Frequently Asked Questions (FAQ)

I’ve heard the term ‘Swing Trading’ before but I’m not totally familiar with it – how does this style of trading differ from other styles?

Swing Trading can be thought of simply as the bridge between Day Trading and Position Trading.  With the former, you’re typically holding a position open for several hours (or less) for an average target profit typically well under 100 pips, often watching the trade carefully through to completion – trailing stops, dodging news releases, and so on.  With the latter, you’re sitting on positions carried open for typically one to several weeks or more with a target profit of several hundred pips or  more.  The only problem with this is that if your high level analysis is wrong, even a substantial floating profit can be wiped out when you’re away from the action for too long.  Swing Trading represents a nice compromise between these two approaches – offering you superior Reward/Risk potential compared to Day Trading methods (and with a less intensive trade management style), but allowing you to capture profits more frequently than with Position Trading.  The profile of a typical Swing Trade as described in our course and tracked in our Update Service would be: 1-4 days to complete on a Limit Exit, targeting 100-400 pips profit with an initial stop risk of 20-40 pips.  (Please note: this is not a guarantee, just a benchmark).

Yes - absolutely!  Module 12 of our course – entitled Adapting the Paradigm to Other Trading Styles – shows you exactly how you can adapt the core methodology to different combinations of timeframes (and risk profiles), including Position Trading, Day Trading and Scalping.  Though we focus on Swing Trading as the core application, our method is fractal based, which means that the simple and effective tools we use to confirm tradable trend and setups within it are repetitive in form and function – wherever they may be found.  So whatever your style, we’ve got you covered!

Fibonacci retracements and extensions are important components of trade execution with this system, but we don’t rely on Fibonacci exclusively.  Our approach draws a clear and specific link between Fibonacci and Swing Points (and other elements), such that the retracement measurement is predicated on joining objectively identified Swing Points, and the counter-trend pullback to within that range forewarns of a pending dip in the uptrend, rally in the downtrend which may be actionable.   So, Fibonacci is important, but it’s by no means the whole story.

In addition to Fibonacci measurements, we pay very close attention to Swing Points, specifically those confirmed by specific types of readings provide by 9,3,3 Full Stochastics in conjunction with confluences of Support/Resistance in the form of Old Highs & Lows, Pivots (and less frequently, trendline and trend channels).  The chart templates presented both in the course and update service are minimal in complexity and can be easily replicated on virtually any quality charting platform. No need for high-end, expensive charting packages! 

In developing this trading system, we focused on the stated needs of traders.  What they’ve told us over and over is that they want the optimal combination of simplicity and effectiveness.  While certain approaches such as Elliott Wave and sophisticated pattern analysis techniques like Gartley can produce stunningly precise forecasts on occasion, the fact is, they require a pretty advanced degree of competence to use them for actual trading purposes.  In addition, the KISS rule definitely applies in trading – the simpler you can keep your methods, the less confused you’ll be. Or conversely, the more complicated you make it, the more likely you’re to be wrong.  So we focus on keeping it as simple as possible, and that means no Elliott Wave, no sophisticated pattern analysis, no added complexity!  Then again, if you feel comfortable with those other methods, you could certainly think about how to overlay them onto Fibonacci Swing Trader.

It is indeed both (a course and service), and we offer several different options between them to give you the flexibility you need.  Those completely new to Swing Trading and/or Fibonacci trading would be best served by opting for the complete package which includes both the Fibonacci Swing Trader online course (available also in DVD format) together with the Daily Update Service.  The best way to think of this option is that the course provides the baseline training, while the service provides useful reinforcement through regularly recurring, practical examples. Those already familiar with the methodology (which was presented throughout August 2010 in the Forexmentor Daily AM Review service) may wish to subscribe to the update service only, using it as a resource to help confirm and/or highlight high probability trading opportunities.  Those not yet ready to trade the update service may wish to take their time with the online course only, then perhaps add the update service to their membership at a later date. 

The short answer is NO – we do not send you emails all hours of the day and night telling you to buy here, sell there “right this very minute”.  But we definitely try to get as close to that degree of timeliness as is possible within a once-daily scheduled update.  We post advisories the same time each day, five days a week, and then it becomes your responsibility to find an entry point in relation to that update (assuming you have considered it and are in agreement with it). But that’s really the only task you need to worry about. Every other element of trade management except removing risk is covered off by the daily advisories.  Let us do the ‘heavy lifting’ – you just focus on finding a credible entry point and that’s it!

The FST Daily Updates are posted daily, Monday through Friday each week, except for statutory holidays in Canada, which we advise members about at the beginning of each month. They specify the tradable trend, specific Swing Points on the 4hr chart from which a Fibonacci measurement is taken, all Fibonacci retracement and extension levels, the so-called “kill” level which, if violated, negates the setup, and the two Limit Exit levels to be applied on the setup. This information is presented in an easy-to-read tabular layout which is viewable in Flash PDF format. Accompanying the tabular data is a single annotated 4hr chart extract for each pair that offers a pending, or in-progress trade, for easy reference in relation to your own charting platform. So the maximum page count for each daily update would be 17 pages (2 pages of tabular data and one chart for each of 15 Forex pairs). Our daily ETA for posting new updates is by no later than 12pm Pacific Standard Time (3pm EST) for the PDF report, and by no later than 1:30pm Pacific Standard Time (4:30pm EST) for the Daily Video Commentary. Because 4hr setups often take days to properly materialize, one should not be anxious about missing too many opportunities that may fall outside this timeframe. Often a pending setup will be monitored over several consecutive daily updates.

We provide regular coverage for a total of 15 specific Forex pairs (see list below)

How long will it take for me to start making money with your system?

It’s impossible to specify exactly how long it will take for each and every student of Fibonacci Swing Trader to become successful with it.  Numerous variables can affect the length of the learning curve, most notably your level of previous trading experience. But if you are able to spend an average of 1-2 hours per day studying the course materials and practice trading the system in a demo account, you could conceivably be trade-ready within as little as one month.  With a slower paced study program, or if you’re a relative newcomer to the Forex market, give yourself considerably longer.  In either scenario, it is advisable to build up a track record of positive results covering at least 20 trade attempts with this system before even considering trading it in a funded account.  We discuss the appropriate benchmarks in Module 1 of the online course.

There is no specific level of experience one needs in order to learn the Fibonacci Swing Trader method. Experienced traders will hopefully find this method a ‘breath of fresh air’ that avoids the pitfalls of ‘analysis paralysis’ common to overly complicated or indicator-myopic approaches; while relative newcomers may find they can pick up on the core concepts surprisingly quickly.  Generally speaking, however, the less prior knowledge of Forex markets you have, the longer you should allow yourself to practice in demo mode before attempting to trade the system live.  Just to be sure you have it down pat before risking anything on it.

Relatively few!  We advocate a high Reward/Risk trade profile which typically involves protective stops limited to between 20-40 pips, while seeking profit objectives rarely less than 100 pips – and typically much more.  Though we don’t cover position sizing extensively in the course, we do advocate risking no more than 1-2% of account equity per trade.  By limiting risk in terms of both leverage and stop loss levels, your winning trades should pay for any losing trades and still leave a substantial residual profit in your account.  That is the objective.

Our attitude to news and fundamentals is that a high quality setup should dictate the reaction to them, not the other way around.  If the daily trend is strong and unambiguous, and if the 4hr corrective setup is well defined and ‘ripe’, then any concurrent news release should have at best a finite impact.  For traders specializing in day trading methods where the focus of attention is on lower timeframes like the 60m and 15m charts, new events tend to have a more significant impact, simply because the scale of the setup is of lesser degree and therefore of lesser reliability.  There will be exceptions from time to time, but the primary cause of stop triggers with Fibonacci Swing Trader is simply a too early entry attempt, not news.

Risk Disclosure Statement: Trading currencies on margin involves a high level of risk which may not be suitable for all investors.  Leverage can work against you just as easily as it can work for you.   Before deciding to trade currencies you should carefully consider your trading and financial objectives, level of experience, and appetite for risk.  The possibility exists that you could sustain a loss of some, or possibly all of your trading capital.  Therefore, you should not fund a trading account with money that you cannot afford to lose.  It is recommended that you seek advice from an accredited financial advisor if you have any doubts as to whether currency trading is right for you.  No representation or guarantee is offered or implied as to the trading results that may be attained by applying concepts presented herein.  Any losses incurred by traders unsuccessful in applying these ideas or methods are the sole responsibility of the trader and Currex Investment Services Inc (d.b.a “Forexmentor”) and its principals, contractors and assigns will be held safe from prosecution in any form.