Using volumetric analysis in currencies pairs

volfixtrader

Member
86 0
Hi guys

I'd like to share with idea about trading based on volumetric analysis. Everyone of us know that volume is too important data to ignore it. When we trade FOREX we can't see true volume. But Forex Market, as well as other markets are controlled by big players. They may be central banks, hedge funds, large multinational companies that operate in different countries. Before we talk about FOREX – you need to understand that each currency has a guide. This is an absolute analog of the currency pair at the Chicago Mercantile Exchange (CME). For example, EUR / USD pair has a ticker 6E, CAD / USD pair has a ticker 6C etc.

Since Forex is a decentralized global curb market, respectively there’re no clear criteria for the formation of foreign exchange rates. FOREX operates through a network of financial institutions, each of which may affect the price of the currency as well as its volume. We can’t clearly track the volumes. They will be not correct.

However, most of the big players are also trading on the CME, buying and selling futures contracts, options and other financial instruments. For many, it is more reliable, because the market is governed by laws and regulations, as well as giving more opportunities to trade. And since, according to the rules of the Exchange, all transactions are recorded at the exchange, we can see the volume and see the big players.

When we see volumes on CME it is more easy to predict a price movement. Huge volumes like fuel for price movement. Often price move fast after "loading" by volumes. I show some examples. It's very clear and logical.

CAD.jpg

6B.jpg

6E 10.5.jpg
 

rathcoole_exile

Veteren member
3,924 766
I don't understand the general fascination about trading Forex.

As you so correctly pointed out, volume (along with so much else) is so much easier to ascertain on the related Futures contract

So why not get a Jigsaw DOM tool and just trade the 6E, 6B futures ?
 

volfixtrader

Member
86 0
I don't understand the general fascination about trading Forex.

As you so correctly pointed out, volume (along with so much else) is so much easier to ascertain on the related Futures contract

So why not get a Jigsaw DOM tool and just trade the 6E, 6B futures ?
For speculative rades it also could be used. But for understanding situation you volumes give much more.
 

tomorton

Legendary member
7,469 1,012
I don't understand the general fascination about trading Forex.

As you so correctly pointed out, volume (along with so much else) is so much easier to ascertain on the related Futures contract

So why not get a Jigsaw DOM tool and just trade the 6E, 6B futures ?

In % terms the volatility is much less than individual stocks. So also, but partly because, the range of unpredictable events, human issues, competitor actions etc. is much narrower than with stocks the implication is that, once established, trends in forex can continue for extended periods of time, and that's what they do.

The downsides are that forex is the most liquid market but its narrow, so if the major currency pairs are chopping, probably so are all the minors. Secondly, leverage - people get sucked into over-leveraging their accounts, but that's not really down to the forex market, that's down to the access providers.
 

volfixtrader

Member
86 0
In % terms the volatility is much less than individual stocks. So also, but partly because, the range of unpredictable events, human issues, competitor actions etc. is much narrower than with stocks the implication is that, once established, trends in forex can continue for extended periods of time, and that's what they do.

The downsides are that forex is the most liquid market but its narrow, so if the major currency pairs are chopping, probably so are all the minors. Secondly, leverage - people get sucked into over-leveraging their accounts, but that's not really down to the forex market, that's down to the access providers.
Exactly leverages are the most popular reason for trading FOREX. It seems that too easy make money with them. But this is the main reason that 90% are losing money in FOREX.

And also big popularisation from different kind of brokers who stay from another side of clients. And they gain money when traders lose them.
 

NVP

Legendary member
36,783 1,882
I don't understand the general fascination about trading Forex.

As you so correctly pointed out, volume (along with so much else) is so much easier to ascertain on the related Futures contract

So why not get a Jigsaw DOM tool and just trade the 6E, 6B futures ?
Specialisation is key for any successful trader . And you end up,where the path takes you.......

I don't waste time on volume analysis full stop....other more powerful things offer the edge in forex trading

And I agree 100% with rath......if I ever decided to move to other markets I would look at what they offered regarding relevant data and information

And leverage it to my advantage

N
 

NVP

Legendary member
36,783 1,882
Hi guys

I'd like to share with idea about trading based on volumetric analysis. Everyone of us know that volume is too important data to ignore it. When we trade FOREX we can't see true volume. But Forex Market, as well as other markets are controlled by big players. They may be central banks, hedge funds, large multinational companies that operate in different countries. Before we talk about FOREX – you need to understand that each currency has a guide. This is an absolute analog of the currency pair at the Chicago Mercantile Exchange (CME). For example, EUR / USD pair has a ticker 6E, CAD / USD pair has a ticker 6C etc.

Since Forex is a decentralized global curb market, respectively there’re no clear criteria for the formation of foreign exchange rates. FOREX operates through a network of financial institutions, each of which may affect the price of the currency as well as its volume. We can’t clearly track the volumes. They will be not correct.

However, most of the big players are also trading on the CME, buying and selling futures contracts, options and other financial instruments. For many, it is more reliable, because the market is governed by laws and regulations, as well as giving more opportunities to trade. And since, according to the rules of the Exchange, all transactions are recorded at the exchange, we can see the volume and see the big players.

When we see volumes on CME it is more easy to predict a price movement. Huge volumes like fuel for price movement. Often price move fast after "loading" by volumes. I show some examples. It's very clear and logical.

View attachment 225128

View attachment 225130

View attachment 225132

So you are just tic trading ?.......
 

Tytus_Barnowl

Member
92 7
There is no such thing as a volume indicator in the spot fx market. The only volume is delivered by your broker as there is no centralised exchange. Better indicator is the futures market which projects volume but even the futures market on the currencies side can be misleading.
 

volfixtrader

Member
86 0
There is no such thing as a volume indicator in the spot fx market. The only volume is delivered by your broker as there is no centralised exchange. Better indicator is the futures market which projects volume but even the futures market on the currencies side can be misleading.
I see volumes on CME. There are real volumes. And correlation spot market and futures market about 99%
 

forker

Senior member
2,688 500
In all my years I have never seen or heard of anyone trade fx using volume analysis. Even on an exchange I just can't see how this could work better than a coin toss. Just because volume is increasing and say price is going up doesn't mean that's what's happening.
 

volfixtrader

Member
86 0
In all my years I have never seen or heard of anyone trade fx using volume analysis. Even on an exchange I just can't see how this could work better than a coin toss. Just because volume is increasing and say price is going up doesn't mean that's what's happening.
If you know rhere are futures bord where curencies pairs are trading. The bigest is CME. Below correlation between SPOT EUR/USD and 6E (ticker EUR/USD on CME future).

And there - all information about volumes and trades. https://www.cmegroup.com/trading/fx/

Correlation 6E.jpg
 

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