10.7 CSS

Post by **nanningbob** » Sat Apr 12, 2014 11:25 am

Now lets take a look as the eur is on top and begins declining. But first we have a nice up move against the aud. While on top the euro increases in price but as it decelerates we get into a range but lower lows because the aud is on a strong move. Soon the aud catches up and at the cross boom euro drops like a rock and the aud is a big winner. A cross near the 20 lines above +20 or below -20 can be nice moves.

The aud/chf will find a similar move. The eur/aud and the aud/chf are sister pairs with almost identical charts. If you did buys on one and buys on the other you would literally be hedge against each other. This will continue to happen as long as the SNB ties itself to the euro. So I wouldnt trade both of these pairs but choose one.

Post by **nanningbob** » Sat Apr 12, 2014 11:53 am

When a currencies is angling strong down and a currency is angling strong up. They are both decelerating and this causes a range time until the cross or the angles change. eur/aud, aud/jpy. But remember the stronger pair has the advantage. aud/cad are parallel but aud is stronger.

Post by **nanningbob** » Sat Apr 12, 2014 12:09 pm

aud/nzd cross high and nzd stays with the aud for a while then begins to fade and weaken. Staying with the higher currency gives you the best trades.

Post by **nanningbob** » Sat Apr 12, 2014 12:34 pm

So let us review the basic reads of the CSS info page. I use the Daily almost exclusively and sometimes consult the 4H. But I have gotten whiplashed too many times on the 4H. The strength of the move simply doesnot change quickly and correctly reading your CSS with give you future clues of where price is going. So here are the basic rules.

Before I go over the rules again remember this. This indi only measures strength,it does not measure volatility. Pairs can cross and not go anywhere, trend times maybe small or short in duration but this indi will show these moves whether they are volatile or not. So this compares the relative strength of one currency against another but it does not predict the volatility.

A. Crosses.
When one currency crosses up and the other crosses down this is a switch in trend direction. The indi will show a bar to the far right of the chart letting you know a cross has happened between the two pairs. These can be some of your best trades.
There are 4 kinds of crosses.
1. Ones near or outside the 20 lines. These can be your most volatile and can explode quickly. The reason is as one car (currency) is slowing down towards the stop sign, the other is speeding up away from the stop sign. So as each car passes the other the distance between them can accelerate quickly. This can also lead to a good strong move on your charts.

2. Cross happens inside the 20 lines and the close 0. Since both cars are coming to a stop or just taking off from the stop sign their movements are slower and will build into a potential UT,DT to each other. Patience or smaller profits are in store here.

3. One pair stays between the 20 lines and one goes outside the 20 lines. These are a trend trade but not as strong as #4.

4. One car goes above the +20 line and one car goes below the -20 line. These are you nicest long term trend runs. This is the signal to buy and hold. This is the only indicator I know that gives you this type of information and makes it clear to you. It does not mean they have to cross the 20 lines at the same time, infact most of the time it will happen on different days or even weeks. Either way take the ride and hang onto the trade unless you have a fundamental reason not too.

Post by **nanningbob** » Sat Apr 12, 2014 12:47 pm

B. PARALLELS

When two currencies are running parallel to each other they are ranging. It matters not if they are flat parallels or up angle parallels or down angle parallels. They will range but the currency that is higher on the chart or the stronger currency has the advantage.

Post by **nanningbob** » Sat Apr 12, 2014 1:01 pm

parallels gbp/cad long term advantage cad. First gbp/cad parallel down and then gbp/cad parallel up. Range trading.

Post by **nanningbob** » Sat Apr 12, 2014 1:17 pm

C. Cross up +20: Cross down -20

The third big indication on the CSS is the cross up above the +20 line (green dot) and the cross down below the -20 line (pink dot)

When you see this on the CSS it lets you know that there is a break out from its range and the currency will be going into a trend. These are the breakout points. If you are a breakout trader this will help you realize which currencies are about to break out and in which direction they will go.

(At this time I have no pics of the breakout dots because this indi does not work when markets are closed.)

Why the aud, chf, and cad work and not the others I have no idea.

Post by **nanningbob** » Mon Apr 14, 2014 2:52 am

CSS for 4.14

AUD is still on top but its rate of increase is slowing down. As long as it declines it will range with the other currencies that are angling up. So unless something spikes it up again it looks like its run up is coming to an end. If you see bad Chinese data come out this week then you will see it head back to the 0 line and the NZD go under the 0 line. If the Chinese data is good you could very well see another move up by those two with the NZD bouncing off of the 0 line and AUD staying on top.
NZD has slowed down and is reaching the 0 line. See AUD notes.
JPY is angling up and its rate of decline has slowed down. This is consistent with its end of the month strengthening we have often seen. It is consistent when aud and nzd go up JPY goes down; aud and nzd go down JPY goes up. So we see that scenario is being played out. BOJ and Japanese govt. officials keep talking about increasing their bond sales in May if the JPY continues to strengthen. I have often noticed that JPY officials try to talk their currency down and it often fails. We will see if they back up their talk, until then JPY strengthening will most likely continue through the end of the month.
GPB is in the middle like usual, so what else is new. It will be going up against those below it and going down with those above it. That GBP/NZD cross looks good to me. If it happens I see a lot pips coming my way as I buy the gbp/nzd.
EUR and CHF are rising, We will see if their DT will continue or its over for now.

I see a lot of range trading this week except the USD which is sell USD after every rally and dip. The others are all heading back to the middle. I am taking notice of gbp/nzd if they cross. In ranging markets the higher currencies will have better moves up during range times. Angling up to the 0 line and angling down to the 0 makes for range move. angling in the same direction is also range time with the advantage to the higher currency. For example aud/usd both are angling down but advantage belongs to the aud.

Good buy areas are jpy, chf, euro against the usd since they are angling up and usd is angling down.
nzd and gbp buys against the usd are good also since they are at the 0 line and USD is moving away.

Well have fun.

Post by **nanningbob** » Mon Apr 21, 2014 11:29 pm

Last week ended slow with Easter and most banks were closed Monday so here is my CSS report for the week. Commodity currencies angling down strong but that was with weak volitility. Everyone else angling up. take those crosses and see what happens. GBP is now passing the AUD and it becomes the top dog. Over 70% my profits last came from following the gbp as it crossed up over each line. Will follow that trend this week also. I also had some nice trades with the eur/nzd as it passed the NZD and am looking forward to some trades as it crosses the CAD and AUD probably later in the week. USD starting to turn up so will look for crosses there. JPY will probably continue to strengthen since it goes up when the commodity currencies go down. So simple week unless things suddenly change. Sell the cad, nzd, and aud. Buy GBP and JPY and Euro. USD watch and see if it continues up. Hopefully volatility will pick up now that the holiday is over and ................ Ukrainian elephant is still in the room.

molliere · Post by **molliere** » Tue Apr 22, 2014 7:31 pm

Thanks Nanningbob

I learned here in this forum more in 1 week than I learned about forex in the last 2 years
you mentioned that
"Ones near or outside the 20 lines. These can be your most volatile and can explode quickly. The reason is as one car (currency) is slowing down towards the stop sign, the other is speeding up away from the stop sign. So as each car passes the other the distance between them can accelerate quickly. This can also lead to a good strong move on your charts."
Is it correct to say that according the indi the GBP crossed the AUD outside the 20 line so the GBP can move up strongly from here against the AUD.

The JPY crossed the NZD within the 20 lines so it means a ranging market with the JPY stronger.

Is my interpretations regarding this currencies correct