Best Thread Correlation Trading - Basic Ideas and Strategies

[Kruspe_Svk]

see how the gbp came back and everyone headed for the Zero line to go home ?

Jees convergence Team i'm sorry .........i'll be super ready to let you loose next time it happens and you can have your fill of Carnage and Destruction on the poor currencies that are hung out there and overcooked

please please dont hurt me...Gulp.....Chess anyone ?

N

Hi N,

GBP is really volatile devil, nice sell on gbp/jpy...

But nzd/chf makes me angry... still not going my way, I have to be patient ( higher TF requiers it, but it also brings more green pips )... and meantime can I scalp on M5 with Corrie

K

 

[trend_catcher]

Hi NVP:
Once you entered the trade, how do you set your TP and SL? Any suggestions?
Any MA, S/R or Fib to gauge our exit and TP?

Thanks,

 

[NVP]

Hi NVP:
Once you entered the trade, how do you set your TP and SL? Any suggestions?
Any MA, S/R or Fib to gauge our exit and TP?

Thanks,

Hi T

there are comments around the thread from me but nothing concrete

depends on the system I am entering on

divergence trades on Low TF's are target driven

S/L's are always set to recent s/r levels

on the classic 80/20ma system I watch for either of the currencies traded to retrace back though the 20ma level zero line as a warning sign to tighten stops

exiting trades is 1000% harder than entering trades and the key to success

check out my recent thread here on T2W re exiting trades for more trader input

N

 

[NVP]

hey all


once again I am one finger typing trying to do some basic programming

here is the guts of the basic fxcorrelator below.......

can anyone tell me how to make any of these lines return an absolute value please ?

ie I want to show on a graph the absolute (+ve) value for all lines and not the negative value

I think the mt4 formula is Abs .........but it doesnt want to play

N

 

[NVP]

overnights..............piece of cake

N

 

[NVP]

.......and the morning session has been kind as well.........

N

 

[NVP]

overnight convergence saw the NZD way south......3 to 3.5 band divergence on some currencies...........(the risk currencies)

The NZD snapped back quickly and long before the Dow started improving to any significance so you cant say it was a trade supported by Dow influence

I prefer 4 bands minimum on the currencies involved as they are not in the same tribes

the convergence crew stay in the cage for now
N

 

[Kruspe_Svk]

Hi N,

no big movements today on convergences M5, maybe gbp will go north once again (we know that gbp can do it) .. gbpusd & eurusd ares now testing daily R1, will see if they can do a breakout... c´mon gbp (or some another currency, I wanna see a touchdown )


K

 

[NVP]

Hi N,

no big movements today on convergences M5, maybe gbp will go north once again (we know that gbp can do it) .. gbpusd & eurusd ares now testing daily R1, will see if they can do a breakout... c´mon gbp (or some another currency, I wanna see a touchdown )


K

hey K............lets hope so as it means big pips being made by us !!!

interestingly all of the G8 (EXCEPT USD) ran it at least 1 touchdown last week , and this week (mid week now) we have only seen 1 north from GBP (excluding retraces) and 1 south overnight from NZD....

at this time last week (and that includes a big fat Zero score on the low volatility presidents day monday) we had cheered in 5 seperate G8 currency touchdowns....

hmmmm
N

 

[NVP]

and before everyone asks.........


the mighty USD recorded its last touchdown (South of the border) at 16.50 gmt on 1st February over a month ago

Jees - not the most showboat currency then ! :smart:
N

 

[NVP]

This actually shows how pivotal and Highly important the USD is in the G8 Dynamics and how difficult it is for any single news item or action to move it into a serious overbought/oversold zone .......... every currency is taking a piece of it always in both directions in all timeframes 24 hours a day

N

 

[NVP]

the 1 hours are frustrating if you took the 4+ bar divergence........

looks like the usd is not exactly a regular at the touchdown line on 1 hours either....as all currencies have touchdowned at least once in 2011 except the USD !

hmmmm we can trade that relationship on all timeframes

but dont ever take any dynamics to be a cert !!! .......the usd virtually camped out on the lower touchdown line last Sep/october 2010........... so theres no such thing as a free lunch..... :smart:

N

and what is going on in New Zealand ..the NZD is virtually at hyperextension Bar ????

 

[NVP]

hmmmm

the kiwi and the AUD usually walk a very very tight path............that extension on the 1hr is becoming very interesting aside from everything else - over 2+ band widths now

and my rules re trading convergences on related currencies is set at 3 bands which is actually a very very tough criteria to hit on reflexion for these 2.....

lets mark it below for interest............horrendous spreads on this pair as well no doubt

hmmmm
N

 

[NVP]

clearly eyeballing charts and this freewheeling approach to potential convergence trades is unsatisfactory ..........but its a short term solution hopefully to be backfilled with more sophisticated Indicators and methods of detection

but not by the MT4 Gorilla programmer sitting here !
N

 

[NVP]

amongst the action below I also see the chf decided to rejoin his European mates and ditch the risk brigade (Tag team)..........hmmmm

N

NZD loves that touchdown area eh ?....its still tight on the AUD so I'm still hopeful that will converge soon overnight......On balance I think a scenario of Safe haven plays (that will help drive the Aussie boys south) would be the best wind to make this happen .......so I actually want the dow to Fall now and also commodities to take a pasting over the next few hours to drive them together....I just cannot see NZD suddenly rising like a phoenix and closing the gap on AUD using the opposite strategies......it hasnt got the legs to take on the AUD in a race north if good news pans out for them

 

[NVP]

hmmm could be tempted by that CHFNZD duo again you know ?

N

 

[NVP]

or indeed we trade both Signals

Sell CHFNZD
Sell AUDNZD

banking on NZD coming home soon...........

N

 

[NVP]

and to do that we need some sign that the damn pairs are slowing from the current Divergence.......

this will be an overnight hunt ........ and will no doubt develop fully when the AUD and the NZD wake up later to start really trading

hmmmmmmmmmm
N

 

[Kruspe_Svk]

Hi N,

yep, we´re waiting still for some bigger movements, today was weak

K

 

[Kruspe_Svk]

wait, you said "sell nzdchf" ?