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Stating The Obvious and The Quest For Wisdom

  • #901
  • Mar 19, 2010 11:05am Mar 19, 2010 11:05am
Quoting SunTrader
Why not look for some kind of confirmation in price before acting?
I 100% agree with that premise. If you take out the last 2 days of price action, there "was" chart confirmation of an up move. Thats why I took the long. It's looking bad on both fronts now so I have an out at 3400.

I wouldn't add to my position or take on a new one at this point, but if you're already sitting in one (like I am) its a question of temporary vs permanent correction. I'm still leaning towards temporary, but I'm not about to risk my whole account hoping I'm right. We'll just have to see how it plays out.
  • #902
  • Mar 19, 2010 11:44am Mar 19, 2010 11:44am
I should also mention that while its always a good idea to look for price action confirmation, it doesn't invalidate the point of my statement. If monday morning the EU and greece announce a completed deal, the euro is going to explode higher. The chart may look bad, but if people have a good excuse to buy, the chart doesn't matter.
  • #903
  • Mar 19, 2010 12:17pm Mar 19, 2010 12:17pm
Quoting Darkstar
I should also mention that while its always a good idea to look for price action confirmation, it doesn't invalidate the point of my statement. If monday morning the EU and greece announce a completed deal, the euro is going to explode higher. The chart may look bad, but if people have a good excuse to buy, the chart doesn't matter.
Which is why, I'm done for the week and will not hold any positions over the weekend. I'd rather play it safe with the unknown expectations of what may occur this weekend than play a weekend position, even though I just may benefit from it.
  • #904
  • Mar 19, 2010 12:26pm Mar 19, 2010 12:26pm
The Greece situation will definitely be a catalyst for what will happen next.. that part is a sure bet. I know that big guys usually take a bit to unload their positions so I wonder if waiting for confirmation from CoT will be waiting too long. What do you think in your opinion DS? Idk if you have watched the Tudor "Trader" documentary but I bet you would enjoy it.
  • #905
  • Mar 19, 2010 2:12pm Mar 19, 2010 2:12pm
Quoting Darkstar
The second its pierced, I save 200m and you lose your premium.
it is at 1.3800, right? Don't need to go at 1.3801?!
  • #906
  • Mar 19, 2010 2:30pm Mar 19, 2010 2:30pm
Quoting giraia_br
it is at 1.3800, right? Don't need to go at 1.3801?!
Yeah 1.3800.
  • #907
  • Mar 19, 2010 4:50pm Mar 19, 2010 4:50pm
Changes in Commitments from: March 9, 2010 :
Long 10,364

Short -18,132
  • #908
  • Mar 19, 2010 6:33pm Mar 19, 2010 6:33pm
Quoting Scotty B
Changes in Commitments from: March 9, 2010 :
Long 10,364

Short -18,132

EURO FX - CHICAGO MERCANTILE EXCHANGE Code-099741
FUTURES ONLY POSITIONS AS OF 03/16/10 |
--------------------------------------------------------------| NONREPORTABLE
NON-COMMERCIAL | COMMERCIAL | TOTAL | POSITIONS
--------------------------|-----------------|-----------------|-----------------
LONG | SHORT |SPREADS | LONG | SHORT | LONG | SHORT | LONG | SHORT
--------------------------------------------------------------------------------
(CONTRACTS OF EUR 125,000) OPEN INTEREST: 163,822
COMMITMENTS
41,800 88,141 1,431 82,124 32,720 125,355 122,292 38,467 41,530

CHANGES FROM 03/09/10 (CHANGE IN OPEN INTEREST: -79,702)
9,211 -18,999 -805 -87,489 -56,268 -79,083 -76,072 -619 -3,630

PERCENT OF OPEN INTEREST FOR EACH CATEGORY OF TRADERS
25.5 53.8 0.9 50.1 20.0 76.5 74.6 23.5 25.4

NUMBER OF TRADERS IN EACH CATEGORY (TOTAL TRADERS: 134)
40 52 11 19 31 66 87

Good news for guys building their longs. It just seems too unbelievable that they would let Greece falter. What is that a drop of around 17.7% for short positions and simultaneous 23% increase for long positions? From -74551 to -46341 net positions
  • #909
  • Mar 19, 2010 8:25pm Mar 19, 2010 8:25pm
Quoting Deusomega
EURO FX - CHICAGO MERCANTILE EXCHANGE...
Yes, the non commercials are all speculative. If Greece really goes bankrupt, the Euro is really going to suffer. As the leader of the French said, all this is doing is showing the world disunity in eurozone. The Germans keep whining about the problem and really don't want to deal with it, the longer this continues, the more capital will flow out of EU.

If the EU turns their back on Greece, I think we'll see parity or less in the next year. I am playing this hopeful still though.

I still see 1.25 regardless, it's just a matter of whether this retracement will materialize for now.
  • #910
  • Mar 19, 2010 8:56pm Mar 19, 2010 8:56pm
Quoting Scotty B
Yes, the non commercials are all speculative. If Greece really goes bankrupt, the Euro is really going to suffer. As the leader of the French said, all this is doing is showing the world disunity in eurozone. The Germans keep whining about the problem and really don't want to deal with it, the longer this continues, the more capital will flow out of EU.

If the EU turns their back on Greece, I think we'll see parity or less in the next year. I am playing this hopeful still though.

I still see 1.25 regardless, it's just a matter of whether this...
I am not huge on fundamental info at all, but I am reading in to this as well. It would be great if the markets were this simple, lol. The resolution of this event dictating the direction of the market so clearly would make the next few weeks easy play. I wont hold my breath however...
All I ask for is a chance to prove that money cannot make me happy.
  • #911
  • Mar 19, 2010 9:11pm Mar 19, 2010 9:11pm
Quoting Darkstar
The whole point of the attack is to take out the barrier. The trade is a stop hunt for you, me and anyone else helping the attackers but the attackers only care about the barrier.

For an example, Lets say I sell you a 200m DNT at 3600 and 3800. You get paid if the price remains within the range. I don't want to pay you the 200m, so I try to push price around until I can pierce one of those barriers. The second its pierced, I save 200m and you lose your premium.

Now think about that for a min... Where does the "rumor" on IFR come from? What...
I think hearing you call them attackers instead of hunters helps me to understand better what's going on. I understand that it makes sense for the writer of the option to leak word of it's existence. It's an opportunity for the hunters to go stop hunting and it saves the writer 200M.

If it's just the attackers and defenders playing the game, then it makes sense for the attackers to get out with a standing limit at or just above the stop order. If you're not fully filled, issue a market order for the balance. I guess my next question is, how many market participants know what going on at the time of the battle? If there are relatively few, and you can suck the technical traders into helping you via PA manipulation, then you'd probably be able to fully liquidate at the stop price with a single limit order.
  • #912
  • Mar 19, 2010 9:18pm Mar 19, 2010 9:18pm
Quoting Marsh
I am not huge on fundamental info at all, but I am reading in to this as well. It would be great if the markets were this simple, lol. The resolution of this event dictating the direction of the market so clearly would make the next few weeks easy play. I wont hold my breath however...
Thats what I think a lot of our problem is around here. We are failing to think like the guys and gals who actually move the market. I beleive they care way more about the fundamentals than any other factor. If they didn't, then why does news move the markets to such a strong degree? This week was a perfect example of this, as are most weeks. For the sake of learning, it's great to follow a currency in real time.

The biggest moves this week all came out of news or event flows as DS called it. Surprise? I don't think so.
  • #913
  • Mar 19, 2010 9:40pm Mar 19, 2010 9:40pm
Quoting Scotty B
I think hearing you call them attackers instead of hunters helps me to understand better what's going on. I understand that it makes sense for the writer of the option to leak word of it's existence. It's an opportunity for the hunters to go stop hunting and it saves the writer 200M.

If it's just the attackers and defenders playing the game, then it makes sense for the attackers to get out with a standing limit at or just above the stop order. If you're not fully filled, issue a market order for the balance. I guess my next question is, how many...
Sorry, I make up the titles and descriptions as I go. Glad it's making more sense. Your spot on as far as I can tell.

To answer your question... Its almost impossible to know. Its helpful to simplify it down to attackers and defenders, but the reality is there are probably dozens (if not hundreds) of participants all engaged in the event. Some know exactly whats happening and have chosen a side... others are obliviously doing their own thing. I wouldn't go looking down this rabbit hole though. KISS is the key.

As far as limit orders at the stop... thats exactly what they do. It's a probability distribution on the outcome of the stops being triggered. Sometimes the stops will be larger and price will spike higher, sometimes the limit will be higher and price will fall back. There is no way to determine the exact volume in advance so I just disregard it. I've NEVER had a problem getting filled on the stop level and I have swung a pretty mind numbing line at times.
  • #914
  • Mar 19, 2010 10:12pm Mar 19, 2010 10:12pm
Quoting Scotty B
Surprise? I don't think so.
No? Was the down direction not up a surprise.

What the news is is unimportant. It is what the market does with the news that is. Anyone that thinks that they know what the market will do, beforehand, with the news must have a time machine.
  • #915
  • Mar 19, 2010 10:23pm Mar 19, 2010 10:23pm
Quoting SunTrader
No? Was the down direction not up a surprise.

What the news is is unimportant. It is what the market does with the news that is. Anyone that thinks that they know what the market will do, beforehand, with the news must have a time machine.
I know for a fact that later this year the US economy will be in far better shape then it is now. I also know that at some point later this year the Fed will start raising rates. Both will be dollar positive and are definitly tradeable.

You don't need a time machine to predict the news; a basic understanding of macroeconomics, game theory, and some patience is pleny sufficient to make money on it.
  • #916
  • Mar 19, 2010 10:30pm Mar 19, 2010 10:30pm
Quoting SunTrader
No? Was the down direction not up a surprise.

What the news is is unimportant. It is what the market does with the news that is. Anyone that thinks that they know what the market will do, beforehand, with the news must have a time machine.
Hey Sun,

So you're saying that the market won't respond correctly to the news? Price changes because perceptions of value change. Take this week's news as example. Negative numbers, along with negative comments depreciated the Euro against the dollar. I don't understand how you can say the news is unimportant when price consistently responds to it in such a logical fashion.

I don't understand how you can trade the response to the news if that response is just random and counter intuitive anyways. I doubt that's what you mean, but it would be helpful if you explained your viewpoint in more detail.
  • #917
  • Mar 19, 2010 10:54pm Mar 19, 2010 10:54pm
Quoting Scotty B
Hey Sun,

....respond correctly to the news? ......price consistently responds to it in such a logical fashion.

I don't understand how you can trade the response to the news if that response is just random and counter intuitive anyways....
Respond correctly? Damnit I am going to file a complaint with the CFTC: the market does not respond correctly.

Have you ever tried to trade the news? I have/do. Scalp the resultant volatility from every orange/red news announcement scheduled in the FF news panel (E/U bearing, for me) for a year - then see what you learn about the market's tendency to "respond correctly."
"If The Fool persists in his Folly he will become wise." - William Blake
  • #918
  • Mar 19, 2010 11:48pm Mar 19, 2010 11:48pm
Quoting The Fool
Respond correctly? Damnit I am going to file a complaint with the CFTC: the market does not respond correctly.

Have you ever tried to trade the news? I have/do. Scalp the resultant volatility from every orange/red news announcement scheduled in the FF news panel (E/U bearing, for me) for a year - then see what you learn about the market's tendency to "respond correctly."
So you're saying that EU appriciated on all the bad news this week? Was the decrease in value incorrect or illogical?
  • #919
  • Mar 20, 2010 12:01am Mar 20, 2010 12:01am
Quoting Scotty B
So you're saying that EU appriciated on all the bad news this week? Was that incorrect?
No I just take issue with the assumption that there is a "correct response" to news. And I have come to this point of view through harsh experience. I don't believe that the fx market is random; there are clear & predictable cause/effect movements in the rates all the time, evidenced on any tf you want to look at. But it is on the whole huge, liquid and unpredictable and even the most logical results to major news announcements will fail to materialize often enough to burn even the savviest trader.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #920
  • Mar 20, 2010 12:05am Mar 20, 2010 12:05am
Oh by the way - thanks to DS and the other traders who recommended "Reminisences of a Stock Operator" here - it is proving to be a good read.

Free link:

http://www.stock-market-seminars.com...-livermore.pdf
"If The Fool persists in his Folly he will become wise." - William Blake
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