Tom below is presenting at £125 a ticket at the worldMoneyshow on 2/11/12 in London........I may pop along as I want to see first hand what hes doing......I respect anyone who trades live in front of an audience (try it 
)
meanwhile....do you recognise the approach below ?
yep - set your FXcorrelator up on a 60ma setting on a 4Hr chart and only trade the order in which they stand making sure you are only buying currencies on the shorter TF's that are above others on the 4hr chart above (and vice versa)......lower TF's confirming to the higher TF's ..like say the 5min or the 15m
and by the way this is also Andys 3 duck leading duck (4hr 60) ...so it seems we are all looking at similar lead indicators ! :smart:
umm............when do I get my £125 please ?
N
TOM HOUGAARD
CONSULTING ANALYST, INTERTRADER
Do you remember the film Trading Places with Eddie Murphy? The key scene takes place in the commodities trading pit for orange juice in the World Trade Centre. Two traders observe that Randolph and Mortimer, the two old-timers running the show, are buying every orange juice contract in site. Then those two observers rush into the pit to be part of the action.
I didn't understand the significance of this “action” – the volume and activity in a trade – until my friend and trading partner Dr David Paul taught me the Relative Strength Matrix. He explained that because many traders trade just one thing at a time you could be losing out on “action” in other asset classes, something that short-term traders favour.
For example, if you only trade euro-dollar, you may well miss out on better opportunities in other currency pairs. David taught me to go through each currency pair and cross pair within the “four majors” and ascertain where the strengths and the weakness were.
The explanation below is not a strategy, but an analytical framework to ascertain where the best move of the day is likely to be.
Put a four hour chart on the screen with a 60 period moving average. Go through each of the 10 pairs – euro-dollar, sterling-dollar, dollar-Swiss franc, dollar-yen and their six cross pairs – and make a note of which currency is the strongest and which one is the weakest. After looking at all ten pairs, you now have a Relative Strength Matrix of the ten currency pairs.
Here’s an example. On Friday morning the euro was stronger than all the four main currencies, while the yen was the weakest against them. So naturally I was looking for opportunities to buy euro-yen all day. The non-farm payroll numbers made it a difficult trading day, but nevertheless in my live trading room I raked in 30-40 points in euro-yen alone.
It is a simple analytical framework and it only takes 15 minutes to do in the morning. Happy trading.
The views and comments in this article are not the views of InterTrader.com. The provision of this information should not be construed in any circumstances as a recommendation or solicitation to buy or sell any security or financial instrument.
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