Tuesday, May 28, 2013

The Secret to Successful Forex Trading

If your wish is to get involved in the largest traded asset in the world, the current market, then it is now prime time for you to trade in the Forex Market. While you are wondering how to get started, don’t be; this post will try to provide you with all the required information. Here are the tips you should know for you start trading currencies.
Secret to successful forex trading
  • Know yourself. Define your risk tolerance and understand your needs:To make money in trading, you must first be well versed with the markets. To be well versed with the markets, you must recognize yourself. The first step to start  trading is know your risk tolerance level and make sure you have not allocated excessive money to forex trading. This means that you must carefully understand and analyze financial goals and needs.
  • Learn trading by using a demo account:Before you start trading forex, you need to learn all you can by taking advantage of demo accounts which are provided free of cost by several trading platforms. Trading on demo account will allow you to learn how forex actually works, learn how the trading terminal works; explore its strengths and weaknesses. Trade on a demo account before you can test things out in the real market. It is essential for you to learn how precisely the Foreign currency market works and how to trade prior to getting started.
  • Learn to calculate your moves and way to draw your own conclusion:Perhaps this may be the only way for you to become successful in the currency market and make money for yourself.
  • Avoid Trading in many markets at the same time:  Trading at same time in many different markets or even in a lot of different currencies makes you careless, reckless and confused which will eventually led to you to losses. Make sure you concentrate on major currencies or major market. Don’t over trade. It is hard to master all the different kinds of markets that are available in the world hence it is better to restrict yourself to currencies that you are familiar with.
  • Keep it Simple:Your trading plans and the analysis of your trades should be simple and easily understood and explained.  Currency trading is not rocket science, you don’t need to be a mathematical genius or trading expert to makes lots of money in forex trading. Instead, clarity of vision, well defined goals and plans is enough for you to have a respectable career in Forex trading.
  • Placing a Stop Order:To Limit your losses and maximize your gains, it is very essential for you to utilize the stop loss order. It will put an end to trades once the amount you have invested falls below the set amount. Placing a stop loss order will help you follow trading disciplines.
  • Follow you plan and your signals:Don’t just blindly copy some other traders. Even an expert trader makes mistakes. Follow your own plans and your signals rather than following others.
  • Have an Exit Strategy:If you are unable to make any gains in the forex market and if you are suffering constant losses, then it is better for you to get out. Having an exit strategy will help you avoid impulsive decisions.

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Monday, May 27, 2013

Money Saving tips for 2013

Money Saving tips 2013According to Bureau of Economic Analysis, on an average, Americans save around 4 percent of their income. But some great savers manage to save more than that.

Here are some money saving tips for 2013, go through these tips and find which you can apply and use them in your life and you'll quickly find yourself saving some serious money

1.    PAY YOURSELF FIRST:  You have worked hard for your money, so pay yourself by putting money into a Savings account before you spend it. Consistently putting aside a small portion of your income or salary in savings or for retirement is one of the best personal finance strategies.

2.    SET FINANCIAL GOALS:  Setting financial goals will put you in charge of your money. Set Short and Long term goals to help you stick to your budget but they all need to be achievable.

3.    SAVE YOUR SPARE CHANGE: Like they say, Pennies add up. Let your spare change add up and which will become a lot of money for yourself.

4.    CAR POOL TO WORK: You'll save on gas and splurge on social interactions. Not only that but you will save half your gas expenditures - An Average of $2,500 a year.

5.    LEAVE THE CREDIT CARD AT HOME: One of the simplest ways to whack your credit card habit is to stop yourself from accessing it. Decide how much spending money you will allow yourself per paycheck and take it out in cash on payday. When you're out - You're out.

6.    TURN OFF THE LIGHTS WHEN YOU LEAVE YOUR HOUSE: Don’t be Dim, you won’t become an overnight millionaire but conserving energy can help you save a little at a time.

7.    DOUBLE YOUR RECIPE SO YOU'LL HAVE LEFTOVERS: You likely won’t need to buy more ingredients; you'll just use more of the ingredients you already have. This way your meals will go twice as far and you'll save half as much.

8.    PACK YOUR LUNCH: It costs a lot less to pack your lunch than it does to eat out. Believe it or not, "Brown-Bagging" it can save you more than $1,000 a Year.

9.    SKIP THE BOTTLED WATER: How smart is it spending money on bottled water? Not very. The average person consumes 167 bottles per year. That’s a pretty easy way to decrease your bank account.

10. EVALUATE YOUR CELLPHONE PLAN:  Check your cell phone plan, look at it and see if you are paying too much money for it. See if you really need everything you pay for, by removing unnecessary plans, you could save a cool $250 every year.

11. CUT THE CABLE: Cancel your cable package- It can cost $100 each month and which adds up to $1200 each year which is a lot of money to be saved.

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Sunday, May 26, 2013

How to become a Financial Manager

Financial Manager is responsible for all aspects of financial health of an organization. He handles all the monetary and fiscal details of a company making sure the company is financially healthy, by increasing revenues and decreasing expenses. His actions directly impact the profitability, growth and goodwill of the company

The following Infographic explains role and responsibilities, how to become a financial mangers, salary and job outlook and top paying finance jobs.

How to become a Financial Manager

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Friday, May 24, 2013

Investing in Commodities

In recent years we have seen the commodities market enjoy an impressive bull run. With a few exceptions, the prices of commodities have experienced major increases and generally outperformed other investment class. This trend has brought commodities under the focus of investors.

What are Commodities
Commodities are a broad category of raw materials used by industries and traded on specialist commodities markets that include

·         Energy – Includes natural gas and oil-related commodities
·         Industrial metals – Includes Copper, Zinc, Aluminum, lead, and Nickel
·         Precious metals – Gold and Silver
·         Agriculture – Includes cotton, wheat, soybeans, coffee, and sugar
·         Livestock – Includes cattle and hogs

Why should you invest in Commodities
Commodities are a source of inflation and hence they provide a strong hedge against it. Commodities provide benefits of risk diversification by adding them to a portfolio. Based on historical results, adding commodities to your portfolio will increase portfolio returns while lowering your risk. By adding a small percentage of commodities, say 6% can improve your overall portfolio performance and returns. Hence Commodities asset class has become an effective way of diversifying your portfolio. Investing directly in commodity producing assets gives linked returns with lower volatility and cash flow.

How to Invest in Commodities
Investors have a number of options available with them to investing money in some of the products they use daily such as food, oil and metals. There are number of ways available to invest in commodities: future market, which is used by speculators looking to make money on whether the price of a commodity will increase or decrease in the future. There are a small number of mutual funds and Exchange Traded Funds available for individual investors and for small institutions.

Risks in Commodities
Obviously, investing in Commodities is not without risks and it is not a typical for this asset class to under perform for an extended period. Commodity prices are very volatile and are affected by geopolitical risk, speculative risk and the risk of fraud in trading commodities

There are many reasons for you to invest in commodities. Judging by historical data and results, this asset class can provide attractive absolute and relative returns during appropriate economic environment. They have historically been positively correlated with inflation, while other asset class has been less or negatively correlated with inflation. If anyone invests in this asset class during unfavorable economic conditions, they must be prepared for the possibility of unpleasant results.

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Thursday, May 23, 2013

Investing in Real Estate in 4 simple ways

Investing in real estate has a lot more advantage than from investing in other asset classes such as stocks, commodity trading or hedge funds. It also offers significant advantages to a diversified investment portfolio. Investing in real estate also has a number of characteristics that differentiate them from other assets. In addition to that, rental income provides a regular revenue streams that helps to increase the overall returns.

In the following . We discuss about 4 simple ways of Real estate Investment

Investing in Real Estate

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Wednesday, May 22, 2013

Forecating Foreign Exchange Rates

Foreign exchange rates
Currency exchange rates are determined by the supply and demand for the currencies. For some countries, the foreign exchange rate is the single most important parameter in the economy since; it determines the international balance of payments. There is no general rule to determine foreign exchange rate, but Eiteman has suggested the potential exchange rate determinants into five areas
·         Parity conditions
·         Infrastructure
·         Speculation
·         Cross-border FDI and Portfolio Investments
·         Political risks

Even though there is no model which has been consistent in predicting short-term foreign exchange rates, but there are several major concepts that can be used to determine the long-term behavior of foreign exchange rates.

Purchasing Power Parity
Purchasing power parity (PPP) states that over the long-run the exchange rate between two currencies adjusts to relative price levels.  Over longer time periods, PPP does tend to hold, in part since countries take this approach seriously and act to control relative inflation rates. For the short term period, however, other factors such as capital flows can remove the impact of PPP.

Balance of Payments
Balance of payments (BOP) was the initial approach used for economic modeling of the exchange rates. BOP concept traces all of the financial flows in the country during the given time horizon. All the financial transactions that occur are treated as credit and the final balance must be zero. BOP is equal to Current account plus Capital account Plus official reserve account which must be zero.
The Current account contains the trade balance, net income received, balance of services and unrequited transfers. The capital account includes the FDI, Portfolio investment, other capital inflows and net errors and omissions. Official reserve account includes the net changes in the country’s international reserves.

Relative Economic Strength
This approach focuses on the investment flows rather than the trade flows. The rationale behind this concept is that strong economies are likely to attract more capital, which causes the currencies to increase. Foreign investors must always weigh whether the higher yield offsets the risk of inflated currency values. Relative Economic Strength demonstrates how currencies should respond to economic news, but does not imply a “true” currency value. Because of this, many investors combine Purchasing power parity and Relative Economic strength for a more complete theory of interest rate movements.

Asset Approach
The asset approach is based on the ideas that markets are efficient and that exchange rates are assets traded in an efficient market.  The asset approach predicts that the spot rate behaves like any other asset--the value of the spot rate changes whenever relevant information is released.  Therefore, prices are determined based on expectations about the future.  This approach focuses on the relationship between the capital account and exchange rates.

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Tuesday, May 21, 2013

How to Deal With Erroneous Credit Card Transactions

When it comes to credit card charges, you don't have to immediately assume that they are telltale signs that will enable you to identify credit card fraud. Sometimes, these are just erroneous charges or double billing that can and will be reversed. Here is how to differentiate, as well as how to deal with errors in your credit card entries.

There is no doubt that consumers really have to be vigilant with their credit card transactions. Not all credit card charges are legitimate: some credit card transactions are erroneous, while some are even telltale signs of an actual credit card fraud. A consumer should be wary once there is a string of erroneous entries on his credit report. That may be an indicator for him to investigate further to help prevent credit fraud. As with all things in life, however, correcting
a credit card record would have to start with a reasonable dialogue. Here is how to properly dispute credit card charges before you identify a credit card fraud.

Before we go on, however, we have to give you the tell-tale signs of how to identify a credit card fraud, and differentiate it with credit card charges that are legitimate, albeit erroneous:

-          It is credit card fraud when you have NEVER ordered from the company, and neither had you set foot in their store's premises.

-          It is a legitimate credit card charge when you have ordered from the company, only, there are some delivery aspects that are open for dispute.

-          It is credit card fraud when you notice some out-of-state transactions, and transactions from places you have NEVER been to in the past 6 months to a year.

-          It is a legitimate, albeit erroneous transaction if you've placed an order for a subscription, cancelled the same subscription, but are still being billed for the monthly or quarterly payments.

That being said, we go on to discuss how to handle credit card charges in dispute.

1. Initiate a dialogue. As we mentioned, a dialogue is the first step to resolving any such transactions. Whether the transactions are red flags for credit card fraud or not, the first thing to do is to file a dispute directly with the shop owner, operator, or online seller. If you've gone through a financial tool like PayPal, then chances are, you can actually file a dispute from PayPal itself. But the best thing to do really is to talk to the seller directly. For double-billing incidences, or recurrent billing beyond the termination or act of unsubscribing, still talk to the subscription provider directly or his employees.

Ask politely if you can have the charges reversed. If it is a subscription, ask if you can get the subscription discontinued, and the charges reversed. This way, you would have tried to resolve things where they were manageable. Not only that, you also gave the seller/service provider a chance to explain and redeem himself.

2. Call your credit card company. If the seller/service provider/subscription publisher refuses to take action with your questionable credit card entries, call your card company. That way, your card company will be the one to take on the headache of getting your money back. Ask if you need to fill out certain forms.

3. Send in the necessary documentation. Credit card companies will be able to reverse credit card chargesmore effectively when they have received the right documentation from the user. Usually, your credit card dispute case will not move forward until the credit card company receives your documents. Comply with these, in order to facilitate the process.

Usually, the credit card company will work on getting the consumer's charges reversed. There is generally no need for litigation nor the services of a lawyer. However, in the event that the credit card transactions were actually part of a credit card fraud operation, there is another process to follow:

1. Call your credit card company and have your card frozen.

2. Go and file a police report for the incident, so that if the credit card fraud is perpetuated beyond the first incident and the first report filed, it will be easier to press charges and there would already be a paper trail to help with the investigation on the credit card fraud activity.

3. Call the three credit unions in order to put a credit card fraud alert on your report. If you haven't yet, order credit monitoringfor your accounts so that future instances of credit card theft will be reported as it happens.

Here are the numbers of the three credit unions:

Equifax: (800) 685-1111
Experian: (888) 397-3742
TransUnion: (800) 888-4213

4. Change your SSN if you need to. While this is tricky, you may be able to file for a new SSN if the identity theft continues after already filing for different reports and freezing your accounts.

Consumer credit is truly a target of identity theft and similar crimes as of late. This is why a credit card user needs to be vigilant about his account's activities. Not all erroneous or out-of-place entries are symptoms for you to identify a credit card fraud, however. Sometimes, it may be just simple absentmindedness on your part. Other times, it could be a computer glitch. Yet other times, it may well be just an honest mistake. Either way, the first step is always to open a dialogue with the other party.

Joy Mali is an active blogger who is fond of sharing interesting finance related articles to encourage people to manage and protect their finances.

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Monday, May 20, 2013

"Gold or Bitcoins" Infographic

After the recent meteoric rise (and subsequent crash) of Bitcoins we thought it would be useful to pull together an infographic comparing the 3000 year old form of money, with the up-start and very young (5 years) ‘new’ form of money.
Some have even gone so far as to describe Bitcoins as ‘digital gold’ – but is this really a fair comparison? Below we present a head-to-head match-up between the new digital currency and the oldest form of money on the planet. 
As you’ll see Bitcoins are certainly an very interesting development in the creation of money, especially given their decentralised nature and the fact that no ‘central bank’ is in control of their development. In that sense they are a true ‘free-market’ phenomenon. 
But in a few key areas gold still possesses crucial advantages over the digital upstart currency. 

"Gold or Bitcoins" Infographic - An infographic by the team at Gold Made Simple

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Saturday, May 18, 2013

Using the Cash Flow Statement

The cash flow statement explains the change in cash by three activities: operating, investing and financing activities.

Cash flow from operating activities is the change in cash as a result of the daily operations. It is the balance of money received from customers and cash paid to suppliers, personnel, etc. It also includes interest paid and interest and dividend received on securities that the firm holds.

There are two common ways to compute the operating cash flow: the direct method and the indirect method. With the direct method, the different cash flows (cash received from customers, cash paid to suppliers, etc.) are shown separately. With the indirect method net income is used as a starting point. Adjustments are made in order to undo accrual accounting. Both methods result in the same cash flow from operating activities. I will focus on the indirect method, because it is most widely used.

Cash flow from investing activities is the change in cash as a result of investments and disinvestments, including transactions involving financial long term assets such as notes receivable.

Cash flow from financing activities is the change in cash as a result of obtaining and repaying loans, issuing shares, buying back shares and paying dividend.

Key points:
- the cash flow statement explains the change in cash by three types of activities: operating, investing and financing activities
- cash flow from operating activities is the cash generated (or used) by the ‘daily’ transactions
- there are two methods to compute the operating cash flow: the direct method (showing separate cash flows) and the indirect method (starting with net income and making adjustments)
- cash flow from investing activities is the cash invested /disinvested by buying/selling long term assets
- cash flow from financing activities is the cash that has been raised/repaid by issuing/repaying loans, or selling/repurchasing shares, and paying a dividend

Creating the cash flow statement

To create the cash flow statement, it is helpful to keep the business equation in mind. The business equation states that total assets equal total liabilities plus equity. This is true for all transactions together as well as a single transaction, or the transactions over a period. Therefore, the change in assets (∆assets) must also be equal to the change in liabilities (∆liabilities) plus the change in equity (∆equity).

∆assets = ∆liabilities + ∆equity

Since we are interested in the change in cash (∆cash), we split the change in assets in the change in cash and the change in the other (non-cash) assets:

∆cash + ∆non-cash assets = ∆liabilities + ∆equity

Then, taking ‘∆non-cash assets’ to the right-hand side:
∆cash = ∆liabilities + ∆equity - ∆non-cash assets

Thus, the change in cash can always be explained by changes in all other T-accounts. The use of this formula is best illustrated using an example.

Consider the end of year condensed balance sheet of Google for 2007 and 2008 (Google's annual report).
Condensed balance sheet Google 2007 and 2008

Naturally, total assets equal total liabilities plus total equity. Also, the business equation holds for the changes.

Change in condensed balance sheet Google 2008

In this example the balance sheet is condensed. The same principle holds when the T-accounts are used.

Adding/subtracting the changes in all the non-cash T-accounts adds up to the change in cash. However, this is not yet an informative cash flow statement. However, it is a starting point for creating the cash flow statement. What we need is to allocate all these changes to the three categories: operating, investing and financing activities.
With the indirect method, net income is taken as the starting point to compute operating cash flow. All cash flows which are also an expense/revenue are included in net income. Hence, items that require an adjustment are (1) items that are included in the calculation of net income, but which are not a cash flow, or (2) items that are a cash flow, but are not included in net income.

Depreciation is an example of an item that affects net income, but does not affect cash flows. At the time of investment, cash is spent on a long term asset. The depreciation during the economic lifetime is an expense (but not a cash flow). Hence, depreciation is added back to net income in the operating cash flow section.

Examples of items where the cash flow does not have to match the expense/revenue include the following: cash received from customers does not have to be the same as revenue; cash paid to suppliers does not have equal cost of goods sold; interest paid does not have to equal interest expense, etc.

Current assets and liabilities (with the exception of interest-bearing debt) are operations related. That means that the change in all current assets and current liabilities will be included in the operating section of the cash flow statement. This makes sense, because these T-accounts are used because of accrual accounting. With the indirect method net income (accrual accounting) is being corrected to result in operating cash flow (cash accounting). Hence, the corrections basically ‘undo’ the accrual accounting.

The balance of Accounts receivable at the beginning of the year and end of the year is 50 and 60, respectively. Thus, accounts receivable has increased by 10.

Net income increases when the sale is recognized (and not when the customers pay). As a result, the increase in accounts receivable (customers have delayed payment) must be subtracted from net income in the operating cash flow section. This is also in line with the formula used: ∆cash = ∆liabilities + ∆equity - ∆non-cash assets. As accounts receivable is a non-cash asset, the increase must be subtracted (note that the change in assets is subtracted).
The operating section starts with net income as the starting point. For the investing and financing section the ‘real’ cash flow is shown. For example, if a new machine is purchased for 50, then an entry like ‘investments in new machines -50’ is included in the investing activities.
Depending on the country’s GAAP, there could be flexibility in the classification of items. For example, under IFRS interest paid can be classified as an operating cash flow as well as a financing cash flow, whereas under US GAAP interest paid has to be classified as an operating cash flow.


The following information is available for CTU Inc. for the year 20x8:
Net income500
Accounts payable at beginning of year110
Accounts payable at end of year120
Inventory at beginning of year80
Inventory at end of year65
Depreciation expense30
Furthermore, during the year a machine with a historic cost of 80, and a book value of 30 is sold for 32 in cash.
The operating cash flow section for the year 20x8 (Assuming no other information would be relevant):
Net income500
Change in accounts payable10
Change in inventory15
Depreciation expense30
Gain on sale machine-2
Operating cash flow553

gain or loss on sale of long term asset

When the firm sells a long term asset at a gain or a loss the cash flow of the disinvestment is an investing cash flow. At the same time, the gain or loss affects net income, which is the starting point for computing operating cash flow. As a result, the gain or loss needs to be adjusted for in the operating cash flow section.

The firm sells a machine for 45 cash, which is an investing cash flow. The book value of the machine was 40. Assume this is the only transaction during the period, so net income is 5 and operating cash flows are 0.
The cash flow statement using the indirect method:
Operating cash flows
  Net income5
  Gain on sale machine-5
Investing cash flows
  Sale machine45
Financing cash flows-
Change in cash45
The correction ‘gain on sale machine -5’ is needed to undo the gain on sale of +5 which has increased net income.
Key points:
- The change in cash always equals the changes in liabilities and equity minus the change in non-cash assets: ∆cash = ∆liabilities + ∆equity - ∆non-cash assets
- With the indirect method, net income is taken as the starting point to compute operating cash flow, with corrections for (1) items that are included in the calculation of net income, but which are not a cash flow, and (2) items that are a cash flow, but are not included in net income.
- some countries’ GAAP can allow flexibility with respect to classification of cash flows. For example, under IFRS interest paid can be classified as an operating cash flow as well as a financing cash flow.

Author: Joost Impink

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Friday, May 17, 2013

Trading Signals for MetaTrader 4 and MetaTrader 5

Forex is the fastest growing segment of the global financial markets and because of this more and more new people are entering into the fray. However, because of it, currency trading is so competitive, finding good information and advice is imperative. In order to become successful in forex trading you have to either be very lucky or find the right people and emulate them.
Since luck can be very fickle, you are far better off with the latter option. Fortunately, there are products available that can help you find and emulate the trades they are making in order to get in on the action and make really good money.

The type of products we are referring to are called Trading Signals and they are a very powerful tool and when used properly, your potential for success increases exponentially. What exactly are Trading Signals and where do you get them? These are two very important questions and the balance of this review will thoroughly answer both questions.

Trading Signals

When it comes to forex trading or really any type of financial market trading having an edge is the only way to improve your chances of being successful. That is where Trading Signals come into play. Trading Signals gives you the ability to monitor all trades that the successful traders are making. Once you identify these successful traders, the Trading Signal software when loaded on your terminal automatically duplicates all of the trades the person has made.
However, not all Trading Signals are created equal and it can be a daunting task to find the right one for you. There is a way to ensure that you have access to only the best of the best Trading Signal programs and that is by using the MQL5 Signals. These are only available from the MQL5 Market.

The Trading Signals for MetaTrader 4 and MetaTrader 5 are all researched and fully vetted to ensure that they are all of the highest quality products and only yield the most accurate results. The MetaTrader 4 and Meta Trader 5 platforms are well respected and widely considered by most of the industry leaders as the best of the best.

What makes MQL5 Signals the best?

Since the MQL5 Market is a subscription based service, both buyers and sellers are paid members. All of the products on the market have been scrutinized to ensure that they are of the highest quality available. That way the buyer can be assured that they will always received the best results possible.

The subscription model also helps to make it a very easy to use system. You simply make your purchase, select the provider you want to match up with and connect to their signal and the software does the rest.

You never have to worry about whether or not the person you select has the necessary experience. All of the providers have been checked before they can even post a product for sale.

Since it is a subscription based process all the fees have been established and there are no hidden surprises. This is true no matter if you are a buyer or the seller.

My Final Thoughts

Getting involved in Forex Trading can be very exciting; however, it is also one of the most competitive financial markets in the world. That can also make it a bit scary for a beginner. With that in mind, finding the best information on how to successfully trade in Forex is absolutely critical.

That is where Trading Signals for MetaTrader 4 and MetaTrader 5 can really come in handy. The idea that you can subscribe to a service that offers a clearinghouse of only the highest quality products for the Forex trading industry, is amazing.

What is even more amazing is that for a price, you can make the exact same trades that some of the most experienced traders in the world are making. This product means that you can simply select a provider and connect with them and in a short amount of time you are making the exact same high profit trades.

We would highly recommend not only the Trading Signals for MetaTrader 4 and MetaTrader 5, but we would also highly recommend the whole MQL5 Market. They created a Forex trading product warehouse and service that is packed full of the highest quality products. You owe it to yourself to check it out.

                                         SUBSCRIBE TO MeTaTrader5 Trading SIGNALS NOW

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