Two Ribbons and Secret Bob on the 15 Minute

[slowkey]

When I look at Four Hour or Daily CSS I look at the following for all the various currencies.
How far apart are the two currencies:
Very strong vs Very weak, Both in the trending zone, One in Trending Zone the other not, Strong vs a little Stronger, and Weak vs a little Weaker. Or any variation of these possible strengths in the currency spectrum.

How have there lines been running on the CSS chart. Both heading away from each other or back towards each other or staying somewhat parallel or any variation of this. I like moving away from each other best.

So that is the big picture.

I like the 15 minute CSS. I failed to be able to make it an entry signal because reading it is an art. I might be good at reading it but how can I teach you the nuances of it. It takes observation and practice. Bobs Secret Indicator is much better for a signal.

One clue to reading it is the difference between the Base Currency and the Quote currency or Counter Currency if you prefer.
Below that would be EUR 46 JPY -17 ... So the difference is 63 points. If you look at the Daily Chart you will see that the run up has been from 135 to 147 for the Eur vs JPY over the last month. So it has been trending constantly almost straight up.

With the previous GBP/NZD trade I discussed earlier the difference between the base and counter on the 15 minute CSS was about 100 and that narrowed very quickly after the release of the CPI report. Reversing completely the direction of the trade. Yet the NZD and GBP were still very far apart on the Four Hour CSS and the 15 minute CSS. On the 15 minute about 60 to 80. So micro trends and counter trends as Secret Bob points out are within the ebb and flow of two currencies no matter the Four Hour CSS or Daily CSS. So I try to pick up on these inner movements with the 15 minute CSS.

So ... yes it takes some interpretation but you can get a nice sense of immediate feed back by picking up on what is happening on a 15 minute CSS. Each pair is unique. A 63 difference by itself does not mean another pair with the same difference is trending. It might take a 100 on that pair but getting a feel for what is happening can start to give you some insight into what is next and also takes some of the boredom out of trading. That is why I like to see a lot in a chart I look at. I like to see the dynamic S/R with the ribbons. I like to see a CSS on the same time period. I like to keep up with fundamentals. It just makes it a whole lot more interesting.

So I hope to point out something you will see over and over again that makes a nice counter trend trade. Easy to spot even in a trend like the chart below. When one currency line peaks either by it self dramatically or both blow out as in the example below ... a set up for a nice counter trend trade is usually the result as you see circled on the chart where Secret Bobs Signal is pointing too. The two currencies can not maintain that distance on the 15 minute for very long and there is for a time a strong pull back towards the base trend. You see this all the time with the Bollinger bands in the statistical deviations and price movement beyound the deviation band. If you start to pick up on the obvious one like this than it will not be long till you see the ones that are not so obvious. Until you spend some time with it might just seem like noise.

EURJPYM15.png

[slowkey]

I will probably put together a package for the 240 indicator that has the 15 minute CSS indicator on it and one with the 60 indicator. It really is just which one you prefer. I like seeing the faster average however you may prefer the slower 240. Both give good signals and averages follow price. I think both can reveal a consolidation of the ribbons and the average for a setup into a major trend.

I have a lot of things going on this week so hopefully I will get to it after the weekend.

I hope it is warm where you are.

The US is frozen and in the mountains of Western Maryland.. 17 F or ... - 8.3 C if you live in one of the advanced Metric countries.
70 inches or 177 cm of snow in Buffalo, New York. Yes that is almost 6 feet.

Have a great week.

Cheers,
Doug

[slowkey]

No real currency moving language in the FOMC discussion release. The word inflation was used 68 time as opposed to less the last time and less the time before. They are not overly concern about a weak Europe. There keeping one eye on it maybe
There was a discussion about how they should explain when ... that is interest rate increase. Some like a more specific language some do not so generally they are sitting on the runway not sure when to take off because there is a cloud here and there. They seem to have lost their maps.

Interest rate hikes are not imminent but they are really quite hung up on the language about when

Stock market is generally not to upset about it. They do not like interest rates. Of course we currency traders love interest rates but in the end it is just a tool the central bank uses to put a break on inflation.

It is interesting in that the US has a history of depression where as in Europe it is inflation. So US fed policy was very aggressive to overcome what could have been a deflationary spiral which is what recent history is now showing was needed.

Europe took a different approach. You can sort of see where that leaves us. Is the Euro overvalued. Well will find out when the US move s to increase interest rates. The US has a definite advantage as the reserve currency. So even if it seems devalued there are certain built in advantages for the US dollar. There was a lot of talk about moving away from US reserve currency domination. Russia's currency is in a melt down. China 's economy continues to weaken some. They have a potential nightmare of a housing crisis.

Oil is now a growth industry in the US. Gas prices are the lowest they have ever been in recent times and going lower in the US. Manufacturing is returning to the US.

What will be the greatest challenge in the immediate future for all the world. Water and agriculture. In the US California is draining the deep water aquifer at an unbelievable rate for agriculture related to the longest drought in history in the Western US . That is the most productive agricultural region on earth folks. It may take a century to restore the water in the deep water aquifers. Satellite images shows huge area similar to this in all the major fertile areas of the world. Stayed tune.

Cheers,
Doug

[slowkey]

A new setup package for the thread coming on Monday with templates for the 60 minute indicator and 240 indicator. A new Gann analysis template will be included. I will be adding CSS to the templates probably using Neotrader's indicator that also show the Base and Quote currency Difference and seems to be pretty efficient with the computers CPU.

Have a nice Weekend.

Cheers,
Doug

[fire580]

okay - thanks

[slowkey]

okay - thanks

Nice to here from you Fire and thanks for following.

Cheers,
Doug

[slowkey]

OK ...

I had a little bit of fun with the FOMC minute release this last week a few post back.

The experts who do not work for the Fed. ... They think that the Fed will raise interest rates this coming summer of 2015.

Cheers,
Doug

[MagicMittens]

Really enjoying going through this thread, I'm pretty new to this forum, so trying to play catch up a bit. It's nice have a thread that hasn't been going too long. Much easier to keep up with changes. Looking foward to Monday to read the latest.

Have a great weekend, Paul

[slowkey]

Really enjoying going through this thread, I'm pretty new to this forum, so trying to play catch up a bit. It's nice have a thread that hasn't been going too long. Much easier to keep up with changes. Looking forward to Monday to read the latest.

Have a great weekend, Paul

Glad to here from you. Welcome aboard.

I am going to try to keep this one simple and profitable hopefully. How many times do we say wow I wish I could have got in on that trend at the beginning.

A range or consolidation is where it all begins. We spot the trend just fine after its a 100 pips into profit. It is those boring consolidations where it all begins. So I will use fundamentals, S/R (Ribbons), chart patterns (Ribbons and Averages) and CSS to clarify what direction is likely next and what news might change that direction. Pending trades are key to entering these trades and good nights sleep.

Cheers,
Doug

[slowkey]

Some thoughts on Fundamentals.

The thunder storms to navigate around are significant in trading and planning trades.

There is nothing that is 100 percent right in Forex. Fundamentals can change in the blink of an eye. When this happens it's likely it is a result of the concept of Risk On and Risk Off trading or Good News and Shocking news:

The modern 21 century restatement of the old mantra ... Fear and Greed brought to you by the great depression of 2008 featuring the Euro Zone crisis, The US Banking and Real Estate crisis, and the Japan crisis or 20 years of economic malaise. To top all of this the AUD is in the unique position to move both on both Domestic economic fundamentals and China economic fundamentals. We all should have it so lucky.

Throw in a Tsunami and Earth Quake here and there, Terror attacks and Misstatements by supposedly smart central bank leaders and well you get the picture. So the best of trades can be thwarted by fundamental thunderstorms.

However a little better than expected news like the GBP CPI report this week and the GBPNZD trade that I demonstrated can reverse a trade as well or start a new trend. It does not always have to be really good or really bad. So I had mentioned the CPI as a factor in the setup of the trade and it turned out to be a player. So incorporating what you will do in this light can also be an important consideration in making a trade. First thing to do is take the profit and get out. If it will work go for the counter trend trade. Watch the clock for these anouncements and know when you may need to take the profit and run. A terrific free site to monitor news in real time is the following.

http://www.financialjuice.com/news/

It is a terrific site and you can set the site up to show you the news you are most interested in hearing about and it even has a siren that blows when a major report is released on to the site. If you have access to CNBC it can get you a report even before it is released on a site like Forex Factory. They had the monthly US jobs release 2 minutes before it made it onto the internet in real time. It can also be entertaining to listen to the so called experts argue over what it all means.

But what if you are sleeping ... My God have you not heard of this little EA probably the most used EA in history.

Multi-Purpose Trade Manager ... Learning to use this little EA is the most promising step you will ever take in your trading or getting a good peaceful nights sleep if you live in the US.

MPTM ........... I repeat Learn It and Use it so you do not Loose it.

http://www.stevehopwoodforex.com/phpBB3 ... ?f=21&t=64

The best intraday trading is an understanding of both the technical's you choose to use and the fundamentals you need to listen too. If you trade large time periods an intraday setback may not be so important but if you trade intraday you must have a knowledge of what is on the news calender for the day.

The big plus ... Volatility is back in the market or more specifically large market movers are trading again. The largest economy in the world is starting to heat up enough that the thought of applying the breaks other wise known as interest rates looms within the next Eight or Nine months. The US does not want to be derailed by a weak Euro Zone economic picture so they will be keeping an I on this factor big time.

We may actually be worried about inflation again in the US economy.

Oh inflation I have hardly known you where have you been

Cheers,
Doug