Trader Sentiment and Positioning - Page 31

Million$Man · #**451** (**permalink**) 08-24-2009, 11:56 AM

Quote:

Originally Posted by Sean Hyman

For me, I keep the SSI indicator very simple.

If the market overall is trending and not range bound, I look this indicator for a general bias. Then I turn to my technical indicators to actually enter a trade.

Exactly how I use SSI, personally

But here's the simple way that I use SSI. If a pair has an extreme reading of +3.00, then I get ready to short the pair (since its a contrarian, "buck the crowd" type of indicator).

When a pair gets to -3.00 or greater, I get ready to look for buy signals on my technical charts.

The basic thought behind SSI

The basic thought behind the SSI is that, "Crowds are generally wrong in their analysis". Therefore if they are "bent on being largely on one distinct side of the pair", then it may pay for me to be on the opposite side of their trade, since they are wrong so often.

After all, they are saying, "It has gone up too far, it has to come down...so I'll short". OR "It has gone down too far, it has to bounce higher, so I'll buy".

They are trying to catch a top or a bottom rather than simply going with the trend that already exists. It's always easier to go "with the flow" than "against it".

Manage your risks on any indicator!

Remember to use good risk management with any type of trading signal. In other words, if you were to get stopped out on the trade, you should only lose 1-5% of your account balance. That's good risk management.

Hope this helps. Let me know what you guys think.

Intersting thing this SSI, i've heard of it many times but never actually read up about it.
So I have managed to look at the recent post and this is what it shows.
Are you suggesting that using the data, one would be looking for shorts in USD/CHF and also USD/CAD. The loonie has already dropped quite a bit today.

Thanks in advance M$M

Sean Hyman · #**452** (**permalink**) 08-24-2009, 12:10 PM

Quote:

Originally Posted by Million$Man

Intersting thing this SSI, i've heard of it many times but never actually read up about it.
So I have managed to look at the recent post and this is what it shows.
Are you suggesting that using the data, one would be looking for shorts in USD/CHF and also USD/CAD. The loonie has already dropped quite a bit today.

Thanks in advance M$M

Yes, Million$Man, and more so USD/CHF short than even USD/CAD short...although both are very bearish...but traders feel so sure that they've called a bottom on USD/CHF, that if they're wrong and the trend continues to break down, they'll have to scamper to close those longs out (which causes sells....selling pressure) or they'll get margin called out or stopped out or they'll reverse their positions. Any of these would continue to see the USD/CHF pair continue in its larger downtrend.

Correct.

Million$Man · #**453** (**permalink**) 08-24-2009, 12:17 PM

Thanks for the response Sean, also I'm sure this has already been mentioned but its great to have an active member of the Team helping us all out and responding promptly.
Looking at the 4H the 20ma seems to be acting as resistance for USD/CHF and stochs maybe on the verge of a cross over..il keep a very close eye on this pair.
Thanks again
M$M

Sean Hyman · #**454** (**permalink**) 08-24-2009, 12:19 PM

Quote:

Originally Posted by Million$Man

Thanks for the response Sean, also I'm sure this has already been mentioned but its great to have an active member of the Team helping us all out and responding promptly.
Looking at the 4H the 20ma seems to be acting as resistance for USD/CHF and stochs maybe on the verge of a cross over..il keep a very close eye on this pair.
Thanks again
M$M

Million$Man, you're welcome. I sure do appreciate the kind words. Yeah, I love this stuff...so it's been a "ton of fun" mingling with you guys in the forums.

khaled.gad · #**455** (**permalink**) 08-24-2009, 06:25 PM

hi everyone

thanks SEAN for your efforts

can u tell me how you interpret the DAILY CHANGE LONGS and SHORTS compared to the index , also if you can tell us how we can use these data side by side with COT data trying to figure out how the herd thinking

hakagure · #**456** (**permalink**) 08-24-2009, 06:51 PM

Hi everyone, I`d like to know, since the new regulation is in place, how to do if i want to put an entry order and in the same time put a stop-loss and limit on that trade?? cos now it seems the trade can be trigerred "in" by my limit or stop-loss accordingly if it`s a short or long....
Thanks for any reply

Sean Hyman · #**457** (**permalink**) 08-25-2009, 10:38 AM

Quote:

Originally Posted by hakagure

Hi everyone, I`d like to know, since the new regulation is in place, how to do if i want to put an entry order and in the same time put a stop-loss and limit on that trade?? cos now it seems the trade can be trigerred "in" by my limit or stop-loss accordingly if it`s a short or long....
Thanks for any reply

Go about 1/2 way into this video (maybe slightly before 1/2 way) and you'll see the point where it shows how to do entry orders OCOs, etc. Just lick on the word, "FXCM" below.

FXCM

Sean Hyman · #**458** (**permalink**) 08-25-2009, 10:41 AM

Quote:

Originally Posted by khaled.gad

hi everyone

thanks SEAN for your efforts

can u tell me how you interpret the DAILY CHANGE LONGS and SHORTS compared to the index , also if you can tell us how we can use these data side by side with COT data trying to figure out how the herd thinking

khaled.gad, All of us that trade using SSI honestly ignore the longs vs. shorts, etc. We only look at the readings and really focus on the trade when a reading is +/-3.0 or greater.

When traders get extremely bullish, I get extremely bearish. When traders get extremely bearish, I get extremely bullish.

Million$Man · #**459** (**permalink**) 08-25-2009, 10:48 AM

Quote:

Originally Posted by Sean Hyman

khaled.gad, All of us that trade using SSI honestly ignore the longs vs. shorts, etc. We only look at the readings and really focus on the trade when a reading is +/-3.0 or greater.

When traders get extremely bullish, I get extremely bearish. When traders get extremely bearish, I get extremely bullish.

Hi Sean, I looked at the SSI reading this morning and the last update was 5.30pm GMT yesterday. It showed a reading of 4.00 for $/CHF which would be classed as extreme. I shorted the pair this morning and managed to lock in 50+ pips. The pair broke a short term TL on the 1H chart and now seems to be going up. Whats your opionion on this pair?
M$M

Sean Hyman · #**460** (**permalink**) 08-25-2009, 10:57 AM

Quote:

Originally Posted by Million$Man

Hi Sean, I looked at the SSI reading this morning and the last update was 5.30pm GMT yesterday. It showed a reading of 4.00 for $/CHF which would be classed as extreme. I shorted the pair this morning and managed to lock in 50+ pips. The pair broke a short term TL on the 1H chart and now seems to be going up. Whats your opionion on this pair?
M$M

Million$Man, good trade. Great job!

I'd initially short when an hourly candle goes below the green support line but possibly add on more once the daily candle closes below this green support line.

That's my take on it. I want to see a break in my direction in order to get in. That way, the move compliments the extreme SSI reading and helps the odds of my success in the trade.

khaled.gad · #**461** (**permalink**) 08-26-2009, 10:12 AM

Quote:

Originally Posted by Sean Hyman

Million$Man, good trade. Great job!

I'd initially short when an hourly candle goes below the green support line but possibly add on more once the daily candle closes below this green support line.

That's my take on it. I want to see a break in my direction in order to get in. That way, the move compliments the extreme SSI reading and helps the odds of my success in the trade.

i think guys , when SSI be +/- 3 we could say it is OB or OS but it doesn't give us a signal , as price can still move higher when it is OB and lower if it is OS , just like the RSI indicator , so we need confirmations to pull the trigger .

Sean Hyman · #**462** (**permalink**) 08-26-2009, 10:23 AM

Quote:

Originally Posted by khaled.gad

i think guys , when SSI be +/- 3 we could say it is OB or OS but it doesn't give us a signal , as price can still move higher when it is OB and lower if it is OS , just like the RSI indicator , so we need confirmations to pull the trigger .

khaled.gad, Yes, you are absolutely correct. It doesn't say "buy now" or "Sell now", etc. You're right.

If SSI could talk, it would say "hey guys...get ready for a potential turn around coming...traders are getting too one-sided in this trade and it may turn around soon".

You hit it "spot on". Good job!

So I use other oscillators, support/resistance levels, etc. as my triggers as to when to get into the trades. Good job!

khaled.gad · #**463** (**permalink**) 08-27-2009, 09:17 PM

hi everyone

you may find the next post little weird
but i am trying something , i don't know if i am thinking right or wrong so i thought to share it with you

as SEAN told me that we don't look at the DAILY CHANGE LONGS/SHORTS only the index and be contrarian to it , but i think that the index itself doesn't tell everything . it just tell us the total ratio of long/short now but the way this position is forming exist within the DAILY CHANGE LONGS/SHORTS so i am trying to interpret these values to give me a broader outlook
also , as the position of one pair doesn't reflect the whole market sentiment about any currency , i thought of mixing more pairs together trying to figure out the big picture
notice , everything i am saying now just initial thoughts , it may end in nothing
imp point , i see SSI as the total positions exist now in the market but the DAILY CHANGE SHORTS/LONGS represent the change happened throught the past few hours , who is building up his positions and who is covering his positions

the principle :
i take the GU and EU to measure the FXCM speculative traders sentiment , EU and GU represent about 55% of the total cake so we can depend on them for our meaures
note : we can add more pairs like GJ and UJ to reach about 80% of the cake but i preferred to start with those two pairs

we will consider the EU and GU the whole market , that means
EU + GU = 55% of the whole market
but
EU + GU = 100% of our system

first , calculate each pair percentage of our system
EU% = [ EU% / ( EU% + GU% ) ] * 1OO
GU% = [ GU% / ( EU% + GU% ) ] * 100

then , calculate the new SSI depending on the new %
new EU SSI = old SSI * EU%
new GU SSI = old SSI * GU%
the point is to give different weight for each pair data as that pair represented in the whole market share ( or to be specific , in our new market profile ) .

finally , add the new EU SSI + GU SSI = x
so , USD SSI = - x

the whole idea is trying to find out the market sentiment about USD despite of looking at specific pairs which may lead to false sentiment reading

now , lets interpret the DAILY CHANGE LONGS/SHORTS
of course we will adjust their percentages the way we did with SSI

new % ( long or short ) = old % * new pair %
so we will have new EU short %
EU long %
GU short %
GU long %

adding EU long % + GU long % = A
EU short % + GU short % = B

then A - B = Y , difference between longs and shorts

change in USD% = -Y %

NOW , we have
USD ratio of total longs versus shorts , and
USD % change of longs versus shorts

that is it guys

i feel dizzy confused and very close to madness for tonight , i spent more than 4 hours doing that stuff and i don't know if i am right or wrong , especially i am not perfect in mathematical issues

waitin to see your comments

maybe this experiment won't be useful for us now , but if we couldn't make any good of it i hope it inspires anyone to figure out something new

thanks for those who made the effort and read it

dtseng123 · #**464** (**permalink**) 08-28-2009, 12:26 AM

Hey Khaled, I'm very down to experiment with this. I'll take what you got and get the data and when I'm done I'll post the excel here with some comments.

VINCY BALBOA · #**465** (**permalink**) 08-28-2009, 02:07 AM

Quote:

Originally Posted by dtseng123

Hey Khaled, I'm very down to experiment with this. I'll take what you got and get the data and when I'm done I'll post the excel here with some comments.

Okay Great I Specially waiting For your Comment...

because I really do Know How to Do It..

Let See..