Best Thread Correlation Trading - Basic Ideas and Strategies
NVP
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Hi All
As we fall into the new year heres a summary of the things I look for regarding my trades, regardless of the ma settings or combinations you decide to chose for the FXCorrelator indicator
THE FXCORRELATOR - SIMPLE RULES OF COMBAT
1) The yen and the USD are aligned in the same direction - the most important rule
2) As many as possible other G6 currencies are also aligned in the same direction as the yen and dollar ..............this is common sense..........the more G6 that also flow alongside the tag team means the ones that are moving in the opposite direction will be even stronger in their power/moves = more pips !
NOTE - The CHF is my favourite accompaniment to the tag team as that means a big risk play is happening (See 3 below)
3) the Dow30 (US30) futures is moving in the opposite direction to the usd and the yen....common sense and something you see most of the time so every little helps ! If you dont like using the us30 futures outside of us trading hours then the Nikkei will suffice as well (test it )
4) when you have a decent signal based on some /all of above the next decision is what of the G6 to trade against the Yen/USD.........2 choices
a) trade a G6 already showing a strong opposite signal and ride it out
b) wait for the next G6 to move into an opposing signal to the yen/usd and
trade it as a new mover
your money and your choice...........in all honesty I have loads of other things I am looking for so I can do either of these based on the situation... if you put me on the spot I would wait for a fresh G6 signal or at least wait for a current strong G6 to retrace a little (taking a breather) before trading it
5) always check the pairchart of the selection you have decided on from above as a final go / nogo signal ..............use any standard and more conventional tools that suit you to support the move (your choice from from MA’s to price action.......whatever you like) but keep it simple as the fxcorrelator will have already selected a really decent trade !
So regardless of if you use the triple arrow correlator on 20mas on use a 5min or a 4h chart or even other combinations ........remember the rules above and you will always be entering trades with some high probability on your side
Trade well and prosper in 2011........
NVP
As we fall into the new year heres a summary of the things I look for regarding my trades, regardless of the ma settings or combinations you decide to chose for the FXCorrelator indicator
THE FXCORRELATOR - SIMPLE RULES OF COMBAT
1) The yen and the USD are aligned in the same direction - the most important rule
2) As many as possible other G6 currencies are also aligned in the same direction as the yen and dollar ..............this is common sense..........the more G6 that also flow alongside the tag team means the ones that are moving in the opposite direction will be even stronger in their power/moves = more pips !
NOTE - The CHF is my favourite accompaniment to the tag team as that means a big risk play is happening (See 3 below)
3) the Dow30 (US30) futures is moving in the opposite direction to the usd and the yen....common sense and something you see most of the time so every little helps ! If you dont like using the us30 futures outside of us trading hours then the Nikkei will suffice as well (test it )
4) when you have a decent signal based on some /all of above the next decision is what of the G6 to trade against the Yen/USD.........2 choices
a) trade a G6 already showing a strong opposite signal and ride it out
b) wait for the next G6 to move into an opposing signal to the yen/usd and
trade it as a new mover
your money and your choice...........in all honesty I have loads of other things I am looking for so I can do either of these based on the situation... if you put me on the spot I would wait for a fresh G6 signal or at least wait for a current strong G6 to retrace a little (taking a breather) before trading it
5) always check the pairchart of the selection you have decided on from above as a final go / nogo signal ..............use any standard and more conventional tools that suit you to support the move (your choice from from MA’s to price action.......whatever you like) but keep it simple as the fxcorrelator will have already selected a really decent trade !
So regardless of if you use the triple arrow correlator on 20mas on use a 5min or a 4h chart or even other combinations ........remember the rules above and you will always be entering trades with some high probability on your side
Trade well and prosper in 2011........
NVP
NVP
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hey all - this above was at 8am.............slow progress for my first signal of the year and remember this one is not a fast scalping methodology as I enter on a 15m TF signal ..........its a slow burner that requires bigger spreads and a lower pip per trade investment
also the dow is dissapointingly still holding so that doesnt help the cause...fall dammit !
if you want faster action reduce the Triple arrow corrie timeframes to say a
1h 20ma
15m 20ma
5m 14ma delta 3
your money your choice
N
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NVP
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chugg chugg chugg..............slowly does it......:smart:
reference my earlier comments regarding the FXcorrelator Rules of combat
see how on the triple arrow indicator below we now have 2 currencies supporting the tag and pointing north ?
that all helps the cause as this is a Zero sum game .....the more weight you have going north means the more the remaining currencies have to go south to balance it to zero
and I have 4 triple arrow corrie currencies indicating north
NOW - cummon Dow go south godammit !!!
later
N
reference my earlier comments regarding the FXcorrelator Rules of combat
see how on the triple arrow indicator below we now have 2 currencies supporting the tag and pointing north ?
that all helps the cause as this is a Zero sum game .....the more weight you have going north means the more the remaining currencies have to go south to balance it to zero
and I have 4 triple arrow corrie currencies indicating north
NOW - cummon Dow go south godammit !!!
later
N
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NVP
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slow progress today...
if you sold E/U back at 8 am today (See earlier posts) with a decent Stoploss based on the 15m charts (not scalp type levels) you could still be in play (unless you had reached a predefined target) and a little more optimistic again as dow is deffinately under presssure
if you look closely as soon as dow corrletates (inversely) with the tag the moves are much more fluid and fast
I say again as I did at 8am today .....a Dow below 11700 will make life easier :smart:
later
N
if you sold E/U back at 8 am today (See earlier posts) with a decent Stoploss based on the 15m charts (not scalp type levels) you could still be in play (unless you had reached a predefined target) and a little more optimistic again as dow is deffinately under presssure
if you look closely as soon as dow corrletates (inversely) with the tag the moves are much more fluid and fast
I say again as I did at 8am today .....a Dow below 11700 will make life easier :smart:
later
N
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NVP
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who would have guessed it at 8am today ..........sure it had its moments and there were lots of reasons to walk away at times.....but not now with dow finally falling below the 11700
ALSO - see how sluggish the day was until the dow got below the ma lines there on the top right US30 chart ? (20 sma, 50 sma, 80 sma)
thats Rule number 3 of my FXcorrelator rules of Combat (post #5082)....wait till the Dow is opposing the tag directionally and all hell should break loose.....so you could have avoided about 6-7 hours of that trade and waited for the Dow to fall .......then traded when the action really began
100 pips on E/U since 8am though still - thanks very much
N
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