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FOREX Forecast Legend
Trend Direction: Direction of market
movements based on the weekly charts. This offers a medium-term
(1week - 1 month) to long-term (1+ month) view of price movements.
The week ending date provided indicates the start of the new trend.
#1
rule to trading is to always
trade with the trend.
Trend Reversal Point:
The price listed is the forecasted level where a trend reversal is expected
to occur. This does not yet indicate a complete change in trend direction,
but serves as reference to enter a short-term trade (< 1 week) on
a price break above or below this level.
Note:
Trading off of trend reversals
should only be conducted on a
short-term basis with tight stops.
A 30 Pip stop loss is recommended.
Expected Highs and Lows:
The expected high and low for the week on the referenced currency pair.
This is based on a calculation of the prior week's actual price movements.
The
forecasted trading range is helpful in understanding the weekly average
movements of each currency pair and is more commonly used in determining
ideal entry points and exit points.
Momentum and Volatility:
Both are important factors in price movements. They are categorized
as heavy, medium and light. Medium momentum and volatility are ideal
for medium to long-term trading, and the reason is consistency in price
movement. Currency pairs that are heavy and light in momentum and volatility
are normally short lived and do not present multiple opportunities to
compound your trades.
Note:
Both momentum and volatility
must be present for price movements
to occur. Do expect momentum levels to increase as volatility levels
rise.
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