What is Zulutrade and how does it work?

Zulutrade is a company that have been founded in 2006. Since then they have been offering a service that permits traders to trade using the signals of somebody else. In their terminology somebody that offers signals is called a signal provider or SP. They are not the only one offering this kind of service. Remember when we wrote about Tradency... Well it is the same thing. What makes Zulutrade special is the large number of signal providers and the large list of brokers that can be used.

 The idea itself is great. Imagine that you can follow the signals of an expert trader and that you can make the same profits. Before getting to enthusiastic lets see how this service is actually running.

First of all why would any successful trader share his signals? Well the way the system works every signal provider will make money if they have followers that follow their signal. (0.5 pips per lot followed) It doesn't matter if the signal provider has a demo or a real account. If a signal provider trading with a demo account gives a bad signal he will still make money even if his followers who are following his signals with a live account are losing money with his bad signal.... Of course he will try to avoid giving bad signals because he will lose followers if he gives bad signals all the time. Recently Zulutrade has made a new rule stating that a signal provider will only get paid for each month with a positive return. This new rule has some strange consequences. Some signal providers will stop giving signals at the end of the month when they have a positive return so far. They do this to avoid having a bad trade with would risk ending the month in negative and would make them lose being paid by Zulutrading. We are going to test Zulutrade with a demo account and we will see how it turns out.....

Whselfinvest keeps Chart studio alive

Whselfinvest has send a letter to all its clients informing they will keep on offering a version of WHS Prostation (Dealbook) with Chart Studio. Apparently they have a great number of clients who actively use Chart Studio. This comes as a total surprise and is greatly appreciated by its customers.

Besides offering a version with Chart Studio the will also offer the latest version. For those who decide to use the new version without Chart Studio they offer the integration of all the indicators and tools that can be found on their website.

What can we say more? Thumbs up for Whselfinvest.......

How do you trade the forex market when news comes out

As we know almost every day data comes out. Some of these data releases can have a big impact on certain pairs. Before trying to trade the release of any data you better prepare yourself. Because trading a news release can be very profitable but can be disastrous if unprepared. How can you be ready?

First of all have a look at the calender and decide which news releases you will be trading. Not all data releases have a big impact. Some releases have a short term effect others have a long term effect from days till weeks. Because of the risks involved you want to trade the data releases that have the biggest impact. Why? Because of the typical high volatility when data comes out. You can't trade a news release with a small stop. The high volatility will always hit your stop. Furthermore we want a target price that is at least 2 times that relative big stop. So we are going to trade with a big profit target....so we need big price movements....so we need to trade the important data releases.

High volatility => requires big stop => profit target at least 2X big stop => we need big price movements

The perfect tool for checking out all data releases is the following website.

>>>>>>>>>>> http://www.forexfactory.com/ <<<<<<<<<<<<<<

This website gives you all the information you need. They tell you which release will have a big impact and on which pair. And of course they give you the exact time the data will come out.

Now that you know when to trade and on which pair lets have a look at the different techniques you can use.

Break out strategy

If the pair is ranging before the data is released then you have the ideal circumstances for a breakout strategy. The smaller the range the better. Why does this work so well? Well because a lot of traders will be using the same strategy and therefore enforcing the breakout. It is one of the most used strategies on the forex market. There are of course also “false” breakouts where the pair fails to continue its direction after the breakout. In that case the breakout receives a boost because a lot of traders are trading the breakout strategy. But soon reality kicks in. Is there a fundamental base for the breakout or not? In case that fundamentally there is no base the breakout will often die and the pair will go back into the ranging zone. Does that necessarily mean that you will loose in case of a false breakout? Not at all. When the breakout has enough momentum you will have the opportunity to put your stop on breakeven or even with a small profit.

false breakout, only loss it stop wasn't moved	don't take a position to fast, going long here would have been a losing trade

A common mistake is to buy to fast when the pair hits the upper range or to sell when it is close to the bottom of the range. Make sure you clearly see that it left the range with a descent number of pips. If you have that dream breakout and the pair continues its move start moving the profit target and stop loss in the direction of the move.

The trick is to keep the pair between that stop loss order and that take profit order. In this case you want to maximize your profit and at the same time you want to protect the profit you already have. In this case 50/ 100 pips or more are achievable targets.

When it isn't ranging before the news comes out

This is a lot harder to trade. The trick in this case is to distinguish a move of the pair in a direction with a move that is actually volatility. How can you see the difference? Again patience is the key. Don't take a position seconds after the news release. The first moves are volatility anyway. Look at the size of the next candle that is being formed. Don't take any position if its size isn't bigger than the last 5 candles. If its size is smaller than the last 5 candles.....it is just volatility (noise)....it is not a move. Once the candle is big enough you can take a position. Your stop should be about ½ of the size of the current candle. The target should be at least 2X the stop loss but preferably at the next resistance level. Again try to move the stop an the stop loss as soon as possible.

Before trading the news you should try it on a demo account. Protecting you account is the most important thing and with these big price movements you can't be careful enough. So trade with a small position size. Always consider the worst case scenario. Imagine your internet connection fails...do you have a stop loss? So place your stop loss immediately after taking any position!