Attacking Currency Trends

GREG MICHALOWSKI is the chief currency and trading analyst for FXDD. Prior to joining FXDD, he was an assistant vice president and trader in the treasury/funding area with Citibank in New York, a vice president and interest rate derivatives trader at Citibank in London, and a vice president and trader in the banks funding department at Credit Suisse First Boston. Michalowski maintains a daily market commentary and currency analysis website at fxdd.com. His market comments are quoted in the financial press by Bloomberg.com, Reuters, and the Wall Street Journal, and he has written for various print and online trading publications, including eForex, Equities magazine, forexstreet.com, stocktwits.com, and forexfactory.com. His twitter site, twitter.com/gregmikefx, was one of thirteen cited by SmartMoney magazine as a "go to" source for making money moves.

• Acknowledgments xiIntroduction 1PART I The Foundation for Success 19CHAPTER 1 Stereotyping the Retail Currency Trader 21They Think Trading Currencies Is Easy 22They Have Too Much Fear 27They Lose Money 29They Are Too Fundamental (Not Technical Enough) 31They Don’t Know Enough about Key Fundamental Requirements 34They Fail to Anticipate Trends 45Don’t Be Like the Rest ... Change! 46CHAPTER 2 The Six Attributes of a Successful Currency Trader 47What Are You Good at Doing? 47There Will Always Be Peaks and Valleys 491. Skill or Aptitude 492. Practice, Practice, Practice 523. Know Your Risk 544. Create and Execute a Plan 585. Control Your Fear 616. Be Greedy Enough 63A Foundation for Success 66CHAPTER 3 The Mission Statement 67A Team of One 68A Two-Part Mission Statement 70Finding Trades That Satisfy Your Mission Statement 76The Importance of Staying on Trend 80CHAPTER 4 What’s Your Game Plan? 85Every Mission Statement Needs a Game Plan 86Trade the Trends 86Keep Fear to a Minimum 91Never Underestimate a Strong Foundation 97CHAPTER 5 Rules for Attacking the Trend 99Rule 1: Keep It Simple (but Stay Positive) 100Rule 2: Have a Reason to Place a Trade 105Rule 3: Be Picky about Your Tools 107Rule 4: The “If . . . Should” Rule 115Rule 5: Look Ahead, but Not Too Far Ahead 117Rules Rule 120CHAPTER 6 The Trader’s Toolbox 121 Rules for the Tools 122How to Use Fundamental Analysis 122The One Thing We Can Agree On: Price 125The Tools 131If I Had a Hammer 146PART II Tools and Strategies 147CHAPTER 7 Moving Averages 149What Is a Moving Average? 150How to Use Moving Averages 151Time Frames for Analysis 156Anticipating a Trend 164Managing a Trend 167Managing Profits 169Trade Setups 171The Push That Gets the Market Going 177CHAPTER 8 Trend Lines and Remembered Lines 179Bullish Trend Lines 180Bearish Trend Lines 183Channels: Highways to Ride the Trend 186Flags and Pennants 190Finding the Golden Ticket 192Remembered Lines 197Simple but Effective 204CHAPTER 9 Fibonacci  Retracements: The Hybrid Tool 205Introduction to Fibonacci 206Placing Retracements on a Chart 210Using Fibonacci Retracements 214Trading Shorter-Term Corrections 227Using the Tools to Your Best Advantage 231CHAPTER 10 Preparing for the Trade 233First Things First 234Analyzing the Charts 236A Composite View of the Clues 249“Is Ita Boy ora Girl, Doc?” 251CHAPTER 11 Executing the Game Plan 253The Kickoff: The Entry Trade 254Managing the Trade 256Finding Clues in the Consolidation Phase 264A Borderline: Always a Low-Risk, Unambiguous Level 266Another Trend Reentry 267The Key Role of Borderlines in Hourly and Daily Charts 271Attack the Currency Trend 275About the Author 277Index 279