Money Flow Trading Method along with Risk Management

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4. Dec 18, 2016 4:20pm

1. BenjaminIs
2. | Commercial Member | Joined Dec 2014 | 4,157 Posts | Online Now

UPDATE ON TRADING COURSE !!! I have 3 Forex Traders now and have space for 3 more so Welcome Aboard !!!

Good Morning

We now have three demo accounts open with FXCM UK. I want to welcome our third Forex Trader.

Hello Benjaminis,

Opened an account with FXCM as required.


Dildubai

Now what I need you to do is to set up the 16 currencies pairs that we use. If you have any questions just post them here and if need be I will access your platform and help you. For the moment we are standing clear until the dust settles. One of my TOP Trade Plans is to short US 30.

When your pairs are in place please post here and I will suggest your first Trade Plan. Each Trade Plan is using in groups of three positions so when I give the green light to SHORT US30 (Dow) then your first position will be scaled in and you will enter a STOP LOSS of $1000 US so you know your MAXIMUM LOSS and if you were to lose your DEMO FUNDS on your 3 positions YOU KNOW in advance your MAXIMUM LOSS is $3000 US which is 6% of your Total Trading Capital.

If and when the Dow goes to 19,000 probably during 2017 then your profits will approach $10,000 US a Trade Position. Of course we do not need to be greedy so once your position is entered you enter a Limit Out and then go enjoy your day instead of sitting in front of your monitors 8 hours a day.

Here is the 5 Minute chart on the US30 (Dow) from Finviz

http://finviz.com/futures_charts.ashx?t=YM&p=m5

https://www.forexfactory.com/brokers.php?broker=fcm

http://www.fxcmukdemoaccount.com/

CLICK HERE TO OPEN $50,000 US dollars Demo Account

https://www.fxcm.com/uk/forex-tradin...2xQJ1SWabw_wcB

Enter Account With Currency in US dollars.

Post here your account number and send me your 4 number password so that I can log on to your account and set up your platform for you.

PLEASE POST ANY QUESTIONS THAT YOU HAVE HERE ON THIS THREAD !!!


Benjaminis

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4. Dec 20, 2016 11:31am

1. BenjaminIs
2. | Commercial Member | Joined Dec 2014 | 4,159 Posts | Online Now

Quoting dttsomh
{quote} Can you elaborate on which ones are actually relevant and which ones will just confuse us beginners more than needed? Is Price Action enough if we don't rely on indicators for entries? I'm taking my time to re-read everything at least 2-3 times because FUNDAMENTALS are very new for me, all I did before was looking at technicals and didn't even focused much on price action (as I should)



I am taking a few minutes to answer your questions. It is very very important for anyone interested in learning how to make money trading Forex to ask questions. I again encourage all traders viewing this thread called Money Flow Method and Risk Management that I started on December 3, 2016 which was 17 days ago to ask questions in order to learn. There is no such thing as a stupid or dumb question. Asking questions is the only way that we can learn.

Now to dttsomh and his question.

Can you elaborate on which ones are actually relevant and which ones will just confuse us beginners more than needed?

Benjaminis: First we establish which currency pairs are in our Trade Plan. In previous posts I have stated the only 3 currency pairs are in my Trade Plans. They are as follows;

(1) Short US30
(2) Short USD/JPY
(3) Long Gold and Long Silver

We short $100,000 US of US30 or 100 units. We short $100,000 US of USD/JPY or 100 units. We go long 100 OZ of Gold and we go long 5000 OZ of Silver.

That is it !!! For the next three months we trade NO OTHER CURRENCY PAIRS.

Is Price Action enough if we don't rely on indicators for entries?

Benjaminis: The reason that most Forex traders lose is because they only rely on Price Action and Technical Indicators the odds are that you will not get to the level of the 5% winners. I do not say that Price Action and Technical Indicators are not needed.

On a scale of 100 here is what you need to have in order to become part of the exclusive 5% Forex Trading Club.

25 - Human Psychology (If You do not have the discipline to control your FEAR and your Greed and your EGO just forget about trading anything because those three emotions will always win)

25 - Fundamental Knowledge (This is my Money Flow Method and it is different from just normal fundamental knowledge)

25 - Fundamental Knowledge (As an example of this what happens in the next 11 days with the oldest bank in Italy (MSP) which is now on life support is a very important fundamental as it has the possibility to cause MAJOR DAMAGE to EUR/USD and the Eurozone)

25 Skills in using Price Action and Technical Indicators



I'm taking my time to re-read everything at least 2-3 times because FUNDAMENTALS are very new for me, all I did before was looking at technicals and didn't even focused much on price action (as I should)

Benjaminis: I hope that I answered all your questions and as long as you put in the time and effort as you have done the odds are good that you will have the opportunity to join the Forex 5% Club.

I might not post again until later this afternoon after the North American Markets close. Thank you for your interest and cooperation.


Benjaminis

OPEN YOUR FXCM UK DEMO ACCOUNT PLEASE !!!

https://www.fxcm.com/uk/forex-trading-demo/


Benjaminis

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4. Jan 23, 2017 2:25pm

1. Fader123
2. Joined Feb 2016 | Status: Member | 933 Posts

This is a really good thread and what FF needs proper fundamental analysis
By really going into it you become aware of what is likley to happen in the future
So when things happen you are already in the trade
Obviously it is important to focus on the things that the market is looking at
Look forward to swapping ideas
The Curve is the Oracle

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4. Jan 2, 2017 2:04pm

1. BenjaminIs
2. | Commercial Member | Joined Dec 2014 | 4,162 Posts | Online Now

Now for my Technical Forex Trader Friends let us study and understand the following;

http://www.investopedia.com/articles.../02/042202.asp

Snippet:
http://i.investopedia.com/inv/articl...e/AXP2_SAR.gif

SAR: United It Stands
Given the mechanical properties of the parabolic SAR, it is no surprise that it is a favorite among traders who develop their own strategies. In trading, it is better to have several indicators confirm a certain signal than to solely rely on one specific indicator, so most traders will choose to compliment the SAR trading signals by using other indicators such as stochastics, moving averages, candlestick patterns etc.

For example, a reversal of the dots from below the price to above is much more convincing when the price is trading below a long-term moving average than when it occurs when the price is above the moving average. Having the price remain below a long-term moving average suggests that the sellers are in control of the direction and that the recent reversal could be the beginning of another wave lower. Furthermore, a signal is considered stronger each time that an additional indicator confirms the same trend. For example, diving into the American Express example again in Figure 3, you'll notice that the parabolic SAR indicator triggered a sell signal (black arrows) each time it neared the resistance of its 50-day moving average (green line). Traders would also take note that the stochastic oscillator crossed below its signal line around the same time as the SAR signals (shown by the red circles). The simultaneous sell signals are then used as confirmation of a move lower. (For related reading on combining strategies, see MACD And Stochastic: A Double-Cross Strategy.)

Read more: Introduction To The Parabolic SAR | Investopedia http://www.investopedia.com/articles...#ixzz4UdIIyZPm
Follow us: Investopedia on Facebook

Bottom Line
The parabolic SAR is a fairly good tool for traders looking for a strategic method of gauging a stock's direction or for portioning a stop-loss order. As illustrated above, this indicator proves to be extremely valuable in trending environments, but it can often lead to many false signals during periods of consolidation. This indicator is simple to implement into any strategy, but like all indicators, it is usually best if it is used in conjunction with other indicators to ensure that all information is being considered. (For further reading, see our Technical Analysis Tutorial.)

Read more: Introduction To The Parabolic SAR | Investopedia http://www.investopedia.com/articles...#ixzz4UdIiMFYJ
Follow us: Investopedia on Facebook

Comments from Benjaminis: I expect some comments and inputs from our Technical Forex Traders here. Maybe even We can convince Rockey007 to return as he was a big help and Asset for us when he posted here.

http://www.investmentwatchblog.com/g...-more-than-20/

Do you believe that we will see banks on the brink of failure during the next financial crisis? Or are they safe now?

In one of the most volatile years on record, we are see a story split in two. Depending on the information you acknowledge, stocks are looking weak, the economy is struggling, and the fear of contagion is very high. If you choose to ignore reality, there are a handful of statistics that look quite modest. But you didn’t want to be lied to, did you?

Markets: Indexes, Bonds, Forex, Key Commodities, ETFs
www.cnbc.com/markets/
Stocks broke key level and could aim for the year’s low
www.cnbc.com/2018/12/14/stocks-broke-key-level-and-could-aim-for-the-years-low.html
After the most volatile year on record, strategist sees more to come
www.cnbc.com/2018/12/14/after-the-most-volatile-year-on-record-strategist-sees-more-to-come.html
2018-12-14_11-18-55.jpg (890×421)
www.zerohedge.com/sites/default/files/inline-images/2018-12-14_11-18-55.jpg?itok=1giqpZKe
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www.zerohedge.com/sites/default/files/inline-images/2018-12-14_11-12-29.jpg?itok=Ok4OyDvl
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www.zerohedge.com/sites/default/files/inline-images/2018-12-14_11-14-34.jpg?itok=NlMw5_Te
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www.zerohedge.com/sites/default/files/inline-images/2018-12-14_7-07-35.jpg?itok=ufiQObAm
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www.zerohedge.com/sites/default/files/inline-images/2018-12-14_7-09-53.jpg?itok=2e7it69I
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www.zerohedge.com/sites/default/files/inline-images/2018-12-14_7-19-51.jpg?itok=tvkp-2uq
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www.zerohedge.com/sites/default/files/inline-images/2018-12-14_7-39-29.jpg?itok=jbJ9NayB
MW-HA177_tumblr_20181212110402_NS.jpg (500×327)
realinvestmentadvice.com/wp-content/uploads/2018/12/MW-HA177_tumblr_20181212110402_NS.jpg
BBB downgrades dec 14 2018.jpg (573×393)
www.zerohedge.com/sites/default/files/inline-images/BBB%20downgrades%20dec%2014%202018.jpg?itok=u_ytHMla
Saudi Arabia Pumps Up Stock Market After Bad News, Including Khashoggi Murder – WSJ
www.wsj.com/articles/saudi-arabia-pumps-up-stock-market-after-bad-news-including-khashoggi-murder-11544727772

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4. Mar 9, 2018 7:59am

1. BenjaminIs
2. | Commercial Member | Joined Dec 2014 | 4,165 Posts | Online Now

http://traderfeed.blogspot.ca/2018/0...actice-of.html

FRIDAY, MARCH 09, 2018
A Surprising Best Practice of Successful Traders
https://3.bp.blogspot.com/--43QjrGvb...20/Mastery.jpg
Here's an interesting observation I've made about traders who are doing well recently versus those not doing so well:

It's not just the quality of the trades that distinguishes the successful trader, but the quality of the time during market hours when they are not trading.

The least successful traders are glued to screens throughout the day and have very little structured, quality time away from the screens.

The more successful traders take breaks during the day and keep themselves fresh and focused.

The most successful traders have a structured non-trading process during market hours. They are just as plan-oriented in their non-trading time as in their trading time. When markets are open and they are not trading, they have processes they follow to identify new opportunities and to maintain their performance zone.

Productively planning and structuring your non-trading time: that is an unappreciated best practice. The great traders are highly productive when they are *not* trading. A big step that can move your trading forward is to start keeping a report card where you grade the quality of your time during the trading day when you are nottrading.

On Monday at noon EST, I'll be joining Jigsaw Trading for a free webinar on three psychological techniques to improve trading psychology. In that session, I will go into detail about specific practices I see best traders engaging in during non-trading hours. Registration for the session can be foundhere; I hope to see you there!

Brett

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4. Mar 11, 2018 9:52am

1. BenjaminIs
2. | Commercial Member | Joined Dec 2014 | 4,166 Posts | Online Now

Forex Market Hours

www.forexmarkethours.com

also

http://fxtrade.oanda.com/resources/fxmarkethours/

There are at least two reasons why you should track the major forex market trading hours:

 

1. The first hour after a major market opens is considered very important and often indicates how the session might develop.
2. In periods when market 'trading hours' overlap, liquidity tends to increase because more traders are participating in the FX market.

In case anyone here reading any of these articles or my comments has any questions please feel free to post your questions. No question is stupid and you can only learn by asking questions. I see now that there are 10 traders reading this and only myself is a member so it is simple and easy to register so that you can post anywhere in Forex Factory and also enter into a discussion with me on these important world changing issues if you care to. Have a good evening.




Benjaminis

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4. Mar 11, 2018 10:02am

1. BenjaminIs
2. | Commercial Member | Joined Dec 2014 | 4,167 Posts | Online Now

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4. Dec 10, 2016 4:31pm | Edited at 5:26pm

 

1. BenjaminIs
2. | Commercial Member | Joined Dec 2014 | 3,638 Posts | Online Now

Quoting Fadhl
{quote} Hi Benjamin: I may suggest that you share your knowledge publicly to allow readers to exchange with you and build some relationship with them. I think through this way, everyone is winning and you don't have the workload of assessing everyday how your trainees did. Personally, I can't afford one hour everyday, but I'm willing to learn at my pace. This said, I would thank you for your offer.
I will post tomorrow how to go about opening a Demo Account with FXCM UK and if you would like to tell posters about this thread then of course he would make the thread more interesting for everyone. That is one of the reasons that I encourage people to register with Forex Factory so that they can post.

THE WHOLE POINT OF THIS THREAD IS TO HELP TRADERS LEARN FROM A PROFESSIONAL TRADER HOW TO TRADE AND WITHOUT RISK FINANCIALLY SHOW HOW TO LEARN THE RIGHTS HABITS where it is accepted that 95% of all Forex Currency Traders lose. You can learn how to get into the 5% category only if you can learn to first CONTROL your Ego , Greed and FEAR !!!

It is quite easy to open a $50,000 US Dollars Demo Account with FXCM UK. Just log on and click on the link to open a $50,000 US Funds Practice account and set it to currency in US Dollars and you get your User Name and your Password. DO NOT DO ANY TRADES until I explain to you the 16 Symbols that you need to set up on your Trading Platform. You can post questions on this thread. I will answer promptly. Thank You.

Antal E. Fekete

January 9, 2003

That central bankers are the quartermasters of inflation is no longer a controversial assertion. That much was admitted by central banker Alan Greenspan in his speech before the Economic Club of New York on December 19, 2002 (see: www.federalreserve.gov/BoardDocs). He observed that as long as the gold standard was in charge of money-creation the price level was relatively stable. For example, in 1929 it was hardly different from that in 1800. But, after gold was banned and central bankers were put in charge in 1933, the consumer price index nearly doubled in two decades. And in the four decades after that prices quintupled. In other words, under the watch of the gold standard the dollar preserved its purchasing power for a period of one and one third of a century, but under the watch of the central bankers it managed to lose 90 percent of it in half of that time-period.

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The Specter of Deflation
Presently the specter of deflation is haunting the world, so much so that central banker Ben Bernanke felt obliged to address the problem in a speech before the National Economists Club in Washington, D.C., on November 21, 2002 (see: www.federalreserve.gov/BoardDocs). He presented a simplistic view of deflation defining it as a general decline in prices. Actually, it would be more accurate to say that deflation manifests itself through a general decline in prices andinterest rates. Mr. Bernanke identified the source of deflation as a collapse in aggregate demand -- a drop in spending so severe that producers must cut prices on an ongoing basis in order to find buyers. Of course, this is the view of an unreconstructed Keynesian. But Keynesianism has been brain-dead for some three decades, so we ought to feel emancipated from its tyranny. We identify the source of deflation as reluctance of producers to take the loans that bankers try to push on them through ongoing interest-rate cuts. Uncharacteristically, producers are pessimistic about future profit opportunities. Instead of contracting new debt, they scramble to get out of the old, and try to retrench by reducing inventory.

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Guided Tour of the Star Chamber
Messrs. Greenspan and Bernanke claim that the Federal Reserve has the situation firmly in hand. If deflation were to develop, options for aggressive monetary policy response such as lowering interest rates are available. They admit that the zero lower bound on nominal interest rates presents a problem. Even if debtors were able to refinance loans at zero nominal interest, they may still feel excruciating economic pain caused by high and rising real rates due to the falling price level, as shown by their deteriorating balance sheet. However, Messrs. Greenspan and Bernanke reassure us that monetary policy will never lose its ability to stimulate aggregate demand and the economy, zero interest notwithstanding.

Mr. Bernanke gives us a guided tour of the Star Chamber, showing all the instruments of torture and explaining how they are to be used. The first of these is the printing press. Under a fiat money system the central bank generates inflation by this technology allowing it to create as many dollars as it wishes at essentially no cost. But it is not enough to create fiat money; you must also be able to put it into circulation or, at least, to make credible threats (sic!) to do so. Normally the Fed puts newly created fiat money into circulation through asset purchases. This particular torture instrument is used by the Fed to reduce the value of the dollar in terms of goods and services. Under a paper-money system a determined government and its central bank can always generate higher spending and induce positive inflation, we are told.

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Pushing on a String
If this has the result of pushing short-term interest rates to zero, the Fed will still not be at the end of its rope. It can further stimulate aggregate spending by expanding the menu of assets that it buys. If we do fall into deflation, we can take comfort in the thought that "the logic of the printing press" will ultimately assert itself. Sufficient injections of new money must eventually reverse a deflation.

So what may the Fed do if its target rate, the overnight federal funds rate, has fallen to zero? Why, it will change the target, that's what. It will stimulate spending by lowering interest rates further along the maturity spectrum. It will target the two-year rate by committing to make unlimited purchases of securities maturing in two years or less. But suppose that deflation is so stubborn that spending is not stimulated even as the two- year rate is pushed down to zero. Well, then change the target again, this time, say, to the ten-year rate, committing to make unlimited purchases of securities maturing in ten years or less. And so on, ad libitum. Mr. Bernanke says that lower rates over the entire maturity spectrum of public and private securities should strengthen aggregate demand "in the usual ways", and thus help end deflation.

This betrays our central bankers' ignorance of the nature of the beast. The Fed may be pushing on a string. People may refuse to spend the money in the "usual ways". It is one thing to print fiat dollars, and another to make people spend them. No problem, Mr. Bernanke says. If lowering yields on longer-term securities proved insufficient to re- start spending, the Fed might next consider offering fixed-term loans to banks at zero interest, with a wide-range of private assets (including, among others, corporate bonds, commercial paper, bank loans, and mortgages) deemed eligible as collateral.

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Operation Helicopter-Drop
But the banks may not use the loans at zero interest in the way intended by the Fed. They may not want to make further loans to their clients whose prospects to turn a profit are dim at best. The banks may find it far more attractive to invest in bonds for the capital gains guaranteed by the central bank's zero-interest policy. Business lethargy may not react to loans offered at ever lower rates. In this case Mr. Bernanke recommends the helicopter-drop of money, an idea first suggested by Milton Friedman. There must be a way to put fiat money into circulation, if not by hook then by crook! A broad-based tax- cut financed by open market purchases of securities by the Fed should do the trick. This "manna from heaven" should re-start spending. The Federal Reserve and other policymakers are far from helpless in the face of deflation, even if the rate of interest is already pushed all the way to zero.


Taking Risks out of Bond Speculation
All this talk is old hat, except for the fact that heretofore it hasn't been considered polite behavior for central bankers to flaunt their authority to create fiat money in unlimited quantities, and to boast their power to drive down the value of the dollar in terms of goods and services. More interesting than what these gentlemen say is what they don't say. They studiously avoid reference to the 100 trillion dollar behemoth: the interest-rate derivatives market, and to bond speculation. Derivatives are a tell-tale, revealing the big picture. Far from trying to prevent or to combat it, the Fed is promoting deflation. It does, in fact, act as the quartermaster of deflation. Every one of the torture instruments in the Star Chamber enumerated above is making deflation worse, not better.


What the $100 trillion derivatives market shows is that the main feature of deflation is the invisible but nonetheless real bull market in bonds. Nobody is talking about it, although the bull market in bonds that started in 1980 has been the largest of all bull markets of all kinds in all history. Fabulous fortunes have been made and will be made before it is over, thanks to the Fed that has taken the risk out of bond speculation.

The speeches of Messrs. Greenspan and Bernanke are the best example to demonstrate the charge. Speculators are told that the Fed is prepared to buy unlimited quantities of securities across the entire maturity spectrum. What is this if not an invitation to get aboard the bandwagon and share the ride to infinite riches? Come and get the bonds before we snap them up. Fear not, your investment is absolutely safe. Your friendly central banker has made bond speculation risk-free. He underwrites the unlimited capital gains you are going to make on your speculative bondholdings (or on your long positions on bond futures, or on your call options on bond futures). The figure $100 trillion shows the extent to which speculators have rallied to the call of the Pied Piper. It measures bets in the aggregate that speculators have made on ever-increasing bond prices or, what is the same to say, on ever falling interest rates.


Of course, interest rates will never go to zero. They just keep getting halved. The yield on long-term Treasury bonds was 16% in 1980. It has been halved to 8% and will be halved again to 4%, according to the script of Messrs. Greenspan and Bernanke. After that the target at successive halvings will be: 2%, 1%, 0.5%, 0.25%, 0.125%, 0.0625%, etc. As you see, it never gets to 0%.

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Falling Interest Rates Squeeze Profits
Paradoxically, falling interest rates squeeze profits. Conventional wisdom suggests otherwise: lower interest rates are considered salubrious to business. However, we ought to distinguish between a low interest rate structure and a falling one. Only the former is salubrious; the latter is lethal. Falling interest rates reveal that past investments in physical capital have been made at too high a rate of interest in view of lower rates presently available. Furthermore, even the low rates of today will appear too high tomorrow. This explains business lethargy. Expanding production would appear foolhardy as long as the decline in the rate of interest continued. Falling interest rates make the cost of servicing past investments soar. As bond prices rise, the present value of debt will rise as well. So does the cost of liquidating a liability. These increases hit the profit margin, regardless whether the fact is realized by the producers or not. If not realized, the outcome will be that much worse. As the firm is paying out phantom profits in dividends, it is undermining its own financial strength already weakened by the falling price level. At one point the firm will be unable to pay its bills and will be forced to seek bankruptcy protection. Then there is the matter of the domino-effect. Even perfectly healthy firms are hit by deflation: they may find it impossible to collect their receivables and go under after their debtors have -- all because of the falling interest rate structure.


Financial Vampirism
In the view presented here deflation is a huge wealth-transfer scheme from the producing sector to the financial sector, denuding the former of its capital, and enriching the latter with risk-free capital gains. Indeed, the beneficiaries of the falling interest-rate structure, making risk-free profits thanks to the zero-interest policy of the central bank, are the principals of the financial sector, chief among them those of the big money-center banks. Their obscene profits do not come out of thin air. Their wealth is not newly created wealth. It is existing wealth siphoned off the balance sheet of producing enterprise, forced into bankruptcy by the falling interest-rate structure. This is modern vampirism practiced by the financial sector, aided and abetted by the central bank, and its victim is the producing sector.
The bear market in stocks is not the cause but the effect of deflation. The cause is the artificial bull market in bonds financed by the central bank. If you ask the bond speculator about his obscene profits while the rest of the economy crumbles around him, he will shrug: "I play by the rules. And I did not make those rules either."


Bond Speculation Is No Zero-Sum Game
The proof of complicity of the banks in the bond-speculation-scheme is the $100 trillion derivative monster. No small-time speculators could create such a Moloch. It was created by the big money-center banks, for their own benefit, with complete disregard for the disastrous effect it has on the producers of goods and services. The total face value of outstanding bonds falls far short of the colossal figure of $100 trillion. It is against common sense, and an invitation to disaster, to allow speculative long positions to exceed total supply. Messrs. Greenspan and Bernanke have no comment on all this, except to confirm policies that are conducive to further increasing the debt behemoth and further whetting the appetite of the $100 trillion derivatives Moloch.

We are told that the sum of $100 trillion is "only a notional amount". However, the profits of the bond speculators are not notional. They are payable in cold cash. If indeed interest rates did go down, and the price of bonds did go up, say, one percent, then the speculators' profit would be $1 trillion in cash. Who is going to pay that?

Economists will tell you that the profit of one bond speculator is the loss of another. Don't buy that. It would be true only if speculation was a zero-sum game, and it was a case of stabilizing speculation. It is true that some speculative markets answer that description. An example is the commodity market trading agricultural goods. It fits the model of a zero-sum game. This is so because the risks involved in commodity trading are nature-given, having to do with the fickleness of the weather and the unpredictability of natural catastrophes such as a flood or a tornado. Human mortals are not privileged to see the future. Speculators in agricultural commodities make money by resisting the formation of price trends. But in markets where the risks are made (unmade!) by man such as the market for bonds and their derivatives, speculation is not a zero-sum game. There, speculators make money not by resisting price trends but by riding them. This is the case of destabilizing speculation.

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Power to Create Is Power to Destroy
The producers are sitting ducks in this speculative shoot-out. They have no choice. They must carry the risk of owning productive capital, without which there will be no consumer goods for Mr. Greenspan and Mr. Bernanke, or for you and me. This is an accurate description of the mechanism whereby the capital of the producing sector is surreptitiously siphoned off for the benefit of the financial sector as the rate of interest is driven down to zero. The producing sector is condemned to bankruptcy. It is a victim of plunder sanctioned by the Criminal Code. This is the essence of deflation: speculators aided and abetted by the central bank are allowed to bid bond prices sky-high, in complete disregard for the havoc that falling interest rates will wreak with the capital accounts of the producing sector, not to mention losses inflicted on stockholders. The $100 trillion derivatives market is a monument to the folly of man in delegating unlimited power to the central banker to create as much fiat money as he wishes. Former central banker Paul Volcker knows. He has been there. He is quoted as saying that "the truly unique power of a central bank is to create money and, ultimately, the power to create is the power to destroy." If the central banker has unlimited power to create, then he has unlimited power to destroy. And destroy he does, especially the savings of ordinary people.


Why Are Economists Silent?
I am aware that my warnings will be received with a great deal of skepticism. The central banker as the quartermaster-general of deflation? Arrant nonsense! Not only does the central bank has its own army of research economists, it also has the benefit of the knowledge and research of the entire profession. There can be no question that the central bank wields its awesome power while enjoying the best economic advice money can buy! Siphoning off wealth from the balance sheet of others is straight out of science fiction, my critics charge. The allegedly injured party, the producing sector, hasn't complained that its capital is open to pilferage. The media in reporting the crash of Swissair and United did not suggest foul play in plundering the airlines' balance sheets.

Yet you may dismiss my charges only at your own peril. The awareness is growing that not just the media, but the entire profession of monetary economists has been bought off by the central banking establishment in order to put the best possible spin on our fiat money system. In an interview on December 17, 2002, entitled "Our Dishonest and Corrupt Monetary System" (www.kitco.com), Dr. Larry Parks recalled that John Kenneth Galbraith, the Paul M. Warburg Professor Emeritus of Harvard University, had published a book in 1975 entitled Money, Whence It Came, Where It Went. In this book the professor wrote: "The study of money, above all other fields in economics, is one in which complexity is used to disguise truth or to evade truth, not to reveal it." In other words, Galbraith is saying that when it comes to money, economists lie! Dr. Parks asks: why do they lie? They have tenure. Why don't they tell the truth? He concludes that the monetary economists, for the last fifty years or more, have been bought off. With Nobel-prizes, endowed chairs, research grants, board memberships, and other perks. Monetary economists have betrayed their Muse, to serve Mammon.


Off-Balance-Sheet Wizardry
That the profession of the accountants has been bought off by the financial sector came to light recently in the wake of the Wall Street accounting scandals. But in spite of the great publicity given to these scandals by the media, the problem has not been fixed. A few small-time crooks may have been apprehended, but none of the authors of the scheme whereby banks are allowed to cook their books has been charged. The truth is that banks can carry assets, such as bets in the derivatives markets, "off balance sheet". They do this in order to find shelter from the scrutiny of depositors, creditors, shareholders; more generally, from the scrutiny of taxpayers at large. Accountants, regulators, and bank inspectors know this, but that's a different matter. Apparently, they have been bribed, too. They are part of the conspiracy. This is how Dr. Parks describes the fraud:
"Fractional reserve lending is jargon for creating money out of nothing. That's what that means. In the case of derivatives, these are bets that the banks make. The banks today in the aggregate worldwide have made roughly $110 trillion worth of bets. That's all they are. Banks are making bets and creating money. One of the things that obscures this for everybody is that banks alone do not have to reveal their entire balance sheets, as all other public companies must do under Securities and Exchange Commission regulations. Banks have the option, with some of their assets, to put them in a basket that they call "held for investment". When they put assets in that basket (they could be stocks, bonds, or whatever), then those assets are held at historical costs, rather than at market value... Nobody else gets away with this except for them. The reason they get away with it is because they say, in effect: 'If we had to mark everything to market, there would be too much volatility in our earnings. We don't want you to find out.' All this is secret. It's called bank secrecy... There are winners and there are losers. The losers are the ordinary people who lose their pensions, their savings, their jobs. The winners are the financial guys... These guys have no downside... Do you know what the banks took out of the economy last year? Nearly $400 billion. The Wall Street firms who get transaction fees for moving the newly created money around took another roughly $250 billion. Between them they took out nearly three times the amount of money that the auto industry took out. But from the auto industry we got 20 million cars. What did we get from these guys? We got cancelled checks and bank statements. This is monstrous, don't you think?"


Playing with Fire
I am not predicting that interest rates will keep falling to zero and that the world economy will succumb to deflation. I just want to sound the alarm that it might, in view of the counter-productive monetary policy of central bankers. Other scenarios, no less frightening, are also possible. Paradoxically, the threat of zero-interest (deflation) and that of infinite-interest (hyperinflation) are separated only by the knee-jerk reaction of the marginal bond speculator. He may get scared by the threats of Mr. Bernanke to undermine the purchasing power of the dollar further. As he becomes persuaded by the "logic of the printing press", the marginal bond speculator may cut and run. Then other bond speculators, especially those abroad, could dump their U.S. Treasury bonds, too, and run for the exit. Quite possibly Mr. Bernanke thought that he was just "fine-tuning" the purchasing power of the dollar. Under this scenario he would destroy it. When the central banker threatens to reduce the value of the dollar in terms of goods and services, as Mr. Bernanke does, he is playing with fire. After dumping the bonds, people may dump the dollars, too. First the foreign and then the domestic holders. They need not be reminded that the central banker has the card to trump deflation -- by triggering hyperinflation. How desperate must the specter of deflation appear to Mr. Bernanke that he has seen it fit to flaunt his possession of that card!

Snippet (8)


Congress, Not the Fed, Has the Solution
It is not too late for the U.S. Congress to act to fend off disaster. It should immediately take away the unlimited power from Messrs. Greenspan and Bernanke to create as much fiat money as they wish, and to drive down the value of the dollar in terms of goods and services. Not only are the present monetary arrangements blatantly unconstitutional, they are responsible for the destabilization of the rate of interest allowing it to swing from one extreme to the other, causing grievous economic damage along its path. The House of Representatives, to which the Constitution delegated the monetary powers, can rectify this by going back to constitutional money. It should stabilize interest rates without any further delay, and remove the threat of both zero and infinite interest, by opening the Mint to gold and silver. This is a Republic based on checks and balances. It has a government of limited and enumerated powers. Neither arm: not the legislative, not the executive, nor the judiciary may claim to have unlimited powers under the Constitution. Why should officers of the Federal Reserve be allowed to make such claims?
Free coinage, a right of the people enshrined in the U.S. Constitution, would remove the greatest threat this Republic has faced in its entire history up to now, greater even than that of foreign terrorists. This is the threat to destroy the capital of the producing sector, through the machinations of the financial sector, aided and abetted by the Federal Reserve.



Copyright 2003 by Antal E. Fekete

January 18, 2003

Snippet (9)


CORRECTION
I am very grateful to James E. Schoenbeck for calling my attention to a mathematical error in the example I used in my latest article The Central Banker As the Quartermaster-General of Deflation. I also used the same example in earlier articles such as Wrecker's Ball of Swinging Interest Rates. Mr. Schoenbeck wrote me on January 8, 2003, as follows:
"Professor:
While I enjoyed reading your article, I take dramatic exception to your pricing of the hypothetical bond as interest rates decline. If the interest rate dropped from 16% to 0% overnight, the price on the 30-year bond with 16% coupon, $1,000 par, would go to $5,800. A nice increase, to be sure, but nowhere near the 1,000-fold capital gains of which you talk

While it is true that the value of a 30-year bond will almost double when the rate is halved from 16 to 8%, it is no longer true as it is halved further from 8 to 4%, from 4 to 2%, from 2 to 1%, etc. Below is a table showing how the value of a $1,000 investment in a 30-year bond goes up with each halving (after which the investor takes profits and rolls out to a new 30-year maturity)

16 to 8%$1,000 to $1,900- - - - - - - - - - - - - - -
8 to 4%$1,000 to $1,700or $1,900 to $3,200
4 to 2%$1,000 to $1,450or $3,200 to $4,684
2 to 1%$1,000 to $1,260or $4,684 to $5,855
1 to 0.5%$1,000 to $1,140or $5,855 to $6,675
0.5 to 0.25%$1,000 to $1,070or $6,675 to $7,142
0.25 to 0.125%$1,000 to $1,037or $7,142 to $7,406
0.125 to 0.0625%$1,000 to $1,019or $7,406 to $7,546
Wouldn't you agree that we are fast approaching a limit here? The value of the $1,000 investment will stay below $10,000 no matter how many times the rate of interest is cut into half, and will never be worth anything like $1,024,000 under any circumstances. Sorry... but making money is not that easy..."

James E. Schoenbeck
[email protected]
I concede that under the simple strategy of buying and holding the 30-year bond, or continually rolling it over to new 30-year bonds, the $1,000 investment cannot be doubled in value with each successive halvings of the rate of interest. But there are other more sophisticated strategies available involving strip bonds, and derivatives such as: bond futures, call and put options on bond futures, knock-out calls and knock-out puts, interest-rate swaps, and various combinations of these which bond speculators can use, and do use, in order to double their investment (or do even better) every time the rate of interest is halved. I quote from J. Taylor's Gold & Technology Stocks newsletter, January 7, 2003, issue (www.miningstocks.com):

"Michael B. O'Higgins was able to turn $1,000 into $415,302 by being in bonds, not stocks... If you invested $1,000 in the Dow in 1972, that investment would have been worth only $27,347 as of December 27, 2002. But had you invested $1,000 mostly in bonds during that time, your initial investment would have turned into $422,819." (Visit www.miningstocks.com for more information on this amazing but true story which can be fully documented. The point is that lenders make a killing during periods of falling interest rates at the expense of debtors.)



But even these fabulous profits could not explain the creation of the $100 trillion derivatives market coming, as it did, out of nowhere. Individual bond speculators could not possibly accomplish this feat. It was accomplished by the big money-center banks. They are responsible for the prolonged agonizing fall of the interest-rate structure, the flipside of which is the snowballing of the derivatives monster. They make up the bond market. They run it. They buy the bonds and interest-rate derivatives before the Fed can buy, since the Fed buys through services they can provide. If there has ever been socially devastating insider trading, then this is it.
My point is that Keynesian monetary policy takes the risk out of bond speculation. It makes it extremely profitable and a sure bet. This explains the persistent fall in interest rates, and the snowballing of the derivatives market, all of which spell deflation. Deflation is not merely falling prices; it is falling prices plus falling interest rates, squeezing the debtors. This deadly combination is not an Act of God. It is caused by unlimited speculation in bonds, with profits underwritten by the central bank.

Keynesian contra-cyclical monetary policy and "deflation control" is a disaster. Nostrums advocated by Milton Friedman and other monetarists are equally disastrous. Far from containing deflation, the central bank is causing it, through its counter-productive measures such as bond-buying programs widely advertised through speaking engagements such as those of Messrs. Greenspan and Bernanke, prompting more and more bond speculators to climb on the bandwagon to have a free ride to riches. Rather than relieving debt-implosion, this mindless monetary policy is, in fact, the one identifiable cause of it through the bankrupting of the producing sector.

Mr. Bernanke made a solemn vow to Milton Friedman at his 90th birthday party at the University of Chicago. He vowed that the Fed would not repeat the mistakes it had made in the 1930's in not whipping and chastizing deflation vigorously enough. This brings to mind the Biblical story of King Rehoboam, the son of King Solomon, who answered the people when they petitioned him to lighten their burden: "My father hath made your yoke heavy; I will add to your yoke. My father chastized you with whips; I will chastize you with scorpions." (First Book of Kings, 12:11.) May God save the producers of this country from the yoke and the scorpions of the Fed.
January18, 2003

Antal E. Fekete

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1. BenjaminIs
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1. BenjaminIs
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From a Thread called Knowledge Is Power
Copy and Paste


We welcome constructive criticism and well founded discussion. Inflammatory, rude, repetitive, offensive, off-topic or otherwise disruptive messages designed intentionally to annoy, stimulate or antagonize the existing members or alter the flow of discussion are NOT welcome and will be reported to the moderator team.

I will also start a sister-thread as a digest and to store all the cream from this thread and also as storage for all indicators posted for ease of reference.

10 Trading Rules for Successful Traders
1. Limit your losses.
2. Let your profits run.
3. Keep position sizes within reason.
4. Know your risk-reward ration.
5. Be adequately capitalised.
6. Dont fight the trend.
7. Never add to losing positions. Dont average out.
8. Know market expectations.
9. Learn from your mistakes keep a trading journal.
10. Have a maximum loss or retracement in profits.


For beginners, please read this free Forex education material and learn to be a successful trader: www.BabyPips.com

And also you are advised to read these excellent books:
1. Day Trading the Currency Market: Technical and Fundamental Strategies To Profit from Market Swings (Wiley Trading) (Hardcover) - by Kathy Lien

2. Technical Analysis of the Currency Market: Classic Techniques for Profiting from Market Swings and Trader Sentiment (Wiley Trading) (Hardcover) By Boris Schlossberg

3.High Probability Trading Setups for the Currency Market By Boris Schlossberg, Kathy Lien


You can preview the 1st and 3rd books here:
http://books.google.com.my/books?id=...sec=frontcover

http://books.google.com.my/books?id=...+lien%22&psp=1

The Essence of the 3rd book is here:
1. Never let a winner turn into a loser
2. Logic wins, impulse kills
3. Never risk more than 2% per trade
4. Trigger fundamentally, enter and exit technically
5. Always pair strong with weak
6. Being right but being early simply mean you are wrong
7. Know the difference between scaling in and adding to a loser
8. What is mathematically optimal is psychologically impossible
9. Risk can be and is predetermined but reward is unpredictable
10. No excuses, ever

BEWARE:
Why Currency Trading Is Not For Everyone?
Trading foreign exchange on margin carries a high level of risk, and may not be suitable for everyone. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. Remember, you could sustain a loss of some or all of your initial investment, which means that you should not invest money that you cannot afford to lose. If you have any doubts, it is advisable to seek advice from an independent financial advisor.

RISK WARNING: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. Before deciding to trade foreign exchange you should carefully consider your monetary objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your deposited funds and therefore you should not speculate with capital that you cannot afford to lose. You may be liable for losses that exceed the amount of margin that you post. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent advisor if you have any doubts. Past returns are not indicative of future results.

Good Morning

Today we have RISK OFF for the moment and since I see NO positive news on the horizon today with the BIG Problem in the UK with May and Brexit and Comey coming back to Testify in the USA and with the FED expected to raise on Wednesday we have more negative issues at the moment. This time I do not think they will intervene because I think they also now want the collapse. As for who is the THEY ? You figure that out. Hint the Central Banks led by the FED and being challenged by President Donald John Trump.


Benjaminis

http://www.learntotradethemarket.com...trading-course


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Good Morning

PLEASE UNDERSTAND THAT I AM IN NO WAY PROMOTING THIS COURSE.

I will explain later today my issues with such excellent courses from highly ethical and knowledgeable people.

Good Afternoon

I have done 5 Forex trades today. My Net Profit for today is $2395.70 US dollars. My new account balance is now at $59,937.70 US dollars.

I am $62.30 US dollars away from my 20% target of 20% Return on Investment.

This was done in the 14 days since December 4, 2018 to today December 17, 2018.

I am done 25 perfect trades in two weeks. Of course it is not an accident or luck that I have reached my goals less the $62.30 US dollars that I still need to earn.

I am watching on CNBC Jeffrey Grundlach manager of Doubleline and one of the most prominent and well respected traders in the world.

While he spoke the market went down over 300 points surely because of what he was saying about the terrible shape of the World economy.

The TREND is DOWN !!!

Please post any questions that you have here.

YOU have a CHANCE to become Very Wealthy if you have the Forex Trading skills. Give me 90 days and I will tell you if you do. When I start my specialized training my fee will be $500 US dollars for 90 days of my time and my knowledge obtained over the last 15 years.

You can see why I posted above about other methods of learning to trade Forex.

My RESULTS make my point.

Anyone who I teach from this thread will be offered free courses and as I have said before on this thread no monthly fee of $50 US dollars for 24/7 access.

Have a positive day.


Benjaminis

http://traderfeed.blogspot.com/2018/...ith-stock.html

SUNDAY, DECEMBER 16, 2018
What In The World Is Going On With The Stock Market?
https://1.bp.blogspot.com/-fWiGGQ_C6...s400/Sight.jpg
Why are stocks falling like this? That's the question I've been hearing from a number of investors and traders. In the previous post, I posed the question of whether we might crash. That post has received almost three times as many hits as my average post--and that is just in two days. That tells me uncertainty is high. The sentiment, as I noted in that post, is bearish.

But the question posed with anguish is *why* this is happening. The U.S. economy is not in such bad shape despite political turmoil in the U.S. and concerns about tariffs and trade wars. Nor do we have a Federal Reserve that is aggressively tightening monetary conditions. Inflation overall is tame and there are few signs of overheating in the economy. Indeed, with solid employment numbers, we were not so long ago hearing about being in a sweet spot of economic growth.

Alas, U.S. investors and traders can be horribly U.S.-centric. One thing I love about working out of London is that the perspectives tend to be more global. That is important when markets--and those managing capital--are so intertwined. Perhaps what is going on in the U.S. stock market is not about the U.S. Perhaps it is not about President Trump; not about the daily dose of polarized, politicized commentaries from MSNBC, FOX, CNN; and not about chart patterns and wave counts of American markets.

Consider an excellent article in the Washington Post reflecting upon the difficulties of Britain, given the problems associated with Brexit and the problems associated with remaining in the E.U. The author poses the scenario: Suppose Italy defaults on its debt and Britain is asked to bear some of the load. Will its citizens really want to take on more debt? Will the Yellow Vests of France want to step up to the plate and shoulder that debt? What happens in the event of sovereign debt default? Could Italy be the epicenter of a crisis that the ECB would have trouble responding to, given already low rates? As Robert Samuelson notes, the ingredients of a crisis are present.

So now let's look at some charts of banks. Here is Deutsche Bank:
https://3.bp.blogspot.com/-CUu6_UaMV...0/DB121418.jpg
Here is Credit Suisse:
https://3.bp.blogspot.com/-3MmCDThH-...0/CS121418.jpg

Here is Goldman:
https://1.bp.blogspot.com/-cVRt8M5NR...0/GS121418.jpg

Here is an ETF for European stocks:
https://4.bp.blogspot.com/-_OQyRZIOh.../VGK121418.jpg

Uniformly, it's been a straight shot down from early January, unlike U.S. stocks, which peaked in September. Now, however, U.S. stocks are moving down alongside their European counterparts, with banking shares among the downside leaders.

Here is one last chart. This one is a cumulative running total of all NYSE stocks trading on upticks minus those trading on downticks. The measure is updated every second of every trading day. It's one of the most sensitive indicators of buying and selling pressure, as it reflects the aggressiveness of buyers (lifting offers) and sellers (hitting bids).
https://3.bp.blogspot.com/-D8lbf0wY2...TICK121418.jpg
Notice how, during the decline of early 2018, the cumulative uptick/downtick line did not move significantly lower and indeed held above its February lows when we bottomed in the spring. The cumulative TICK line was not able to make a new high going into the ultimate peak in SPY and, indeed, started trailing off before we actually peaked in the index. That was one yellow caution light I noted in September.

From there it has been straight down in the cumulative measure, reflecting aggressive selling across the entire stock universe. In that respect, this decline has not been like the previous one.

As I mentioned in the previous post, my job, both as a trader and as an investor of family capital, is to stay open minded and consider a range of possible scenarios. That means looking beyond the U.S. and trying to make sense of areas of the financial world that are weakest. It also means collecting data that others overlook and looking at time frames wider than the norm. My goal, per Helen Keller, is to ensure that my sight enables me to also have vision. At the moment, I can't say I am comfortable with what I see.
Further Reading:

NYSE TICK as a Trading Tool

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