions may also be more logical than being greedy.

Upgrading a trader's skills to act and think more like a strategist could only be to one's advantage rather than the opposite. That is why, developing a sense of market timing whenever three of the 4 major chart parameters are mostly in line with each other may be your best way of keeping track of successful trades. Until such time that this methodology can be built within your personal trading system then one would know that you have improved your trading skills. A set of trading platforms and formats maybe harder to re-formulate an equation as time tested trading hours for them to be called successful may take a significant time and money for that matter. Once these trading skills are in place, you will find the results in your bottom line and the equivalent dollar value together with it.