Consolidate debts to reduce your debt load

Hi everyone! I've an article from a Guest Author who doesn't want to be named on how to manage your debt. Now if you are currently trading, I trust that you are NOT in debt. If you are, I urge you to seriously commit yourself to settling your debt before trading. The additional psychological pressure of holding a debt while trading is certainly detrimental to your performance!

Do check out the article, and I hope you find it useful.

Consolidate debts to reduce your debt load

Debts can take away your mental peace if you don’t handle them wisely. Statistics reveal that on an average the number of credit cards an American household uses is 14. However, things get worse if you use credit cards even for your daily needs. You lose track of your payments and land up in serious trouble. Although there are various ways in which your debts can be controlled, you can consolidate debt to overcome your debt problems.

Consolidating debts allows you to treat all your debt accounts as one. It also makes debts more manageable. If you are not confident enough to consolidate debt on your own, you can take help of a debt consolidation company.

Few other options that can make you debt free and help you to avoid bankruptcy include the following-

- Debt settlement
- Debt management plan or DMP

If you are undecided about consolidating debts or opting for some other debt help option, you can always consult a credit counselor for the same. A credit counselor will not only help you to manage your debts better but will also educate you to manage your finances wisely.

There are a couple of other ways in which you can lead a debt free life. You don’t need a debt relief company to assist you and you just need to follow few simple steps.

- Minimize credit card usage

- Use credit cards only in case of emergency and try to use cash instead.

- Pay more than the minimum balance each month. The minimum amount you are required to shell out is usually 2% to 3% of the outstanding balance. If you are required to pay USD$300 as the minimum amount, try to pay more than that. In this way you will not only be making payments for the interest rate but your principal balance will also get reduced in due course.

- Don’t take fresh credit and try to reorganize your existing debts to get out of debt.

AUDUSD Forecast (29 May 09)

Here's an update on the AUDUSD chart I put up about 10 days back.



Prices have rallied since the last chart, and appears to be stalling at the bottom of wave iii decline (See brown line). My preferred count is a 1-2-3 and waiting for wave 4 and 5 to complete. An alternative count would be an A-B-C, where wave A = Wave C (If you measure Wave 1 and 3, they are rather similar in length).

In anycase, stalling below the wave iii decline (Brown line) could mean a decline from this level before its next (anticipated wave 5) rally.

Good luck with your trading!

4th Surefire Trading Challenge

Hi Folks, Some of you may be interested to know that the 4th surefire trading challenge is starting soon and may wish to join it.

The competition starts from 1 June 09 till 30 Jun 09, and winners shall be calculated as the greatest percentage gain irrespective of starting equity - meaning you don't need a whole lot of cash to join. In fact, there's a demo trading category too. So if you are keen to put yourself to the test.... check it out.

P.S. I'm not affiliated anyway to the competition or the organiser of this competition and do not benefit anyway from it. Just sharing some information that some of you may be interested in. :)

(Video) Bob Prechter Talks to Forbes

USDJPY Forecast (24 May 09)

USDJPY looks like it is ready for a rally. Reasons:
a) Depth of Correction (Area of Previous 4th Wave)
b) Wave c = Wave a
c) Wave 2 = 50% retracement

There are some support resistance levels as well.

Looking at daily candlesticks... last candlestick is showing a bullish engulfing pattern.

So if you are going long on the USDJPY... look for a stop below wave 1 (assuming wave count is correct and this is a wave 4) around 90.00.

Good luck with your trading!

AUDUSD Forecast (18 May 09)

Hi folks, I know its been an obscene amount of time since my last elliott wave forecast. I'd been rather busy with work, and simply didn't have the time to look at my charts, much less do up one for sharing.

BUT, I've finally done one up quickly for sharing. It is not going to be as detailed as some of my previous posts with multiple charts... this one only has one.

Firstly, would just like to share that.... I'd missed a fantastic rally that I had previously put on my charts but since I had not been actively monitoring.... I had totally missed it! If you are familiar with how I draw my charts, the arrows that I draw always start at the last available candlestick at time of drawing. So if you look at the blue arrow... its a beautiful chart! But what's missed is missed.... no matter what the reason. So here's my next anticipated price movement.

I've counted a five wave down, and a possible expanded flat (ABC*). If prices do rally to 0.8300-0.8400, I think its a good level to short.

* The expanded-flat should perhaps be more accurately labeled W-X-Y, because wave C should be a five-wave structure rather than a three-wave structure.
Since Elliott Wave is fractal in nature, I'm not too anal about the
labeling. But is good to be clear what we are looking at.

Here are the reasons for shorting:

a) Wave C is 2.618 of Wave A - I'm counting this as an expanded flat correction. Generally, Wave C is 1.618 of Wave A, but we can see that prices have broken through that level, which happens to also coincide with another interesting level (where wave c = wave b)

b) Wave c is 1.618 of wave a - In a flat correction, wave c can be the same length as wave a, or 1.618 of wave a. In this case, I'm counting 1.618 of wave a since it has broken through the wave a = wave c level.

c) 0.8380 is the 0.618 retracement of wave 1 / (A). Now at this point, all I'm counting is five-waves down, but I have no idea if its a wave 1 or a wave (A). In anycase, a 0.618 level is a pretty popular/strong retracement resistance level.

d) 0.8380 is near the termination point of wave iv. Although the guideline for depth of correction is usually applied to wave 4 corrections, sometimes we can also use it for wave 2 corrections if the lesser degree wave iii is subdivided. In this case since wave iii happens to be sub-divided, so it will probably make a pretty good resistance level.


So here are my 4 beautiful reasons for shorting at that level. But here's what you have to be aware of. Based on this count, the stop-loss is going to be above the start of wave 1 / (A), around 0.9850. That's a risk of about 1,550 pips! Make sure you have a large enough account size and can afford to take the trade. Remember, risk management, risk management, risk management!
If you can't afford to take this trade, wait for price confirmation i.e. for prices to start making 5-waves move downwards before entering.

That's all for now! Good luck with your trades!

The Million Dollar Challenge

I recently stumbled upon a trader's website where he embarked on a Million Dollar Challenge to trade a $2,000 account into a Million in 2 years.

Based on the power of compounding, he will be able to do that if he netts 15pip a day. This is done with a max risk of 5% on his account each time and he closes for the day if he loses twice. You can read more about it, or even follow him (he provides email subscription) at his website.

What's interesting for me is that I (and many people I believe) has forgotten that we don't really need huge gains to be successful. Slow and steady is one way to build up your account. Of course, this depends on your strategy.... many longer-term trend followers will happily accept losses due to whipsaws to catch that one nice huge trend. If you can't tolerate long string of losses that trend-followers accept, then perhaps you can build up your portfolio slowly.... 15pips at a time.