Friday, October 31, 2014

Currency Strength Meter 31/10/2014

The Yen continues to tumble after the surprise BoJ announcement of increased stimulus. The upper panel is daily bars, and the lower panel is hourly bars. It is weak and "over-sold" on both these time-frames, but this is definitely not one of those times where you go long.

Nikkei up over 6% on the day!

Compare the markets!

So far this year, the markets have been ...

Multi-Instrument Compare comparing the main equity markets, gold, oil, USD, etc. The values are % change since 1/1/2014.

BOJ announcement: EASES FURTHER – Expands monetary base target

Big news out of Japan (here courtesy of Forex Live). The day after the US formally / publicly announced the end of QE - interesting.

Big move on Yen and Nikkei.

Wednesday, October 29, 2014

Supply/Demand Indicator

Well, I've not had time to release the version of this indicator with my latest changes, so I am rolling the temporary keys again. Hopefully, this is the last such roll, and I will eventually finish testing the new improvements ready for release.

If you don't already have the indicator, you can download the indicator here. Installation instructions are in the accompanying documentation.

The temporary key (valid until 2014/11/13):
Supply Demand key: E328BA89F3F1365E2462FA43

Tuesday, October 28, 2014

Supply/Demand and Divergence

Putting Supply/Demand and Divergence together could be a useful strategy. I've been experimenting with both Supply/Demand zones and Divergence indicators.

(Divergence is a technical analysis tool whereby the price makes a higher high (or lower low) but the oscillator makes a lower high (or higher low). Divergence can be bullish or bearish, regular or hidden).

Here's some recent supply/demand zones with divergences marked on the chart.

Monday, October 27, 2014

DAX scalping EA

Most of my trading has been manual, discretionary trading. However, recently I have been looking at some simple automated strategies (some people refer to these as Expert Advisor or EAs).

I've implemented a simple Bollinger Band scalper. It uses 2 Bollinger Band levels, set at 1 and 2 standard deviations in this example. A long is entered if price crosses under the 2nd level, and then crosses over the 1st level. A short is entered if price crosses over the 2nd level and then under the 1st level. The strategy allows for partial profit taking, move to break-even and trailing stops.

This strategy is only deployed when the market is in a sideways phase or approaching a top or bottom. It should not be deployed when the market is in break-out or strongly trending mode. Essentially it is a mean-reversion strategy.

Looking reasonable so far. My intention is to use this for those dull side-ways portions of the day.

Tuesday, October 21, 2014

ECB looking into buying corporate bonds!

Sudden move on the EUR and DAX, seems to be attributed to this...

Here's the Currency Strength Meter, you can see the sharp drop on EUR (and CHF).

Sunday, October 12, 2014

Divergence indicator

I don't normally use oscillators, but I was intrigued by a recent discussion about divergence - something which I haven't used much myself. I wrote a small indicator to test the topic. This is still in development, but the basic feature is working. The indicators finds the highs and lows in the price and the oscillator, and determines whether there is regular (or hidden) bullish or bearish divergence.

Here's an example on the EUR/USD.

Friday, October 10, 2014

Stocks tumble

Whatever way you put it - it's not pretty.

Current year...

Current month...

The Multi-Instrument Compare indicator allows up to 10 instruments to be easily compared. The indicator is available on this blog and also on FXCM Apps.

Line Sync for MarketScope 2.0

Line Sync is available from this blog, and also on FXCM Apps.

Wednesday, October 8, 2014

Currency Strength Meter during FOMC minutes release 8/10/2014

It's kind of fun to watch the Currency Strength Meter during a big news event like the FOMC minutes release. I recorded today's minutes and immediate aftermath.

I set it up on 1 min chart. In this video, the Currency Strength Meter is post-processed using MACD(1, 200) on the upper panel and RSI(14) on the lower panel. Both are considered to measures of momentum, and therefore strength. The audio on the video is from RANSQUAWK. I speeded up some of the more boring bits.

For best results view in YouTube at 720p HD.

The Currency Strength Meter is available from this blog or on FXCM Apps.