So yesterday I created the first part to the 'post' Today I'll continue it.submitted by iTradeSocial to u/iTradeSocial [link] [comments]
All markets, equities, cars, widgets, groceries, bonds and even forex are driven by volume. Without volume there is no movement as it's the market maker to entice the trader to aggressively buy or sell based upon their sentiments of direction.
So let's first put into perspective market sentiment and what it is for this posts purpose.
Sentiment is the psychological pressure of trader expectations in movement. It's visible through intermarket analysis and even some indexes when the indexes are properly cross referenced. But sentiment is visible even when candles stop their climb or when buying pressure supports the prices on an attempt to move lower. What comes after sentiment builds it's pressure is the path of least resistance and that's really what the markets are doing. Following the path of least resistance with volume as the rivers boundaries.
Volume in foreign exchange is real.
Retail traders think that because the market is decentralized that volume isn't available. Well, the broker you connect to, and the prime broker or bank that they connect to, they source their pricing with risk management modules by analyzing aggregated volume. Aggregation is a grouping of FX liquidity streams (that all include volume levels) into one hub of liquidity housed inside a limit order book. Volume is not made available to you though. It's the playground of the banks and if you're going to have access to a tool that allows the masses to dilute their returns do you think they would let you have it freely? Nope! They would though lobby for laws (Dodd-Frank, FIFO etc etc come to mind here) they all make it more difficult for you to trade!!!! Opacity!!! But volume is very real, it only needs proper aggregation!
So how do we find valuable opportunities when studying the charts? First off, if you study the charts alone you're doing yourself a great disservice! EURUSD in any time frame is just a representation of a relationship between two currencies. You need to study the value of the underlying currencies!
What that provides you is precision entries. Let's call the entry on Candle 12 (an arbitrary number). On candle 12 you see USDCHF spike higher, that would indicate that EURUSD is going to drop 96% of the time! Oh a little insight! So you take a position short EURUSD on candle 12 in expectation that the relationship between the two currencies is going to go lower because of the strength in the Dollar.
But remember, exchange rate fluctuation is the path of least resistance. So at the point where you have found your entry short in EURUSD, there is the opposite consideration. What if I am wrong? What it if goes the other way? At what price would it show me the opposite direction and how long do I have to wait to confirm a reversal? Candle 12 is magical. It tells you what you need. You see, in ALL instances, extremes high or lows of charts are seen by changes in what's called bid/ask bounce. When bid ask bounce is breached it's giving you sentiment, volume and price all shifting directions. If candle 12 is the candle short, then the high immediately prior to candle 12 is your reversal point!
I guarantee you this is the intersection of buyers and sellers, and when one defeats the other the market changes direction. This is true for all of the entries here, if price reversed before it reached a profitable exit then the reverse would in fact be at the opposite extreme prior to the entry candle.
So we go back and visit the adage buy low/sell high but what happens in between? Proper analysis is an active participation. And just as your analysis says you should buy or sell, your analysis should also tell you how the market is reacting in the middle. If there's no change or breach in bid/ask bounce the trend is still moving.
In the attached chart. When an entry signal is confirmed, the immediate high or low prior to that entry becomes the exact reversal point. (I have circled them in yellow) In most of the opportunities shown that stop loss is a mere 2.2 pips away from the entry price and there are no reversals that were required and all signals were profitably identified. No I did not trade them, this is live analysis that runs continually. Of all the signals there is ONE blue X in the center region of the chart that almost gave a sell signal but price pressures remained in tact and thus bullish. The analysis identifies over 100 pips in movement within a range of 35 pips overall. And none of it with lagging analysis.
With proper analysis, you can maximize your returns by comprehensively understanding all market conditions. You'll minimize your losing trades to negligible frequencies, your gains will be maximized and you'll see precisely how the market moves, turns, breathes and follows the path of least resistance.
Now my purpose here is to develop market transparency for the little guy. Sure my posts attract trolls because the trolls have been burned by their own trading ignorance. So they attack those that strive for and deliver something better, in fact most of them don't know how to trade to save their life and that's their anger. I could show you a few of them who have had accounts with companies I advise or am principal of - but there are privacy rights to respect. Do I do this free? On here of course. Is it a business? I've spent over a million dollars in just research, but when I experienced how expensive it was to obtain true transparency I knew there were benefits to providing this information to retail traders.
As John J. Murphy points out in his aforementioned book on Intermarket Analysis, market analysts have observed a number of key correlated relationships between the stock, bond, currency and commodity markets over the years. Seven of these important intermarket relationships can be described as follows: Trends in commodities and the U.S. Dollar tend to be negatively correlated. As head FX strategist at CMC Markets–one of the world's leading forex/commodity brokers–Ashraf Laidi understands the forces shaping today's currency market and their interplay with interest rates, equities, and commodities. And now, with Currency Trading and Intermarket Analysis, he shares his extensive experiences in this field with you ... Intermarket analysis has a long history in the equity, agricultural commodity and currency markets. Equity traders for years have compared returns between small- and large caps, one market sector versus another, a sector against a broad market index, one stock against another, international versus domestic stocks, etc. Fund managers talk about diversification and asset allocation as they try ... Treasury Bills Correlation to the Forex and Equity Markets. Industrial Metals Correlation to Equity Prices. This Research is Based on 15.5 Years of Daily Market Data. Intermarket Analysis Conclusions The Unification of Global Financial Markets. World financial markets operate as a common area for world investors, a common area incorporating ... With that in mind I have decided to create this thread so dedicated traders could discuss intermarket analysis. Every one is welcome and the main objective is to create a place where intelligent discussion can help facilitate learning for all. Post # 2; Quote; Nov 23, 2009 12:53pm Nov 23, 2009 12:53pm walb99 Joined Nov 2007 Status: Member 1,142 Posts. Quoting 1energy. Disliked. I have ... As head FX strategist at CMC Markets-one of the world's leading forex/commodity brokers-he understands the forces shaping today's currency market and their interplay with interest rates, equities, and commodities. And now, with Currency Trading and Intermarket Analysis, he shares his extensive experiences in this field with you. Following an innovative approach based on what still works and ... Sale Forex Trading Using Intermarket Analysis And How To Trade Forex On News Rele
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Intermarket analysis is one of the best tools in Forex to have in your Forex strategy as it will help to detect the best risk to reward high odds entries into your trades. In terms of using Forex ... In this edition of our podcast Trading Global Markets Decoded, our host Tyler Yell talks to him about Intermarket analysis, removing useless indicators from your strategy, and how the social ... The foreign exchange market (or "forex" for short) is the biggest financial market in the world, with over $4 trillion worth of transactions occurring every day. Simply, forex is the market in ... The foreign exchange market (or "forex" for short) is the biggest financial market in the world, with over $4 trillion worth of transactions occurring every day. Simply, forex is the market in ... This feature is not available right now. Please try again later. Published on Jul 26, 2016. Intermarket analysis is a branch of technical analysis that examines the correlations between four major ... Live now; How to use dollar ... Market Correlations & Forex Trading webinar - Duration: 1:02:43. Trading with Venus 6,988 views. 1:02:43. Moving Average Trading Secrets (This is What You Must Know ... This feature is not available right now. Please try again later. Published on Feb 20, 2019. Ivan Delgado, Head of Market Research at Global Prime, shares his insights on Intermarket studies and ...