Hello and welcome.
It is me, the Mr BubaYaga. and today I share.. something.
Now, try pay attention.
First, you need data. a few years or greater is good. The data you require is a simple calculation. For this example, I will use daily chat value close, let's use EURUSD+USDCHF-EURCHF=(1.11499)+(1.00961)-(1.125745)=0.998855
Now you need to plot this number on a chart (for this example, 3 years of data, daily chart) - line chart.
Using correct lot sizing to normalize tick value, this 3 pair hedge is a market neutral position, but if you plotted the above calculation you will see this value oscillates (because lot size tick normalizing has not been applied).
Now you can see the extremes (statistically this unbalanced hedge is overbought, or oversold).
It is me, the Mr BubaYaga. and today I share.. something.
Now, try pay attention.
First, you need data. a few years or greater is good. The data you require is a simple calculation. For this example, I will use daily chat value close, let's use EURUSD+USDCHF-EURCHF=(1.11499)+(1.00961)-(1.125745)=0.998855
Now you need to plot this number on a chart (for this example, 3 years of data, daily chart) - line chart.
Using correct lot sizing to normalize tick value, this 3 pair hedge is a market neutral position, but if you plotted the above calculation you will see this value oscillates (because lot size tick normalizing has not been applied).
Now you can see the extremes (statistically this unbalanced hedge is overbought, or oversold).
Well sir, looks like you're playing checkers at a chess match.