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.
Trading-Grundlagen 03: Intermarket-Analyse Die Intermarket-Analyse ist – neben Technischer und fundamentaler Analyse – die dritte Variante, um Börsenkurse zu analysieren. Sie kann als eine Art Synthese der beiden anderen Analyseformen betrachtet werden, da sie verschiedene Märkte (Aktien, Anleihen, Rohstoffe und Währungen) und deren Wechselwirkungen betrachtet. Intermarket Analysis of Forex Markets MARCH 2008 41. CURRENCY TRADING Intermarket analysis: The next logical step So, a quantitative approach to implement intermarket analysis, which has been the basis of my research since the mid-1980s, is neither a radical departure from traditional single market technical analysis nor an attempt to undermine it or replace it. Intermarket analysis, in my ... Yet intermarket analysis as it’s called is a missed opportunity in my view. Many traders ignore the subject almost entirely, preferring to focus on one market at a time. So those open to learning about this method can certainly gain an advantage. Forex Analysen Optionen ← Optionen ... Bei der Intermarket-Analyse werden Zusammenhänge zwischen verschiedenen Anlageklassen analysiert. Die Hauptmärkte der Intermarket-Analyse sind Aktien, Anleihen, Rohstoffe und Währungen. Dabei geht die Theorie davon aus, dass sich Kapital in einem Kreislauf bewegt und je nach Performance zwischen dem Aktienmarkt, Anleihenmarkt, Rohstoffmarkt und ... Die Intermarket-Analyse hilft Investoren bei Anlageentscheidungen. In der Realität gibt es immer wieder Abweichungen von diesem Prinzip, da sich die Rahmenbedingungen in jedem Zyklus etwas voneinander unterscheiden. Das Modell liefert jedoch einen guten Hinweis auf Zusammenhänge und Korrelationen, die man als Anleger im Blick haben sollte. The analysis of a market must involve all the other analyses; an analyst using an Intermarket approach looks beyond his own nose and combines technical analysis with the economic cycle. Below we see a simple statement of the four most important reports Inter-market Approach Analyst John Murphy introduced in 1990: Intermarket Analysis: The analysis of more than one related asset class or financial market to determine the strength or weakness of the financial markets or asset classes being considered ...
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Forex Today Strategy Session: Intermarket and Currency Correlation Analysis Forex.Today. Loading... Unsubscribe from Forex.Today? ... The foreign exchange market (or "forex" for short) is the ... 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 ... Intermarket analysis is a branch of technical analysis that examines the correlations between four major asset classes: stocks, bonds, commodities and currencies. Forex Market Analysis Tradeciety.com; 46 videos; 6,486 views; Last updated on Jan 8, 2018; How to analyze the Forex market with a consistent approach in order to achieve consistent results. Play ...