From a trader's point of view, illiquid market conditions will have chaotic movements or gaps because the level of buying or selling volume at any given moment can vary greatly. A highly liquid market is also known as a deep market or a market that is smooth and price movements are also smooth. Most traders need and should require a liquid market because it is very difficult to manage risk if a trader is on the wrong side of a big move in an illiquid market. Here are three signs to watch for:
Gaps When Trading Forex
Gaps, or differences in forex are different from other markets. However, price differences in forex may occur when interest rate announcements or other news announcements that have a large impact are released against expectations.
Gaps can occur at the opening of trading at the beginning of the week along with Sunday afternoon in the US. If there are news announcements over the weekend, then the overall gap is usually less than 0.50% of the currency value.
Forex Market Shows Little or No Gaps
Markets that take place 24 hours a day such as the forex market are considered to be more liquid or tend to have fewer gaps due to the sustainable nature of the equity market. This allows the trader to enter and exit the market at the trader's discretion. Markets that only trade for a small part of the day such as the US equity market or the Futures Exchange will condense into a thinner market as prices could spike at the open if overnight news comes out against market expectations.
Forex Liquidity Indicator
Brokers often offer a "volume" option on a chart by which a trader can measure market liquidity. This forex liquidity indicator is interpreted by analyzing the bars on the volume chart.
Each volume bar represents the volume traded over a certain period of time, thus providing traders with a suitable liquidity forecast. It is important to remember that most brokers only reflect their own liquidity data and not the overall market liquidity. However, using a broker's liquidity as a measure can accurately represent the retail market depending on the size of the broker.
Time Differences Offer Different Amounts of Liquidity
Short-term traders or scalpers should be aware of how liquidity in forex varies throughout the day. There are less active hours like the Asian Session which are often tied in narrow ranges which means support and resistance levels are more likely to hold from a speculative point of view. major market session moves such as the London and US sessions are more prone to breakouts and larger percentile moves on the day.
The time that lets you see the biggest moves is the US Morning Session as it overlaps the European/London Session which accounts for about +50% of the total daily global volume. The US session alone accounts for about 20% and in the US Afternoon, you will often see a sharp decline in aggressive moves except when the Federal Open Market Committee (FOMC) comes up with an announcement that surprises even if only a few times a year.
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Sebelum menjadi trader sukses, perlu dipahami bahwa ada berbagai macam tingkatan trader forex yang harus dilalui. Tingkatan-tingkatan tersebut biasanya dibedakan dari beberapa kriteria. Jika dilihat dari pengalaman, pengetahuan, cara berfikir, dan sikap mentalnya, seorang trader dapat dikategorikan dalam 5 tingkatan. Trader Pemula Seorang trader pemula pada umumnya masih merasa asing terhadap pasar forex. Trading forex dianggap sesuatu yang baru dan mungkin agak unik atau mengasyikkan. Mereka cenderung ingin mengetahui segala hal yang berhubungan dengan trading dan pasar forex dengan cepat dan instan. Baik analisa fundamental maupun analisa teknikal dipelajarinya dengan cepat. Trader pemula selalu mencari dan mempelajari cara-cara yang gampang, sederhana, dan segera dapat digunakan untuk trading. Pada umumnya, mereka mengharap profit besar dari trading forex. Trader Profesional Dari sebutan "profesional" yang disandangnya, memang profesi utama trader di tingkatan ini adalah t
SNR (Support and Resistance) is fairly popular in the world of forex trading. This is one of the most frequently used techniques in technical analysis. Without it, traders will experience difficulties and even lose in carrying out trading activities. The support point is the point which is believed to be the lowest point of an asset in a certain period. While the resistance point is the point that is believed to be the highest point of an asset in a certain period. In simple terms, support and resistance are likened to the two most discussed attributes in analysis where support is a level that has the potential to withstand price declines. Meanwhile, resistance is a level area that has the potential to hold back price increases. These levels are used to determine whether the price will continue or reverse. Basically, SNR aims to find out the right area when taking a buy or sell position and determine the target price movement. The support area is generally an area used as a reference f
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