How does the SHI Channel indicator work?
The SHI Channel indicator and as the all of the channel indicator uses the highest high and lowest low of the price to determine the upper and lower bands of the channel.In the SHI Channel The channel is calculated according to the given period of calculation and the time frame of the used chart, and the channel is self-adjusted (Like the Bollinger Bands).As you see in figure 1 there are two thick lines that indicates the upper and lower channel and a dashed center line.
The channel gives the overall direction of the price movement - up or down - and may change from time to time, specially if it used with a low timeframe (1, 5 and 5 minutes).
How to trade using the SHI Channel indicator?
Actually you can’t trade with the SHI Channel indicator alone, it will not tell you when to enter the trade neither when to exit, The SHI Channel indicator telling you the overall direction of the price trend and the channels with the middle line warn you how much the trend is strong or weak, however , you have to use another indicators to generate the entry/exit signals
So.. for entry and exit.. i will use chart pattern.. you don't have to be an expert in chart pattern.. to make hundred bucks a month in fx.. i only focus on double top or bottom pattern, head n shoulder pattern, inverse Head n Shoulder, Ascending and descending triangle (the breakout of these triangle at 4h can give you about 400 pips)
Simple yet powerful things of how 5% traders win the Forex battle
2 comments Posted by sara carter at 8:21 PM
Forex market is actually a battle field. You can win or lose in the forex market. It pays you to have a good strategy, discipline, Money Management, logical analysis and the right decisions.
Good strategy
Logical, good strategy is critical for you to survive in this battle. You have to be able to determine the right moment to entry and exit the market. Prepare for the worse; you have to have Plan B when price movement against you or it will kill you.
Discipline
Once you have your own strategy, then apply it and be discipline on use it. Entry the market when your strategy said so, and exit from the market when your strategy says so.
Money Management
This is important for you to get survive in this battle. Use only money where you can afford to lose. Consider that money management is important for long term of your trade.
Logical Analysis
Even currencies prices follow economic law:
High demands = Prices up
This pays you to trade using logical analysis and not wish.
Say, for example, my indicators give fake signals. Hence, I have to exit from the battle. I would rather lose in my stop lose than wish that the price will return over and then rob all my money.
Right Decisions
The rights decisions are not always make you win in the battle. It sometimes makes you to be a loser in some trades, but as a whole, it makes you to be a winner. The most important thing from this stage is how you learn from your lose and make your trade better and better.
Whether you plan to trade on the foreign exchange marketplace (Foreign exchange) or in the stock marketplace you will need to have some knowledge on two basic forms of analysis: fundamental analysis and technical analysis. Traders will transfer their money out of the stock market when interest rates rise, which can cause the currency of that country to weaken. The foreign exchange market is a cash interbank/interdealer market.
Major news is released publicly, often on scheduled dates, so many people have access to the same news at the same time. In the broader sense, currency correlation can refer to the correlation between any currency pairs and the commodities, stocks and bonds markets. A country’s economic health is directly measured by economic reports. The foreign exchange (currency or foreign exchange or FX) market exists wherever one currency is traded for another.
Surpluses and deficits in trade of goods and services reflect the competitiveness of a nation's economy. The world's currency markets can be viewed as a huge melting pot: in a large-scale and ever-changing mix of current events, supply and demand factors are constantly shifting, and the price of one currency in contrast to another shifts accordingly. Interest rates and the strength of the economy are the two primary causes that determine the availability of a currency. Remember that economic indicators gauge a country’s economic state, changes in the conditions reported will directly affect the price and volume of a country’s currency.
Different dealers offer very different deals to their customers. A broker is any person or firm that charges a fee in exchange for executing trades for a trader. A Forex broker is paid according to the spread or the difference between the traders bid for a currency, and the sellers asking price for that currency. A Forex broker does not charge a commission for placing a buy or a sell order the way a real estate broker would charge a percentage fee of the total price of a sale.
When two markets are open at the same time, trading is busiest during those timeframes. The Forex market is open 24 hours a day; however it isn’t always active during those 24 hours. Currency trading happens continuously throughout the day; as the Asian trading session ends, the European session begins, followed by the North American session and then back to the Asian session, excluding weekends.
The loan (influence) in the margined account is collateralized by your initial margin (deposit), if the value of the trade (position) drops sufficiently, the broker will ask you to either put in more cash, or sell a portion of your position or even close your position. The bare minimum security (margin) for each lost will vary from broker to broker. A margined account is a leverageable account in which Forex can be purchased for a combination of cash or collateral depending what your brokers will accept.
A market order is an order to buy or sell at the current marketplace price.
When you are doing your research of the brokers, check to see what kind of trading tools and analysis data they are offering. The diverse selection of execution venues such as internet trading platforms has also made it easier for retail traders to trade in the forex market.
Generally, the more healthy and robust a country's economy, the better its currency will perform, and the more demand for it there will be. Reports released by the government that detail a country’s economic performance are economic indicators.
Strange And unbelievable!
Meta Trader 4 has the option that you can enter more than type of account for different brokers through the same platform.
For Example If You installed SigmaForex Platform, you will find in your drive C:/ the following Pass: [C:\Program Files\MetaTrader – SigmaForex]
If you installed another Meta Trader 4 for another broker a conflict can be occurred because 2 Meta Trader 4 but for different Brokers.
Let's Continue our example with another broker like FXCM or Interbankfx or Swiss Global Broker. All of them are using Meta Trader 4 as trading station. Let's Install FXCM Software.You will find this pass in your Drive C:/ [C:\Program Files\FXCM Trader 4]
N.B: Some Versions of windows copy the same folders while installing the same version of the software .
That You may find FXCM installed inside SigmaForex & this one from the disadvantage in Meta Trader 4 & Meta Quote published this issue in their FAQs to be available for Traders to solve the issue.
The Solution is to open the platform that you are using e.g.: SigmaForex. Then Open A folder called Config. [C:\Program Files\MetaTrader - SigmaForex\config]
You have to erase All SRV files for other brokers & just leave SigmaForex-Demo.svr and SigmaForex-live.svr
And here's the post of the Meta quote from their website:
"Client terminal allows you to connect to any MetaTrader 4 Server. If you connected to another company's server from your client terminal, the parameters of that connection were stored in a special configuration SRV file in the "\MetaTrader 4\config\" folder of the client terminal.To remove foreign servers from the server list of your client terminal, just go to the "\MetaTrader 4\config\" folder of the client terminal and delete the unnecessary SRV files."
How to use SHI Channel?
Now we will explain how to trade with this method step by step.
Step 1. Open GBP/USD chart and use 30M Timeframe with candlestick pattern.
Step 2. Attach SHI Channel indicator, the Stoch (5,3,3) and RSI(7).
Please see the figure below to make sure that you have a right chart :
Wait for the price touch the lower/bottom line of SHI Channel, check the other indicators mentioned above, if it has an oversold condition at the same time we could enter buy order with TP 20-50 Pips. Check the example below :
As seen above, GBP/USD have an oversold condition at May 23 2007 and our indicators offering buy signal. We could put buy order at closing of bear candle or at price 1.9723 with TP 50 pips (1.9773) and SL 40 Pips (1.9683).
We will see how this method working :
As figured above our buy order hit the TP 50 pips at price 1.9773. Now we will learn to catch the sell signal.
Sell Signal :
Wait for the price touch the upper line of SHI Channel, check the other indicators mentioned above, if it has an overbought condition at the same time we could enter sell order with TP 20-50 Pips, as figured below :
In the chart above GBP/USD have an extreme overbought condition at May 23 2007 and our indicators offering sell signal. We could put sell order at closing of bull candle or at price 1.9888 with TP 30 pips (1.9858) and SL 40 Pips (1.9928).Once again we will see how this method working :
Yup, our 30 pips target price executed at 1.9858. So totally we have 80 pips form both buy and sell order in one day.
So simply method?
Yes, this method is simple and profitable, especially we have sideaways market. But please note that the strong signals is only generated when price touch Top/Bottom line of SHI Channel and the other indicators have an overbought/oversold condition at the same time also an extreme overbought/oversold are highly recommended to enter the market.*
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