Best Thread Correlation Trading - Basic Ideas and Strategies

[NVP]

new approach and Feel to thread ?

Hi Gang.......

waiting for flight now back to blighty..........internet cafes cannot be ignored !

I was thinking that a second thread may be an idea that summarises everything to date ....perhaps locked (like I see some threads are) as anyone can drop in for a chat on this thread....sound good ?

also I have been discussing Forex trading with a very dear friend from the 80´s when we were together in Shell international Trading company and I am hoping to bring her in as a newbie to help me with the relatively live scalping commentaries/observations during the day (as I cannot continue this alongside a full time job and i want to diversify the thread as well)

alcohol and promises of forex riches :whistling seem to be gradually working and they are very rusty (25 years), but would love to sharpen up again with some time on her hands inbetween jobs so fingers crossed we have her on board in next week or 2 ....we just need to get her fired up with systems and brokers blah blah

well nothign more at the meoment....just about 10 hours of waiting and travelling blah blah till back on sunny warm uk soil...........

waddya mean its still zero degrees.......isnt summer here now ?

N

 

[phreddyinbg]

Your friend will be most welcome, I am sure.
Actually, I thought that the thread was your full time job.

Second thread with it all explained so that I can understand it will be wonderful. You write it, I will edit it.

Welcome back to Grey Briton

 

[jrplimited]

Hi and happy new year Neil, phreddy and anyone else,

Neil, good idea on second thread (does that mean another 10,000 views in double quick time?!!) and I second phreddy's most welcome welcome to your friend as the more the merrier on this corrie concept - we have got a load of ground to cover.

Safe flight home; UK is frozen solid at the moment, but thats just like our credit rating - it will melt very soon!

See you all next week - regards,
Simon.

 

[phreddyinbg]

...and we are off...early hours yet but there are trades indicated. 0330 according to my chart so that is about 0130 UK.

So, what can we see?
Euro is below the line for all three TFs. GBP is above in 4H and 1H but losing power a bit in the 5min.
According to my understanding we sell EUR/GBP pair.
Looking at the chart that is just what we do...

Placed my trade, demo of course, cannot use this for real money while I am still learning. Cannot believe the spread either. I will take my real trading elsewhere.

 

[phreddyinbg]

Seems that Price is not looking at Correlation!!!
Directly I place the trade...up goes the price. OK, you get 20 pips, then you are out!!!

Ungratefull trades, just cannot be trusted. Look at this...

I have a couple of S/R lines put on now. Guess I should have paid attention to the support line from before the New Year!!

 

[phreddyinbg]

It is back to the drawing board for me.
Look, bounced off the bottom support line, double bottom wizzed up now it has broken my other long term down trend. Out for a loss.

CAD is high and EUR is low but Idon't have that pair available.

 

[phreddyinbg]

Now, a few hours later, still early in UK so expect the boys are still asleep - 0630ish.

This EUR/GBP has gone badly wrong. I am wondering if it should be the lower TF that I should look at for my hints.

The chart itself I could have traded with simple Price Action, trend lines and S/R lines. Buy on the break of the trend line, be careful of the S/R lines and buy on the break of them to the upside. It is all there.
So what has correlation showed me? It looked like I should sell the EUR/GBP on the longer TFs although I might be reading them all wrong.
Certainly the 5 min tells the story of what is happening.
The other thing could be that I am looking too closely at the chart and covering only a few pips worth of picture.

Here is the latest pic. Looks like we are in a thirty pip channel, it is coming off the top R line. Making another test as I write.

 

[phreddyinbg]

Here we are again and where have they gone?
Are you snowed in Neil or are you too busy getting ready for the day job?

Never mind, EUR/GBP is doing what it is supposed to do and coming down after a multiple rejection from Resistance.
All the colours are in their right order so down we jolly well go!!

 

[jrplimited]

Hi All (anyone there?)

phreddy, I think NVP is busy being back at first day at work - or decided to stay in the sun! Bit late on parade posting today but here is what I saw for this morning's bun fight:-

EU; Entered long at 08:05 got a small lift up then drifted into a gentle drawdown which didnt really threaten much (had change of trousers ready in case!), then price recovered and went north again. I did my usual and became bored with the consolidation range starting at 10:30 and jumped ship at close of 10:55 bar (premature as it turns out, but profit is profit) for just over 55 pips bagged.

GU; That opening 08:00 bar had me cautiously waiting in the wings for a while but I could see the bias was definitely up. Entered long on 08:45 bar open and rode the wave upwards until price hit my TS near end of 10:40 bar for 44 pips profit.

EG; Bit of a weirdo this morning, couldnt really find any decent entry points reflecting the fact that both E and G were strong against the "whipping boy" U. Some good opportunities for quick, small pip value scalps but I stayed with my two open EU and GU trade charts instead - EG might be worth a play this afternoon once either E or G gets into trouble.

Also trying to attach (!!) my two charts of EU and GU so apologies if this doesnt work with this post...

Trade well and regards,
Simon.

 

[jrplimited]

Yeeha! That worked.... Dont know why different sizes but will sort that out for tomorrow.

Got a real load of honey-do stuff this afternoon, including destructive taking down Christmas decorations, but will be keeping a casual eye on EG as this might just yield a good trend later on.

Simon.

 

[phreddyinbg]

Nice to see you back Simon, glad to see you have made a few pips.

I am off to bed now, it has been a busy day.

 

[phreddyinbg]

So he's still not back!! I think that next year we will have to make him stay in the cold over Xmas!!

What about this then: AUS is in the tops and USD largely in the bottom.
Chart shows one of those flag things and threatens to break out up after its nice rest going sideways.

 

[NVP]

Hi all

1 million apologies for my extended absence......been sick with a respiratory infection and my internet at home crashed sunday......200 hours of techy calls later i've just had a new modem delivered and seems to be working finally

got to sort work stuff out first so will try to pop in later..........but the paying mortgage stuff comes first....!

thanks to JRP and Phreddy for holding the fort .........

N

 

[NVP]

Here we are again and where have they gone?
Are you snowed in Neil or are you too busy getting ready for the day job?

Never mind, EUR/GBP is doing what it is supposed to do and coming down after a multiple rejection from Resistance.
All the colours are in their right order so down we jolly well go!!

Hi Phreddy

once I am squared away a little here and can fire up my other newbie up on the scalping I will be starting to focus on the longer term signals and how we fine tune this triple play indicator......

in truth There are a lot of subleties to it and my main worry is that you are chasing everything that appears as opposed to some more structured stalking approaches to our traditional pairs..........for example if we are playing the big game then a lot more pips go on the table as these are longer term trades so its not scalping

I would also recommend you now research more of the Captain currency pages and his website/blog..... you will see that many have walked this path and read the feedback and info he gives to them re entries and exits.....remember this is one of an infinite numer of ma/TF permutations to use and really we are just using the 4h and 1h to show hignest trend probabiity setups re 60 ma crosses....the 5m is the trigger to trading with the higher trend that sometimes works and sometimes certainly does not....(I have talked about this on other T2W threads)......we are also not using any correlation strategies here at all yet as the corrie is mearly being used as a multiple currency trending tool.......so for example when you intot a G/E trade what correlation are you using to confirm it ?........and is there any !!

(eg I know JRP has ideas of when E/G looks best vs other options)

ok got to get on with the paying stuff..........

later and thanks for the posts....every post and idea and chart is 1 step closer to becoming a sucessful trader.......remember that ....:smart:

N

 

[NVP]

Hi All (anyone there?)

EU; Entered long at 08:05 got a small lift up then drifted into a gentle drawdown which didnt really threaten much (had change of trousers ready in case!), then price recovered and went north again. I did my usual and became bored with the consolidation range starting at 10:30 and jumped ship at close of 10:55 bar (premature as it turns out, but profit is profit) for just over 55 pips bagged.

GU; That opening 08:00 bar had me cautiously waiting in the wings for a while but I could see the bias was definitely up. Entered long on 08:45 bar open and rode the wave upwards until price hit my TS near end of 10:40 bar for 44 pips profit.

Trade well and regards,
Simon.

hi JRP.....wow !!......youre off the 2010 starting grid faster than schuuy ! :clap:

good to have you on board .....

NVP

 

[NVP]

what is going on ?

I've just fired up the machines and U/Y/G just took a major hit to the Kiwi, aussi and CAD...........Swissie & Euro have held Neutral

let me reset my charts...........perhaps i've missed an upgrade ??!!

forget it ...........my feeds are missign about 6 days at present....need to reset all charts and feeds on metatrader !!!!!

N

 

[NVP]

Embarrassed help !!

my metatrader charts are not showing the many bars from 23/12 to about 2 hours ago when I fired her up again....how do I get those back in the charts please ?

N

 

[jrplimited]

Embarrassed help !!

my metatrader charts are not showing the many bars from 23/12 to about 2 hours ago when I fired her up again....how do I get those back in the charts please ?

N

Hi N,

Will be commenting on this morning's bun fight a little later. Re your display problem; Try re-starting MT yet again (!) and load up M5 charts first so tick database is present and current, then load up your usual templates - I have one specific profile (top menu, File/Profiles different from templates) dedicated to my fab 3 pairs which has M1 up to Daily charts for all of them and this is great for pump priming tick database in case of problems.

Simon.

 

[jrplimited]

Hi N and all,

Had to shoot out first thing this morning so missed the bun fest, but from sitting down now and looking at what charts show I can see that on EU it would have been a struggle for me - that cursed 08:00 big bar - with one good (?) sized short loser, another smallish sized short loser and finally a long winning trade that wouldnt have been taken due to both timing and my rule of two hits on the trot per pair.

On GU it looked to be short biased to me so my entry point would have been further on in the morning for a single winning short trade that would have just covered the EU fiasco trades. On EG the bias was long for me and first long trade looked to be a small loss whilst second long trade easily covered this and produced a single digit profit on top.

Urgh! After yesterday I would have been lucky to get away with a very small profit or break even on the morning - the market gives and the market takes! Do you want me to post any charts? These would be that horrible hindsight stuff now....

I see you are now going to look into more longer term trades based upon higher tfs and corrie settings, this is out of my particular league I'm afaid so all I can do is look and comment with probable useless gibber! Also as you are looking at the higher tfs, should I keep wittering on with these short M5 observations?

Glad to see you are back and recovered - trade well and regards,
Simon.

 

[NVP]

Hi N and all,

Had to shoot out first thing this morning so missed the bun fest, but from sitting down now and looking at what charts show I can see that on EU it would have been a struggle for me - that cursed 08:00 big bar - with one good (?) sized short loser, another smallish sized short loser and finally a long winning trade that wouldnt have been taken due to both timing and my rule of two hits on the trot per pair.

On GU it looked to be short biased to me so my entry point would have been further on in the morning for a single winning short trade that would have just covered the EU fiasco trades. On EG the bias was long for me and first long trade looked to be a small loss whilst second long trade easily covered this and produced a single digit profit on top.

Urgh! After yesterday I would have been lucky to get away with a very small profit or break even on the morning - the market gives and the market takes! Do you want me to post any charts? These would be that horrible hindsight stuff now....

I see you are now going to look into more longer term trades based upon higher tfs and corrie settings, this is out of my particular league I'm afaid so all I can do is look and comment with probable useless gibber! Also as you are looking at the higher tfs, should I keep wittering on with these short M5 observations?

Glad to see you are back and recovered - trade well and regards,
Simon.

Hi Simon

a 1 million percent yes to still adding your comments and observations (when you
get time) ....

I am not deserting the scalping observations (and hoping my old friend will step in a little as she learns the ropes) but trying to fire up as many areas and contributors as possible here on the thread so we get more input and more areas to follow and discuss....

tied up on work but will try to fire up my metatrader later on......

N