Asian market as an indicator to western markets??

All,

Have a question regarding using the Asian markets as a guide to possible movement in the western world of currencies and equities? This is something that I have never really bothered with but it seems that a few traders use this for direction as in looking at the previous nights Asian markets for the days direction?

My question is this, and the logical reason why I didn't really see this too relevant, or at least what I thought and think I am maybe wrong, do the Asian markets drive the western markets or do the western markets drive the Asian markets???? Therefore using one to determine another you would need to answer that question. Now logic states that it could be either way, in that major news from either the Asian or Western markets will drive the other, but with the western economy being the biggest dictator? How do you know that movement over the night in the Asian markets is because of its own direction or the direction from the previous days western markets?

I am interested in using the Asian markets as an extra string to my bow as in the following days direction and would like if possible for someone to provide me a quick analysis to do first thing in the morning? I trade the ftse/dow/eurusd/gdpusd.

thanks all and good luck.

Asian Market sort of went flat after the earlier Yen intervention ( not the G7, earthquake one but earlier ).

Before that it usually was a continuation of market bias after a small correction with the end of the American session.

Both EU and GU have been quite flat if compared to AU and NZU in the Asian session.

With that being said I would be careful using such an analysis in making trade decisions.

Just like currency pair correlation like say UCHF and say GU or EU. It works but then it does not follow the "rule" all the time.

Making trade decisions based on that could be risky.

Dont know if any other members see something in the Asian market movement that could be used to look for trade in the European session.

Hi Nikitafx,

Not for a second am I looking at making trading decisions based on this, just see it as an extra string to my bow in terms of possible trading information and nothing more, correlation between the markets is expected and inevitable but I just wondered if anyone does this quickly each day for trading and how?

good luck

Kwickwool, Nice meeting you.

Like yourself, I will be watching this thread closely. Might get an opportunity to learn something new.

Cheers.

I have used premarket figures from the NYSE to help determine certain openings in the UK,

Was thinking about this with the Asian markets the other day actually, not looked in great depth yet.