Money Flow Trading Method along with Risk Management

I am going to stop now as I have other things to do and it will be interesting to see where the markets stand at the Europe close. You are free to make any Forex Trades on your Demo Account now that you understand the methodology. If you do please post your trades here so that I can follow along as can anyone else interested.

Please post ANY QUESTIONS here on the Thread so we can all share together and learn together and for those with technical skills please share your information on the currency pairs that we are interested in. Thanks and good trading !!!

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)

Also thanks again for all the time and effort you are putting into this!
Wonderful reads

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

Thankyou! Awesome mentoring and thanks for encouraging me I needed that.
Best wishes!

Only one question left unanswered is:

I analyzed every aspect of the Trade Plan, now I decide it's time to sell/buy. Which SPECIFIC indicator(s) do you suggest I use? The Price Action part I understand, I just don't know which indicator is right because there are hundreds of them and I'm left confused.

Or.... I'm free to pick my own 'edge' to use it combined with Money Flow + Fundamentals + Price Action? (for example Davit's method with pivots/tdi along with PA)


This is golden information from you, everything looks so much clearer in my head right now. I will always be grateful to you as my mentor when I will reach the '5%"

Update: USD/JPY started moving strong! I'm excited about the gains on my live account as well! +40 PiPs

Took this Long XAU/USD: Price Action reversed and I entered on 3rd candle from reversal (H1)
Been watching this pair since yesterday since we talked about gold.

XAU/USD
Open: 1,130
Stop: 1,125
Limit: 1,140

Gross P/L: +70


EDIT: Would it be easier if I upload Trade Explorer on my forex factory profile mr. Benjamin?

To start you can call me Benjamin

As for the main thing for you to understand is the Trend. The Trend will be set for US30 when it turns around and that so far has not happened so the first thing that you do when you start a new trading day is to ask yourself this question. "Do we have Risk On or Risk Off ? Today is quiet and we have Risk On. You can see that by looking at a 5 or 15 minute chart of US30 and 10 Year US Bonds and USD/JPY and I use the charts from Finviz because of the visual aspect of it and the news links on the top.

http://finviz.com/news.ashx

http://finviz.com/futures_charts.ashx?t=YM&p=h1

http://finviz.com/forex_charts.ashx?t=USDJPY&tf=m5

http://finviz.com/futures_charts.ashx?t=ZN&p=h1

Try to give yourself the proper Risk to Reward Ratio over a longer time period. Example I opened a new FXCM UK Demo Account earlier today to use to show a new client. My meeting was postponed until January 2017 so right now I will short US30 $100,000 US Dollars.

I just shorted 100 units at $19,966.50 and now I will enter my STOP.

I just entered my STOP at 20,041.50 so my MAXIMUM LOSS would be $750.00 !!!

Now I will enter my Limit Out !!!

I just put it at 19,816.00 so my LIMIT OUT would be Profit of $1500.00 US

Do you understand the strategy ? Keep in mind that you are trading with $50,000 US Dollars. I will be back later today and whatever happens I do not need to think about it as it is done.

Hoping to hear from others who really want to learn and make money trading Forex as long as you give yourself 30 days to see if you have what a successful Forex Currency Trader needs.

Thanks


Benjamin

Information from post 65 on December 10, 2016.

A Very Important Article To Explain The Situation With American US Dollars.

https://dailyreckoning.com/emerging-...y+Reckoning%29

Snippet:

An Emerging Dearth of Dollars

Uh-oh: The mainstream is starting to fret about the great dollar shortage.
With the help of Jim Rickards, weve been delving into the paradox of a dollar shortage periodically since September. The paradox is this: While the Federal Reserve blew up its balance sheet by $3.4 trillion between 20082015, the world created new dollar-denominated debt faster than the Fed created money, as Jim explains it. Indeed, more than $60 trillion of new dollar-denominated debt came into existence during this time.

Its all good as long as the dollar is weak. But relative to a large basket of foreign currencies, the dollar is approaching its strongest level at any time in the last two decades
https://dailyreckoning.com/wp-conten...22-768x491.jpg
When the dollar goes up, it directly impairs the risk-taking capacities of banks and investors alike, writes Hyun Song Shin, chief of research at the Bank for International Settlements.

As you might know, the BIS is the central bank for central banks. Jim Rickards says unlike many central bankers, the BIS folks are pretty sharp cookies. Mr. Shin, according to The New York Times, is concerned the dollars rise will worsen what he refers to as an emerging dearth of dollars, which could bring back memories of the financial crisis in 2008 and 2009. Back then, a global rush into dollars caused short-term borrowing rates to skyrocket, forcing hedge funds to shut down and banks to fail.

The dollar shortage is even getting the attention of mainstream strategists like Paul Christopher at Wells Fargo Advisors: In the type of global economy we live in, [Federal Reserve chair Janet Yellen] has to be careful about the dollar increasing too much, creating dollar shortages and liquidity problems as a result.

Alas, Fed leadership is clueless. Quelle surprise. And so they plow ahead with plans to raise its benchmark fed funds rate next Wednesday which will have the effect of further strengthening the dollar.

As we pointed out last month, Fed Vice Chair Stanley Fischer said he was reasonably confident foreign economies could absorb the impact of that move: The dollar would strengthen further, yes, but it wouldnt necessarily tank the value of foreign currencies.

Jim Rickards called this wishful thinking.
Lets go back to that $60 trillion of dollar-denominated debt thats come into being since 2009. As Jims pointed out for the last two years, about $9 trillion of that total was issued by companies in emerging markets; those companies need a weak dollar to keep the cost of servicing that debt from spiraling out of control. But the dollars been rising relentlessly since mid-2014.

Also on shaky ground is $5 trillion in debt issued by U.S. energy producers. It was bad enough most of that debt was issued on the assumption of $80-plus oil prices into perpetuity. (They’re $51.45 this morning.) But this is worse: “A strong dollar implies lower oil prices,” Jim reminds us, “despite OPEC’s machinations.”

Reminder: A strong dollar is the only reason gold is so weak right now. The bid is down to $1,161 this morning, retesting a 10-month low.
“A strong dollar implies a lower dollar price for gold,” says Jim. “A weak dollar implies a higher dollar price for gold.” Look no further than the chart above. The emerging dearth of dollar’s all-time low came in August 2011. Gold touched its all-time high within a matter of weeks.

“Further evidence,” says Jim, “comes from the fact that gold is performing much better when measured in Japanese yen, Chinese yuan and euros. In other words, the recent price action is not really a gold story; it’s a dollar story.”

Not that it makes gold’s recent swoon easier to take if you transact mostly in dollars, but that’s the story.

“In the short run (one–three months) the strong dollar, weak gold story may continue,” Jim allows.

“Beyond that, the strong dollar will strangle the U.S. economy with imported deflation and weaker exports.” Oh, and it’ll worsen the great dollar shortage and threaten to detonate a large portion of that $60 trillion in dollar-denominated debt we mentioned.

Then the Fed will have to reverse course. Jim figures by next spring. Gold holders, keep the faith. “Gold is in the doldrums now, but it is poised for a strong comeback when central bankers confront the unsustainable reality of higher real rates on dollar debt.”
Regards,

Dave Gonigam

Monthly Chart on US Dollar Index
http://finviz.com/futures_charts.ashx?t=DX&p=m1

Have a LOOK at it and the article will be easier to follow and understand.

FINAL COMMENTS: You will NEVER read about these matters in the Mainstream Media. As part of my trading skills I decided 10 years ago that I needed to know and understand all these associated matters in order to understand what was really happening behind the scenes.
This is how I was able to develop My Money Flow Method over the last 5 years and it is why I am able to generate a ROI (Return On Investment) of 10% a month.
There of course is much more to achieving these results. There is NO TRADER whether trading Equities or Commodities or Forex that can succeed unless they have the DISCIPLINE to CONTROL first their EGO. (The Market Is Always Right) Then control their GREED and finally most important their FEAR !!!
Good Evening an enjoy your weekend.

Benjamin





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.

http://www.forexfactory.com/showthre...=620091&page=4

The information is from post 76 on December 10, 2016.

http://wolfstreet.com/2016/12/10/gov...rs-sixth-week/

Snippet:
The bond market is doing the math.
Traders got even more nervous on Friday, after having been twitchy all Thursday, and they alleviated this condition by selling government bonds.
In July, government bonds were sitting ducks with their low yields, and perfectly ripe for a good plucking. This plucking has now proceeded relentlessly and has entered its sixth week in a row, after an already rough four months.
The price of the 10-year Treasury note swooned on Friday. The 10-year yield, which moves in the opposite direction, rose 6 basis points to 2.47%, the highest yield since June 2015. Since early July, the 10-year yield has jumped by 1.08 percentage points! That’s a 77% move (via StockCharts.com):
http://wolfstreet.com/wp-content/upl...2016-12-09.png
The 30-year Treasury yield jumped 7 basis points on Friday to 3.15%, the highest yield since June 2015, which elegantly crowns a 50% move in six month (via StockCharts.com):
http://wolfstreet.com/wp-content/upl...2016-12-09.png
US government bonds are considered among the most conservative investments in the world because they’ll never default. They will always get redeemed at face value since the government, via the Fed, can always print enough money to take that risk off the table, though the bonds’ purchasing power might get crushed in the process.

Information from post 80 on December 11, 2016 and is the end of posts from page 4 of the 15 pages of this thread. This topic is very very important to understand so if you have any questions or thoughts please share it here with us. Thank You !!!

Quoting Davit
{quote} thank you for very interesting video
Davit , You are very welcome. I would like to share with you and any interested parties the REAL ISSUE concerning the UNFREE Markets and the following as explained in this excellent article about the present economic system the world economists follow and what is taught in universities around the world.

https://www.theguardian.com/business...-from-the-dead

Snippet: Keynes died 70 years ago. We ignore his wisdom at our peril
Justin Talbot Zorn and Merle Lefkoff

The economist warned against the potentially disastrous weaknesses of our global financial system. It’s not too late to pay him heed now


Keynes discovers that governments deviate from his ideas. Instead of running budget surpluses in the good times and deficits in the bad times, they run deficits all the time. They fail to draw the proper distinction between day-to-day spending and investment. In Britain, December 1976 was the pivotal moment. Matters came to a head in early December when a divided and fractious cabinet agreed that austerity was a price that had to be paid for a loan from the International Monetary Fund, which was needed to prop up the crashing pound.

Subsequently, Keynes is informed, there was a paradigm shift. Labour had been reluctant converts to monetarism; the Thatcherites who followed were true believers. Controls on capital were lifted, full employment was abandoned as the prime policy goal, trade union power was curbed, taxes for the better off were cut, inequality was allowed to widen, finance waxed as manufacturing waned.

You don’t need to go on, Keynes says, because I can tell you what happened next. Bashing organized labor and cutting government spending led to a dearth of effective demand that was papered over by cuts in interest rates. Cheaper money led to some increase in productive investment but this was overshadowed by speculation in the stock market and real estate. Eventually, the bubble burst and – just as in 1929 – there was a stupendous crash.

That explains why the headlines I can see from 2016 bear so much resemblance to those from 1936: high unemployment and a lack of growth that has bred deep public resentment. That explains the referendum results in the UK and Italy, the outcome of the US presidential election and the growing support for far-right parties in Germany and France.

Even so, Keynes is surprised to discover that the crash occurred, not in 2016 or 2015, but some eight years earlier. What’s been happening in the meantime, he asks?
The answer given is that initially central banks slashed official interest rates to levels never seen before. In the UK, borrowing costs were reduced to 0.5%, even lower than the trough of 2% reached after the pound came off the Gold Standard in 1931.

But that was not all. Central banks also bought bonds from private institutions, with the aim of increasing the supply of money and reducing market – or so-called long-term – interest rates. Both initiatives meet with Keynes’s approval. His works advised the use of aggressive monetary policy because lower interest rates should help to stimulate higher private sector investment, because in most cases this is what lifts economies out of recession.

But, he adds, if this was a really serious slump then monetary policy might not have been enough on its own. In certain circumstances, it doesn’t really matter how low interest rates go – private companies feel so uncertain about the future they are reluctant to invest. People hoard cash rather than spend it. Monetary policy becomes like the drug soma in my friend Aldous Huxley’s book Brave New World – it calms people down and disguises the fact that something untoward is happening.
Analysis Keynes helped us through the crisis – but he's still out of favor.

NOW let me introduce you in case you are not aware to the Austrian School of Economics.

https://mises.org/about-mises/what-austrian-economics

Snippet:

The result of Mises's research was The Theory of Money and Credit, published in 1912. He spelled out how the theory of marginal utility applies to money, and laid out his "regression theorem," showing that money not only originates in the market, but must always do so. Drawing on the British Currency School, Knut Wicksell's theory of interest rates, and Böhm-Bawerk's theory of the structure of production, Mises presented the broad outline of the Austrian theory of the business cycle. A year later, Mises was appointed to the faculty of the University of Vienna, and Böhm-Bawerk's seminar spent a full two semesters debating Mises's book.

Mises's career was interrupted for four years by World War I. He spent three of those years as an artillery officer, and one as a staff officer in economic intelligence. At war's end, he published Nation, State, and Economy (1919), arguing on behalf of the economic and cultural freedoms of minorities in the now-shattered empire, and spelling out a theory of the economics of war. Meanwhile, Mises's monetary theory received attention in the U.S. through the work of Benjamin M. Anderson, Jr., an economist at Chase National Bank. (Mises's book was panned by John Maynard Keynes, who later admitted he could not read German.)

In the political chaos after the war, the main theoretician of the now-socialist Austrian government was Marxist Otto Bauer. Knowing Bauer from the Böhm-Bawerk seminar, Mises explained economics to him night after night, eventually convincing him to back away from Bolshevik-style policies. The Austrian socialists never forgave Mises for this, waging war against him in academic politics and successfully preventing him from getting a paid professorship at the university.
Undeterred, Mises turned to the problem of socialism itself, writing a blockbuster essay in 1921, which he turned into the book Socialism over the next two years. Socialism permits no private property or exchange in capital goods, and thus no way for resources to find their most highly valued use. Socialism, Mises predicted, would result in utter chaos and the end of civilization.

Mises challenged the socialists to explain, in economic terms, precisely how their system would work, a task which the socialists had heretofore avoided. The debate between the Austrians and the socialists continued for the next decade and beyond, and, until the collapse of world socialism in 1989, academics had long thought that the debate was resolved in favor of the socialists.

Meanwhile, Mises's arguments on behalf of the free market attracted a group of converts from the socialist cause, including Hayek, Wilhelm Röpke, and Lionel Robbins. Mises began holding a private seminar in his offices at the Chamber of Commerce that was attended by Fritz Machlup, Oskar Morgenstern, Gottfried von Haberler, Alfred Schutz, Richard von Strigl, Eric Voegelin, Paul Rosenstein-Rodan, and many other intellectuals from all over Europe.
Also during the 1920s and 30s, Mises was battling on two other academic fronts. He delivered the decisive blow to the German Historical School with a series of essays in defense of the deductive method in economics, which he would later call praxeology or the logic of action. He also founded the Austrian Institute for Business Cycle Research, and put his student Hayek in charge of it.

During these years, Hayek and Mises authored many studies on the business cycle, warned of the danger of credit expansion, and predicted the coming currency crisis. This work was cited by the Nobel Prize committee in 1974 when Hayek received the award for economics. Working in England and America, Hayek later became a prime opponent of Keynesian economics with books on exchange rates, capital theory, and monetary reform. His popular book Road to Serfdom helped revive the classical liberal movement in America after the New Deal and World War II. And his series Law, Legislation, and Liberty elaborated on the Late Scholastic approach to law, and applied it to criticize egalitarianism and nostrums like social justice.

In the late 1930s, after suffering from the worldwide depression, Austria was threatened by a Nazi takeover. Hayek had already left for London in 1931 at Mises's urging, and in 1934, Mises himself moved to Geneva to teach and write at the International Institute for Graduate Studies, later emigrating to the United States. Knowing Mises as the sworn enemy of national socialism, the Nazis confiscated Mises's papers from his apartment and hid them for the duration of the war. Ironically, it was Mises's ideas, filtered through the work of Roepke and the statesmanship of Ludwig Erhard, that led to Germany's postwar economic reforms and rebuilt the country. Then, in 1992, Austrian archivists discovered Mises's stolen Vienna papers in a reopened archive in Moscow.

While in Geneva, Mises's wrote his masterwork, Nationalokonomie, and, after coming to the United States, revised and expanded it into Human Action, which appeared in 1949. His student Murray N. Rothbard called it "Mises's greatest achievement and one of the finest products of the human mind in our century. It is economics made whole." The appearance of this work was the hinge of the whole history of the Austrian School, and it remains the economic treatise that defines the School. Even so, it was not well received in the economics profession, which had already made a decisive turn towards Keynesian.

Though Mises never held the paid academic post he deserved, he gathered students around him at New York University, just as he had in Vienna. Even before Mises emigrated, journalist Henry Hazlitt had become his most prominent champion, reviewing his books in the New York Times and Newsweek, and popularizing his ideas in such classics as Economics in One Lesson. Yet Hazlitt made his own contributions to the Austrian School. He wrote a line-by-line critique of Keynes's General Theory, defended the writings of Say, and restored him to a central place in Austrian macroeconomic theory. Hazlitt followed Mises's example of intransigent adherence to principle, and as a result was pushed out of four high-profile positions in the journalistic world.

Mises's New York seminar continued until two years before his death in 1973. During those years, Rothbard was his student. Indeed, Rothbard's Man, Economy, and State (1963) was patterned after Human Action, and in some areas—monopoly theory, utility and welfare, and the theory of the state—tightened and strengthened Mises's own views. Rothbard's approach to the Austrian School followed directly in the line of Late Scholastic thought by applying economic science within a framework of a natural-rights theory of property. What resulted was a full-fledged defense of a capitalistic and stateless social order, based on property and freedom of association and contract.

Rothbard followed his economic treatise with an investigation of the great depression, which applied Austrian business cycle theory to show that the stock market crash and economic downturn was attributable to a prior bank credit expansion. Then in a series of studies on government policy, he established the theoretical framework for examining the effects of all types of intervention in the market.

In his later years, Mises saw the beginnings of the revival of the Austrian School that dates from the appearance of Man, Economy, and State and continues to this day. It was Rothbard who firmly established the Austrian School and classical liberal doctrine in the U.S., especially with Conceived in Liberty, his four-volume history of colonial America and the secession from Britain. The reunion of natural-rights theory and the Austrian School came in his philosophical work, The Ethics of Liberty, all while he was writing a series of scholarly economic pieces gathered in the two-volume Logic of Action, published in Edward Elgar's "Economists of the Century" series.

These seminal works serve as the crucial link between the Mises-Hayek generation and the Austrians now working to expand the tradition. Indeed, without Rothbard's willingness to defy the intellectual trends of his time, progress in the Austrian School tradition might have come to a halt. As it was, his wide and deep scholarship, cheerful personality, encyclopedic knowledge, and optimistic outlook inspired countless students to turn their attention to the cause of liberty.

Though Austrians are now in a more prominent position than at any point since the 1930s, Rothbard, like Mises before him, was not well treated by academia. Although he held a chair in his later years at the University of Nevada, Las Vegas, he never taught in a capacity that permitted him to direct dissertations. Nonetheless, he managed to recruit a large, active, and interdisciplinary following for the Austrian School.

The founding of the Mises Institute in 1982, with the aid of Margit von Mises as well as Hayek and Hazlitt, provided a range of new opportunities for both Rothbard and the Austrian School. Through a steady stream of academic conferences, instructional seminars, books, monographs, newsletters, studies, and even films, Rothbard and the Institute carried the Austrian School forward into the post-socialist age.

Larry Elliott Economics editor
A brief burst of Keynes prevented a 1930s-style collapse that might have led to a more fundamental rethink of the status quo


Keynes is told that ever bigger doses of monetary soma have been necessary to keep the global economy ticking over, with weak investment leading to poor productivity and growth rates well below those seen in the years leading up to the crisis. He asks the obvious question – if monetary policy has ceased to be effective, what have governments been doing to help?

Comments from Benjaminis: It is suggested that if you want to really understand the TRUTH of where we all are today in this Global connected financial world you start to educate yourself as your time permits on this economic school of thought. I will have more to add in a follow up post.

Information from post 82 on page 5 on December 11, 2016.

Now for those that want to make money trading Forex , I will start to tie the FUNDMENTAL INFORMATION to how you can make money trading Forex which is what my trading course is all about and what is stated in the title of my thread.

http://dollarcollapse.com/stock-pric...-prices-crash/

Snippet:
2007 All Over Again, Part 6: Stock Valuations Enter Crash Territory
December 11, 2016

The Trump Christmas stock market rally has taken valuations beyond a point that in the past has signaled trouble, which in turn has generated a lot of cautionary press like the following:

Market indicator hits extreme levels last seen before plunges in 1929, 2000 and 2008
(CNBC) While the S&P 500 is reaching all-time highs on optimism over Donald Trumps economic agenda, some Wall Street strategists are increasingly worried about a widely followed valuation measure thats reached levels that preceded most of the major market crashes of the last 100 years.

The cyclically adjusted P/E (CAPE), a valuation measure created by economist Robert Shiller now stands over 27 and has been exceeded only in the 1929 mania, the 2000 tech mania and the 2007 housing and stock bubble, Alan Newman wrote in his Stock Market Crosscurrents letter at the end of November.
Newman said even if the markets earnings increase by 10 percent under Trumps policies were still dealing with the same picture, overvaluation on a very grand scale.
http://i2.wp.com/dollarcollapse.com/...c-16.jpg?w=550
The Shiller cyclically adjusted price-to-earnings ratio (CAPE) is calculated using price divided by the indexs average historical 10-year earnings, adjusted for inflation. Yale economics professor Robert Shillers research found future 10-year stock market returns were negatively correlated to high CAPE ratio readings on a relative basis. He won the Nobel Prize in economics in 2013 for his work on stock market inefficiency and valuations.

Other academics agreed the current extreme CAPE ratio of 27.7 is a worrying sign for future returns versus bonds.

Only when CAPE is very high, say, CAPE is in the upper half of the tenth decile (CAPE higher than 27.6), future 10-year stock returns, on average, are lower than those on 10-year U.S. Treasurys, Valentin Dimitrov and Prem C. Jain wrote in paper titled Shillers CAPE: Market Timing and Risk on Nov. 17.
Even based on the more common price-earnings ratio, the market looks rich. The S&P 500s P/E based on earnings of the last 12 months is 18.9, the highest in more than 12 years, according to FactSet.

U.S. valuations start off as being high both on a historical basis and also on a peer group. Certainly based on the Shiller PE, the equity market seems expensive, Jefferies chief global equity strategist Sean Darby wrote on Nov. 29.

The above chart requires a bit of interpretation, mainly because of that spike in 1999 which seems to imply a much higher ceiling for stock valuations. It probably doesnt, because of the uniquely delusional nature of the tech stock bubble. That market was driven by newly-minted dot-coms and related companies that in many cases had minimal or no earnings, so prices werent related to profits. In other words, you cant calculate a price/earnings ratio if there are no earnings.
Eyeballs that is, the number of people visiting at a dot-coms website had temporarily replaced traditional valuation measures in the hearts of speculators. With disastrous results.

Todays market, in contrast, is made up of companies with actual earnings, so it might be safe to discount 1999 and use the rest of the chart for comparison. In which case current equity prices look extremely dangerous.

Comments from Benjaminis: Now that it is clearer where I am heading with my fundamental knowledge which I obtain through hours and hours each day of reading I can start to apply it to a Trade Plan.

Right now I have 2 almost certain WIN guaranteed Trade Plans.

My first one is to short USD/JPY from where it is today until it reaches 105.00 then I will review my options. The second one is go long Gold and Silver until Gold reaches $1325 US and Silver reaches $18 US.

Now it will be easier to explain my Money Flow Method. I know from my 10 year old career in trading currencies that as the value of one Asset Class changes it affects another. For example we now have Risk Off because of the Trump Factor which now has been in place since November 9, 2016. On Wednesday , December 14, 2016 that Factor may change. That is when Janet Yellen announces the FED rate decision at 2:00 PM. Will we have buy the rumor and sell the news ? Regardless of the decision I will be ready to FOLLOW THE MONEY FLOW using proper Risk Management. While technical indicators are very important and part of my strategy when PERCEPTION turns to REALITY you can ignore Support and Resistance short term until new Support and Resistance is set. Two recent examples are the British Pound and the Euro. We of course can add USD/JPY because it is a safe haven currency and money ALWAYS flows there on Risk Off as it also flows short term to the US Bonds whether they are the 2 Year or the 5 Year or the 10 Year or the 30 Year US Bonds.

Since the November 8, elections the Fixed Income or BOND MARKETS of the world have suffered real losses of OVER TWO TRILLION Dollars and the funds not all of course has flowed into the equity markets of the world. When the EQUITY markets revert to more realistic levels then we will see a REVERSAL.
Knowing this I have 100% guarantee of which Asset Classes to buy or sell. THAT IS MY EDGE !!!

It is common knowledge that 95% of all currency traders specifically the retail traders lose their money. There is a reason of course. I took over 3 years to learn my trade only Demo Trading and that was a great learning experience for me since FEAR was eliminated and Greed was not really much of any issue since I could not spend my demo dollars on the nice things in life. :-)

The EGO in my case was build up since over 75% of all my forex trades were winning ones and I averaged a ROI or return on demo investment of $50,000 US dollars of a minimum of 5% each and every month during the last year during 2005 of my demo trading. I would NEVER trade real funds unless my starting capital was $25,000 US and there is a reason behind that.

Risk Management is the MOST IMORTANT part of my teaching. I am still looking for a maximum of 6 forex traders that would take 30 days to learn free of charge my Money Flow Method with proper Risk Management.

FREE OFFER AT NO COST OTHER THAN YOUR TIME !!!

I will teach the first 6 traders that sign up here how to earn 5% NET a month or ROI of 5%

CONDITIONS:

(1) You must have been trading for at least one year.
(2) Your methods have not been profitable.
(3) You will invest one hour a day of your time.
(4) You will open up a $50,000 US Funds Demo Account with FXCM UK
(5) You will email me your user name and password so that I can check your results daily.
(6) I will give you 30 days of my time and knowledge and at the end of the 30 days I will give you a grade out of 100 HOWEVER your real Grade will be if you show NET PROFIT or ROI of 5% or $2500.00.


The first 6 qualified persons that sign up and agree to the above conditions will be given my Private Email address so we can communicate. All QUESTIONS AND ANSWERS WILL BE PUBLISHED ON THIS THREAD IN ORDER TO HAVE FULL DISCLOSURE.

Thank You and have a Great Trading Day !!!

Contact Benjamin at [email protected] Thank You and I look forward to hearing from you.

Information from post 87 on December 11, 2016 on page 5 of the thread.

VERY IMPORTANT TO FOLLOW:

http://www.investing.com/rates-bonds...ear-bond-yield

As the 10 Year US Bonds go down in value the Yields go up and do the work of the FED whatever the FED does.

Look what happened since November 9, 2016 since the US Presidential elections.

http://www.investing.com/rates-bonds...ear-bond-yield

STRONG BUY ? Not if the Dow reverses with Risk Off. Look at the USD/JPY chart.

http://www.investing.com/currencies/usd-jpy

Hello all traders not registered to post on Forex Factory. It would be very helpful to have questions on I am sure this new subject matter so please register and post any questions that you may have. The only way to learn is to ask questions. Thanks for your interest.

Chart from Finviz for USD/JPY

https://finviz.com/forex_charts.ashx?t=USDJPY&tf=h1

US Dollar Index Finviz Chart

https://finviz.com/futures_charts.ashx?t=DX&p=h1

The Euro makes up 57.6% of the index. This is a FUTURES chart not the Spot Price.

Benjaminis

Information from post 88 on page 5 of thread dated December 11, 2016.

http://www.investing.com/analysis/do...2400-200169312

This is one of the best up to date article on the reality versus the perception. The author is one of the best out there. Enjoy !!!

Snippet:
Last One Out, Turns Off The Lights
I know, lots of charts, but bear with me. (pun intended)
As shown below, the market is currently pushing well into 3-standard deviations above the 50-day moving average. As discussed above, such extensions are rare and do not historically last very long.

http://c3352932.r32.cf0.rackcdn.com/...c8604582a5.png
SPX Daily 2014-2016 with 50DMA

As shown at the top of the next chart, the market is currently at 92% of a full 3-standard deviation extreme. The horizontal dashed red line shows all the previous times the market hit such extreme levels going back to 1992. Short and intermediate-term corrections are common along with more major crashes.

http://c3352932.r32.cf0.rackcdn.com/...feb52e5495.png
SPX Daily 1992-2016

This last chart shows a longer-term picture of quarterly data back to 1942. With valuations high and the markets extremely overbought, as shown by the vertical red dashed lines, corrections have been common. The highlighted areas show where extreme deviations have collided with really bad outcomes.like now.

http://c3352932.r32.cf0.rackcdn.com/...0cf574b52b.png
SPX Quarterly 1942-2016

Here is the point. Despite the rampant optimism running through Main Street and Wall Street since the election there is little changed economically speaking. The economy remains weak, labor costs have surged, monetary policy has tightened, and a stronger dollar negatively impacts corporate earnings. Wages havent increased much for the average worker and employment is still trending lower.
In fact looking at the primary indicators of things that affect the production side of the economic equation, things dont look so good.

US Dollar Index

http://www.investing.com/quotes/us-dollar-index

Information from post 90 on December 11, 2016 from page 5 of this thread.

Quoting BenjaminIs
{quote} Davit , You are very welcome. I would like to share with you and any interested parties the REAL ISSUE concerning the UNFREE Markets and the following as explained in this excellent article about the present economic system the world economists follow and what is taught in universities around the world. https://www.theguardian.com/business...-from-the-dead Snippet: Keynes died 70 years ago. We ignore his wisdom at our peril Justin Talbot Zorn and Merle Lefkoff The...
Hi Ben I will surely go through the material.Thank you.
Check out my system at Pivot trading with TDI
Its a great way to build equity.Example of my many positions now.I am also short on UJ ATM
Attached Image (click to enlarge)
http://www.forexfactory.com/attachme...1&d=1481496687
Patience is the companion of wisdom. Saint Augustine

Information from post 91 on page 5 of this thread dated December 11, 2016.

This will be the last one for the moment. It might be the MOST IMPORTANT ONE as it relates to a MAJOR CHANGE in the Currency World starting during early 2017.

Have a peaceful day !!!

http://www.goldcore.com/us/gold-blog...inance-market/

Snippet:


The AAOIFI, in collaboration with the World Gold Council (WGC) and Amanie Advisors, has approved what will become known as the Shariah Gold Standard. This is a set of guidelines that will expand the variety and use of gold-based products in Islamic Finance.
As many as 1.6 billion Muslims in the world, 25 per cent of the population, will have far greater access to the gold market than they have since the birth of modern finance, which has been primarily structured towards Western ideals.
More details were announced at the World Islamic Banking Conference including details of the gold products that are likely to be permissible.

The sharia gold standard announced yesterday allows the over 110 million investors in the Islamic world to invest in
a) vaulted gold
b) gold savings plans (such as GoldCore’s GoldSaver)
c) gold certificates
d) physical gold ETFs including “probably” the SPDR Gold Trust, the biggest exchange-traded gold (GLD)
e) gold mining shares (within certain Shari’ah parameters)

We know three things that the new Shariah gold-standard will achieve:

a) Increase diversity in the number of available Shariah gold compliant investment products

b) Greater emphasis on the role of physical gold in gold transactions

c) Islamic finance will have greater say in the setting of the gold price
To some, this may appear to be an unnecessary formality taken by the body whose guidelines are followed by Islamic finance institutions across the world. After all, physical gold is Shariah-compliant and holds a unique status for Muslims.
AAIOFI states, “From the perspective of Islamic Fiqh and the Islamic economic system, gold has its specific significance. This significance arises from the specific principles provided for gold and silver as Thaman in Shari’ah.”

According to Islamic texts, gold is a ribawi item, which means that it must be sold on weight and measure, and cannot be traded for future value or for speculation. In order for a gold instrument to be Shariah-compliant, the precious metal must be the underlying asset in related transactions.
However there has been a need for clarification for how gold bullion can be used for investment purposes by Muslims, for a long time.

This uncertainty has kept Shariah-compliant offerings at a minimum and many investors restricted by the type of gold bullion transactions they are able to partake in, with most focused on jewellery and coin offerings. Daud Bakar, chairman of Amanie Advisors, agrees, “.the existing Islamic standards for gold are fragmented, hampering product development and market demand.”

Currently in the gold market, the majority of activity regarding gold financial instruments is based almost entirely on speculation. This is due to the overwhelming size of both the London and COMEX (Chicago Mercantile Exchange) gold markets, which together have the greatest influence on the spot price of gold.

Whilst Islamic investors have always had access to the gold market through jewellery and coins, this guidance will vastly increase the number and diversity of investment products available. There are very few Shari’ah-compliant gold offerings today. Using its deep sector knowledge, GoldCore, and its Islamic partners, have been working on a comprehensive solution for two years and will provide the solution to qualifying Islamic financial institutions in early 2017.

With gold investment platforms such as GoldCore able to offer segregated, allocated gold bullion accounts with the option of physical delivery, Muslims are now able to invest in gold bars and coins.

The new ‘gold standard’ will affect the gold market globally as 1.6 billion people will be able for the first time to use gold bullion products and platforms that offer physical delivery, allocated and segregated gold ownership.

“For a number of years we have been working on an institutional gold platform and indeed a Sharia compliant gold bullion solution for the institutional market. As a market leader in precious metal storage, we have been consulting with major institutions and our strong partners to deliver allocated and segregated gold storage services to investors throughout the world”, said GoldCore CEO, Stephen Flood.

If Islamic Finance institutions were to allocate just one per cent of assets into new gold products then we would expect to see demand climb by about 500-1000 tonnes, per annum. Given that recent demand and supply figures showed a surplus of just 172 tonnes of gold in the market, we could begin to see some tightening with the increase of Shariah-compliant gold instruments, which will have a positive impact on the price.

It is not unreasonable to expect a minimum one per cent move of Islamic finance assets into gold, especially when you look at how it has performed. WGC data shows that in the last eight years the major Islamic asset classes (including REITs, the Takaful index, the Dow Jones Islamic Equities Index and the Dow Jones Sukuk Index) have all underperformed compared to gold, as have the major currencies used in the Islamic world.

Comments from Benjaminis: This is why I also am looking a my Gold long Trade Plan.

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

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

http://finviz.com/futures.ashx

http://finviz.com/forex.ashx

http://www.cnbc.com/2016/12/20/asia-...-decision.html

Snippet:
Australia's ASX 200 rose 0.55 percent, led by gains in its materials sub-index, which was up 1.06 percent and its energy sub-index, which gained 0.59 percent.

Shares of Bellamy's Australia, suspended for the past week week, were in the news on Wednesday as the company requested the suspension to extend for another three weeks, amid talks with key suppliers and manufacturers. Bellamy last traded at 6.68 Australian dollars ($4.86) per share.

"The fact that this situation has gone on for so long and that negotiations with suppliers are under way suggests that there may be material issues with the company," said Ric Spooner, chief market analyst at CMC Markets, in a note on Wednesday.

In South Korea, the Kospi was up 0.45 percent.

"It's a good day to be an equity bull however, it's a slow grind higher as opposed to an explosion in demand and the moves we are seeing in many markets are fairly subdued," Chris Weston, Angus Nicholson, chief market analyst at spreadbettor IG, said in a note on Tuesday.


U.S. blue-chips index Dow Jones industrial average closed up 0.46 percent at 19,974.62, a mere 25 points away from the key level of 20,000.
The S&P 500 ended up 0.36 percent at 2,270.76.
The Nasdaq composite gained 0.49 percent to 5,483.94 and had touched a new all-time high during the Tuesday session.