Bollinger bands on Forex

May 14th, 2010

Bollinger bands are one of the trading indicators’ type, which is targeted to generate signals about the increase or the decline of volatility on Forex market. This indicator is developed for a trader to observe the tendencies on the market– whether it is calm or stormy.  If the market is even, the bands are converging, if the market starts to move, the bands are diverging.

Bollinger bands’ chart consists of three lines: in the middle – a simple moving average (SMA), higher is the upper band (SMA+2) and below is the lower band (SMA-2 standard derivations).

In order to calculate the indicator it is needed to compute a doubled divergence with the movement within a certain period of time, thereafter up- and downwards from the chart one plots the dots according to these calculations. In the result, there should appear a graph, resembling an envelope. The volatility ascend on the market will make the chart look diverging, and correspondingly, the lowering of volatility will be pictured as a converging envelope.

Bollinger bans are often used to recognize the moment when the price is ready to expand into a trend or, on the contrary, when a flat should be anticipated.

Bollinger bands have a few peculiarities from the analysis viewpoint. When prices start moving horizontally, and on Forex market there is no vivid trend, the bands are converging. When a new trend is forming, the bands are diverging. Thus, if the bands have been in the horizontal channel for a long term, a strong breakthrough should be projected resulting in a new trend.

Bollinger bands work well in combination with other types of charts. Though, taking a decision to open or close a position one should not consider signals of a single indicator. All your actions should be confirmed by numerous Forex indicators.

Bollinger bands are becoming more popular among other indicators; every trader using the technical analysis for his trading strategy, should know the way to employ it.

However, this indicator provides no precise signals for opening or closing positions on the basis of a price crossing the lines, but they can determine the borders, within which the price fluctuations can be analyzed by additional indicators. As a rule, together with Bollinger bands such indicators as the relative strength index, the MADC and Money Flow are used.

Added by Alexey Skachilov,
InstaForex
Clients’ relationship manager

InstaForex team took part in greeting the veterans

May 10th, 2010

Numerous cities all over the world have saluted marking the anniversary of the end of World War II! According to a regular tradition the team of the international on-line Forex broker InstaForex participated in honoring of the World War II veterans.

InstaForex group joined the public demonstration from the central location of the parade on the Victory Square to the memorial of 1200 guardsmen. Near the memorial, the representatives of the company together with the veterans and their relatives laid flowers in memory of all the heroes, who at a price of their lives achieved peace for future generations. InstaForex team warmly congratulated the veterans by handling flowers and presents to them, in acknowledgement of the accomplished during World War II acts of bravery.

9may-after1

Unfortunately, the years go by. The number of direct participants, struggling for peace and future, free from tyranny and fear is getting less. But we will always keep their feats and valour in our hearts!

Our warmest congratulations to all veterans on the occasion of the Great Victory! We remember you and highly appreciate your deeds!

Trends and tendencies

May 6th, 2010

If a trader expects that working on Forex market can bring regular profit he needs to realize the economic laws according to which the market is functioning, as well as the peculiarities of the market.

This article dwells on the notion “market tendency”, or a trend. A trend and tendency both denote the general direction which the currency fluctuations follow at Forex market. Constant analysis, monitoring and estimation of tendencies and trends on the market allow a trader to open positions timely and gain profit. The majority of novices make the mistake as they do not pay attention to the overal trend direction while opening positions; this leads to opening false positions and a sequent loss of funds. Watching the dynamics of increases and downfalls a trader can see the dominating on the market tendency, its duration and can predict further advances.

On the whole, there are three types of trends on Forex:

The bullish trend is also called an uptrend or an upward trend. The peculiarity of this trend is that the lowest prices of market fluctuations start to increase gradually. The notion “bullish” appeared on the analogy with the animal ‘a bull’ who is tending to raise the enemy on his horns – or in case with Forex – the price.

The bearish trend is called a down-trend, or a downward trend as well. The characteristic is that prices start the declining movement. The name “bearish” emerged because of the connection with ‘a bear’, which as if pressurizes the price with all his heavy body.

Sideways trend or the flat market and the trendless market, denotes that there is no trend. A long-term flat demonstrates that in the nearest time there will be a strong break though on the market either directed to the bullish or to the bearish trend. The major feature of the flat is a lack of a clear price movement.

The basis of financial markets is the price. The result of any operation conducted at Forex currency market is fully dependent on the price. The price is very flexible and exposed to constant changes. Before conducting an operation on Forex, make sure that the trend is really up-to-date for the market and it is not a short-time recoil of the price in the opposite direction, this mistake is often made by traders with little experience, thus they are exposing their funds to a big unreasonable risk.

The most frequent mistake for a beginning trader is the wrong time of closing the position. A trader can make the incorrect market analysis, make a false determination of a market movement direction or even ignore the trend. This will inevitably lead to the situation when the position which could have brought profit, but was closed in bad moment will on the contrary bring significant losses. In order to define the trend on Forex market a trader can use numerous technical indicators and the market analysis.

If you are tending to achieve success on the international Forex market, do not forget about the important rule – a trend is your friend.

Added by Alexandr Demkin,
InstaForex Chief clients’ relationship manager

Join a new contest by InstaForex and GoldAge froum!

May 3rd, 2010

New surprise was uncorked by InstaForex for the traders beeing active at Forex communities. If you spend a lot of time discussing Forex actualities and trading tendecies with your associates at forums, you will probably like the new contest by InstaForex in cooperation with GoldAge! The conditions are very simple: register at GoldAge forum and start a new topic in Forex area. This topic can be devoted to the problems of Forex market development, your unique trading strategy, frequently asked questions by newbies and so on – do not confine your fantasy and make the most original thread!

If your subject will be under discussion and attract a lot of forum members, you will get a chance to win one of the fetching prizes (from $100 up to $1000). The most active posters, whose messages will be informative and useful, will be also awarded with good winnings.

Sounds interesting? – Click here to read the rules and join the competitions!

Added by Ekaterina Abramova,
InstaForex PR-manager

InstaForex invites you to a new seminar in Malaysia!

May 3rd, 2010

InstaForex Company gladly announces about new event within the frameworks of Malaysian seminars’ series. Mini seminar will be held on May 8, 2010 in Johor (Malaysia). Two InstaForex lecturers Ismail Bin Mohamad and Asri Bin Mohamad will acquaint you with aspects of using medianline for high probability trading set up and peculiarities of fundamental news trading.

The participation in the seminar costs USD 60. These funds will be credited as bonuses to trading accounts of all visitors, so that you will be able to use this money in your trading and nail down attainments, received at the leacture.

Please, find the detailes in the poster below:

Seminar-Johor-poster