• “For example, in forex, you can control $100,000 with a $1,000 deposit. Your leverage, which is
  expressed in ratios, is now 100:1. You’re now controlling $100,000 with $1,000.” The $1,000
  deposit is “margin” you had to give in order to use leverage. Margin is the amount of money needed
  as a “good faith deposit” to open a position with your broker. It is used by your broker to maintain
  your position. Your broker basically takes your margin deposit and pools them with everyone else’s margin
  deposits, and uses this one “super margin deposit” to be able to place trades with the interbanks. Margin
  is usually expressed as a percentage of the full amount of the position. For example, most forex brokers
  say they require 2%, 1%, .5% or .25% margin.Based on the margin required by your broker, you can
  calculate the maximum leverage you can wield with your trading account.
  
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• Most professional traders and money managers trade one standard lot for every $50,000 in their account. If they traded a mini account, this means they trade one mini lot for every $5,000 in their account. Let that sink into your head for a couple seconds. If pros trade like this, why do less experienced traders think they can succeed by trading 100K standard lots with a $2,000 account or 10K mini lots with $250? No matter what the forex brokers tell you, don’t ever open a “standard account” with just $2,000 or a “mini account” with $250. The number one reason new traders fail is not because they suck, but because they are undercapitalized from the start and don’t understand how leverage really works.
  
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• In an uptrend, the general idea is to go long the market on a retracement to a Fibonacci support level. In order to find the retracement levels, you would click on a significant Swing Low and drag the cursor to the most recent Swing High. This will display each of the Retracement Levels showing both the ratio and corresponding price level
  
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• The next use of Fibonacci you will be applying is that of targets. Let’s start with an example in an uptrend. In an uptrend, the general idea is to take profits on a long trade at a Fibonacci Price Extension Level. You determine the Fibonacci extension levels by using three mouse clicks. First, click on a significant Swing Low, then drag your cursor and click on the most recent Swing High. Finally, drag your cursor back down and click on the retracement Swing Low. This will display each of the Price Extension Levels showing both the ratio and corresponding price levels.
  
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• The Commodity Futures Trading Commission publishes the Commitment of Traders report (COT) every Friday, and it measures the net long and short positions taken by traders in the futures market. It is a great resource to gauge market sentiment from the “big players” because of their large positions they are required to report to the government. Of course, it is very important to see what the “smart money” is up to because they move the markets and it may have an impact on your positions.
  
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EUR/USD dropped further to 1.2587 but turned sideway since then. Initial bias remains neutral this week and some more consolidations would be seen first. But upside should be limited by 1.2910 resistance and bring fall resumption. Below 1.2587 will target 61.8% retracement of 1.1875 to 1.3330 at 1.2431 next. Sustained trading below there will argue that medium term decline is likely resuming for another low below 1.1875.

GBP/USD dropped further to as low as 1.5371 last week but drew support from 55 days EMA and turned sideway. Initial bias remains neutral this week and some more consolidations could be seen first. But upside is expected to be limited by 1.5701 resistance and bring fall resumption. Below 1.5371 will target 1.5123 cluster support (50% retracement of 1.4230 to 1.5997 at 1.5114).

USD/CHF's down trend extended further to as low as 1.0219 last week before recovering mildly. A temporary low is in place and initial bias is neutral this week for some consolidations. But after all, short term outlook remains bearish as long as 1.0449 resistance holds and another fall is still expected. Below 1.0219 will target lower trend line support (now at 1.0034). But we'd anticipate strong support at around parity to contain downside, at least initially.

USD/JPY dropped further to as low as 83.61 last week but lost momentum and rebounded strongly. Considering bullish convergence condition in 4 hours MACD, a short term bottom should be in place. Initial bias is mildly on the upside this week for further rebound to 86.36 resistance and possibly above. But upside should be limited well below 88.25 support turned resistance and bring another fall.

USD/CAD jumped sharply to as high as 1.0666 last week but faced resistance ahead of 1.0675 resistance and retreated. With a temporary top in place, further retreat would likely be seen initially this week. However, note that the break of near term falling trend line resistance argues that recent consolidations is finished and rise from 0.9929 is resuming. Hence, we'd expect current retreat to be contained above 1.0246 support and bring another rise..

AUD/USD dipped further to as low as 0.8770 last week but managed to hold above lower channel support and rebounded strongly. The break of inner falling trend line resistance argues that fall from 0.9220 might be finished with three waves down to 0.8770 already. Initial bias is neutral this week with focus on 0.9087 resistance. Break there will suggest that whole rise from 0.8066 is still in progress and is resuming for another high above 0.9220.