Have you asked yourself yet, ‘what is a PIP anyway and why should I care?’
Great question! A pip is an increment of measurement in the FOREX market. It stands for ‘point in percentage’ and depending on what currency pair you are trading, typically is 1/100th of a penny.
This is important to you for 2 reasons. The first layer of importance lies within the Fx365i methodology that we teach at the institute. And the second, is eventually going to be important to your bank account.
First of all, the ‘Market Makers’ (mainly the big banking institutions), follow a repeated pattern of business in the market. They accumulate the market to soak up liquidity (retail trader’s money), then they manipulate the market to knock said retail traders out of their positions (often times the majority of retail traders are correct in their market speculation, but not before the market swiftly moves against them to take them out of their position,) before ultimately taking the market where they need it to go to profit heavily. This is all measurable in PIPs, which is good news for us because knowing some of the measurements these guys use, we can increase the affectivity of our speculation dramatically so that we can trade for profit.
The second reason that this is important, is because by knowing how the market reacts at certain prices, based off of repeated measurements, we can have a specific place of entry for our trades. This increases probability, and more importantly, allows us to more effectively manage risk. If you buy a currency low, and it moves upwards in pips, you can sell the position you are holding and however many pips make up the difference between where you bought and sold, or sold and bought again (trading short,) are now yours to keep. Simple enough right? Even better, the market moves 100’s of pips ALL THE TIME…yes, like every day!
Oorah you might be saying to yourself. But wait! It gets better.
Pips are pips, and if you learn the skill set of capturing pips consistently, you can literally write your own income. How you ask? Not by capturing more and more of them, but by assigning a higher and higher dollar amount to them.
This is the magic of FOREX. Once you learn how to safely capture PIPS, you can give yourself a 50% raise overnight. You can do that over and over again. Imagine walking into your boss right now and saying, ‘I am going to produce the same amount that I currently do, I am going to work the same amount of hours I always have, and I want you to pay me 50% more!’ Now imagine doing that again next month, and then the month after that, in perpetuity.
No job I’ve ever had works like that, which is one of the many reasons it might be worth your time to learn how to safely and effectively trade the FOREX for profit with us!!!
Until next time, live happy and pursue your passion.
Okay, okay, I know, I’ve heard it too – all the modern pseudo pop-psychology of ‘The Power of Positive Thought’, ‘Attitude is Everything’, the ‘Law of Attraction’, etc. Aren’t we all getting just a little bit tired of all the clichés? I mean, it can’t all be true, can it?
Well what if it is? All of it. And what if it’s the one thing that is keeping you from where you want to be; maybe in your trading, personal small business, career, personal finance – you name it.
As it turns out, more winning athletes, entrepreneurs, political figures, and other notorious characters that I can shake a stick at, have at one time or another referenced their mindset as a key attribute in the success that they have accomplished.
If all of these people who have at least financially achieved a status that most of us would aspire to reach, were to openly suggest that this may be a key part of their success, why oh why, must we roll our eyes at the idea of doing such a thing ourselves?
I read that Muhammed Ali once said, “It’s the repetition of affirmations that leads to belief. And once that belief becomes a deep conviction, things begin to happen.”
Admittedly, I’ve always had mixed feelings about affirmations. Part of me felt like there was obvious truth to it, and the other part of me felt that it was redundant and dishonest.
However, I trained in a gym with high level athletes for years. During that time, even though I personally had a fairly high level of fitness, I had generally plateaued. Now it’s not what you are thinking, one of these stories where I was actually reading Vogue on the treadmill and texting on the weight bench and calling it hard work. No, this was something else. One day I thought about the type of (affirmation) dialogue I was having with myself repeatedly: “This is going to suck’”, “Ahh this workout is so gnarly”, “I’m about to get wrecked”.
There wasn’t much positivity in my dialogue. In February of 2015 I decided that I had to change the voices in my head (fun, huh?). I decided then and there that the outcome of every workout was going to be deemed awesome no matter what. Anytime I was going to do, or was doing, a very large effort in the gym, I repeated to myself, “this is going to be so good”, “I’m about to gain so much fitness”, “I love working out”.
So what happened? In the next 6 months I PR’d every movement we focused on in the gym. Seriously—all of them! Max pull-ups, deadlift, bench press, pushups, 2K row, bw in calories for time, 10min air-dyne test. Was there a correlation? Undeniably so.
So what does my fitness have to do with your trading you ask? Well, once you’ve been around the FOREX market for a while, the price action of the market itself is relatively simple. It either goes up, or down, and always for good reason. So why is it that some people interact so well with it and get rich, and others can’t seem to figure out up from down and blow up their accounts?
If you saying things like, “I got into this trade, so of course it went the other way”, “I suck at this”, “You’re such an idiot”, “This whole thing is a hoax”, “Is this ever going to be viable?”, “I’m not very good at this”… well you are, as Muhammed Ali would say, one of those people who are repeatedly affirming their thoughts into a belief, which is ultimately becoming a deep conviction and will inevitably happen.
Let me ask you this, how long would you hang out with somebody that was telling you all of those things? Not very long, I would hope. So instead, try this on for size.
‘I’m becoming a world class trader.’ ‘I’m getting it more and more every day.’ ‘I’m a great learner.’ ‘My account is starting to grow exponentially.’ ‘Trading is the hottest thing since sliced bread.’
Now of course, saying all of the right things probably won’t do much for you if you are already doing the right things like showing up consistently with a great attitude, continuously studying your fx365i virtual classroom, keeping accurate and thorough records of every trade you make, taking screenshots of your own trades and reviewing them weekly. However, if you aren’t doing all of those things, this might be the missing link.
Lastly, what is it that you are visualizing? How often are you imagining what it’s going to feel like to open up your trading station and have a six-figure account balance? How often are you imagining what your perfect trade setup would look like, and what it would be like to be in that trade? How often are you visualizing what it’s going to be like to close out a trade for five figures in profit? How often are you visualizing what your monthly account draw from your trading account to your bank account is going to look like?
If you are thinking, wow that sounds like a lot to do, I ask you this: How much thought do you think Muhammed Ali gave boxing? And if that’s not enough motivation for you, remember, Michael Jordan didn’t make his high school basketball team.
It’s that time of year again! Gyms will be over-run with temporarily zealous fit freaks, and life-changing resolutions are declared around the world. With the New Year upon us, it is, in my opinion, important to cast some direction and intention over the year ahead, as well as use the natural tide of change that rises upon humanity this time of year to our favor. Having said that, whether you are a new student with the fx365i, or one of our more seasoned students who wants to write a new chapter in their own history book this year, there are a handful of thoughts that I have had reflecting on the first 7 months of my trading career.
As the great Jim Rohn famously said, “any two years you can change your life forever. 18-20, 30-32, 68-70… Any two years.” To go along with these words he added, “for things to change, you have to change [and] for things to get better, you have to get better.”
I start with that thought because each of us arrived at the fx365institute with the belief that every successful entrepreneur has…
-a better future than their present
-has the absolute power to make it so
And with that, here are 7 things that will help you reach your goals:
Before you start on your journey, take the time to have a clear and defined written explanation as to why you have chosen to take the time and energy to learn to successfully trade the forex. Of course the obvious answer is to make money, but the reason why is what is going to pull you through the frustrating times you will have. The stronger and clearer this reason is, the easier it will be to work through your inevitable shortcomings as a trader and remain solution oriented rather than obstacle focused.
#2) Do not measure your progress in pips.
The immediate trading cliché that didn’t take me long to realize is that in Forex trading “You either win or learn.” As much as I would’ve liked to be a trading prodigy and had an alarming win rate from the beginning, the reality is that I learned almost nothing from a winning trade. At no point that I can remember did I take a positive trade and dissect my own screen shot to figure out where I went wrong. You can practice bad behavior and in the short term you can be up, however the market will expose your mistakes, and it’s ok. Instead measure yourself by the activities you are doing. Study the Virtual Classroom, read the Forex book, engage daily in fxlive, take and archive your screen shots, your trading journal, learn what all of the basic signals are on your charts, and measure your progress off of how well you are doing those things.
#3) Have a realistic expectation for how long this is going to take
One of the immediate shortcomings that I had was that I felt like I had uncovered Pandora ’s Box when I learned about the way that the market works and how we trade alongside the market makers. This caused me to believe this would insulate me from losing and that I would be well on my way right up the lot ladder fast. Here’s what I would tell myself now. Look at the lot ladder, get excited about the lot ladder. It’s real, and it’s not out of reach…however, before you get to start up it, you have to learn how to trade, so give yourself time. Cutty told me in our first conversation that he anticipated taking a year to learn to trade and a year to build up his trading account, which I promptly dismissed because admittedly, I’m young and overconfident. Turns out, from where I sit now, that’s not a bad business plan. Can it be done faster? Of course, but let’s get serious, there’s a reason Jim Rohn says, ‘any two years can change your life.’
#4) Be a good student.
#5) You will probably ask yourself all of these questions…
#6) Play to Win
There is a saying that says ‘if you mess up once it’s a mistake, if you mess up the same thing a second time, it’s a decision.’
While it’s likely in your trading you will make the same mistake more than once, make the commitment to yourself to understand the mistakes your making, take a pro-active approach to each step of your trading. Analyze, discuss, review, try again and dig in… Anything that can deliver the leverage and exponential returns the way that successfully trading the forex can is going to be a challenge, and of course is going to be worth it.
#7) Have Faith
‘The difference between belief and faith’
Years ago there were two friends. One day one of the friends decided he wanted to do something exciting, so he took up tight rope walking. After practicing for months and months walking carefully back and forth on a line strung feet above the ground, he began to feel the urge to accomplish something spectacular. He began to craft an exhibition where he would walk a stretched cable between two rooftops, high enough that if he fell it would result in death. To make his feat all the more impressive, he decided that he would not only walk the tight rope, but he would push a wheelbarrow across it with him.
He practiced and practiced while his friend watched on, impressed with his determination and relentlessness. After perfecting the stunt over and over again and arranging for the big day and exhibition, the time had finally come.
The two friends stood atop the skyscraper eyeing the cable stretched tight between the rooftops. Time seemed to stand still. The sound of chatter amongst the crowd standing below, although constant, faded away to the ears of the two men.
In the final moment as the tight rope walker draped his feet over the cable and steadied his grip on the wheelbarrow handles, the friend was faced with the choice of belief, or faith. His belief led him to have the utmost confidence that his friend would complete the exhibition, but it was his faith, that caused him to get in the wheelbarrow.
In closing, have faith in the journey, the frustrations you will face, the institute, and yourself. Have fun, and in a few years when you are living your ‘Why’, look back on this time as a distinct moment where you went for it 100%…
This week we are going to be focusing on the Market Maker Manipulation and content behind the scenes that played out on November 18th during the release of the FED’s Minutes, which had quite an effect on the EUR/USD. The entire move, from it’s initial setup to the profit release to the short side, was truly a spectacle to behold.
Should you have any issue understanding some of the terminology in this post, please refer HERE.
As you can see from the image above, all of the normal components of the Market Maker Business Model were present.
This is all well and good in hindsight but what we are going to be focusing on is how to read the signs leading up to, and taking advantage of the entry.
We will start small with some of the clues on the 5 minute chart, and work out to the larger time frames. As you can see in the image above, some pretty standard things played out. When news was released price whipped down to a past 8HR Average Price. This was the exact entry to test, that ended up being worth quite a hefty sum of pips. Taking that in the midst of High news snapping around can be a bit unrealistic though. There was also some play around a past Daily Average Price line, but that becomes much more pronounced on some of the higher time frames.
After taking out a past accumulation Dot (which was the best entry into the short earlier in the morning), price stalled out and started pulling back.
The real entry into this trade took place around 25 minutes post news when price completed it’s 32 pip pullback. For those unaware, the Market Maker’s Business model functions off of a 30 & 45 Pip system. Landing this entry had a risk of around 4 to 6 Pips, with a massive upside.
Of course, this is all on the 5 minute chart. Let’s take a look at how some higher time frames might have lent themselves to a long move playing out.The 15 minute chart is where things really got exciting. As stated on the picture, accumulation in the form of a 15 minute Dot took place on a past Daily Average Price line (represented by the tan line). These past levels have shown time and time again that they are some of the prices of choice for Market Maker’s to place trades of their own.
When the Market Maker’s accumulate orders at a price level, they allow the retail trader to also get in at that price. It is how they generate liquidity for their own massive trades. The retail trader’s stop levels was represented by the yellow liquidity line left near the low.
When news came out, it broke right through this level (stopping out any retail trader’s in a long position). After this stop out had taken place, price rose back up, and ended up being a rotation off of that original Market Maker entry point. This effectively took out retail traders, while protecting Market Maker interest in the pending long move.
The 1 hour chart was actually surprisingly similar to it’s 15 minute counter part. There was an accumulation Dot dead on that past Daily Average Price line, followed by a stop out of retail orders. Following the stop out, price rotated back up through the Dot, showing Market Maker’s protecting their own interests in a long position.
At this point there was a great deal of information point to the probability of a long trade, with virtually no risk. As a student of the FX365 Institute, this is an ideal setup.
With the current layout of Smart Money Profile Software, we do not track Accumulation Dots on the 4 Hour chart, however it is plain to see what took place. It was further rotation off of that past daily average price line. At this point, a trade to the long side is inevitable.
Once the long trade played out (which was worth about 120+ pips), I’m sure you can see that the market ended up backing off and going into an even larger run to the short side. Let’s take a look at that to see if there were any signs to get into this trade.
When I’m explaining the Market Maker’s Business Model to a new student, I like to use the gear analogy: The 5 minute gear spins the 15, which in turn spins the hour, that then spins the 4 hour, so on and so forth.
What was an Accumulation, Manipulation & Profit Release on its own ended up being a manipulation to the long side. This Manipulation was intended to knock out a serious number of retail traders from the on going short of the EUR/USD.
As you can see in the picture above, price traveled up and ended up bouncing off of a daily Average Price line. These price lines represent Market Maker Entries into their own trades. A Bounce off of one (especially on the daily chart) is a serious sign of a coming profit release in the opposite direction.
And since it has been mentioned so many times, here is the Daily Average Price line brought up throughout this post. It was formed May 15th, 2015, and all these months later has proven to be an invaluable price level to keep track of.
If you have ever been in a trade, only to get stopped out moments before the move takes off, I would encourage you to look into the Market Maker’s Business Model. If you ever get the feeling Forex is rigged against you, it’s because it is. Luckily for us though, the Market Maker’s system plays out time and time again on every time frame in every currency pair. Learning how to read the 3 stages of the Market allows you to get in when they do, and take your profit when they do. While it can still be hard to master, it certainly levels the playing field in Forex Markets.
Thanks for the read, and be sure to subscribe if you found any of this information useful.
Director of Education
I was asked if I would blog about my experiences as a New Student at 365 Forex and thought it would be helpful for those of you who were wondering what it would be like to enroll. I also think it would help my learning to put down what I am learning and feeling.
A little history first…..I was looking for a way to create additional income. I am currently a Certified tax preparer and really busy for 3 months. During the rest of the year I do business consulting with an organizational called Catapult Leadership. That contract is for 1 week a month. The rest of the month—-my time!!!!
I am very interested in the financial markets and have always been extremely passionate about what is happening with the economy and how I could use my knowledge to my advantage. I saw an ad for a company called “online trading academy” and went to a presentation. I was so excited to learn something new and make $$ doing what I love— leveraging the market to my advantage. The presentation was very professional and informative however they only really wanted to manipulate me into purchasing additional education modules. I was disillusioned and disappointed. I read some of their reviews and realized there as a large group of folks like me that were also “duped”.
I wasn’t going to give up though! I did my homework and found another online trading company 365 Forex and went to tour their facility. The experience there was profound. No high level sales manipulations, no ridiculous high-priced commitment. Their business model made sense to someone who is a business consultant. They make their money when we make money. So for only a 5000 investment for their education modules and daily online sessions. I could learn what I need to learn to supplement my income.
Signing up was the easy part. Now it is up to me to learn. At this point I have watched the modules….I have traded using the “fake account”….I have funded my real account……and I am ready to start trading. However I am stuck….I am taking this experience seriously and don’t feel I have done my job in the education process. There are still areas I don’t understand and need to learn. The folks have been there to support me but I am not “supporting me”. I want to understand what I am looking at…I don’t want to make a trade for the sake of making a trade….I don’t want to approach this experience like I am going to a “slot machine” and hoping that luck will get me through.
I have met a lot of people using this software and watching the daily sessions and they are making great money “doing this”…quite frankly I envy them. I know they know something I don’t and that bothers me. As you follow my journey to “learning this” I will do my best to provide you with a template to also “learn this”. Right now I am frustrated with myself that a “tax accountant/calculus major” – who “thought this would be easy” is finding it’s not!! I guess the old adage “if it was easy everyone would do it” holds true. My next step…..going to make a plan to “get there”….guess I should’ve done that first…..