Best Thread Correlation Trading - Basic Ideas and Strategies

[Ingot54]

Enthusiasm!

I said he rocked !!!

N

You make me smile mate!

But be careful - I have seen flaws in the trades I have mentioned- the longer term trends are against the rally in the GBPAUD - at some point soon it will retrace.

And the EURAUD will too - the long term trend is down.

This GBPUSD trade could have legs ... or not! be careful and just grb the scalps.

Next week I am hoping to get into some trades that are WITH the trend, to eliminate much of the risk I see with the trades I have currently posted.

But I will wait until after the first London session is over, before getting into it. That would be Tuesday my time - we are GMT +10 here. I like the market to try to find direction for the wek before getting serious about my trades - an old habit. You can't trade 4H and Daily charts without having an established price track.

You have to have some natural paranoia about you when trading - Central Bankers and Politicians DO meet on weekends and make the decisions that make or break traders. Look at the timing of the Bear Stearns and Lehmann Bros decisions - those were on SUNDAYS when markets were closed!

Anyay - this is all good for learning - and in a few weeks we will be nailing some really serious trades.

Remember, it is NOT about the pips - it is all about HOW MUCH per pip you are making.

And it is unlikely we can commit to $50/pip until our method is secure and consistent.

I hope a few traders lurking on the thread will begin to post their thoughts and critique here - that's the way forward. Otherwise we are just pandering to our own ego's. I know there must be people reading the thread that can see improvements - I welcome your criticism - constructive ... or the other kind!

EDIT: Time to hit the shower - off to the daily grind in a little while.
Will try to post from work if it is quiet enough.

Happy trading all.

 

[NVP]

lunchtime......!

Hi Ivan.....

Agree re monday's ..........always good to see what shakes out first !

Ok heres the score

we have 3 musketeers (corrie-ateers ?) at present posting.....I have issued a handful of fresh copies of the updated Indicator this week and about 15 got downloaded originally a lifetime ago.........

rollup rollup and get yer free indicators here at my home page while stocks last ! :clap:

N

 

[NVP]

Ref thread 173 - update

Hi all

Nope not much poke so far .....see comments on chart - if GBP had breached the 5mins verses Yen we could have been resuming the 1 hour mega trend......oh well !

N

PS - I am away from tonight until late sunday and not on E-mail ........please all dig in and we can catch up again then !!

 

[NVP]

its the 3 amigos !!!!!!!!!!!!!

we ride !!!!!!!!!!!!!!!!!!!!! :cheesy::cheesy::cheesy:

thank god its friday.....listen is that the men coming to take me away ?

have great weekends all !

N

 

[alan5616]

Very funny

Hi Neil,

Like your sense of humour.

Ivan. You're quite right to point out that a particular currency is strong on 1 hr Corrie and weak on 5 min. This is why I like day trading. Most days you will get a move, on something, of more than 70 pts.

Today is a prime example. The Yen has been the dominant force since about 2 a.m UK time. My chart, for the 1 & 4 hr Eur/Yen shows that the Euro is in an uptrend. Yet, long Eur/Y traders have seen their profits drop by about 160 pts today. The short tf traders have had a red letter day.

Insofar as Corrie is concerned, the Yen is the only currency that's been above the 0 line all day. GBP & CAD have had brief visits above but, got frightened and left. Compare, that with yesterday when the GBP was the dominant force (after B of E statement). You'd have to be very, very unlucky to enter a Long trade, in the dominant currency, just as it was turning back down.

Now, how to pick those other smaller moves is an enigma, at the moment, but it might be possible:idea:

 

[NVP]

the Big Zero.......

Hi Alan,

interesting points.........it actually takes quite a lot for just 1 currency to (solely) occupy either side of the Zero..........although one has to understand that the 200MA will offer less opportunities for this than say a 50 ma when currencies will be flicking in and out more (I'm not explaining that well )

either way I think sole territory status could be an interest one for the play books ?

N

 

[Ingot54]

Hi Neil,

Like your sense of humour.

Ivan. You're quite right to point out that a particular currency is strong on 1 hr Corrie and weak on 5 min. This is why I like day trading. Most days you will get a move, on something, of more than 70 pts.

Today is a prime example. The Yen has been the dominant force since about 2 a.m UK time. My chart, for the 1 & 4 hr Eur/Yen shows that the Euro is in an uptrend. Yet, long Eur/Y traders have seen their profits drop by about 160 pts today. The short tf traders have had a red letter day.

Insofar as Corrie is concerned, the Yen is the only currency that's been above the 0 line all day. GBP & CAD have had brief visits above but, got frightened and left. Compare, that with yesterday when the GBP was the dominant force (after B of E statement). You'd have to be very, very unlucky to enter a Long trade, in the dominant currency, just as it was turning back down.

Now, how to pick those other smaller moves is an enigma, at the moment, but it might be possible:idea:

I'm good at picking LONG trades just as they are about to run SHORT!

Just look at my last 3 picks here!

If I made the choices at the time of the London open, I am sure the result would be better. Problem is by the time I have an opportunity to look over what is happening, most of the moves have happened.

This brings me to shorter-term trading.

However, in order to persevere with my preferred TF, I would have to be looking at daily charts, and setting an order to be filled when trending prices suffered a pull-back.

This is one of the reasons it is difficult for Working classes like myself, to emigrate to the Elite classes ... I am too busy earning a living to make any money! While people living in the Antipodes do have an advantage with market time, it works against types like myself who are night-shift workers.

At around 4pm local time, we have the London open ... about an hour before I am due to complete my nap! By the time I catch up with family, and stop blinking at the daylight, the action has largely passed.

Should I move to the UK? Quit my work? Take more lottery tickets? Or train my wife to trade? (I'd like to see that!)

Anyway - right now I haven't even placed demo trades with the Corrie - except one some time back now. But I am sure my ship will come in ... just a question of time!

 

[NVP]

Patience fellah !

Hey mate....

it will come..........I have similar issues re earning a living and just about everything else that seems to get in the way of findign time to experiment or even just trade !

meanwhile at this moment my better half is (still) waiting for me to leave work and all my brownie points have gone............doh !

N

PS I will not be online soon to post a weekly roundup so any one feel free to have a go........otherwise I will post one next week !

 

[alan5616]

Should I move to the UK? Quit my work? Take more lottery tickets? Or train my wife to trade? (I'd like to see that!)

Anyway - right now I haven't even placed demo trades with the Corrie - except one some time back now. But I am sure my ship will come in ... just a question of time!

Ivan,

How about doing all four things in the first para? A friend of mine taught his partner to trade and she is doing very well. Plus, she prefers it to going out to work.

I do understand how difficult it is to try and juggle trading and a full time job, especially one where unsociable hours are involved.

Please don't think that I'm in the elite class just because I've retired. I've had to defer my pension for at least 4 years, because it took such a hit last year. I need to give it time to recover now. So, successful trading, for me, is a necessity not a hobby.

I have the time to trade so, want to make the best use of it. This is a tough business and the pro sharks are looking for an easy meal. I never trade with a stop loss to avoid getting stop hunted. However, I know where my stop is going to be and never go one pip beyond it. The second the price goes against me by x amount, I close the trade.

 

[alan5616]

Neil & Ivan,

It will be interesting to see where the Yen goes on Monday. The £ had a great run, yesterday, but, today, has been in chop mode (apart from £/Y). Will the Yen follow suit I wonder?

 

[Ingot54]

Preparing for W-A-R

Neil & Ivan,

It will be interesting to see where the Yen goes on Monday. The £ had a great run, yesterday, but, today, has been in chop mode (apart from £/Y). Will the Yen follow suit I wonder?

Hi Alan

I have been so taken by this method of trading, that I am pulling out a few stops to fast-track my trading career!

As a permanent night shift nurse, I find it difficult to live the dual life of the worker-trader. As well as that, the demands on my 59 yr old body to sleep days and work nights (sometimes 12 hr shifts) is exhausting. Add to that my family commitments, and there is a mix of stressors that is well above the danger level of human survival!

So - when my wife offered to fast-track the trading from demo to real money, I was cautiously optimistic that this time it WILL be different.

And it will!

I mentioned teaching my wife to trade - that's exactly what she has been doing! I bought a price-action course recently, but have not had the time to get into the videos. But she has, and is loving it. So much so, that she told me: "There comes a time when you simply have to jump in and do the trades."

She wants to go "live" in 2 weeks!

Well - I'm up for it! She has an iron discipline - really does. She will not tolerate insubordination, corner cutting, greed nor stupidity! In fact - she has all the qualities I need as a trader, but lack. (Yes - I included "stupidity" because a few of my trades have been beyond the pale!)

Move over Maggie Thatcher!

Anyway - all that to say I'm on my way!

YouTube - The Stampeders - Sweet City Woman

Now - re Monday: You have nailed half of a perfect strategy ... if it materialises. I say that because what we have here is a large deviation after a great run. The GBP has been running/rallying since January 2009, and the USD has been falling off the table since mid-March.

Take a look at the huge divergence, and the snap back to the mean which has occurred from October 2008 to now, in the 2 charts below. I know this does not help if you are looking at quick scalps, but there is serious folding stuff here for the asking, if we can nail it.

Looking at the charts, you can see that the EUR has been like a big fat log - meandering along with no particular place to go. But - look at the YEN and the USD - they've been smashed - all to the benefit of the GBP!

Sometimes looking at the big picture is the "Aha!" moment we need. What I suggest here, is to always look at some of the larger TF - yes - over a few months. I see a tightening here over the past 3 months.

Something big is brewing ... these currencies are bunching together like pilchards at a shark-fest!

When the shark heads in for the kill, the pilchards will scatter!

Cheers mate - I'm sure you see what I am seeing.

 

[alan5616]

Hi Ivan,

It's good to hear that the Mrs is on board, viz a viz trading. Let her have a run on a demo account and see how she does. Unfortunately, many people trade demo accounts as though they have a bottomless pit of money and are willing to take huge drawdowns. On a live account, only a lunatic would trade this way. If she takes her disciplined approach to demo trading, together with a set of trading rules, then it might be a stepping stone to full-time trading.

Most currencies are range bound at present, as we can see by looking at the daily charts and there is a lot of convergence going on. I do see what you see and will be putting some more work into this over the weekend. I've got a 2 day golf comp but, will fit time in along the way.

 

[NVP]

I'm proud of these Guys.....

Hi all

I'm Back from weekend.........lovely one on south coast yesterday !

however i'm off again wed for 10 days in the canaries and my wife says only 1 hour a day max to go play in an internet cafe....!!

however look at my compardres doing the do.....fantastic !

Talk tomorrow all
N

 

[NVP]

10.50 ish...monday monday..........

ok quick peek at my 200/1's

heres what I see happening...no idea if any news coming today

looks like GBP will rebound up soon on retrace to 1hour (buy GBP sell Tag team)

longer term for the day no reason why Yen will not recommence climbing especially if US stocks open with bearish action

ladies and gentlemen the clock is ticking and money to be made.........

Hey - Alan was really cooking big time last night looking at his pm's to me and may share some thoughts later....we like him to get at least 2 hours beauty sleep a night.......forget "Stig" on BBCs top gear show.........this guy is a machine !!!!

Come to my home page for a copy.....live a little !

N

 

[NVP]

12.35ish...........whats the score ?

Hmmmm.......boring really

GBP is frustratingly consolidating since the call a little up a little down with no breakout
to speak of....

The tag team both obliged with initial small falls but again seem to be arsing around although as we are looking perhaps Yen is starting to pitch for a fall as it has breached prev low (?)....watch for USD to follow and of course buy the gbp

WS30 shows US Stocks beneath 200Ma on 5min TF but climbing for an assault on it again........if this goes balistic upwards then Yen will crumble to the GBP

if this all goes off big time today the 1h is showing this could be the start of further falls for the Yen which has been moving up nicely for over a week..........just noticed the Euro sitting there on the 1h and waiting to take pole position today ? ....hmmmmmmm !

N

Sorry - remember my charts show 1 hour behind GMT (god knows why)

 

[NVP]

13.45pm........I canna hold her captain....

fingers crossed I think its gonna blow.....

sell yen and USD against GBP and Euro.......shes on a knife edge

the WS30 (us stock) is bang on the 200Ma on 5mins (bottom left in piccy ) if it goes skyward this will all fall into place......

come on baby !!! :clap:
N

 

[NVP]

I hope yuo guys are watching the Yen....

shes going south !!!!!!!: :clap::clap:

N

 

[NVP]

14.20pm...are we having fun yet ?d

C mon baby...I would love the GBP to cross the Yen on
the 5 min TF....they are almost kissing

also - you would be doing real nice if you were already on the Euro against
the Yen especially............

N

 

[NVP]

Textbook correlation trading here.....!

Yen she go south as US stocks they start to go north......comprende ? :smart:

N

 

[NVP]

15.08pm.....

now we just need the GBP (red) whuch is now sandwiched between the Yen and the USD to start Blazing up the 5min chart and catch up with the Euro..its our most volatile European currency so fingers crossed it will happen shortly

then we need to monitor that light blue horizontal line on the 5 min chart below the Yen....thats moving into oversold territory for me and one should start locking down the stops when/if we get there !


wow........The Euro Yen play is to beeeautiful for words today so far....

N