Best Thread Correlation Trading - Basic Ideas and Strategies

[NVP]

morning all

very very smooth trading day today .....excellent dynamics

GBP ran bull hot from early doors.......been buying it ever since ....

yen and usd selling off steadily so far ..........

Cable the pair to trade so far today (buy buy buy) ....only G/J close

Cable safe from 2850s to 2910s so far

excellent !
N

 

[NVP]

2880s watching for cable rebuys

 

[NVP]

Cable being kind ....it came all the way back to 2850s and easy rebuy decisions ....back up to 2920's now ...........very very good session for me

N

 

[NVP]

gbp has has a great day in markets so far ..........the GBP currency index on my FXCorrelator is some 100 pips up from 6am opens ....

Cable now been to 1.3000 pretty much .........ive been buying it up from 2850's (See earlier posts) so 150 pips of scalping today on offer.....

correlating to a minor rally in Dow forming (selling USD and Yen)

best day for a long long time for me ! .....10/10

N

 

[NVP]

in case it had'nt escaped anyones notice .....the Dow has lost some 8% of its value in October ....moving smoothly from hero to Zero in 4 brief weeks .......and in the process also selling a mega fake interim bounce to all the believers burying them all firmly..........more fool them .....cheap money is no more ......markets dont go up in straight line any more ....welcome to trading

when i started this thread way over 10 years ago ..........i used to be much more heavily into intermarket analysis ..........john murphy and his followers etc etc .....I also remember talking at length to Ashraf Laidi at a forex conference who was also heavily selling his own intermarket work .....interesting times ......

basically here I used to follow the equity markets and if the Dow fell I was straight into buying yen , Swissie and USD and devil take the hindmost.........

theses days i am more relaxed on the subject ........i dont need to worry about what gold , Equities , bonds or even crude oil is doing .......I just watch the 8 forex currencies and trade where my indicators tell me ...........i dont need the blanket of intermarket correlations .....if they happen they happen ....i make money whatever .......

even so ............heres that Dow falling in October and equivalent G8 action for same period ......look at that Yellow Yen climb.......thats over 300 pips for buying yen alone before you add in the partner/pair currency falls (like Euro falling 90 pips = 400 pip selloff of E/J in Oct so far )

The yen is the most sensitive to global equities i have found over time .......so its a pretty good result for the intermarket crew .......hey more books sold .....(ignore the times it doesnt work)

or you do what i simply do .....buy the currencies rising in a period and sell the ones falling ......too simple ?....depends .....all we have to do is follow what the market is telling us ..............screw the fundamentals .....screw the experts .........just listen to the one person worth following ......the market itself !

who needs the extra complexity and layer of intermarket analysis ?.....well the booksellers do .....thats for sure !

N

Dow is trying to rally a little .........thats whats giving us such great cable trading....if you believe intermarket correlation theories.......me ? ..........i dont give a fig these days ...I trade what i see ......and i see a very bullish GBP and very bearish USD and Yen !

N

 

[NVP]

interesting morning gang .....

more mixed than last few days of excellent G8 Forex dynamics

with usd generally bearish again i have been looking for cable buys , ucad sells and a little EU when offered ..........conditions are not perfect so im cautious

Cable buying from 3000 levels....up to 3040 so far ......
EU buying from 1420's to 1440s so far .....
UCad selling from 3070s to 3040s so far ...

N

 

[NVP]

an hour from dow opening and interesting switch going on

usd and yen have swung positive now from 6am opens in london.....all change

 

[NVP]

interesting week .......

GBP finished as top alpha Bull.......yen was the alpha bear .......not surprising given the dow rally this week ........

heres the fixed FXCorrelator.....my Standard MA based one is available in the links below

if you followed me here or on my other forums and sites you would have seen me attacking Cable buys from wednesday with a lot of success .....now you can see why.... and how GOOD GBP was to buy from wednesday !

excellent week !

N

 

[NVP]

morning all

good opening to week so far ....all eyes on a bull GBP for me ....

buying cable from 2990s to 3020s so far ...........

N

 

[NVP]

rocky ride for GBP today but its back now as alpha bull for session since london open

again i have been all over buying Cable twice from 2990s to 3020's

great range trading on the 2970s to 3020's

Deja Vue
N

 

[NVP]

had a great question from someone that i wanted to share .....really open and honest trader who reflects a lot of traders out their on the cusp of success.........I cant share my email address here or other things I (obviously) have but that would breach the rules of T2win.......Mods talk to me if this is still a problem

From: XXXXXX
Date: 4 November 2018 at 19:17:54 GMT
To: [email protected]
Subject: Enquiry?


Hello Neil,

I hope you’re well; I’ve read your thread on T2W for a long time now and appreciate you’ve got a lot going on with the house, etc, but would like to ask you a question if possible.

To contextualise this, I’ve been looking at trading, and trading on and off for a good number of years - I’ve got to the point where I am certainly break-even but I have concerns over viable long term profitability. I’m capable of following a (hopefully reasonably sensible) plan and can apply discipline to the point where I can follow a plan, but I think the lack of a serious ‘edge’ (beyond continuation a trend being an edge) is where I’m struggling.

I have downloaded your free strength meter and think I understand the basic concept OK. I also think I understand, having read your posts, what you are doing on short intra-day timescales...My question is, on longer timescales, say the hourly chart or 4hr chart, is it too removed from the ‘in the moment’ action / pressures that move price to still have a viable edge using strength meters as a tool? Basically because of work I need to be able to trade something I can look at a couple of times a day. Am I disadvantaging myself purely by trying to do this?

I also see you’ve talked about mentoring. I’d be interested in your thoughts...Put simply (and I might be wrong of course) I think I’m 80% there with trading and can’t reconcile giving up at this point after many years of thinking about it, testing out ideas etc . I feel I’d be quitting the race with the finish line in sight, but despite this, I’m struggling to make further forward progress.

I know you’re really busy, but if you could spare a few minutes I’d be most grateful.

Cheers XXX

Hi XXXX

many thanks for your email and yes its a little crazy at the moment ....but then thats life .....we all have plenty going on to keep us busy !

great question and thank you for your honesty ......ive worked with a lot of intermediate traders on the cusp of becoming consistently profitable but not quite there.......

firstly pat yourself on the back .....you are already in the elite area.....most wannabee traders are in truth dire !!!! ......and should pack up before they even open that live account and lose money .....but they dont and blame everything except themselves.....

but that doesnt answer your question ..........im not sure i can 100% but i will try

if you havnt read my published guidance pages (removed links as I cant publish here) please do so

they cover key items such as

Can i win ?
Methodology
Mind game

consistent and profitable traders are only a few % points better in their processes than yourself ......... but those few extra degrees of excellence are all it takes to reach the tipping point and become successful ......

so look at your Methodology and find an edge ......then test it and refine it .....you talk about trend ....great Edge ! ...........now what rules are you going to apply in what market in what timeframe etc etc etc ..........thats how you break it down ......

and the mindset ......well you are naturally in a mixed place .....but get the head together and focus on delivering that methodology ........never give up the fight and be confident....goes for any vocation or profession ......the best are quietly self confident and self assured in what they do knowing all will work out for the best .........sprinkle some law of attraction and universal energy elements in as well if you feel you believe in that stuff ...if you dont ...then dont worry.........but being confident is 50% towards success i have found over the years...always helps .....no need to be cocky or egotistical .....(many are)....i mean humbly confident and self purposeful......quietly confident ......

you mention my strengthmeter ............clearly its only for Forex and i have worked pretty exclusively in Forex trading since early 2000's .........found my groove and never deviated although i have worked with many traders who trade other markets as its great to be a little diversified at times and learn from others ..........but my home is Forex

you are right that I try to be session based when trading ...........predominently 4-5 hour scalp session covering

1) London opens ....6 am to 11-12 am GMT

2) US opens .......from US market opens around 8-9am EST through till i get bored !

my focus is on how the main currencies are moving and news releases and anything else going on ......I then find the best pairs to trade based on my rules etc etc ...I am mindful of news releases and will step back on release then come back in following the news and initial market reactions .....I can already be in or out of positions but i have control.....so i am always watching the market minute by minute ......this is an advantage but equally my disadvantage is i am trading off very small Stop losses when scalping ............

you mention working F/T so scalping is not possible (me too for many years)......

so can you trade higher timeframes ?

YES !!!

clearly though you have to take a fresh and realistic mindset on trading such things and the key is scaling up everything but still try to use the scalping methodologies and processes and your edge.....

and of course you are now hitting lots of news events inside some single candlestick bars ......which is just the way it is .....thats life

so scale up and the big message here is ATR !!! (average true range)...go bigger to reflect the larger candlestick price ranges

when you enter trades be mindful of what price movement would truly tell you that you got direction wrong ............and place stops at these levels (actual or theoretical).....and adjust targets to reflect decent returns for your risks (min 1:1)

dont tinker with stops or double guess the market on news events ....... trust yourself !

all i would say is i am not a big fan of holding positions over weekends .....but it depends on how high a T/F you are going to trade ........

hope you get my drift .........if you are going to trade higher timeframes you also have to accept the smaller number of trades and smaller returns vs scalping etc etc ......its a numbers game

dont increase risk from more that 1-2% of capital .........i know lots who ramp up to 5% as they must make more money on the fewer trades available .............NO ......it will kill you eventually

hope this helps ..........I will release something for traders wanting to trade 1hour-4hr TF at some point as theres plenty of good approaches ...........but if youve read my stuff you know i am woefully bad at knuckling down to create e-books and training ..........I am a trader first and foremost.......but i will get there over next few months and have a team assembling in place again ......

hope this helps.............happy to respond to questions

N

 

[banawa]

RE: Hello friend

had a great question from someone that i wanted to share .....really open and honest trader who reflects a lot of traders out their on the cusp of success.........I cant share my email address here or other things I (obviously) have but that would breach the rules of T2win.......Mods talk to me if this is still a problem

From: XXXXXX
Date: 4 November 2018 at 19:17:54 GMT
To: [email protected]
Subject: Enquiry?


Hello Neil,

I hope you’re well; I’ve read your thread on T2W for a long time now and appreciate you’ve got a lot going on with the house, etc, but would like to ask you a question if possible.

To contextualise this, I’ve been looking at trading, and trading on and off for a good number of years - I’ve got to the point where I am certainly break-even but I have concerns over viable long term profitability. I’m capable of following a (hopefully reasonably sensible) plan and can apply discipline to the point where I can follow a plan, but I think the lack of a serious ‘edge’ (beyond continuation a trend being an edge) is where I’m struggling.

I have downloaded your free strength meter and think I understand the basic concept OK. I also think I understand, having read your posts, what you are doing on short intra-day timescales...My question is, on longer timescales, say the hourly chart or 4hr chart, is it too removed from the ‘in the moment’ action / pressures that move price to still have a viable edge using strength meters as a tool? Basically because of work I need to be able to trade something I can look at a couple of times a day. Am I disadvantaging myself purely by trying to do this?

I also see you’ve talked about mentoring. I’d be interested in your thoughts...Put simply (and I might be wrong of course) I think I’m 80% there with trading and can’t reconcile giving up at this point after many years of thinking about it, testing out ideas etc . I feel I’d be quitting the race with the finish line in sight, but despite this, I’m struggling to make further forward progress.

I know you’re really busy, but if you could spare a few minutes I’d be most grateful.

Cheers XXX

Hi XXXX

many thanks for your email and yes its a little crazy at the moment ....but then thats life .....we all have plenty going on to keep us busy !

great question and thank you for your honesty ......ive worked with a lot of intermediate traders on the cusp of becoming consistently profitable but not quite there.......

firstly pat yourself on the back .....you are already in the elite area.....most wannabee traders are in truth dire !!!! ......and should pack up before they even open that live account and lose money .....but they dont and blame everything except themselves.....

but that doesnt answer your question ..........im not sure i can 100% but i will try

if you havnt read my published guidance pages (removed links as I cant publish here) please do so

they cover key items such as

Can i win ?
Methodology
Mind game

consistent and profitable traders are only a few % points better in their processes than yourself ......... but those few extra degrees of excellence are all it takes to reach the tipping point and become successful ......

so look at your Methodology and find an edge ......then test it and refine it .....you talk about trend ....great Edge ! ...........now what rules are you going to apply in what market in what timeframe etc etc etc ..........thats how you break it down ......

and the mindset ......well you are naturally in a mixed place .....but get the head together and focus on delivering that methodology ........never give up the fight and be confident....goes for any vocation or profession ......the best are quietly self confident and self assured in what they do knowing all will work out for the best .........sprinkle some law of attraction and universal energy elements in as well if you feel you believe in that stuff ...if you dont ...then dont worry.........but being confident is 50% towards success i have found over the years...always helps .....no need to be cocky or egotistical .....(many are)....i mean humbly confident and self purposeful......quietly confident ......

you mention my strengthmeter ............clearly its only for Forex and i have worked pretty exclusively in Forex trading since early 2000's .........found my groove and never deviated although i have worked with many traders who trade other markets as its great to be a little diversified at times and learn from others ..........but my home is Forex

you are right that I try to be session based when trading ...........predominently 4-5 hour scalp session covering

1) London opens ....6 am to 11-12 am GMT

2) US opens .......from US market opens around 8-9am EST through till i get bored !

my focus is on how the main currencies are moving and news releases and anything else going on ......I then find the best pairs to trade based on my rules etc etc ...I am mindful of news releases and will step back on release then come back in following the news and initial market reactions .....I can already be in or out of positions but i have control.....so i am always watching the market minute by minute ......this is an advantage but equally my disadvantage is i am trading off very small Stop losses when scalping ............

you mention working F/T so scalping is not possible (me too for many years)......

so can you trade higher timeframes ?

YES !!!

clearly though you have to take a fresh and realistic mindset on trading such things and the key is scaling up everything but still try to use the scalping methodologies and processes and your edge.....

and of course you are now hitting lots of news events inside some single candlestick bars ......which is just the way it is .....thats life

so scale up and the big message here is ATR !!! (average true range)...go bigger to reflect the larger candlestick price ranges

when you enter trades be mindful of what price movement would truly tell you that you got direction wrong ............and place stops at these levels (actual or theoretical).....and adjust targets to reflect decent returns for your risks (min 1:1)

dont tinker with stops or double guess the market on news events ....... trust yourself !

all i would say is i am not a big fan of holding positions over weekends .....but it depends on how high a T/F you are going to trade ........

hope you get my drift .........if you are going to trade higher timeframes you also have to accept the smaller number of trades and smaller returns vs scalping etc etc ......its a numbers game

dont increase risk from more that 1-2% of capital .........i know lots who ramp up to 5% as they must make more money on the fewer trades available .............NO ......it will kill you eventually

hope this helps ..........I will release something for traders wanting to trade 1hour-4hr TF at some point as theres plenty of good approaches ...........but if youve read my stuff you know i am woefully bad at knuckling down to create e-books and training ..........I am a trader first and foremost.......but i will get there over next few months and have a team assembling in place again ......

hope this helps.............happy to respond to questions

N

well say that correct cannot trade without the correlator at last i know what the market doing not trading blind thanks mate all the best

 

[NVP]

well say that correct cannot trade without the correlator at last i know what the market doing not trading blind thanks mate all the best

Hey B

you are very very welcome ....a long term user and its appreciated

 

[NVP]

morning all ......

once again GBP is alpha bull ........ive been attacking Cable this morning........

3050s to 3080s so far

usd and yen are bearish .......so far anyway

N

 

[NVP]

interesting day ............the GBP index is swinging like sinatra !

bullish early london....then a 50 pip selloff ....then a 50 pip retrace north ....

keeps me on my toes ..........

 

[NVP]

cad is having a bad week....60 pips off from sunday night.....under pressure coming into US opens

 

[NVP]

hey all .........

messy morning ......USD and Yen opened bull but selling off now .....

initially i was selling Europe but all change now .......happy in EU and EJ and GU buys at moment

went bull on Cable from 3130s to 3150's so far
went bull on EJ from 129.50s to 129.80s so far

N

 

[NVP]

morning gang ........(i also refer to other sites and forums)

ok a little messy sar today and a gorilla in the room as well.......

Core Pairs

with yen and usd swinging bear / bull so far since london opens i have mainly focused on selling europeans when offered as they were predominently bear .......

cable sold from 3120s to 3100s earlier........and sold it off again recently from same price levels from 3120s to 3110s approx again .................could have scalped it north in between but was not convinced

sold 1430s to 1410 so far EU
sold 130.00 to 129.70s so far EJ

Others

a large CAD gorilla in room today .........its already 40 pips up from london opens

tempting sells from 3110s down to 3090s so far on Ucad ....but you can see getting only 20 pips off a 40 pip Cad index move means usd is also swinging a lot in correlation with its Cad partner...other cad pairs better (but spreads worse)

im happy to stay bear on europeans at moment


N

 

[NVP]

for all you higher TF trader heres my G8 index meter (FXCORRELATOR) ....set off a late july base (as i was responding to another thread)

I use this to trade from 1 min scalping to daily positions....trading it since early 2000s

the green usd is bull/rangy....current down swing from late Oct highs .....i see another 50 pips of slippage before im gonna look for rebuys .....until then im selling USD into the downswing

yellow yen and Blue Euro are the bear sells as well

Brown Cad is due a bounce north .....and red GBP is bull comer ........

cheers
N

 

[NVP]

morning gang ........(i also refer to other sites and forums)

ok a little messy sar today and a gorilla in the room as well.......

Core Pairs

with yen and usd swinging bear / bull so far since london opens i have mainly focused on selling europeans when offered as they were predominently bear .......

cable sold from 3120s to 3100s earlier........and sold it off again recently from same price levels from 3120s to 3110s approx again .................could have scalped it north in between but was not convinced

sold 1430s to 1410 so far EU
sold 130.00 to 129.70s so far EJ

Others

a large CAD gorilla in room today .........its already 40 pips up from london opens

tempting sells from 3110s down to 3090s so far on Ucad ....but you can see getting only 20 pips off a 40 pip Cad index move means usd is also swinging a lot in correlation with its Cad partner...other cad pairs better (but spreads worse)

im happy to stay bear on europeans at moment


N

cable still selling ok on bounces......been back on it from 3130s AGAIN down to 3100s again

Europeans are Still weak sell them