Best Thread Correlation Trading - Basic Ideas and Strategies

[NVP]

and for all you history lovers .......

2012 saw the Yen dump and provide gains to all other currencies up to even 17% against the GBP ....

 

[NVP]

and 2011 saw the rise of the Yen taking about 8% off of the Struggling Euro

N

 

[NVP]

End of lesson.............its all history and useful but don't get to excited...sure theres a guy who writes for the FT who is a very noted historian

all interesting and fun for debating I suppose

but at the end of the day ...........

TRADE WHAT YOU SEE ...........thats it ......

N

 

[be-positive]

End of lesson.............its all history and useful but don't get to excited...sure theres a guy who writes for the FT who is a very noted historian

all interesting and fun for debating I suppose

but at the end of the day ...........

TRADE WHAT YOU SEE ...........thats it ......

N

think you would be a great historian

 

[NVP]

think you would be a great historian

doubtful..........I flunked at school ...although the wife is forcing me to watch all these new historical movies and TV series to try to educate me on such matters.....

good luck with that then !!........hahahahaha
N

 

[NVP]

mornin all......

well - if the Dow futures breaches the 14,700 all hell will break loose like last week........and methinks twill be the Yens chance to shine ......?

hmmmmm :smart:
N

(who let shakespeare in ?)

 

[NVP]

a few pips this morning scalping so back in the saddle again ........

off to work now......have a good day

N

 

[NVP]

mornin all......

well - if the Dow futures breaches the 14,700 all hell will break loose like last week........and methinks twill be the Yens chance to shine ......?

hmmmmm :smart:
N

(who let shakespeare in ?)

yep ....as the Dow fallesh...t'was a good day for the Yen fellow sires and mistresses

thou can havest those yen pips today free of charge from me :smart:

N

(Hey - this shakespeare trading system really works ! )

 

[NVP]

overnight was more Dow futures pressure that put the Yen back north again on the 1hr chart

look at GBP as well............consistent strength over last day or so now .....

hmmmm
N

 

[elisab]

What’s going to happen to the Nasdaq is EurSek breaks upward the resistance of 8.86?

 

[NVP]

What’s going to happen to the Nasdaq is EurSek breaks upward the resistance of 8.86?

Hi E

I would prefer to see 3 lines if possible to answer your question ...........

Nasdaq
Euro index
SEK index

you may find the answers there

any pairchart to me contains 1 currency to many !

N

 

[NVP]

hey all

I had to start work early today re some presentations and other nonsence.......

I didnt get time to review the markets or indeed trade at all this morning ..........

grrrrrr
N

 

[NVP]

mornin all.....

Dow is fighting back......and the ole correlation Karma has been a little screwy in truth (well using the rules of my free system available here anyway)

Yen and USD are still truly resisting the urge to be pushed south.......but only because the European currencies are being trashed .........Hmmmmm

When you use Strengthmeters its important to really really think about what you are seeing and what the market is trying to tell you..........with practice and experience you will be surprised how useful it is ..........even for an idiot like me

N

 

[NVP]

hey all ..another week draws to a close

heres 2 charts .......1 is a 1hr standard 20ma show .......the other is a 500/1 1Hr setting with a weekly 1/1 x-men chart alongside showing the moves this week

with Dow being so aggressive its been relatively easy to identify the buy currencies .......my main issue through the week has been picking the correct dudes to sell ....

and yes i know I should follow what i see but i do like to have either Yen or USD is my trade pairings.....a legacy from my continued fondless to scalp on lower timeframes

so in the 20ma chart you see I normally went to whatever one of the USD or Yen was in the south whene Dow was going north.....

if you had taken the easier route of buying the Aussies and dumping GBP you would be doing well this week ........but looks like peanuts at around 1-2% gain so far overall this week .

have a good day :smart:

N

 

[NVP]

NVP,

Asia has been shorting the JPY for a long time now, though it has gained some strength over the past few months or so. The persistent Asian shorting of the Yen, against being Long in Gold, has also fallen apart of late.

Don't you find that just when you locate a real correlation throughout the hundreds (maybe thousands) of possible combinations and pairs out there, that it disappears into the ether or begins to decay to the point of being unreliable?

I try to look for internal JPY "correlations" - using the word sparingly, of course. I'm trading the seven (7) largest cross pairs in the Yen and often times find one or two of them lagging the basket. Sometimes that lag can be several dozen pips in size. Occasionally, Australia and New Zealand team-up and diverge from the bunch, creating an opportunity. Sometimes, USD and CAD will do the same thing, while typically GBP/EUR/CHF will run pretty much in sync with each other.

I find that trading the "Magnificent Seven" (as I call them) gives opportunity for heading as well, when you are forced to deal with FIFO rules. You have to get the sizing correct, however. Of course, not each pair has the same cost and not each pair moves with the same daily range.

Spend some time with all seven of them and you'll note some interesting internal behaviors that give rise to opportunities intra-day.

Some good points you raise here G....

you have to spend a lot of time watching the markets to start to see the
opportunities........and yes they can dissapear as fast as they appear.....

but at least by using strengthmeters we have a decent window through which to observe them as individual currencies.......unlike the very high percentage of traders that look at single pair charts and live in a truly one dimensional world !! :smart:

N

 

[NVP]

hey all

Dont beat yourself up too much this week if you are trading off the 4 hourlys and things were thin.....

looking at my charts and violatility indexes its been the worst week indeed for 4hr TF action since late March .....and I would have only picked up the glimmer of a signal around Wednesday 26th late London morning session and it then faded rapidly

these are the kind of things I use to maintain my sanity and get the G8 Forex world into perspective..........if the volatility isnt there on a TF I just dont trade.......(reluctantly)

why go fishing when the fish are not biting ?

N

 

[NVP]

Euro and CHF having a great morning so far on the 15m TF ...........

N

 

[NVP]

heres the Daily on my goldmeter......available
free in the signature area

any goldbugs still standing now ?.......

are they all still telling you to buy on these dips .......???? :whistling

Trade what you see..the rest is noise :smart:

N

 

[NVP]

yeoowww..........just got 10 pips out of that G/U move up .........

jees that was tight as its reversed on new 15m bar

N

 

[NVP]

20 pips up and 20 pips down ...........dont you love G/U ?

n