Scalping and Intraday Trading Strategies Discussion - Page 39

imported_Bigpips · #**571** (**permalink**) 08-15-2009, 08:07 PM

Quote:

Originally Posted by TheGreenBaron

Does anyone know of any forex brokers that practice price shading? I don't think FXCM does but I'm curious as to which ones do.

I have been a happy FXCM customer for years and I did not notice any price shading activity at all, of that I am absolutely sure.

Lcash · #**572** (**permalink**) 08-15-2009, 09:16 PM

Is there a coorelation between the TICK index of the NYSE and the movement of the EUR/USD currency pair? Since the pair usually moves in the same direction as the US stock market is this a useful tool for scalping the EUR/USD?

Lcash

Be kind, it's my first post. I am used to trading S&P 500 E-Mini's and just started trading FX

imported_Bigpips · #**573** (**permalink**) 08-16-2009, 01:43 AM

Quote:

Originally Posted by Lcash

Is there a coorelation between the TICK index of the NYSE and the movement of the EUR/USD currency pair? Since the pair usually moves in the same direction as the US stock market is this a useful tool for scalping the EUR/USD?

Lcash

Be kind, it's my first post. I am used to trading S&P 500 E-Mini's and just started trading FX

There is indeed a 80%+ correlation between EUR/USD, USD/JPY and the US stock market, especially the S&P500. But that correlation varies and can reach 50% sometimes, so I would not bet the farm on that intermarket relation alone.

Lcash · #**574** (**permalink**) 08-16-2009, 11:05 AM

Quote:

Originally Posted by imported_Bigpips

There is indeed a 80%+ correlation between EUR/USD, USD/JPY and the US stock market, especially the S&P500. But that correlation varies and can reach 50% sometimes, so I would not bet the farm on that intermarket relation alone.

What I am looking for is a similar reaction to the S&P500's short term price swings in relation to the TICK index. If there is a similar short term swing (10-20 minutes) in the EUR/USD pair. In the e-mini there is a very close reaction between the two where you will see the TICK index swing below 450 just prior to a sell off in the S&P500. If this does not provide a short term indicator, what other index might show the short term price swings of the pair?

Lcash

imported_Bigpips · #**575** (**permalink**) 08-16-2009, 03:21 PM

Quote:

Originally Posted by Lcash

In the e-mini there is a very close reaction between the two where you will see the TICK index swing below 450 just prior to a sell off in the S&P500.

That could be true Lcash, but you need to thoroughly backtest that observation first, to see if it is indeed profitable in the long run, assuming you have the historical data of the Tick index, the S&P500 index (cash or futures) and the EUR/USD.

As a matter of fact, if you have enough data, you can test almost any price relation you can think of : currencies, bonds, stock indexes and commodities. For example you could find that there is a strong relation between the price of gold and the price of the USD/ZAR (South African Rand).

TheGreenBaron · #**576** (**permalink**) 08-17-2009, 08:51 PM

Quote:

Originally Posted by imported_Bigpips

I have been a happy FXCM customer for years and I did not notice any price shading activity at all, of that I am absolutely sure.

I'm not saying that FXCM practicing price shading at all. I am very happy with the service and platform that FXCM has provided for me. I'm just curious about other forex brokers that do. I read an article about a strategy involving price shading and I would like to test that strategy out.

imported_Bigpips · #**577** (**permalink**) 08-17-2009, 09:25 PM

Quote:

Originally Posted by TheGreenBaron

I'm not saying that FXCM practicing price shading at all. I am very happy with the service and platform that FXCM has provided for me. I'm just curious about other forex brokers that do. I read an article about a strategy involving price shading and I would like to test that strategy out.

Oh I see, so you want to profit from order flow imbalance, assuming you can find a crooked forex broker that uses price shading regularly.

That's kind of sneaky, don't you think?

Xiao · #**578** (**permalink**) 08-18-2009, 04:09 AM

Quote:

Originally Posted by imported_Bigpips

There is indeed a 80%+ correlation between EUR/USD, USD/JPY and the US stock market, especially the S&P500. But that correlation varies and can reach 50% sometimes, so I would not bet the farm on that intermarket relation alone.

hi Important Big pips...please see your DailyFX Forum - View Profile: imported_Bigpips

thanks...

TheGreenBaron · #**579** (**permalink**) 08-18-2009, 10:47 AM

Quote:

Originally Posted by imported_Bigpips

Oh I see, so you want to profit from order flow imbalance, assuming you can find a crooked forex broker that uses price shading regularly.

That's kind of sneaky, don't you think?

Well it may be a little sneaky, no more so than arbitrage. I'm not quite sure if price shading is legal or not. If it isn't, would profiting from it be illegal as well?

imported_Bigpips · #**580** (**permalink**) 08-18-2009, 03:54 PM

Quote:

Originally Posted by Xiao

hi Important Big pips...please see your DailyFX Forum - View Profile: imported_Bigpips

thanks...

Hi Xiao,

You can use the CORREL function in Excel to determine whether two data sets are related, and if so, how strongly. The correlation coefficient ranges from +1, indicating a perfect positive linear relationship, to -1, indicating a perfectly negative linear relationship. To calculate a correlation coefficient for a sample, Excel uses the covariance of the samples and the standard deviations of each sample. To use the CORREL function in Excel, just select the two sets of data to use as the arguments and use the following syntax:

=CORREL(data set 1,data set 2)

where data set 1 is the price of the first currency and data set 2 is the price of the other currency, for example the EUR and the USD.

John Rivera · #**581** (**permalink**) 08-20-2009, 10:37 AM

Quote:

Originally Posted by imported_Bigpips

Hi Xiao,

You can use the CORREL function in Excel to determine whether two data sets are related, and if so, how strongly. The correlation coefficient ranges from +1, indicating a perfect positive linear relationship, to -1, indicating a perfectly negative linear relationship. To calculate a correlation coefficient for a sample, Excel uses the covariance of the samples and the standard deviations of each sample. To use the CORREL function in Excel, just select the two sets of data to use as the arguments and use the following syntax:

=CORREL(data set 1,data set 2)

where data set 1 is the price of the first currency and data set 2 is the price of the other currency, for example the EUR and the USD.

David Rodriguez does a correlation report on a weekly basis that you might find interesting. It is posted in the cross markets section. US Dollar Remains Correlated to S&P 500, Ignores Interest Rates

^eagle^ · #**582** (**permalink**) 08-20-2009, 12:11 PM

My scalping set up.

Sean Hyman · #**583** (**permalink**) 08-20-2009, 12:23 PM

Check out some quick scalp possibilities that may be coming in the EUR/USD.

Breakout coming soon.

imported_Bigpips · #**584** (**permalink**) 08-21-2009, 02:00 PM

Quote:

Originally Posted by Sean Hyman

Check out some quick scalp possibilities that may be coming in the EUR/USD.

Breakout coming soon.

Thanks a million Sean, I just made a quick 100 pips with the pattern you noticed on the EUR/USD. I bought after the re-test of the upper channel yesterday and the trade worked like a charm, up it went like a NASA rocket.

Thanks again and keep up the good work!

Sean Hyman · #**585** (**permalink**) 08-21-2009, 02:06 PM

Quote:

Originally Posted by imported_Bigpips

Thanks a million Sean, I just made a quick 100 pips with the pattern you noticed on the EUR/USD. I bought after the re-test of the upper channel yesterday and the trade worked like a charm, up it went like a NASA rocket.

Thanks again and keep up the good work!

haha, imported bigpips...glad you liked that. Yeah, I profited handsomely off of it too. I love it when a plan comes together.

Be sure to check out the other currency forums to see what I'm watching too. It doesn't mean I'm always right...because I'm not. However, collectively, we all have some great insights.

United we stand, divided we fall. haha! So the forum brings us together.

It's like our own little "trading room".

And thanks for the testimonial on how good you did and how you benefited from the forums. Awesome!