5/11/12

The nature of the movement of prices

The nature of the movement of prices

Of the things that will immediately grasp is that the nature of the movement of exchange rates are not progressive and continuous.

This applies to the movement of exchange rates as applied to the movement of stock prices and goods and all that is traded in financial markets.What do we mean by that?We mean that even if the price of a currency will rise100 points in 5 hours, for example it will not rise beyond the hour and minute and hour and a minute behind, but the height Satakllah a lot of dips ..!!But rising wholesale.If we assume that the price of the euro nowEUR / USD = .9800, and was expected to rise 100 points will be any euro EUR / USD = .9900 within 5 hours.Even if true, the expected price movement may be as follows:Price now.9800 EUR / USD =Then price will fall for about ten minutes to be upEUR / USD = .9780 which dropped 20 points from the first price Vtkon floating your loss = $ 200 if you bought 1 lot on the price first.And then rise for half an hour to be up to the priceEUR / USD = .9845 which it rose 45 points from the first price and becomes a floating profit = $ 450.Then will drop for half an hour to be up to the priceEUR / USD = .9790. Any dropped 10 points for price first and now consists of floating your loss = $ 100.And then rise for an hour until it reaches theEUR / USD = .9860 which rose 60 points for price and be the first floating profit = 600 $.And then falls to a quarter of an hour until it reaches theEUR / USD = .9815 and becomes a floating profit = $ 150 after that was 600 $.Then you may go back up to strength to reach for the priceEUR / USD = .9900 after five hours as we expected.Thus, price movement continues in the low and high hours behind the hour, but that rises to bulk up to what we expected, was far beyond our expectations.As you can see it is like to climb the AC..!!That is the cause of headaches..!!

When you open a transaction often find yourself a loser and then become a winner and a loser back then suddenly turn into a big winner..!!!Therefore many of the novices feel dismayed when price begins to decline Fajova that the price continues to decline may decide to sell a loss and close the deal so quickly for their losses Atzdad. And thus become a real loss to the loss because they have completed the deal and switched them off.But may then return the price to rise and become winners after they were losers..But it is too late after the deal has closed a loss if they are patient turned slightly to the loss of floating profit and then they were able to close the deal winners rather than losers Aglqoha..!!It's all dependent on your trust in your prospect If you are aware of the safety of your prospect will not be afraid that something dropped the price a bit, Because you are confident that he will return to rise shortly after.This is your prospect and will be based on analysis of price movement by using the techniques of technical analysis and news, which we will talk about later.It's like a game of biting fingers..!!Of them will win be able to develop and pursue its analysis and risk management techniques..Win and carry the force of the nerves and calm the psychological and self-confidence...This requires experience and long practice and see.. It is worth the effort it ..Millions in front of you and all you need is to learn how to earn as much as possible..!!Corrective movementRetracement or Correction

When following up the movement of exchange rates often you will hear about that"Currency Fulani movement corrective move."This is the nature of the natures of the price movement, what the intended corrective movement?Are the same nature for the gradual movement of the currency in which we talked about, but often within a wider time frame.For example,:If it was destined for the euro to rise within seven days of 820 points, for example, may rise as follows:On the first day180 points.On the second day150 points.On the third day240 points.In a fourth day the price drops120 points.On the fifth day the price drops50 points.On the sixth day the price rises200 points.In the seventh day rise220 points.As you can see the total Artfh euro from the first day of the seventh day is equivalent to820 points. And he was on the rise with the exception of the fourth day and fifth day, where the price fell in them some thing to come back before the rise later.Called the price movement in the fourth and the fifth movement of the correct priceRetracement.Be a movement in the opposite direction to the general price movement.You can be perceived as if the market takes a break after the breath may be a move strongly in one direction for a period of time to complete walk towards him after the price of a new.Of course, this break is not a requirement to be in fourth or fifth day may be at any time and no one knows exactly when it can occur, But when the price moves in one direction and for a period of time and it is strongly expected a correction in the price and the price remains as to walk in the direction of non-stop near the greater the likelihood of a corrective movement.

Why is it important to know this truth about the price movement?When you know this fact and see that the price of a currency on the rise for several days may consider the purchase of this coin, but when you see that this rise has been severe and rapid and sustained it is better to wait a bit before buying because it expected a correction in the price of the currency to go back and go down a bit before re- rise, It would be smart to buy the currency at that moment because you have bought more at a low price.And vice versa in the currency drops rapidly and continuously, and continuous, where the correction will beCorrection is the high bit rates continue to fall again later.At this stage do not have to worry too much if you do not understand the policies included in this page soon to begin practice will understand all this, and clearly and you will see for yourself how prices move currencies and have we mentioned the nature of price movement here for your reference, it is not more the you can not Mnfem meant by this Flabos now you will understand everything a little practice

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