No this isnt a fashion blog or even referring to my interest in short skirts, but an interesting market connection.

The hemline index was first identified in the early part of the last century. When times are good then skirts are shorter and when times are tough then hemlines fall.

What has now been identified is that there is a lag time between market moves and fashion as it takes time to design and prepare new fassion ranges.

The expectation for 2012 is ankle length skirts!

so keep an eye on the new season fashions

Happy trading

Ian Newton

A few nights ago I watched the documentary on Jessica Watkins, the 16 year old Australian girl who recently sailed around the world by herself.

It wasn’t the severe lightening storms the got her down, it wasn’t having her tiny boat flattened several times in huge seas. It wasn’t having a wet bed and boring packaged food.

It was the times in the southern ocean when she was becalmed. The boat would just sit in one place rocking back and forwards, for days on end. This would drive her nuts and has historically proven to be one of the biggest problems faced by sailors.

So to is it with traders. Times of sideways market activity can drive us nuts. The big danger is looking for trades when real trades don’t exist. At this time the market is doing this for medium term currency traders.

It is time for patience, this can be hard when you are trying to earn a living. However it is far better to make no money than to lose, just to be in the market.

Don’t forget! No position is a position. After all you have made a trading decision to sit on the sidelines.

Happy trading

Ian Newton

Anyone trading at the moment must be wondering what is going on. Good news gets only a minor response on the Dow, bad news isn’t having the impact it should do.

But what is noticeable is that the steep trendline has come to a head on the weekly chart and could easily be broken to the downside. There is still a lot of bearish sentiment. Of course reading tea leaves could be as easy as reading charts at the moment.

Of course the market could just as easily surge upwards. This is the ever present reality of trading and why trying to predict the future is so dangerous.

Happy Trading

Ian Newton

One of the most frustrating aspects of trading is being right but you are stopped out, then the market moves to your earlier profit target.

It’s easy to think that the market is against you, or that you are just unlucky, but the fact is the market is just the market and that you actually got it wrong and right.

You were wrong in your timing but you were right in placing your stop and sticking to that decision. It may sound weird but you should celebrate the stop being taken out.

Why? Because there are a lot of traders who took the same trade but didn’t place the stop. Some of these will have taken a bigger loss than you did, but of course there will be those who didn’t have a stop and held the trade until it finally made a profit.

They may see themselves as trading legends but in fact they are lucky fools! Sometime soon they are going to blow up their account.

Take your wins, take your stop outs and just keep on trading

Happy Trading

Ian Newton

It can be hard for newer traders to have patience when the market conditions change. Mt Forex system doesn’t identify as many trades during times of high volatility. Of course the temptation is to change my trading criteria. But my system works well.

Of course the whole idea is to trade and make profits, but a system which tells you when not to trade is just as important as the when it gives you signals. It’s like the gaps between musical notes.

So be patient, sit back and relax there are always plenty more trades to come. The big danger is bending your rules just to be in the market.

Happy Trading

Ian newton

I frequently mention the importance of stress management in trading. In fact it is most of the game.

No matter how long you have been trading you can have times that will really test your emotional reserves.

We trade a variety of financial instruments and have several accounts. Just a few weeks ago we opened and funded a new account for the purpose of trading futures. 6 days after funding that account the firm announced it was bankrupt.

This really got our attention, I only knew because I read it in the paper. I nearly choked on my coffee. The truth is it was a criminal action to accept our funds when they did. We did the follow ups via the firm which is handling the receivership. The fact is we will be unlikely to ever recover any of our funds.

So could we have done anything about it before hand. No. So what are we left with. We have 3 choices.

1. Rant and rave and winge to anyone within ear shot.

2. Stop trading and close all our accounts because noone can be trusted.

3. See it for what it is, and get over it by using stress reduction methods.

Which of the 3 methods do you think will be better for me and my future trading!

Happy Trading

Ian Newton

What do ships have to do with market movements? In the world of trading there seems to be an index for everything. So it’s not surprising that there is an index which measures the cost of shipping and the tonnage being moved around the world at any time.

The Baltic Dry Index was originally a gauge of the amount of dry goods being shipped. i.e. the amount of goods not damaged by water in the holds of the ships.

Now it tends to reflect the amount and cost of resources being moved from sellers to buyers. e.g. During the early days of the GFC the index was low as China slowed in its use of raw materials as it’s building boom slowed.

At this point the Baltic Dry Index has suffered it’s 32nd consecutive day of lower lows. What does this mean? Well the bears seem to be very keen on a second dip, maybe yes, maybe no, time will tell, but this single indicator seems to be pointing that way.

It is important to not make your decisions based on a single indicator, to manage your trading and your stress you need to decide which information you will pay attention to.

Happy trading

Ian newton

Another trading style is to learn how to react to the changes and volatile nature of many markets. This is like learning to play squash. Running, stopping, turning all the while keeping your eye on the ball, while quickly planning where to hit the ball to win a point.

This second style develops the trading muscles and the neurological connections required to survive in the fast paced environment of day trading.

Predicting the future, is another kind of skill. Apart from the people selling courses, I’m still waiting to meet anyone who makes money out of it!

For More info on Day Trading CLICK HERE

Happy trading

Ian newton

It is well worth shopping around. Once you have an idea of roughly how many trades you might take in a month you can do some comparisons.

It is important to note that the quality of your platform is also part of your brokerage. a poorly functioning platform with limited applications will take the gloss of what may seem like discount brokerage.

Shop around, do compare and talk to other traders about their experiences.

For more info on Day Trading CLICK HERE

Happy Trading

Ian Newton

I’m sure an experienced trader will find this to be of no particular difficulty, but I would advise caution for new traders.

In the early days of trading you are more likely to experience stress. You are still learning the ropes, how your platform functions and how to respond to rapid changes in the market. I would suggest that this can be more easily managed from a regular size computer, where you can sit back and take in all the information on a large screen.

Also you are far less likely to make an error on a keyboard than on a cell phone. Trading can be a difficult and stressful process, I would question adding another variable such as a small screen and keyboard as found on a cellphone.

For more FREE info on daytrading CLICK HERE

Happy Trading

Ian Newton