Best Thread Correlation Trading - Basic Ideas and Strategies

[NVP]

Hi all

heres a potential scalp signal from earlier......balls of steel were needed to enter at 16.20ish....and the signals on my more personalised indicators called that as late as 16.35pm - just as GBP kicked back

you can probably surmise I place a lot of emphasis around the 20ma crosses (on both the corrie and normal charts).......just like it and am comfortable with it as a setting (although the corrie on chart is a standard 1000/1 to show the real time movement of the currencies)

A decent stop loss on both GBP and Euro is always needed (I naturally recommend the G/U SL is always larger than the E/U one).....and if in place holding the line would have delivered a decent 10-20 pip return

may be some miles in those trades still.............
N

 

[NVP]

mornin all......

had to transfer across to live ODL account feed this morning........and the prices are having to rebuild....plus some markets are named differently to the trial metatrader feeds (Nikkei , Dow30)...sooo ive got to rebuild some of my indicators...:whistling

oh well......such is life....heres the action

Yen had a good night espec early on......supported by Nikkei and dow falls

USD was on balance eventually up but only when Gold finally caved later in the night

Euro twins flattish realy so no excitement there

at this moment I would say if the DJ and Gold start to breach up more then a sell G/U looks interesting.....with E/U a more steady sell....P could easily retrace a little a this point

Good trading....and be careful out there
N

 

[NVP]

heres the news.....

I believe china news releases as much as I believe the moon is made of cheese

AUD shrugged off that bad employment news relatively well.....those dudes are untouchable like CAD at the moment....open up the 1000/1 corrie and set to H4 to see what I mean (Below)

hmm...........the Kiwi D (light blue) doesnt normally let its bosom buddy get that far away from it....and as for the Eurotwins...........hey !....are they both (finally) making a stand at those recent resistance levels ?

and as I have said in the past......if you want to maintain your Global Currency Wealth ..hold it all in the swiss franc (Grey).... it keeps a straighter line than anything else in the G8 .....you wont make the most but also you wont lose the most.....

ok - later......busy day at the ranch ahead unfortunately
N

 

[jrplimited]

Hi N and those ghosts,

Straight into the bun fight:-

GU; Placed buy stop at 49771 after opening bell which got filled during 08:40 bar and price moved up a little, topped out and went into shallow retrace then 09:30 bar spurted into life and pushed price upwards into a series of new local highs and higher lows. Followed this mini trend through to close of 11:45 bar and exited for 57 pip profit.

EU; Had to wait until 08:40 bar for buy stop at 36484 to be filled, price stalled for two bars, rose and then hit a shallow retrace and finally rose up again with smallish momentum. New local high formed on 10:05 bar but price couldnt hold this and 10:35 bar took out TS for 9 pip profit. No other setups for the morning found.

EG; Waited to see if price would break out to 91172 upside of buy stop but it couldnt find any momentum and just drifted around for over an hour. First trade short opened at 91006 on 09:35 bar, price rose by a few pips then slowly rolled over downwards, pausing for five bars from 10:25 and momentum kicked in at 10:50 taking price down to new local low. TS taken out during 11:25 bar for 22 pip profit.

Bit more market action this morning (well, apart from EU) but for the second day in a row, momentum in one definitive direction has been a little shy in showing itself - trade well and regards,
Simon.

 

[NVP]

Hi N and those ghosts,

Straight into the bun fight:-

GU; Placed buy stop at 49771 after opening bell which got filled during 08:40 bar to close of 11:45 bar and exited for 57 pip profit.

EU; Had to wait until 08:40 bar for buy stop at 36484 to be filled, and 10:35 bar took out TS for 9 pip profit. No other setups for the morning found.

EG; First trade short opened at 91006 on 09:35 bar, TS taken out during 11:25 bar for 22 pip profit.

Bit more market action this morning (well, apart from EU) but for the second day in a row, momentum in one definitive direction has been a little shy in showing itself - trade well and regards,
Simon.

Hi mate.......thats 3 from 3 with one on each pair......nice

N

 

[jrplimited]

Hi mate.......thats 3 from 3 with one on each pair......nice

N

Hi N,

Yep, made up for yesterday's minor car crash but, as mentioned, that lack of momentum issue is slightly worrying - reminds me of a ticking bomb!

Couple of heads up items for you:-

1). This coming Sunday (14-03-10) USA changes its clocks one hour forwards so your broker's feed will change with this, ie my broker feed is currently minus five hours local (London) time so that moves to minus four hours as from Sunday. Then two weeks later our local London time moves forward one hour so everything [for me] reverts back to the normal five hour offset.

2). Beware the ides of March! Next week brings the dreaded and absolutely stupid leverage decision over whether or not USA domained brokers are to be required to limit leverage on fx from the current 100:1 down to 10:1 for "retail" clients. So far there has been a raft of objections from both retail traders and brokers alike, hopefully someone somewhere will see that this is not a welcomed move and common sense will prevail.... Oh, common sense plus politicians equals?

Simon.

 

[NVP]

interesting morning...see below

on reflection some of my indicators are still loading up historic data feeds as no way can the CAD be that tight to USD on far right chart ????? - tomorrow will be better I hope

you cant miss the GBP and Yen action though !

watch for a nice sell on USD if gold takes off upwards....

gotta go..........later :smart:
N

 

[NVP]

Hi N,

Yep, made up for yesterday's minor car crash but, as mentioned, that lack of momentum issue is slightly worrying - reminds me of a ticking bomb!

Couple of heads up items for you:-

1). This coming Sunday (14-03-10) USA changes its clocks one hour forwards so your broker's feed will change with this, ie my broker feed is currently minus five hours local (London) time so that moves to minus four hours as from Sunday. Then two weeks later our local London time moves forward one hour so everything [for me] reverts back to the normal five hour offset.

2). Beware the ides of March! Next week brings the dreaded and absolutely stupid leverage decision over whether or not USA domained brokers are to be required to limit leverage on fx from the current 100:1 down to 10:1 for "retail" clients. So far there has been a raft of objections from both retail traders and brokers alike, hopefully someone somewhere will see that this is not a welcomed move and common sense will prevail.... Oh, common sense plus politicians equals?

Simon.

I am watching that US decision closely my friend (as we have discussed previously)....if I do venture back into the trading arena again the last thing I need is a call for mega funding for mini leverage (as could easily happen in europe if the US folds)

Beware the ides of march indeed then.....or even......:whistling

N

 

[jrplimited]

Hi N,

Guess the slave job is driving you nuts and hard today! Actual CFTC decision over leverage is due on 22-03-10 subject to any re-hearing, next week (15-03-10) onwards marks the point where "for and against" submissions are brought to a close - so far the "against" has a massive majority.
Simon.

 

[NVP]

sorry had this in my inbox and forgot to drop into the thread......some CAD advice from the black Swan boys

well.............were they right ?

I dont trust my feeds (still updating) yet to comment
N

hmm - from some of the charts posted , looks like they could do with a copy of the corrie

 

[NVP]

Hi N,

Guess the slave job is driving you nuts and hard today! Actual CFTC decision over leverage is due on 22-03-10 subject to any re-hearing, next week (15-03-10) onwards marks the point where "for and against" submissions are brought to a close - so far the "against" has a massive majority.
Simon.

lord oh lord........you are not wrong......on the other hand I have unpleasent vague memories of the pressure that comes from putting real money on the line

perhaps just hiding here and cherry picking good signals and ignoring the bad ones on this thread is where i'll stay......:whistling

N

 

[NVP]

mornin all............

markets fell initially...then all moved upwards gradualy retracing their losses from aound 2.30am (red verticals)

Tag team obliged in usual inverse relaionship....so no surprises there

what I wanted to show here was the classic behaviour of the Euro and the GBP overnight

1) They both (usually) tend to move inthe opposite direction to the Tag
2) GBP is much more volatile and explosive in its moves that Euro (usually)

and below demonstrates this very well as the Eurotwins were luckily tight on one another when the overnights started on this 1000/1 corrie - remember the 1000/1 setting allows currencies to drift and get very seperated on the chart....something the lower MA's will never allow as the lower MA continually hauls them all back together towards the Zero much faster. (try it )

anyway look at what the GBP does......it dances above and below the Euro like the tortoise and the hare as they walk the overall directional path dictated by the tag team

so early night..... tag up = Eurotwins down .....and GBP fies down past its chum......

then hold on a minute......as the Tag signals some downward bias (post red vertical) and the Euro turns up...... and GBP again shows off by dancing above and below the Euro like a school kid on a cake diet......

this can yield some nice money if used properly ......if GBP is ever lagging behind the euro in an obvious directional Bias.......get ready to trade it as usually it will kick in and accelerate through until it is ahead of the Euro......:smart:

some marketeers were charging nearly $2,000 for that signal (plus a couple of other more minor ones) a while back.......so start the day $2k up on me

later
N

 

[NVP]

fairly heavy duty day today in north america and canada

so be careful out there
N

 

[NVP]

Hey all

my old friend Ivan (Ingot 54) sent me this today........

I like Henry Liu's stuff so this could be interesting......i'll have a play at the weekend if I get time.....

I have no connection to Henry Liu and I am not recommending this stuff....just bringing anything that comes to me and I feel is worth a share...

if (??) this is a free feed then it could be useful....as ive seen very expensive stuff out there doing the same re relative value grids/ratings placed alongside your pair charts

(thanks Ivan )
N

http://www.currencystrengthmeter.com/ ERR DOES THIS OPEN ???

http://www.newsprofiteer.com/currency-strength-meter-best-usage.html

 

[GMP]

Hey all

my old friend Ivan (Ingot 54) sent me this today........

I like Henry Liu's stuff so this could be interesting......i'll have a play at the weekend if I get time.....

I have no connection to Henry Liu and I am not recommending this stuff....just bringing anything that comes to me and I feel is worth a share...

if (??) this is a free feed then it could be useful....as ive seen very expensive stuff out there doing the same re relative value grids/ratings placed alongside your pair charts

(thanks Ivan )
N

http://www.currencystrengthmeter.com/ ERR DOES THIS OPEN ???

http://www.newsprofiteer.com/currency-strength-meter-best-usage.html

Thanks N, I'll be interested to know how it compares to yours, calculation-wise. I much prefer a line-graph to a set of numbers so you can see what's going up/down. The relative values aren't half as much use without knowing which way they're headed, and their rate of change. And of course your corrie displays all this at a glance

 

[jrplimited]

mornin all............

then hold on a minute......as the Tag signals some downward bias (post red vertical) and the Euro turns up...... and GBP again shows off by dancing above and below the Euro like a school kid on a cake diet......

this can yield some nice money if used properly ......if GBP is ever lagging behind the euro in an obvious directional Bias.......get ready to trade it as usually it will kick in and accelerate through until it is ahead of the Euro......:smart:

some marketeers were charging nearly $2,000 for that signal (plus a couple of other more minor ones) a while back.......so start the day $2k up on me

later
N

Very, very nice call there Mr. N - well done.
Simon.

 

[jrplimited]

Hi N and all else,

OMG; Friday has arrived yet again and we all know what that means.... Yes, time for Simon to throw away the Betty Ford Clinic rule book for the weekend and go snorkelling without a mask in the sea of red nectar. Can you guess I'm looking forward to that?!!! First of all though, here is this morning's bun fight:

GU; Entered long at 1.50648 on 08:05 bar and caught a nice momentum driven push upwards. Price stalled and tracked sideways from 08:30 for nearly an hour, then went into a classic new high / higher low up and down pattern, hit a tight range from 10:15 for seven bars and took out TS during 10:50 bar for 82 pip profit.

EU; First trade opened long at 1.37148 at 08:10 bar, price drifted sideways for a few bars then slowly crept northwards, retraced very weakly from 09:25 for three bars then momentum caught hold and pushed price higher. Tracked price fairly loosely until new local high print at 10:35 reached, then price exhaustion crept in and TS taken out during 11:00 bar for 54 pip profit.

EG: First trade sell stop set at 90808 and filled by tail of 08:10 bar. Price moved down slowly then caught a nice push with 08:25 bar but this was short lived as price drifted upwards again to just beyond initial enrty point, then rolled over to test previous local low and couldnt penetrate it so trade exited on close of 09:40 bar for 2 pip loss. Left this pair alone after first trade as GU and EU both in definitive up trend mode.

Nice end to the week and even though EG trade was unsuccessful, it was a good sort of "insurance" against first EU trade which took some time to get motoring - first GU trade motored off from start.

Amazing to see both GBP and Euro showing remarkable resilience to the enormous pressures of the past few days. Will it last? Is it now the turn of USD to come under pressure? One thing is for sure and that is the obvious fact of this market being totally unpredictable!

Trade well and regards,
Simon.

 

[NVP]

sorry all - stuffed today at work .....will try to post over weekend

N

 

[NVP]

Hi N and all else,


GU; Entered long at 1.50648 on 08:05 bar and caught a nice momentum driven push upwards. for 82 pip profit.
EU; First trade opened long at 1.37148 at 08:10 bar, and TS taken out during 11:00 bar for 54 pip profit.
EG: First trade sell stop set at 90808 and filled by tail of 08:10 bar. exited on close of 09:40 bar for 2 pip loss. Left this pair alone after first trade as GU and EU both in definitive up trend mode.

Nice end to the week and even though EG trade was unsuccessful, it was a good sort of "insurance" against first EU trade which took some time to get motoring - first GU trade motored off from start.

Amazing to see both GBP and Euro showing remarkable resilience to the enormous pressures of the past few days. Will it last? Is it now the turn of USD to come under pressure? One thing is for sure and that is the obvious fact of this market being totally unpredictable!

Trade well and regards,
Simon.

nice end to the week Simon......do I hear a cork popping ?

N

 

[NVP]

Hey all

my old friend Ivan (Ingot 54) sent me this today........

I like Henry Liu's stuff so this could be interesting......i'll have a play at the weekend if I get time.....

I have no connection to Henry Liu and I am not recommending this stuff....just bringing anything that comes to me and I feel is worth a share...

if (??) this is a free feed then it could be useful....as ive seen very expensive stuff out there doing the same re relative value grids/ratings placed alongside your pair charts

(thanks Ivan )
N


Hi all

had a little look at the videos and not bad at all.......I've contacted Henry and asked if I can comment more about it here as it could be useful for me to have running at times

I want to chew some cud as well on how he values the currencies etc etc and whether he will be releasing a graphical version............but a good start !

The Corrie is good but not perfect by any means.......well actually let me qualify that, Its like a jack of all trades, being competent in a lot of areas but sometmes tooo general for me when I am really focusing on something

one of the main issues is a decent way of setting strength values to currencies like henry does.......tried it before but never quite got there yet...but thats just me and my apelike programming skills....

watch this space.....
N