Arbitrage, to explain briefly, is to make a risk-free profit by simultaneously buying from the low-priced market and selling in the high-priced market, in case the price of the same security, currency or precious metal traded in different markets is different. These products can be precious metals such as gold or securities such as stocks. The aim here is to make a profit completely risk-free. One of the most asked questions today is Arbitrage, that is, how to make a risk-free profit?” is the question. For this, many large-scale and globally known companies seek an answer to this question by creating arbitrage pricing models. However, in today's capital markets and money market conditions, this is more difficult than it seems. Because now almost all markets are intertwined and information sharing has reached incredible speeds. For this reason, it has become increasingly difficult to manually mispricing in any market and thereby making profits by arbitrage. When this is the case, arbitrage transactions have become made with algorithmic software. These softwares perform risk-free arbitrage transactions by sending orders to both exchanges at the same time, when an arbitrage opportunity arises for the same security traded in different markets.
Bear and bull market concepts, which are frequently encountered terms in financial markets, provide information about the direction (trend) of the market. The bullish market is the period when the market is in an upward trend, that is, the prices will follow an optimistic environment in the future and investors will start buying. It is assumed that the origin of this term comes from the belief that bulls lift everything from below with their horns. It is possible to encounter comments such as "the beginning of the bull market", which we mostly see in stock markets and commodities such as gold, in the forex market. In a bear market, the situation is the opposite of that in a bull market. In other words, the market is in a downward trend and a pessimistic atmosphere prevails in the market. For a bull market to start, technically it is expected to have risen 20% from the lowest level of the relevant market.
STAGES OF THE BULLISH MARKET
1. Stage-Collection: It is the stage where the goods with very cheap value, which are sold by the investors who are at a loss and who are discouraged, start to be collected by the big investors. There is no clear uptrend yet and there is still little interest in the market in general.
2.Stage-Buying Wave: It is the stage in which the signs of improvement in the market are clearly noticed after the collecting stage, and small investors are now included in the buying wave, and the transaction volumes increase.
3. Stage-Saturation: With the increase in volume, the market has reached a certain saturation and the buyer in the market has decreased considerably. It indicates the end of the Bull Market, then the start of the hard bearish wave can be expected.
EXAMPLES OF BULLISH MARKETS
Gold has been in an important bull market since the early 2000s. Gold prices had risen from levels of 800 dollars an ounce to 1900 dollars an ounce. This is an example of a strong gold bull market formation.
The concept of bear market is a term frequently used not only for forex transactions but also for all financial markets (stocks, bond market). The bear market is called the English bearish market. The bear market is generally used when the markets are in a pessimistic state and there is an expectation that prices will be in a downtrend for a long time. To say that a financial product has entered a bear market, first of all, the main trend must be down (downtrend). However, if there should be a 20% downward move from the previous high level.
Although there is no general opinion about how long the bear market will last, it is expected that prices will continue to decrease for a long time. Demand for products in a bear market is decreasing. Since the demand has decreased, nobody wants to buy those products and the prices continue to fall.
The bull market, on the contrary, shows that the relevant market will be in an upward trend for a long time and the demand for the products in that market is increasing.
GOLDEN BEAR MARKET – BEARISH EXCHANGE MARKET
A gold bear market indicates that gold prices will remain lower for an extended period of time, with prices showing a downward trend and this trend will continue. The stock market bear market also indicates that the stock market index will stay lower for a long time, the prices of the stocks show a downward trend and this trend will continue.
If we take the gold prices as an example, it was in an upward trend for a long time from the beginning of the 2000s to the end of 2011, that is, there was a bull market. However, in mid-2013, it dropped from its 2011 peak price level of $1900 an ounce to below $1500 an ounce. There was a drop of around 30% from the previous peak and gold prices were officially under the bear market effect.
Bollinger bands are volatility bands developed by John Bollinger in 1980, placed above and below the moving averages and frequently used in technical analysis. Volatility is a variable depending on the standard deviation, and increases or decreases in volatility affect the standard deviation. Bollinger bands expand when volatility rises, and narrow when volatility decreases. In 2011, Bollinger bands were patented in the name of John Bollinger. Bollinger bands show whether prices are relatively high or low. According to Bollinger, bands contain 88-89% of price movements. For this reason, he states that price movements outside the Bollinger bands are unusual. Technically speaking, if the prices are close to the upper band, the prices are relatively high, and if the prices are close to the lower band, the prices are considered to be relatively low. However, relatively high prices should not be interpreted as a buy or sell signal.
Flag formations are graphic formations that are formed in the short-term view and mean the continuation of the trend. The flag pattern is definitely not a reversal pattern. Flag formation and pennant formation are very similar to each other. To define it briefly; after a very sharp upward price movement, a short-term consolidation occurs and the shape of this consolidated chart resembles a flag. Volumes generally move low during this consolidated formation. In the formation of the flag formation, the first movement occurs as a result of a very hard upward movement and this creates the pole of the flag. Investors who missed this move can follow the flag formation. Flag formation is usually around eight bars, but never above twenty bars. In consolidation formations above twenty bars, the initial movement forming the flagpole loses its strength and the trend loses strength. The signal to enter comes when the upper point of the flag formation is broken. At this level, there is a noticeable increase in volumes. If the expected increase in volume does not occur, the formation will likely become obsolete. The target price level is usually found by adding the difference between the starting point of the flagpole and the part where the flag is formed, to the point where the flag formation is completed and the upward movement begins.
The Turkish equivalent of CFD means "Contracts for Difference". They are contracts that allow you to invest in intangible assets such as stocks, stock indices, bonds and commodities, and trade price expectations. In any CFD investment, you buy and sell price expectations and you do not physically own that instrument.
CFDs; They are derivative instruments that allow only price expectations to be bought and sold without actually owning assets such as stocks, bonds, indices or commodities. The sources of CFD contracts, which can be traded more easily and quickly with lower capital, can be various financial assets.
They are investment instruments that allow you to invest in the future expectations of the underlying product, without having a financial product with low collateral, by tying a lower collateral than the underlying product.
CFDs, which are preferred and fast due to the need for less collateral, and are an easy investment tool at the same time, provide the investor with the opportunity to make big profits from small price changes.
CFD products are divided into two as forward and demand. In demand contracts, there is no maturity on the underlying asset. In some demand CFD products, although the underlying asset is forward, the product can be traded as demand. In this case, the difference that will occur in the forward difference in CFD products may be reflected to the investors as transportation cost.
Support and resistance concepts are a technical analysis concept used not only in forex markets, but also in all financial markets. In general, support can be described as the level at which the decline in prices is expected to stop. The cessation of sales in the financial product at support levels is interpreted as the reaction of buyers at this level. However, it should be noted that if the important support levels are broken, that is, if the downside support points are passed, the sales will accelerate and the support point will now become a resistance point. Breaking a support point does not mean that prices sag below the support level. We can clearly say that a support level has been broken when it closes below this level. When we look at the historical charts in the Forex markets, the first thing that catches our eye is the support levels, where the sales have stopped and the prices cannot fall below this level.
Devaluation is a monetary policy tool used by countries that implement a fixed exchange rate regime or a semi-fixed exchange rate regime. A devaluation is a decrease in the value of the official currency of one country against the currencies of another country or against the value of a group of currencies or in monetary standards. Devaluation is often confused with depression and is the exact opposite of revaluation.
Devaluation is a tool used by the government or the central bank of the country fixed on the corresponding currency. One of the main reasons for devaluation is that the country reduces the value of its money to balance the trade deficit. Devaluation is to ensure that with a decrease in the value of the currency, exports become cheaper and become more advantageous in global trade competition. With it, imports become more expensive and the demand of domestic households for imported products is expected to decrease, while ensuring an increase in demand for products of the domestic manufacturer.
Although devaluation seems to be a positive monetary policy tool, it also has negative effects. Making imports more expensive can make domestic production less effective, or making exports cheaper can seriously increase demand and cause inflation.
WHAT ARE THE EXAMPLES OF DEVALUATION?
For example, Egypt had experienced severe currency pressure due to the fall of the US dollar on the black market. The rise of the black market had seriously disrupted Egypt's domestic production and investments. For this reason, Egypt devalued its own currency by 14% against the US dollar in March 2016.
After the devaluation, the Egyptian stock market showed very serious rises, but in the face of this, the black market forced the Egyptian central bank to take more measures. On June 12, 2016, the bank of Egypt once again devalued, reducing the value of the Egyptian pound against the American dollar.
Another example of devaluation is China. in 2015, China, which had serious problems with the credit market and economic contraction, devalued the local currency, the Reminbi. China, which has repeated this devaluation movement several times during the year, had warned China about intervening with monetary policy tools on global trade with the United States. The fact that countries are trying to gain an advantage in global trade by devaluing their currencies and becoming advantageous in exports is seen as the main reason for currency wars.
A rectangular chart pattern is formed when prices touch both levels for a period of time between support and resistance levels. These support and resistance levels are usually horizontal, but can also be in the form of a downward or upward looking channel. What is important here is not whether the support and resistance levels are in the form of horizontal or up/down channels; that they are parallel to each other. Rectangle formation begins with the rise of price movements from the support level, then after touching the resistance level, it retreats again to the support level and is completed by making a movement towards the resistance level again. On the other hand, it is possible to form a chart that starts with a pullback from the resistance level. A rectangular chart pattern occurs when prices touch the support level at least twice and the resistance level twice, in other words, at least four movements occur. If the prices break the support or resistance level and move in any direction before the four movements are completed, it will not be possible to talk about a rectangular formation. The entry point for the position is determined by which side the prices will break after the completion of the fourth move. The target price level, on the other hand, is the distance between the support-resistance levels forming the rectangle, up or down from the broken level.
The increasing transaction volume in the Forex markets, as well as professional and institutional investors, arouses the interest of people with different expertise and/or lower collateral, and plays an important role in attracting more players to trade in the forex markets. Leveraged transactions in forex markets result in investors with low collateral gaining higher profits/losses thanks to leverage.
Starting from 0.01 lot trading volume on Meta Trader 4 trading platform, which is a trading platform and used by more than 90% of FX institutions all over the world, while investors are taking positions in the Forex markets, for example, when making a BUY or SELL transaction in USDTRY parity. Positions of various sizes can be opened. If the number of digits after the comma, called Digit, is two and the last digit is non-zero, that is, it is written as 0.01, it is called a micro lot. Thanks to the micro lot application, it is also possible to open position sizes in the form of 0.02 / 0.13 / 1.27.
If the trading volumes are written as 0.10 / 0.20 / 1.50 / 2.70, that is, if the last digit (the second digit after the comma) always remains zero, then there is a mini lot application here. In other words, the minimum lot size that forex traders can use is a mini lot, not a micro lot.
Micro Lot Size; 0.01 Lot = 1.000 br. In other words, if the position is to be taken in USDTRY parity, a position of 1,000 dollars will be opened in the base currency, that is, in the initial currency. If the position size taken is, for example, 1.56 lots, then a position of 156.000 dollars will be taken.
Commodity is the name given to all commodities such as gold, silver, oil, natural gas, copper, cotton, corn, wheat, sugar, coffee that are subject to trade. The market where these goods are traded is called the Commodity Exchange, and there are 133 commodity exchanges in Turkey affiliated with the Union of Chambers and Commodity Exchanges of Turkey. Factors affecting commodity prices include seasonal changes, natural disasters, economic activities, supply and demand. Investors who want to invest in commodities should follow the effects of these factors, which will contribute to their right investment. Although commodity products are generally traded in futures markets, some products are also available in the spot market. E.g; CBOT (Chicago Mercantile Exchange) is the largest commodity exchange in the world, where commodities change hands on a forward basis, providing cash or physical settlement at the end of maturity. Commodity transactions in the futures markets are divided into speculative and hedging purposes. People who trade commodities for hedging purposes are generally manufacturers and companies that use these products in the industry. Those who trade commodities for speculative purposes are investors.
The stock market index is a value that contains certain stocks and is calculated as a result of calculating these stocks with different weights. The weights of each stock in the index value differ.
The most active stock market indices in terms of trading volume in the world are Dow Jones, Nasdaq, S&P500, Ftse and Xetra Dax. In Turkey, there are more than one index under Borsa Istanbul. Index types/index types with the highest number of transactions in Borsa Istanbul; BIST 100 index, BIST 30 index and BIST Banking index.
Stock market indices are calculated according to the weights of the stocks in them. E.g; There are 30 most active stocks in the Dow Jones 30 index. Some of these shares are; Goldman Sachs, Microsoft, Pfizer, et al. The stocks in the index are revised periodically, removal from the index or addition to the index is performed.
Inflation is an increase in the prices of goods and services. However, the prices of goods and services may increase or decrease over time. Inflation is not only an increase in the price of a particular good or service alone, but also a constant increase in the overall level of prices. In other words, inflation is not just a constant increase in the prices of some goods or a one-time increase in the prices of all goods. For example, the fact that the monthly inflation rate is 1 percent indicates that the general level of prices in that month has increased by 1 percent compared to the previous month. The fact that annual inflation is 30 percent also means that prices have increased by an average of 30 percent compared to the previous year, for example, a basket of goods bought for $ 200 last year can only be bought for $ 260 this year.
A decrease in inflation does not mean a decrease in prices, an increase in the purchasing power of people, an increase in their incomes. A decrease in inflation means that prices rise less, people's purchasing power decreases less, and as a result, stability and prosperity.
Inflation rates are also very effective on exchange rates, as they can directly affect the steps that central banks will take in their monetary policy. Because the inflation rate is the leading indicator for the changes that central banks will make to interest rates. For example, the expectation of an increase in interest rates comes to the fore if inflation rates deviate upward from the goals of central banks, while the expectation of a decrease in interest rates comes to the fore if the inflation rate remains below the goals of central banks.
For example, the Central Bank of the Republic of Turkey has set its inflation target for 2016 at 5%. However, domestic and foreign developments may cause this inflation target to deviate. Although this deviation rate does not have an exact value, downward movements in USDTRY AND EURTRY exchange rates (due to the appreciation of the Turkish Lira) can be monitored if the CBRT increases interest rates taking into account the course of global markets. Or, if the current conjuncture causes the CBRT to reduce interest rates, in this case there may be increases in the USDTRY and EURTRY exchange rates (due to the depreciation of the Turkish Lira). Of course, inflation is not a factor in exchange rate movements alone, but it is an important data that can cause volatility.
The Fibonacci Sequence is a series of numbers obtained by adding each number with the previous number. The characteristic of the numbers in the Fibonacci Sequence is that the series formed when the numbers in the Fibonacci Sequence are proportioned with the previous ones, progresses by approaching the golden ratio.
The Fibonacci sequence does not have to start with the number 1. It can start with any number.
Example/ 0-1-1-2-3-5-8-13-is a Fibonacci Sequence, but the Fibonacci Sequence can continue as 4-4-8-12-20-32-52-84.
Why is the Fibonacci Series called the Fibonacci Series?
The Fibonacci Sequence was discovered by Leonardo Fibonacci. Born in Italy, Leonardo Fibonacci discovered these numbers while researching a problem and decided to name it after himself.
Why is the Fibonacci Sequence So Important?
As we mentioned in the title What is the Fibonacci Sequence, approaching the golden ratio by dividing the numbers in the sequence by the number before it, and the fact that the golden ratio is included in the objects in our lives has made these numbers important and mysterious. The golden ratio in the Fibonacci Sequence was discovered by the ancient Egyptians. The Greeks, like the Egyptians, used this number in architecture. To put the golden ratio simply,
It is the geometric ratio between the parts that make up the whole.
If we try to explain the Fibonacci Sequence with examples from our daily life,
The ratio of our index finger to the previous node gives the golden ratio.
The golden ratio that we can reach with the Fibonacci Sequence is also revealed by the ratio of the sensory organs in the human face. For example, the area of our ears, from the bottom of our nose to our chin, contains the golden ratio.
In the Egyptian Pyramids, the ratio of the base to the height gives the golden ratio.
As financial literacy increases every day, many important data at both macro and micro levels are closely monitored not only by financial markets experts, but also by people who now practice different professions such as engineers, lawyers, and tradesmen. In particular, the data of developed economies such as Europe-USA-UK-Japan, as well as the data of developing countries such as China-India-Brazil-Turkey-Russia are of great interest to the markets.
The trading volume of forex markets, which allows you to instantly take advantage of the trading opportunities created by volatility in financial markets at parity, cfd, commodity prices, continues to grow every day.
Due to the fact that instant price movements of investors trading in Forex markets are very fast, the methods and strategies of trading are also changing and improving every day. In this context, Forex Buy and Sell Signals, which include automatic trading techniques, are especially in demand by investors trading on the forex market.
The robot software world, which also contributes significantly to the development of technology, helps forex market investors to trade in parity, commodity, cfd products within milliseconds. For this reason, forex buy sell signals or forex robots undoubtedly bring many advantages to the forex market. Especially of the profession from your phone or computer any time of day investors who can't follow the forex market, automated forex robots strategies that are created in line with specific buy and sell signals forex buy sell signals MetaTrader 4 trading platform, or if they are, thanks to they can take advantage of opportunities in the market.
Another advantage of automatic buy sell robots used in the Forex market is that they notify investors via sms or e-mail, leaving the final decision to the investor about whether to take advantage of the possible opportunity.
Forex is an abbreviation of the word foreign exchange, which means the conversion of two country currencies against each other. After the popularity of forex trading over time, not only currencies, but also commodities entered the forex platforms and began to be traded as a forex product. The Forex market is the highest trading volume and the most liquid market in the world. According to BIS (Bank of International Settlement) data, the trading volume of the forex market is around USD 5.5 trillion per day. Due to the fact that there is a leverage factor in Forex markets, it is possible to trade even with small investment amounts, which has led to the fact that the market has become so interesting.
The difference between the purchase price of currency pairs (ask) / par dec (the ratio of currencies to each other) and the sale price (offer) is called a spread. The difference between buying and selling prices is measured in decibels. The pip is the smallest price change in a pair, and in most pairs it is 4. It refers to the change in the digit (the first digit in the ten thousandth) (1 pip = 0.0001).
It may differ from product to product with brokerage firms offering December trading on Forex markets. Spreads may vary intraday depending on the liquidity in the market. These spreads, called dynamic spreads (variable spreads), can contract during hours when liquidity is high and expand during hours when liquidity is low. Some brokerage firms also have a fixed spread application. Brokerage firms usually do not take commissions on transactions conducted on the Forex markets, the income they receive is within these spread rates. Exbino offers its investors low spread rates.
The moving average is an important indicator used as a trend tracker and is often used in technical analysis. Moving averages show the current direction with a delay, rather than showing a path about where prices will go. It is overdue, as it is an indicator based on past prices.
Moving averages are used in most of the indicators used in forex markets. For example, moving averages are included in the calculations of indicators such as bollinger bands, MACD and ichimoku.
Ichimoku indicator, also known as Ichimoku clouds, is an indicator that helps determine support, resistance and trend in financial markets. This indicator, also known as Ichimoku kinko Hyo, is also known as the “equality graph”. With a single image, trend determination and potential signals about the trend can be seen. The indicator was developed by the Japanese journalist Goichi Hosoda in 1969. Although it seems to be very complicated when looking at the graphs, it is actually a useful and simple indicator.
In order to understand what Ichimoku Indica is, first of all, it is worth noting what the terms mean in the analysis of Ichimoku Kinko Hyo, because we will constantly follow the meanings of these terms on the graphs.
Tenkan Sen: 9-period moving average is the default value.
Kijun Sen: The 26-period moving average is the default value.
Moving averages help us find out where the support and resistance levels are closest.
In the emerging market, the 9-period moving average is closer to prices, so if there is a pullback, it will naturally serve as the first support level. If it is a 26-period moving average that tracks prices more remotely, it takes on the next support task. The same rules apply to the bearish market.
Senkou Span A: It is obtained by summing the 9-period moving average and the 26-period moving average and dividing it in half, and then moving the resulting value forward by 26-period. Senkou Span A acts as a weighted average of 26 periods.
Senkou Span B: 52 is obtained by summing the highest and lowest value in the period and dividing it in half, and then shifting the resulting value forward by 26-periods. In other words, Senkou Span B is the midpoint of 52 periods (50% withdrawal rate).
*Ichimoku Cloud: It is the region between Senkou Span A and Deckou Span B.
If prices manage to penetrate the cloud by passing through the cloud, it is predicted that the trend will continue in that direction. In other words; if the pair goes down the cloud, the fall, if the pair goes up the cloud, the upward current has started to dominate.
The thickness of the clouds is also an important point. We can say that there is more support (or resistance) in the region where the cloud is thick; there is less support (or resistance) in the region where the cloud is thin. Currents are more likely to change direction at such points.
Chikou Span: It is obtained by shifting the closing price back by 26 periods. It is a default value, but it can be changed if desired.
DOUBLE PEAK - DOUBLE PEAK FORMATION
The formation, called a double peak or binary peak, is assumed by technical analysts to be a harbinger of the end of a strong upward trend. Turning from investors who cannot participate in action together with the previously important peak will rise again and that the previous trend will continue with the expectation that prices into the market moves up to a level near the top, but after making a major resistance at the second hill in the hills tough previous sales, buyers reluctant to be taking at this point the level of support occurs with the prices again.
DOUBLE BOTTOM - DOUBLE BOTTOM FORMATION
This formation is the opposite of the binary hill formation. The amount of volume in this formation, which is seen at the end of the downtrend, is high when the first bottom is formed. In response purchases from the first bottom, the volume remains lower. From the moment of the return from the second bottom, the amount of transactions also increases with the price. This formation resembles the letter W on the charts, which is the opposite of the letter M, which is analogous to the shape of the binary peak formation. Just like the binary hill formation, it is generally assumed that this formation will last longer than a month.
volatility in exchange rates, which began in the early 1970s with the expiration of the Bretton Woods agreement, allowed swap-like derivative products to come to life. In addition to banks and similar financial institutions, individual investors have also had the opportunity to easily trade with fairly narrow spread rates in leveraged derivatives markets with the contribution of technology that is developing every day. In Turkey, especially the forex markets for the last 10 years growing, 2012, in accordance with CMB regulations, supervision of financial institutions in providing the opportunity to trade in the forex markets with the introduction of the leverage ratio using high-volume wishing to take advantage of the opportunity to make a transaction, large or small, all investors ' interest began to increase.
AN EXAMPLE OF LEVERAGE ON FOREX
Let's go through an example to clarify the concept of “leverage”, which is often used in Forex markets and is considered by investors as an element of risk. Let's assume that Ahmet Bey, who opened a forex account on FINANSOLINEFX with the option of a leverage ratio of 1/100, deposited USD1,000 into his account as initial security. The maximum position size that Ahmet Bey can open with this deposit is 100.000 USD (1.000 x 100). It is necessary to underline here the maximum position size. Because, depending on the trading platform used by the investors, the nominal size of the position that they have opened can also be seen on the order screen, as well as its value in lots. If Ahmet Bey is trading at USD/TRY parity on the MetaTrader4 platform, which is one of the most commonly used trading platforms in forex markets, he will have opened a 1-lot position by selecting “1” in the field seen as “volume“ on the order screen. The nominal size of the position he has opened will also be 100,000 USD. Now, the $1,000 in Ahmet Bey's account increases or decreases to include the profit or loss of a position of $100,000 for each pip rise/fall of the USD MARKET price.
There are different terms that many investors who trade in the money and capital markets face, “Lot” is also one of them. The concept of “lot” encountered by an investor trading on the Istanbul Stock Exchange refers to a share with a nominal value of $ 1, while the concept of forex lot refers to different position sizes for investors trading on forex markets. Therefore, the answer to the question of how much is 1 lot is different for forex and stocks.
WHAT IS A FOREX LOT? THE CONCEPT OF LOTS IN FOREX MARKETS AND FOREX LOT CALCULATION
The “ Volume / Volume “ field that forex traders trading on the Exbina MetaTrader4 platform encounter on the order screen is the part that shows the position size of transactions made on the forex market.
If a forex investor selects “1“ as the volume on the order screen, then the investor has opened 1 Lot of transactions. The position size of the opened 1 Lot corresponds to “100,000 units” in cross currency pairs, which we call parity. The reason why the lot size is called “unit” in Forex transactions is that the position size varies according to the base currency. For example, as in the image above, the position size opened by a forex investor who trades 1 lot by selecting “1” in the volume field at the EUR/USD pair is “100,000 EUR”. Therefore, the answer to the question “what does a lot mean” at EURUSD parity is EUR 100,000. If this investor had chosen USD/TRY from currency pairs, then the position size would have been “100,000 USD”. The answer to the question “what is a lot” for USDTRY parity is USD100,000. In other words, the currency that will replace the ”unit“ is the currency at the beginning of the cross currency pair, which is the ”Base Currency". The base currency at EUR/USD parity is EUR, while at USD/TRY it is USD.
The DECD indicator is a momentum indicator that is a trend tracker and shows the relationship between two different moving averages of prices. Basically, it is obtained by subtracting the 26-day exponential moving average from the 12-day exponential moving average. The signal line in the MACD indicator is used as a trigger for buying and selling signals. The MACD indicator was developed by Gerald Appel in the 1970s.
The MACD indicator, which is one of the technical analysis indicators available on the Metatrader 4 trading platform, the Exbina forex trading platform, is one of the technical analysis indicators most often used by traders trading in forex markets.
HOW IS THE MACD INDICATOR INTERPRETED?
There are 3 important and most used interpretation methods of the MACD indicator.
Intersections: If the MACD indicator falls below the signal line, this creates a downward signal and may indicate that it is time to sell. Conversely, if the MACD indicator rises above the signal line, this creates an upward signal and may indicate that the buying levels are coming. Most investors are also waiting above the intersection level to avoid false signals.
Divergences: If the price of a financial product diverges from the MACD indicator, this means that the current trend has ended.
Abnormal Rises: If the MACD indicator rises abnormally, this indicates that the short-term moving average is pushing the long-term average upwards. This indicates that the relevant financial product is in the overbought zone and will return to its normal state in a short time. Investors also take into account the bottom and top of the zero line as signals. While the MACD indicator is above the zero line, the short-term average is above the long-term average and indicates that the upward movement may continue. If it is below the zero line, it means the opposite.
One of the most used terms in Forex markets, along with terms such as leverage, lot, is margin. What is margin is a frequently asked question and a concept that is often confused. Margin, which means collateral, is used in the forex market along with different terms. The amount used to open a position is called the initial margin (initial margin), while we understand how many more positions we can open by looking at our money, which also appears as a free margin (free margin).
HOW IS THE FOREX MARGIN LEVEL CALCULATED?
Margin calculation, that is, in other words, the margin level is one of the important points to be considered in the forex market. We find our margin level by comparing the asset/free margin. When this level reaches below 75%, a margin call/margin call comes in, and then when it reaches below 30%, the system automatically starts closing our positions, provided that we start from the most harmful position. It is not mandatory to complete a deposit when receiving a margin call warning in Forex markets.
WHAT IS A FOREX MARGIN CALL? EXAMPLES OF MARGIN CALCULATION:
As an example, let's say we have $5,000 in our account and we will make our transactions using 1/100 leverage. we decided to make a purchase (long) transaction for 5 lots USD. The initial deposit required for this transaction is USD 5,000. After this operation, our free margin level will be 0. As soon as we open this position, our margin level is 100%.
Now; if the USDTRY price moves in the opposite direction of the position we opened, and our margin level reaches 75 percent, we receive a call to complete the collateral, which is called a margin call. This means that we should now monitor our position more closely, because if our margin level reaches below 30%, our position will be automatically closed by MetaTrader4, an electronic trading platform.
The Momentum indicator, one of the technical analysis indicators available on the Metatrader 4 trading platform, the Exbina forex trading platform, is an oscillator that shows the change in parities by percentage over a predetermined period of time. In other words, it is an indicator that indicates as an index how much the relevant pair has gained or lost over a certain period of time.
Momentum is a market anomaly that finance theory has a hard time explaining. The fact that the prices of any financial product are rising does not guarantee that prices will rise in the future. According to the efficient market hypothesis, the increase in prices is determined by changes in supply and demand or by a new information coming from that financial product.
The momentum indicator is calculated as follows;
Momentum = Last Day's Close / x Day's Previous Close *100
How is the Momentum Indicator Interpreted?
The momentum indicator is interpreted in two ways:
Method; it is possible to use it as a trend tracking indicator. The decision should be made to BUY when the indicator dips and turns up, to SELL when the indicator peaks and turns down. Does a new peak or dip momentum indicator ( when compared to peaks and troughs in the past ), the current trend will continue, however, the rise in prices has weakened and is no longer slowing down the effects of factors and stock raiser after a while, you should note that prices may start to fall. Nevertheless, you should change positions while waiting for the signal generated by the indicator to be confirmed by the price movement as well. For example, if the indicator peaked and turned around, you should expect that prices for the sale will also show signs of falling.
The momentum indicator of the method can also work as an indicator that predicts the future. While prices are rising and making new peaks, the indicator cannot make new peaks or prices are making new bottoms, the indicator is not making new bottoms. In this case, a mismatch occurs and it is necessary to consider it as an early signal of a trend change.
The Shoulder - Head - Shoulder formation is a technical anazliz formation that marks the end of the uptrend and symbolizes the trend reversal when it occurs. The shoulder-head-shoulder formation is one of the most common and reliable technical formations in technical analysis. This formation is one of the trend reversal formations with a high degree of reliability. Indicates that a rising trend is ending and a falling trend is starting.
Before the formation of the formation, it is necessary to observe the formation of an upward trend. Secondly, the left shoulder should form the peak of the rising trend, from which a slight retreat should be observed. The head level (provided that it is still in the uptrend) should form the peak, and from there, with a slight retreat, an uptrend should be observed again for the formation of the right shoulder. With the subsequent decrease after the right shoulder, the lower levels of the two shoulder points, called the neckline, are in the position of support. In order for the formation to take effect, the neck line must be broken down with the volume. As a result of this, the target point can be calculated by adding the distance formed between the decollete line and the head in the direction down from the neckline.
Prices are rallying as the OBO starts to form. With a small correction movement that follows the ascent, the graph makes a hill, and the LEFT SHOULDER is formed first. Then the ascent continues. With the arrival of purchases from the area where the withdrawal ends, the upward movement begins again, forming a larger hill, it passes to the level of the left shoulder and the HEAD is formed. After the head is formed, the legs are pulled back to the support formed at the first shoulder level. This level of support is called the ‘Neckline’. With response purchases from the neckline, prices make an upward movement for the last time, forming the RIGHT SHOULDER. The right shoulder is formed at more or less the same levels as the left shoulder. After the right shoulder is completed, the neck line is broken with the strengthening of sales, the formation is completed, and the uptrend ends with the shoulder-head-shoulder formation. Due to the impact of the hard sell coming after the break, it is expected to retreat up to the length of the second crest forming the neckline and head.
The neckline is quite important in the shoulder-head-shoulder formation. This is the support/resistance line where the formation is confirmed and the buy/sell lines are given. The neckline is drawn by combining the points where the sales from the left shoulder and head area find support. It does not necessarily have to be horizontal, it can also be inclined down or up. After the neckline breaks down, it moves back to the neckline, giving it a second opportunity to sell.
In its simplest expression, parity refers to the ratio of country currencies to each other. The interest rates of the country's currencies and the economic conditions in which the countries are located can be considered as factors affecting the parities. For example, from the point of view of Turkey's foreign trade balance, the EURUSD (Euro Dollar parity) pair is of great importance, since most of its exports are denominated in euros, and most of its imports are denominated in US dollars.
HOW IS PARITY CALCULATED?
If Euro: 3 TL Dollar: 2 TL, the Euro Dollar parity will be 3/2 = 1.5. In this case, if the dollar is the Euro parity, it will be 2/3=0.66.
An investor who makes a EURUSD pair purchase (Long position) will have bought euros and sold US Dollars in exchange; when he makes a sale (Short Position), he will have sold euros and bought US Dollars.
EURUSD parity (Euro/US Dollar), USDJPY (US Dollar/Yen), GBPUSD parity (Pound Sterling / US Dollar), AUDUSD (Australian Dollar / US Dollar) are the leading pairs traded on Forex markets with the highest trading volume. In addition, in Turkey, OCTOBERDTRY parity (US Dollar / Turkish Lira) and EURTRY (Euro / Turkish Lira) can also be counted.
By opening a Forex account, you can trade oil 24/5 and track your positions. In order to open a forex account, you must first open a forex trial account and make 50 transactions within 6 business days. The minimum lower limit is 50.000 TL in foreign currency. Using 1/5 leverage in Forex markets, you can make oil transactions on UKOIL (British Brent Oil) and USOIL (US Crude Oil) instruments with a maximum term of 1 month (the expiration dates are notified to you in advance, and you can open transactions again at the next maturity if you wish) to the nearest maturity. Since there will be a maturity change every month, that is, it is mandatory to close open positions on the expiration date, it is not a suitable product for customers who want to invest in the medium and long term and have a low perception of risk. There are no transportation costs in oil operations.
In Forex markets, the pip is considered the smallest price step. Its full name is point in percentage. In most pairs, 1 pip is one ten thousandth of the price of the corresponding currency pair. The concept of pip is often used in profit/loss calculations or spread calculations in forex markets. The concept of pip is also referred to as tick in forex trading. Tick is also the last digit of the given price.
PIP CALCULATOR - TICK CALCULATOR
The difference between the buying and selling prices that forex traders trading on the Exbina Metatrader4 platform dec on the order screen is called a spread. This difference is calculated in pips. If you need to go through the screenshot below; the value of 0.00003 resulting from 1.12195 – 1.12192 is read as 0.3 pips.
To put it in terms of tick, it is indicated as 3 tick. Since the prices of some instruments traded on the Forex markets are in the 5 digits, the last digit in these products is considered a tick. Suppose, for example, that the gold prices are 1380.20 – 1380.40. In this case, the difference between the two prices is stated as 0.20 decip or 20 tick.
The Relative Strength Index (RSI) is an indicator that allows predicting the direction of the short- and medium-term trend, calculated by comparing the closing values in the relevant period with the previous closing values of the period.
There is a harmonious appearance between the price dec and the RSI. Since the RSI indicator reacts in a short time, it can be seen that it moves before prices from time to time. The reference values are 30-70 levels. 30 indicates that the trend may turn up (BUY signal) when expressing the oversold zone below the reference value, movements above the reference value 70 indicate that the trend may turn down (SELL signal) when expressing the overbought zone.
Individual and institutional investors who trade in the money and capital markets often resort to technical analysis methods, especially in the forex markets. One of these methods of technical analysis is pivot points. Briefly speaking, pivot points are prominent in determining the support and resistance points on the traded instrument. The fact is that investors who act according to pivot points pay more attention to trend movements and take medium- and long-term positions rather than short-term ones. This point reveals the pivot points as one of the technical analysis tools that really need to be looked at. In this way, the points where the trend changes, the transitions from the bear market to the bull market or vice versa from the bull market to the bear market can be determined. Investors who take positions can also calculate where to place a loss cut level on their positions and where they should increase their position. Trend conversion points are a key issue for success, especially in the forex market.
EXAMPLES OF PIVOT POINTS:
If we give an example, let's assume that an investor who wants to trade in Euro Dollar parity has found the levels of 1.10 and 1.15 by calculating the current pivot points. Of course, like any technical analysis tool, pivot points are relative. In this way, the investor can open a downward position in the Euro Dollar pair when the 1.10 level is broken down or trade in the buying direction in the Euro Dollar pair when the 1.15 level is broken up by calculating the pivot points.
Scalping, one of the terms that is often mentioned in Forex markets, is to trade very often at very short december intervals using technical analysis methods and different other scalping techniques and try to make a profit in this way. For a long time, along with trading in these markets abroad, the answer to the question of how to get more profit has been sought. One of the alternative answers to this question is to develop scalping stategies and scalping techniques.
FOREX SCALPING TECHNIQUES/SCALPING METHODS
Nowadays, with the development of technology in the international market, algorithmic trading, or HFT (high frequency trading/high-speed Processes considered, automated trading techniques. These transactions, based on a certain algorithm with computer programs, account for about 50% of the trading volume on the US stock market. By means of computer programs that can send such fast orders, it is possible to make a profit by scalping on forex markets that are traded 24/5 days a day.
SCALPING STRATEGIES AND TECHNIQUES
In fact, this method, which should be completely unique to the person, includes technical analysis tools and usually takes 15 minutes.it is created using graphs that do not exceed ’ In order to create the method, it is necessary to select one or more of the technical analysis indicators, of which there are hundreds, and capture a trend and place these indicators on the chart. Before trading with this technique in a real environment, it is necessary to test whether this system works or not on demo forex accounts. A success rate of over 70 percent is generally considered sufficient to try the system in real life. Some of the indicators selected to create a system are indicators such as moving averages, stochastic, and relative strength index that help you find trends and find where to buy and where to sell in a trend.
Swap rates, one of the issues that Forex traders are most interested in, in a simple sense, arise from the difference in the interest rate of two currencies at the parity where the transaction is made. And if the investor switches to a new date along with the position he has opened, he will be affected by these rates + or –. If a position that was opened was closed without changing the day, that is, if it was made during the day, then there will be no swaps. If we explain this with an example, let's take the American dollar (interest rate = 0 dec25% ) and the Turkish lira (7.75% ), which have quite a lot of interest differences between them. If the investor made a BUY transaction in dollar tl parity, he/she bought the US Dollar thinking that the USD would rise and the Turkish Lira would lose value, and in exchange, he/she sold the Turkish Lira. Here, the investor will have to pay swap interest in the USD/TRY position that he moves to the new day, not closing his position at the end of the day, because he buys a currency with a low interest rate and sells the Turkish lira in exchange for a currency with a high interest rate. On the other hand, on the contrary, if an investor who makes a SELL transaction in dollar tl parity moves his current position to the new date, he will receive swap income. In addition, since forex market transactions have a 2-day duration, swaps are usually reflected as x3 on Wednesdays, and swaps of the time period coinciding with the end of the week are applied during the week.
HOW ARE SWAP RATES DETERMINED IN FOREX MARKETS?
In international markets, it is usually determined according to LIBOR, which is the dec of high-liquidity currencies lending to each other in USD in the London interbank money market. However, especially the low liquidity of currencies, the central banks of the policy interest rate and interest rate options are of interest because the band described as exotic, such as multiple ( not major ) dollars, GBP, euro, GBP, dollars, rubles currency swap interest rates, major banks and other market maker in the forex market that provides the price they used to price the swap provider, the practice of small differences in rates may occur institutions.
In Forex markets, swaps are quoted as overnight transportation cost/overnight interest. When calculating Forex swap rates, interest dec between the currencies of the two countries are taken into account. There is a swap cost for all currency pairs traded on the Forex markets. The type of forex account without a swap is called an “islamic” or “forex without a swap” account.
Transactions in the Forex market are made through the electronic trading platform called MetaTrader 4. On this platform, swap interest/swap rates are shown in US Dollars (USD). However, swaps are also shown in point terms in international markets and other electronic trading platforms. In the following example, you can find swap points.
Swap Point Swap Long Swap Short
USDTRY -0.00066 0.00057
USDZAR -0.00202 0.00118
The reading of swap points is as follows:
In the case of a 1 lot long position at USDTRY (Dollar/TL) parity, 66 TRY swap interest will be paid per night.
If 1 lot of short positions are held at USDTRY (Dollar/TL) parity, 57 TRY swap interest will be obtained per night.
The triangle formation, which is one of the formations indicating the continuation of the trend, is divided into three, namely the ascending triangle formation, the descending triangle formation and the symmetrical triangle formation.
Although the ascending triangle formation is similar to the symmetrical triangle formation, it is separated from the symmetrical triangle formation because the upper band trend line is horizontal. An ascending triangle formation is by its nature an upward formation in a general sense; it gives a signal that the continuation of the trend will come, especially if it occurs in an upward trend. The formation of the chart occurs as follows, the market is in the overbought zone, and prices begin to retreat. But after some withdrawal, buyers come back into play and an upward movement begins again towards the previous highest price level. From this level, sales come again, but this time buyers come back into play before they reach the previous low price levels, and there is again a movement towards the previous high price level. This formation, which is formed by new rising lows occurring each time, ends with the upward break of the highest price level and the upward movement continues. It is expected that there will be a significant increase in the volume side when this resistance level is broken. As a target price level, a movement is expected after the resistance level is broken, as well as the widest band december that occurs in the formation of the triangle formation.
Although the descending triangle formation is similar to the symmetrical triangle formation, it is separated from the symmetrical triangle formation because the lower band support line is horizontal. A descending triangle formation is by its nature a general sense downward formation; especially if it occurs in a downtrend, it gives a signal that the continuation of the trend will come. The formation of the chart occurs as follows, the market is in the oversold zone, and prices begin to go up. But after some upward movement, sellers come back into play and a downward movement begins again towards the previous lowest price level. From this level, buying occurs again, but this time sellers come back into play before they reach the previous high price levels, and there is again a movement towards the previous low price level. This formation, which is formed by creating new descending highs each time, ends with the downward break of the lowest price level and continues to move down. It is expected that there will be a significant increase in the volume side when this support level is broken. As a target price level, a movement is expected after the support level is broken, as well as the widest band december that occurs in the formation of the triangle formation.
A symmetrical triangle formation can occur when both downward and upward trends continue, and is formed by descending highs and rising lows. In this way, a symmetrical triangle arises by combining these highs and lows. During this period, significant decreases in volumes are observed. As a rule, the formation ends with the breaking of its triangle in the direction of the trend, and prices begin to move down or up to the widest point of its formation with an increase in volume.
One of the most important concepts in technical analysis is trend. The trend is the general direction of any financial product. In some cases, it is quite difficult to clearly determine whether the trend is up or down. Charts usually do not move in the form of up or down trends in the form of a straight line. Graphs most often move in the form of zigzags with ups and downs. In technical analysis, the high and low values of the financial product form trends.