O'Reilly logo

Forex on Five Hours a Week: How to Make Money Trading on Your Own Time by Jeffrey Alan Brandzel, Raghee Horner

Stay ahead with the world's most comprehensive technology and business learning platform.

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, tutorials, and more.

Start Free Trial

No credit card required

Chapter 3. The Wave

The market is a 6′6″, 280-pound kickboxer that will smash you. Don't fight the market.: 2006 "Fxstreet.com. The Forex Market." All Rights Reserved.

Figure 3.1. The market is a 6′6″, 280-pound kickboxer that will smash you. Don't fight the market.: 2006 "Fxstreet.com. The Forex Market." All Rights Reserved.

If there is one indicator I cannot do without, it's the Wave. It's a simple market cycle indicator: a trio of exponential moving averages based on the Fibonacci number of 34. It provides me with a visual footprint of the market's trend, or lack of trend. It's better than trendlines, support, and resistance for this specific purpose. It's not that trendlines, support, and resistance are not effective but the fact is that these lines can be found in uptrending, downtrending, and sideways or range-bound markets, and by themselves they do not indicate the market's cycle.

So what's the Wave? I'm not one for proprietary indicators, and anything I use to analyze my charts can be done with some simple indicator settings, all of which I will share with you. I will tell you why I use the settings I use, and then you will have to go about doing the real work, which is putting them on your charts and proving to yourself by watching how these studies/indicators behave that you can trust them and will use them. That's no small task. I'm not your mother, so "because I said so" just isn't going to cut it.

While I am going to talk about the Fibonacci series of numbers and their relevance to traders later on, let me just set ...

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, interactive tutorials, and more.

Start Free Trial

No credit card required