Authors Posts by Steve Connell

Steve Connell

79 POSTS 154 Comments
Steve Connell has spent over 17 years working in the finance sector as a trader/market maker and strategist. Over that time he’s worked for several global banks and hedge funds. Steve has a unique insight into a range of financial markets from foreign exchange, commodities to options and futures.

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How ever bad a situation may seem, in nearly every case a losing trade can be recovered and even turned into a winner. This is true if you are prepared to take some action and some additional risk.

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The characteristic “pitchfork pattern” is very common in forex and in other charts. So this is a method that has great practical application.

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Trading without stop losses might sound like the riskiest thing there is. A bit like going mountaineering without safety gear. But what's the reality?

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To make any market there need to be both buyers and sellers. The bid and offer prices are simply the prices at which other buyers in the market are willing to buy and sellers are willing to sell.

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To manage this risk, what some do is make a simple guess to estimate the potential loss involved.The problem though is this doesn't take the full picture.

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The carry trade has a simple aim: Borrow low and lend high. Japanese yen is often the borrowed currency in carry trades. This is because it’s cheap.

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With covered interest arbitrage, a trader is looking to exploit discrepancies between the spot rate and the futures or forwards rate of two currencies. This allows the trader to borrow or lend at below market or above market rates respectively.

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If markets were completely logical and responded only to hard facts we’d see them moving more or less in straight lines with a few jumps here and there when new information arrives.

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One of the ways to succeed in trading is to predict the market by thinking “ahead of the crowd”. When doing this an uptrend can mean a selling opportunity. A downtrend can mean a buying opportunity.

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One of the biggest challenges in financial trading is keeping our emotional state of mind in check and preventing it from following the path of least resistance.