Best Thread Correlation Trading - Basic Ideas and Strategies

[NVP]

hey all

take a look here now at the Encyclopedic collection of Strengthmeters now in the market .some free and some very very expensive to buy !

https://www.google.com/search?q=str...RFYTPhAept4CoBg&ved=0CEsQsAQ&biw=1229&bih=625

Note - 11years ago when I started looking at strengthmeters it wasnt very full at all !!!🙂

in answer to some recent PM questions I have received on the subject .....I have been being asked what is the best Strengthmeter to use and what is the best setting and what is the best timeframe ......is My Free FXCorrelator the best ?

Well they are all tough questions .....because in truth and aside from the odd one that really is badly coded or keeps crashing platforms..... all strengthmeters do pretty much the same thing

they show relative strength and weakness in currencies

and to that I then say

SO WHAT ?

yep ..you heard me ...so what !

REMEMBER - the Strengthmeter you chose is just the tool of the trade ........like a set of golf clubs or a toolbox full of sockets and wrenches for fixing cars ....

The Tool has to be fit for purpose......but the real magic comes from the knowledge and skill and expertise of the Person using it !


the major hurdle with most of these tools and systems is that they have mega bells and whistles and other fancy things ...that all detract from the user developing their own skillsets and abilities on a basic tool .....then it turns into a programming game and the essence of the system dissapears under a pile of code and mist !! 😱

That doesnt mean I condemn programming ...all I am saying is the best programming is seamless and integrates effortlessly with a traders inuitive needs ........(the programmers reading will know what I mean)....how many times do you odownload an indicator and follow the rules religiously and not really understand what it is really doing ?.......thats not good dudes ....thats not good and the road to failure time after time ! :smart:

The Best Traders in the world keep it simple and on subject .....generally Price (its measurement and simple derivatives)

Thats why my FXCorrlelator does not have a lot of add-ons and fancy things ..........sure feel free to do what improvements you want with it (as many of you do)....but dont call it the FXCorrelator or use my name .......because it will not be anything to do with me or my approach !

more on this over the next few months ........I want to start teaching again next year and customise the courses to everyones INDIVIDUAL aspirations and needs for their Trading goals ....one size does not fit all in this business :smart:

N

 

[NVP]

hey all .......

heres the picture this week.......Euro and GBP doing well as Yen primarily drives south

can you see the currencies and where they are on the charts for me to tell you this ......?

as i keep saying .....its not rocket science ! :smart:

GBP/JPY is entering the supertrade status (right chart)...

thats 1,000 pips in 4 weeks ..............1,000 pips everyone ......count them 🙂

ive been trading strengthmeters for over 11 years and it doesnt get easier than this months/weeks action .....😎

N

sometimes a period provides some superb and predictable trades .......this was true in november ....

DOW ploughed into 16,000 territory

the G8 spread their wings and provided thousands of pips in profitability (mainly GBP, YEN,AUD trades)
(look at the multiple divergence on the left chart !!) 👍

I hope you made money .....it was a very very nice month :smart:

and stand by for all the trading marketeers and vendors telling you how great their system is and how much you will make if you give them thousands of dollars to buy it ..........

Remember any idiot can make money in a trending market.....its not giving it all back (and more) in the more choppy times that counts ! 😉

you have been warned :smart:
N

 

[NVP]

the FXCorrelator ................

remember you are never too young to start learning about Mr Corrie ! 😆

have a good weekend .....
N

PS - Jedster well done this week .......we are not worthy dude !!!

 

[davidsk2001]

Hi NVP,
I agree with you that great tool if use at knowledge and skill and expertise of the Person, it will be very powerful. Personally I feel this indicator are great tool for me to understand G8. Great effort!!

May I know how I know there will be the retrace of selected currency?? For example, last week GBP strong while JPY so weak. How can we sense JPY going to strong?

Thank.

 

[NVP]

Hi NVP,
I agree with you that great tool if use at knowledge and skill and expertise of the Person, it will be very powerful. Personally I feel this indicator are great tool for me to understand G8. Great effort!!

May I know how I know there will be the retrace of selected currency?? For example, last week GBP strong while JPY so weak. How can we sense JPY going to strong?

Thank.

Honest answer ?

you just dont know .........you can compare a Currency move to ATR's etc etc (by perhaps putting some horizontal lines on a FXCorrealator at key extension levels).....

but at the end of the day a currency will go as far as it goes .......and thats a fact :smart:

in the long run to be sucessful in trading you will need to let trades run and this means invariably giving back pips ............its contradictory to human behaviour and what people want to do .......but thats the score and if you dont do it you will not be profitable in the long term

take a look on my other Basic Strengthmeter thread as I mention using horizontal price bands

N

 

[davidsk2001]

I did study on your the other thread too, that is very good place to start how the strengthmeter working. I were keep study on your thread to gain more understanding on your indicator, and think to start some demo. So bad I can't find any clear hint on your thread yet to do so.

 

[NVP]

I did study on your the other thread too, that is very good place to start how the strengthmeter working. I were keep study on your thread to gain more understanding on your indicator, and think to start some demo. So bad I can't find any clear hint on your thread yet to do so.

David

1) open up an FXcorrelator

2) let it run on the default 20ma any TF

3) look at the history

any currency that stays above or below the Zero for approx 5 bars or more will have delivered profitable trades during that period - I guarantee !!! :smart:

the rest of any system is detail and just needs identification, discipline and practice

all we have to do is get the calls right about 50% of the time and let the damn things run 😉

N :smart:

 

[NVP]

I did study on your the other thread too, that is very good place to start how the strengthmeter working. I were keep study on your thread to gain more understanding on your indicator, and think to start some demo. So bad I can't find any clear hint on your thread yet to do so.

the underlying message for the FXCorrleator is trade diverging currencies in the direction of divergence :smart:

N

 

[NVP]

look how long some currencies held above or below the Zero in November .....

the USD , AUD. GBP and yen all held for over 15 bars at times ...thats about 50% of the month !!!

and all you need is about 5 bars on 1 of the currencies in a pair to make some decent money usually.... so thats why thousands of pips were generated in this special month ......

N

 

[NVP]

hey everyone

heres more recent months on the Daily and a recent 1 hour chart from this week with this 5 bar principle expanded

the white lines represent just 5 bars in duration ...thats all you need to get some pips ......of course you MUST using a highly scientific and skillful selection of the currency you trade it against ...... and dear friends be careful as this PRICELESS secret takes thousands of hours of practice and hard diligence to understand ....

but a clue below ...

(pick a currency on the other side of the zero .....😎)

N 🙂

 

[NVP]

ok ive got to scoot ...........

read up about the great traders ......dont necessarily copy their approach but listen to what they say ............over 90%+ say the same things

keep it simple
let your profits run
cut your losses fast
be consistent and disciplined

.......and turn up ...each and every day :smart:

these all sound easy in practice ....but we humans have a habit of never following simple rules rigidly or consistently ....we always stray .......and in this particular business that is death ......absolute death

N

 

[NVP]

something totally different

the rich dad poor dad serices of books is a little american in theme and rah rah ...

but at the same time i like its message..... and take it from someone who has been an employee in corporate life for over 35 years (and now facing redundancy for the 4th time again by middle of next year)

try to diversify and build incomes from multiple streams of activity ......as being an employee can suck sometimes 🙂

there you go........a minor confession from me .....and why I might have some more time to start finally teaching and training next year on strengthmeter trading :smart:

N

 

[NVP]

Make everything as simple as possible, but not simpler.

Albert Einstein

 

[davidsk2001]

Got it.. I will try to get the history up and study on it.

I saw you will open up 3 timeframe which is Daily, H1 and M15 (if not mistake, i got read thru your thread) when start trade on M1. If selected currency above zero at D1, H1 and M15, then we can take the trade for the below zero currency. Am I right?

Sorry for so many question. I try to understand clearly about the system. This system really get forex more exciting than just looking on candlestick.

Thank.

Edited: We may take maybe the currency slope is showing down or neutral, just to make sure that currency are above zero against the other currency below zero. I saw from other post, if they are going at parallel no matter it above zero or below zero, it won't be a good pair to trade. Am I right? Can't wait to wait you complete the fxcorrelator topic, then I can understand more.

 

[NVP]

hey David /all

I would love to spend more time helping you and everyone..... but time is still against me re work etc etc .......I will have more time in later 2014 to help as it looks like i will be changing jobs .....I will seek something more low key so I can spend more time talking and training strengthmeters .......

the thing is everyone comes at strengthmeter trading from different backgrounds and expectations and beliefs ...and in truth i have learned I need to get everyone at a certain point (and attitude to trading) before I even start the training and learning process and sharing some more advanced principles I have learned over the years re strengthmeters and other systems (I only started trading forex Strengthmeters 11 years ago but have been involved in trading since the late 1970's)

most traders and newbies REALLY need to step back and look at themselves and what they want from trading before they even start to consider what systems and strategies they use 😎...

most newbies are flawed in their opinions and ideas about profitable trading before they even start .................a little like being told a film you are going to watch is the best film in the world ......and whilst it is in fact a good film......you come out very upset because you THOUGHT it would be better....... you have to work in the real world everyone 😎

I ran a pilot course a year or so back to see what I could do to train and mentor people using strengthmeters .......I kept it fairly low in number and learnt a lot about what works and what doesnt ......and a lot of my ideas about how to train were completely wrong in truth..... (mainly around initital education on expectations as mentioned above) .............I spent most of the time telling people they couldnt make thousands of pips a day which seemed to be a shock to many of them ....a very sad example of what the Vendors and dumnass training schools are selling to most poor newbies re expectations.........some are better than others .........

hence why I spend so much time getting involved and challenging the many hustlers that arrive here at T2W and elsewhere in the forum cosmos ....😎

N

 

[NVP]

Got it.. I will try to get the history up and study on it.

I saw you will open up 3 timeframe which is Daily, H1 and M15 (if not mistake, i got read thru your thread) when start trade on M1. If selected currency above zero at D1, H1 and M15, then we can take the trade for the below zero currency. Am I right?

Sorry for so many question. I try to understand clearly about the system. This system really get forex more exciting than just looking on candlestick.

Thank.

Edited: We may take maybe the currency slope is showing down or neutral, just to make sure that currency are above zero against the other currency below zero. I saw from other post, if they are going at parallel no matter it above zero or below zero, it won't be a good pair to trade. Am I right? Can't wait to wait you complete the fxcorrelator topic, then I can understand more.

hey david ............if you are going to use a 3 TF system then use the recommendations I was playing with at that time in the thread
i would suggest ......Try

4hr 20
1hr 20
15m 20

but dont go below that please...........if you want more granularity and action change that 15mx20ma to a 5mx60ma (which is the same thing but will give you more immediate feedback)

go with any currency that is the same side on all 3 TF's and chose the second currency off of the lowest timeframe i used - where divergence will be most relevent for the trade

exitwise I would recommend you move to B/E as soon as you have cleared a few profitable pips and can see an obvious s/r point on the pairchart and keep moving it up/down each time a new S/R is seen .........

most people fail in trading because of poor exits ........its far less to do with Entries than people think

in truth thats why most people here cant understand why I do not have lots of exact exact rules around Entry .......it really can be done many many ways ....

its not where you start ....its where you finish !😎

N

 

[NVP]

Got it.. I will try to get the history up and study on it.

I saw you will open up 3 timeframe which is Daily, H1 and M15 (if not mistake, i got read thru your thread) when start trade on M1. If selected currency above zero at D1, H1 and M15, then we can take the trade for the below zero currency. Am I right?

if you have alignment on 1 currency - trade the second currency off the lowest TF
and on the opposite side of the lead currency

We may take maybe the currency slope is showing down or neutral, just to make sure that currency are above zero against the other currency below zero. I saw from other post, if they are going at parallel no matter it above zero or below zero, it won't be a good pair to trade. Am I right? Can't wait to wait you complete the fxcorrelator topic, then I can understand more.

look for diverging slopes only..........using purely angle of slope will not be a good idea (due to the skewing on charts/views) ........ N :smart:

N

 

[NVP]

sorry all ........gotta scoot

 

[davidsk2001]

We will looking diverging slopes, the higher the better for us to trade. Will i need to watch out on angle of slope too?
If we looking on H1 chart, then we will entry on M30??

Thank.

 

[NVP]

We will looking diverging slopes, the higher the better for us to trade. Will i need to watch out on angle of slope too?

just make sure its diverging ........dont worry about slope on this type of simple strengthmeter ...........it can be very subjective

If we looking on H1 chart, then we will entry on M30??

if you are using a 1hr TF 20ma as anchor .... then use a 15m tf on the 20 to enter /exit.....perhaps a little faster even as its just a 4 multiple ...........so perhaps drop to 15m 10/1 perhaps ....or around a 5min on a 40ma........

or stick to what I said about 3 posts ago

N