Articles by Forex92

Forex92

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The metaverse: Is it a new virtual universe in which to live?

The advent of the metaverse will effect entertainment, education, financial services, and maybe all facets of our daily life.

What is it?

Like the internet in the mid-1990s, the metaverse is still young. The most accurate characterization of the metaverse was given long before we even realised it existed.

The Metaverse Roadmap, published by the Acceleration Studies Foundation in 2008, divides the metaverse into four categories:

  • A cohesive plot in a virtual world
  • A world that reflects the present
  • The metaverse is an extension of actual life that blends real world and augmented data.
  • Lifelogging is a method of recording and preserving data about people and objects.

In short, the metaverse is a digital realm where avatars can interact using virtual reality, augmented reality, artificial intelligence, and other technologies.

If you want to experience the world's highest cliff jump, swim with Great White sharks or bike on the Death Road, you can do it all from your hotel room. In the near future, the metaverse will reportedly be limitless. The metaverse will eventually deliver lifelike sounds, images, and fragrances.

The phrase metaverse appeared in Neal Stephenson's 1992 science fiction novel Snow Crash. But it wasn't until Facebook rebranded as Meta that the idea became real. What is the metaverse, and why is Facebook hiring 10,000 employees to build it?

The metaverse can be used in the following ways.

Bitcoin games


Gamers are flocking to the metaverse, creating avatars and participating in virtual experiences.

During the COVID-19 epidemic, metaverse games exploded. The Sandbox, Axie Infinity, Splinterlands, Alien Worlds, Defi Degen Land, etc.

This metaverse-based GameFi concept combines DeFi and P2E blockchain gaming drew many users. This ecosystem rewards players for their commitment and engagement by giving them ownership of goods. As games gain popularity, their tokens gain value, increasing the entire market capitalization of cryptocurrencies.

Microsoft plans to buy Call of Duty and World of Warcraft creator Activision Blizzard for $69 billion, its largest all-cash acquisition ever.

Intriguingly, one of the metaverse's primary promises is platform freedom. For example, you will be able to simply transfer any avatar item purchased in one game to another.

Most people think of NFTs as images of digital artwork or artefacts worth millions. The most promising use of NFTs is in metaverses.

What is an NFT? The term non-fungible token is used to describe any digital asset that has evidence of ownership maintained on a blockchain.

While NFTs are still new and contentious, their benefits outweigh the drawbacks. Each one has a unique identification code and is frequently acquired with cryptocurrency, making some incredibly valuable.

Decentraland, for example, allows users to invest in metaverse property using LAND tokens. It is possible to transfer ownership of a property to another metaverse denizen.

Smart contracts can also be used to control NFT access to the metaverse. Actual identities can be linked to digital avatars to access the metaverse. Real-time events can already be accessed via NFT.

NFTs can be used to connect to a variety of amazing functionalities enabled by blockchain. The metaverse and NFTs were clearly created for each other.

New virtual world horizons

The metaverse goes beyond the internet. Our social contacts, commercial partnerships, and the online economy could all change dramatically. Despite its youth, we can already see the metaverse's potential.

E-real estate

It's odd to possess land that doesn't exist. In The Sandbox, a user just paid $450,000 to be Snoop Dogg's neighbour.

Compare it to buying a full-page advertisement in a major magazine or TV show. You can create a business, hold online events, or rent out your virtual land.

Galeries d'

For example, Sotheby's erected a duplicate of their New Bond Street Galleries in Decentraland, where artists can exhibit and sell digital NFT work.

Marketing
As a brand, Nike has done well in the metaverse. It was the first major company to develop a virtual environment on Roblox called Nikeland, where fans can dress up like Nike characters.

In its ongoing digital transition, the company recently acquired RTFKT, a collectibles-focused NFT startup. RTFKT has already released wearables for Decentraland, including NFTs.

The market potential for Decentraland Wearables is immense. Currently, 10,262 people own 71,055 tokens.

Adidas has also pioneered NFTs. That inaugural “Into the Metaverse” NFT collection in December 2021 made $23 million in a few hours. Bored Ape Yacht Club, Punks Comics, and GMoney collaborated on the NFTs. Adidas' debut NFT collection launch is unlikely to be their last, considering its success.

Samsung Electronics America launched a virtual counterpart of its flagship 837 physical shop in Decentraland for users to discover new Samsung technology-enabled experiences.

Immersive offices
Some organisations are literally constructing virtual offices using Zoom and Slack. Like Binance. US is creating a virtual newsroom on Portals, the Solana-based metaverse platform.

Microsoft will add mixed reality support to Microsoft Teams this year via Mesh, its virtual reality collaboration platform. Avatars can be used with or without a VR headset. Companies can build their own metaverses in Teams.

Nvidia just revealed another amazing example of virtual collaborative sessions in the metaverse. For example, in Omniverse, a ray-traced avatar of Nvidia CEO Jensen Huang roamed around a simulated area and performed facial expressions. The most thrilling part was that conversational AI responded to questions just like Huang would with his voice.

E-concer

WMG announced intentions to bring music-themed attractions to The Sandbox, including concerts by WMG's stars. Commemorative 'LANDS' adjacent to WMG property will be sold in March 2022.

Virtual concerts have previously included Decentraland's multi-day virtual music festival with over 80 performers and Snoop Dog's live performances in The Sandbox.

In short,

The metaverse will endure. The current digital transition is considered as the next important step in the evolution of the internet. And it paves the path for a future in which practically all activities occur in the metaverse. The world is rapidly becoming a virtual reality. How do you feel about the digital age?
 

HeavenLeighRob

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I'm sure this will be a big thing and it's interesting to see what they'll do with it, but I'm just not that into it.
 

Forex92

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Identifying future worth

Investors should constantly know a company's USP because market downturns are the perfect time to seek for inexpensive investments. How solid is the company's strategy and management team? Warren Buffet asks those two questions. Another statistic to consider is Price-to-Book (P/B), which helps identify companies that allocate capital effectively.

P/B requires three inputs. A company's current share price, book value, and number of shares outstanding. The Price (or Market Cap) is the share price multiplied by the number of shares outstanding. Entire assets minus total liabilities equals Book Value. Divide the Market Cap by the Book Value to get the P/B per share. P/B tells an investor how much they're paying compared to the worth of their assets or capital invested. Investors reward organisations that can routinely acquire high-quality assets at below-market costs.

It's critical to track a company's value over time and compare it to the competition. When the P/B ratio reaches 1, investors anticipate the company's assets will generate positive returns on investment. The average royalty & streaming mining firm ROI over the last decade was 2.00x, compared to 0.17x for government bonds (Source: Visual Capitalist, February 2022).

With quality assets acquired at reasonable rates, a company's P/B will improve, indicating a higher ROI than its rivals for future revenues earned vs. acquisition price of assets acquired. P/B falling or turning negative is a warning sign that investors are losing faith in the company's capacity to generate revenue from its assets or that its assets are overvalued.

Franco-Nevada Corp obtained a mining royalty on the Goldstrike gold mine in Nevada in 1986. One royalty has since yielded almost 500x ROI. Its management team's ability to purchase high-quality royalties at below-market rates allows Franco-Nevada to trade at a P/B multiple of 4.40x.

Franco-Nevada now leads the $70 billion mining royalty sector

Vox Royalty Corp. (“Vox Royalty”) has developed $145 million in equity value from $33 million in capital invested over the last two years, equaling Franco-P/B Nevada's multiple of 4.40x. Given that Vox Royalty only went public in May 2020, this comparable P/B multiple shows that Vox Royalty has achieved a similar sector-leading return on invested capital as $40B Franco-Nevada.

An investor in a mining royalty company can expect to make a lot of money, especially during times of high Their success depends on their ability to find and purchase mining prospects at reasonable pricing. Franco-Nevada and Vox Royalty, both with high P/B multiples, have regularly found deep value through acquiring mining royalties.

Investors looking for commodity-linked inflation hedges in the mining royalty business could consider P/B multiples as a proxy for management and asset portfolio quality.
 

Forex92

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Five personal consequences of risk avoidance

A number of typical human flaws make it difficult to control risk. In a vulnerable scenario, we may hunt for a single financial solution, such as a large, hazardous trade. Sometimes we can't see when we're wrong and keep moving our stop loss further away. The consequences of not managing risk are extensive, as shown below.

No more trading. You will eventually cease trading if you are unable to control risk. This can be incredibly frustrating for a trader who was controlling risk and profiting, yet lost it all in one rash move. Risk management is one of the main reasons traders abandon trading.

Impact on me. You will lose a lot of money if you do not manage risk. You also risk straining family relationships if you are in charge of managing risk for the family.

You made a great profit, but be careful. Strangely, not managing risk effectively can result in a significant winning trade. You may be overjoyed. But beware! The same irresponsible behaviour that made you wealthy can cause you to lose it.

Stress. If you don't manage risk, your equity will skyrocket. This is especially distressing if your equity curve has big peaks and dips. The excessive tension is unpleasant, and living this way for a long time may harm your health.

Obsession with trade. Too much risk often leads to a trade you can't quit checking. You can't sleep till you check the trade every few minutes. Maybe you can't relax with your family because you're thinking about trading. Trading is a passion, but becoming obsessed with it is harmful.

So always control risk. You can trade patiently but develop solid habits to reduce the impact of risk.
 
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Forex92

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How forex traders evaluate forex trends using candlestick charts

The K-line combination, often known as the candlestick chart, is a sort of technical analysis that is employed for short-term trading. Constant trading signals, minor single-digit gains and losses, and more consistent transactions define it. Of fact, stable transactions can entail consistent earnings or losses.

It's not about how many historical tests the trader has run, or how high the winning rate is, or the profit and loss ratio, but rather if the candlesticks chart's logic aligns with the market and its fundamental principles of operation.

Investors who want to succeed in forex trading must understand trend analysis. A candlestick chart is used to analyse foreign exchange patterns. Many traders rely on candlestick charts to make money. So how can you utilise the candlestick chart to spot trends in the forex markets?

First, we must learn the basic foreign exchange candlestick chart form. Every day in the forex market, the candlestick chart is unique, however some charts are similar. An expert frequently identifies various typical patterns, such as the main axis trend and cross-line trends. These common trend graphs have their unique features. Lessons in common trend graphs for investors They should be able to analyse complex trend graphs and candlestick graphs in depth.

The second stage is to study each line and the underlying cause of its trend. Lines make up the candlestick chart of foreign exchange patterns. Each line influences the next. Simultaneously, investors must comprehend each line's features. The sun line appeared unexpectedly, why it appeared, why the momentum is slow, and major financial events or market news, and then construct your interpretation. Traders will naturally learn to investigate the forex candlestick chart in depth over time.

Third, learn to evaluate candlestick charts with trading tools. For example, traders who frequently trade foreign currency know that the foreign exchange candlestick chart has several lines. It's hard to tell what they're At the same time, investors can design their own trend lines, which is obvious. Finally, investors can choose expert analysis software based on their specific situation.

A long-term perspective is also required when analysing the candlestick chart of foreign exchange patterns in depth. They should do macro research and develop a trading strategy.

How to read candlesticks' rise and fall

Best technical analysis tool: candlestick chart. Trading strategies vary depending on the investor's perspective on the candlestick chart. The findings were examined and divided into two categories: loss and profit.

The candlestick chart has a trick: first look at the yin and yang, then the entity, and finally the shadow line.

1. Yin and yang

Yin and yang indicate long and short trends. The yang line shows the current market is rising and may continue to climb, while the yin line shows the current market is falling and may continue to decline. By way of an example, a close higher than the open implies a bullish bias, and hence a yang line that indicates price will continue to rise.

2. See the entity.

The entity is the difference between the candlestick chart's closing and initial prices. The candlestick chart's power increases with the difference. So choose a candlestick chart with a significant physical portion, like the enormous Yin Yang. Using the large Yang line increases trading success rates and helps traders learn more about risk management.

3. Observe the shadow.

The shadow line is the candlestick's highest low or the difference between the lowest and closing price. A shadow line is the difference between two prices. The higher the shadow line, the narrower the difference between the highest point and the closing price. It is better to purchase or sell short at certain periods. The lower shadow line shows the price difference between the candlestick's lowest and closing price. The longer the lower shadow line, the stronger the upward counterattack. Don't take a long position if the upper shadow of the candlestick is too long. Likewise, if the candle's bottom shadow is too long, you can't go short.

The candlestick chart clearly shows how to judge rising and declining prices. It is simple and easy, but there are risks. Investors must have a clear direction because no one can be 100% correct. It is well known that traders must utilise stop losses and monitor the global market's increasing trend. If the market changes dramatically, you must adjust your strategy.
 

Forex92

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CONSIDERATIONS FOR BACK TESTING: PRIMARY CONSIDERATIONS FOR BACK TESTING A TRADING SYSTEM

Many forex traders, whether consciously or unconsciously, believe that “History repeats itself”. In practise, market observers and technical analysts have found that the overall predictability of human behaviour in big groups tends to support this premise.

Because of this, one of the most important ways to test a forex trading system is to mimic trading over a historical time series of exchange rate data.

This is called back testing.

Why Do Back Tests?

Many forex traders utilise back testing to evaluate their trading strategies before implementing them on live accounts. This entails taking the trading system's rules and analysing how the system would have done had it been traded exactly over the historical price action.

Back-testing, especially over a period of five to twenty years, might help traders anticipate the trading system's behaviour when trading on a real account.

Automatic and Optimum Regression

Back testing can be automated on modern trading systems. They can even optimise your trading system's parameters.

This optimization may allow you to identify, for example, the settings for a system that will maximise profits while limiting losses.

Back Testing Considerations
What to check for when running a back test on a trading system before using it live?

Back Testing Issues

Because back testing includes limitations, the results should not be regarded indicative of future trading results.

Furthermore, to build confidence in a trading method, it should be tested in a real trading environment - perhaps on a micro account.

Nonetheless, back testing can help determine whether a trading method will perform well in actuality. As such, it can help forex traders build a profitable trading method.
 

Forex92

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IMPORTANT ADVANTAGES OF MECHANICAL TRADING SYSTEMS

Technical market indicators are used to purchase and sell automatically, sometimes without human intervention. As a result, they are contentious. After all, a computer making money while you sleep sounds too good to be true.

But automatic trading is legitimate for several reasons

First, any profit you get is due to your value-added effort — you set up the system wisely. You had to code, backtest, and monitor your programme, just like any software engineer. It's all worth something.

Second, taking rewards for your system entails risk. If you constructed your system poorly, you accept the tab. Automated systems provide value by reducing risk.

Third, well-designed systems help the market by reducing volatility and forcing prices to more accurately reflect value. What's wrong with having a computer play a similar role?

Most significantly, automated systems have intrinsic value for those who build them. One typical criticism of mechanical trading systems is that they remove the human aspect. But the contrary is true, because creating the system benefits everyone involved. Consider this: you can't make clear, objective directions unless you've thought through your own plan. But while building up a mechanical system, you are forced to define your strategy in numbers or trading orders. As a result, you have a better grasp of the process.

BENEFITS

A trader can also benefit from backtesting or forward testing a system. Using an automated trading system, this is as simple as pressing a few buttons. So, when the procedure is over, the trader has valid expectations. Like someone entering the market hoping to earn a great profit overnight and being controlled by unreasonable greed. Back testing a personal strategy isn't as easy as back testing an automated system, therefore the fallacy persists.

The computer executes and follows directions without emotion, which is another benefit of automation. Even the best traders adjust their strategy when earnings or losses rise. In most circumstances, this is counterproductive.

But once set up to obey directions, it doesn't care about the bottom line. It will keep executing buy and sell orders until you stop it. Even if your emotions tell you otherwise, you should have tested it before going live.

Simply said, automated trading methods improve discipline and consistency. Sure, they have flaws. You must always adapt to new information, but they never do! Even if you already have a good system, keep tweaking it. With dedication, you and your forex trading robots can achieve even greater success!
 

Forex92

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Five Important Forex News Events You Should Be Aware Of

Because currency markets are so volatile, it is critical for rookie traders to understand the economic indicators and forex news events that shape the markets. Learning which data to look for, what it means, and how to trade it can help rookie traders become more profitable immediately and put them up for long-term success.


Profitable trading of technical chart patterns requires constant awareness of the fundamental storey driving the markets. We've compiled five of the most critical economic news releases you need to know right now!

Top 5 Market Events

1.CB rate decision


Every month, the world's central banks gather to decide on interest rates. The outcome of this choice is tremendously crucial to the currency of the economy and thus to traders.

A rise in rates is often considered as bullish for the currency, whilst a fall in rates is generally seen as bearish, depending on the perception of the economy at the moment.

While the decision itself is important, the accompanying policy statement provides the Central Bank's summary of the economy and forecast. This is also where monetary policy is unveiled, which includes QE, which we cover extensively in our Forex Mastercourse.

Since the ECB dropped the EuroZone rate to 0.05 percent in September 2014, EURUSD has fallen by over 2000 pips.

2.GDP

GDP is a key indicator of a country's economic health. Every year, the central bank determines how fast a country's GDP should increase.

Currency values tend to fall when GDP falls short of market forecasts and rise when GDP exceeds expectations. Currency traders closely follow the release of this number, which can be used to anticipate Central Bank moves.

When Japan's GDP unexpectedly shrank by 1.6% in November 2014, speculators expected more Central Bank action.

3. CPI (Inflation Data)

The CPI is the most extensively used inflation statistic. The index shows historical average prices paid by consumers for a basket of commodities and whether the same goods are costing consumers more or less.

This data is used by central banks to decide rates and policies. Inflation is countered by raising interest rates if it exceeds a target.

With the Canadian CPI beating market expectations of 2.2 percent to 2.3 percent, the Canadian Dollar hit a six year high against the Japanese Yen.

4. Ratio de chô

Markets pay close attention to a country's unemployment rate since it is a key indication for Central Banks. As Central Banks seek to balance inflation and growth, higher employment leads to higher interest rates, attracting traders' attention.

The US ADP and NFP figures released each month are the two most important labour indicators, with the NFP taking precedence. Because this figure is so vital, we publish a monthly NFP preview with our analysis and trading tips. The market's focus on the probable date of a Fed rate hike is giving this number more weight each month.

Because it is released ahead of time, ADP data is a valuable NFP predictor.

5.FOMC

While all central bank meetings are vital, the US Federal Open Market Committee takes centre stage as the world's reserve currency.

Every month, the committee meets to set rates and make statements on current economic conditions and the efficacy of existing monetary policy, as well as future economic conditions and monetary policy expectations.
The committee has members who vote at each meeting, with “Hawkish” members favouring a rate increase and “Dovish” members favouring a rate decrease.

Tightening of monetary policy is a major issue for traders, and even seemingly insignificant wording may cause substantial market changes, as witnessed lately with the Fed's use and removal of the term "patient" about rate hikes.

FOMC meetings can create tremendous market volatility, as shown on March 18th 2015 when EURUSD surged 400 pips in minutes as markets interpreted a USD negative meeting.

These meetings are also where we learn about changes in monetary policy, such as quantitative easing. This is very significant for currency traders and we cover it in our course.

This year's ECB QE programme has seen EURUSD decline over 600 pips since January 22nd.
 

Forex92

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Seven Tips for Avoiding Forex Scams

Scams are increasing in the forex sector. Here are 7 strategies to avoid such scams:

Forex scams are on the rise. Forex dealers' money bought a submarine, according to Michael Greenberg. Another forex scam report.

So, how can we prevent forex scams? For more information on forex frauds, see Casey Stubbs' article. And here are my thoughts on his advice:

1. If anything looks too good to be true, it probably is. This market isn't for suckers. Most sites selling such items have only one page with blinking dollars and no explanations. The graphics are typically not modest.

2. Talk to people: Casey advocates chatting to both company employees and product users to gain an idea. Clowns may already be portrayed in several promotional videos. In other circumstances, they may appear serious, but you must verify their product warranty.

3. Google the item and look for issues: Add adjectives like “sucks” or “scam” to the product name and run a Google search. Not just competitors, but also genuine people who have previously suffered, complain if search results provide too many compelling results.

4. Check out LinkedIn: Its audience is huge. Google searches for the company's founders virtually always return the LinkedIn page as the first result. A lack of a LinkedIn profile is a problem. If so, ask for recommendations. Good advice will make you feel better.

5. Regulation: A serious market player will be governed by at least one authority. The US NFA is the hardest (sometimes too tough). No guarantee that a corporation is legitimate unless it is stamped by the NFA, FSA, CFTC or another reputable institution. Companies listed in exotic locales seem suspect.

6. A forex demo account is the basic broker check. Some robots can perform well, but how can you know? You must see it. Ask to try it for free.

7. After all, you get a sense of the folks on the other side. As you can see, the forex sector is full of crooks. Unlike in court, where a person is presumed innocent until proven guilty, you should assume everyone is guilty and require them to prove their innocence.
 
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