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Mysterio's Cable Corner -- Key Levels, Price Action & Order Flow

  • #381
  • Jan 27, 2023 9:55am Jan 27, 2023 9:55am
Quoting Coxswain
Mysterio I have been following the GBP/USD forum for a while and you have stood out amongst the crowd,so much so I have decided to finally join FF. Your hard work has paid off for you,I can personally appreciate what it takes. I commend you and will keep watching and learning from you. Thanks for your time and efforts. The Coxswain
great to hear man- thats the first i've heard of someone joining to post a comment for me! appreciate it

I have indeed made a ton of sacrifices but I have a slightly obsessive personality which you need to try in succeed in this difficult game. Personally Pat Chiko is the best i've seen on this forum just consistently smashes it. I still suffer from occasional trading psych issues which I haven't quite mastered

By chance i checked GU and I see the market has moved down yet again, we may see another buy around 1.2337
  • #382
  • Jan 27, 2023 10:04am Jan 27, 2023 10:04am
Roger that
  • #383
  • Jan 27, 2023 10:18am Jan 27, 2023 10:18am
im hoping thats the final lqg of the day

long@ 351

target 21:50 hours gmt tonight
  • #384
  • Jan 27, 2023 10:56am Jan 27, 2023 10:56am
Quoting Coxswain
im hoping thats the final lqg of the day long@ 351 target 21:50 hours gmt tonight
i stop trading at 4pm uk time

the market has left EQL with the PDL

not sure if thats being left for next week or what
  • #385
  • Jan 27, 2023 11:21am Jan 27, 2023 11:21am
Some food for thought over the weekend

It is often said that FX is a zero sum game and that for you to win someone needs to lose, this can be quite a daunting thought

However most participants in the FX market use it for hedging foreign index returns back to domestic currency. They use it for risk reduction. They dont care about winning or losing they just want the returns of, say, Japanese equities to be of the index and not have added currency volatility. I know of no institutional level pure discretionary FX fund from working as an investment consultant previously.

Hedge funds, yes, will take position trades in FX along with a basket of other positional trades. But hedge funds make up a relatively small portion of money invested in markets. The standard institutional pension fund (pension funds being probably the largest block of investors) will have less than a 5% allocation to hedge funds. The vast bulk will be in equities and bonds, and the larger funds (say, over $2bn) will likely have a LDI (liability driven investment) overlay made up of derivatives like interest rate swaps.

The previous Chancellor almost crashed the UK's finances completely, a day away from an IMF bailout because of a massive LDI crisis. The LDI models and the people that design them (I used to be one) hadn't factored in such a dramatic shift in Gilt yields and it caused a black swan type event.

So the money you're pocketing is likely not coming from the pocket of some hapless retail trader but instead, a hedger.

That is, if the broker even executes your trade which they probably do not unless you're a sizeable trader.
  • #386
  • Jan 27, 2023 11:34am Jan 27, 2023 11:34am
Quoting mysterio
Some food for thought over the weekend It is often said that FX is a zero sum game and that for you to win someone needs to lose, this can be quite a daunting thought However most participants in the FX market use it for hedging foreign index returns back to domestic currency. They use it for risk reduction. They dont care about winning or losing they just want the returns of, say, Japanese equities to be of the index and not have added currency volatility. I know of no institutional level pure discretionary FX fund from working as an investment...
Well put but possibly a slightly simpler explanation. A company sells to a foreign country and often the sale is denominated in US $ even if that isn't the currency of the country. An example. Microsoft sells to the UK in a US $ contract. In the Uk to control expenses, the UK company wants to ensure that they can recognize a fixed expense for the purchase. They enter into a forward FX contract. Between the day that the contract is paid and the day that it is signed, forex is used to control the level of the expense, sometimes reduce and sometimes increased but with good forex management it becomes a controllable and controlled cost.

In a previous life, I managed pension funds for a multi-national. Very complex. It also relies heavily on effective forex management. Well at least when I ran it, we protected pension income.
  • #387
  • Jan 27, 2023 11:45am Jan 27, 2023 11:45am
Quoting dantpm
{quote} Well put but possibly a slightly simpler explanation. A company sells to a foreign country and often the sale is denominated in US $ even if that isn't the currency of the country. An example. Microsoft sells to the UK in a US $ contract. In the Uk to control expenses, the UK company wants to ensure that they can recognize a fixed expense for the purchase. They enter into a forward FX contract. Between the day that the contract is paid and the day that it is signed, forex is used to control the level of the expense, sometimes reduce and...
.
Ah, I used to do the same, we'd probably have a lot to talk about. I was a consultant though, was responsible for 30 different DB schemes in the UK. Many of those were smaller and didn't need much management beyond quarterly asset allocation reviews. Largest was 6bn GBP and considerably more complex. I've worked as an investment manager for a family office and individuals too. Quite honestly I found the work quite tedious. Had to endure the CFA exams too.

What you're saying is correct indeed
  • #388
  • Jan 27, 2023 11:53am Jan 27, 2023 11:53am
Quoting mysterio
{quote}. Ah, I used to do the same, we'd probably have a lot to talk about. I was a consultant though, was responsible for 30 different DB schemes in the UK. Many of those were smaller and didn't need much management beyond quarterly asset allocation reviews. Largest was 6bn GBP and considerably more complex. I've worked as an investment manager for a family office and individuals too. Quite honestly I found the work quite tedious. Had to endure the CFA exams too. What you're saying is correct indeed
In the mid 80's I was based in London, working for an oil field company with operations in every country that had an offshore or onshore oil well. Smaller than what you are describing but there was over a bn under management!
  • #389
  • Jan 27, 2023 11:59am Jan 27, 2023 11:59am
The tricky work is the actuarial modelling of pensioners and designing a fixed income basket to match the liabilities

A lot of it is standard annualized return assumptions for different asset classes

To be honest, it's not work I ever want to go back to. Covid lockdowns gave me the excuse I needed to go full time trading, self employment has been one of those long held life goals.

I read a book called 'The Obastacle is the Way', based on Greek stoic philosophy and using adversity to your advantage. Great little read if you ever get a chance. After that I was inspired to give trading on my own another go. I wasn't enough of a high achiever in school days (party animal) to get a job trading for a bank which is almost impossible these days unless you have a top flight education.

The lockdown policy was obviously utter lunacy but without it, I may still have been grinding away in an office building somewhere.
  • #390
  • Jan 27, 2023 12:07pm Jan 27, 2023 12:07pm
Quoting mysterio
The tricky work is the actuarial modelling of pensioners and designing a fixed income basket to match the liabilities A lot of it is standard annualized return assumptions for different asset classes To be honest, it's not work I ever want to go back to. Covid lockdowns gave me the excuse I needed to go full time trading, self employment has been one of those long held life goals. I read a book called 'The Obastacle is the Way', based on Greek stoic philosophy and using adversity to your advantage. Great little read if you ever get a chance. After...
It was a different time. At that time this senior employee plan's goal was to maintain a disposable pension income at least equal to the individuals then current income, inflation-adjusted. In the early 2000's this type of pension program was no longer possible for most employees.
  • #391
  • Jan 27, 2023 12:19pm Jan 27, 2023 12:19pm
It's all Defined contribution now which is a much worse deal for the pensioner but better deal for the company

DB schemes are pretty much all legacy now
  • #392
  • Jan 28, 2023 3:10am Jan 28, 2023 3:10am
well then i'll say something about it.
i was an equity trader from an early age, just for my own money. the last time i worked as a hedge fund manager long short equity was more than 10 years ago.

i never really wanted to do that, because i only ever wanted to manage my own money. the "managing other people's money" thing got me out of the concept and i had to learn it the hard way again, via forex, because i was fascinated by the idea of getting profits out of the market every day.

nothing, nothing at all, beats your own independence. i am accountable to no one but myself. if i have earned enough for the day, i can go to the forest or to the café.

and some employer has not been able to force me to take vaccinations, as was the case with many in our oh-so-free democracies.
trading is like dancing, don't think and just listen to the music!
  • #393
  • Jan 28, 2023 4:01am Jan 28, 2023 4:01am
Quoting birdland
well then i'll say something about it. i was an equity trader from an early age, just for my own money. the last time i worked as a hedge fund manager long short equity was more than 10 years ago. i never really wanted to do that, because i only ever wanted to manage my own money. the "managing other people's money" thing got me out of the concept and i had to learn it the hard way again, via forex, because i was fascinated by the idea of getting profits out of the market every day. nothing, nothing at all, beats your own independence. i am accountable...
Excellent, you must have such a wealth of knowledge, great to have you here

I don't want to get too political but yea- I made a decision not to get the mrna vaccine and appear to be vindicated in that decision given the emerging evidence

The shackles of having to turn up for a 9-5 is so against my personality; I knew within a few months of re-entering the industry after a long stint in Canada trying my hand at starting businesses that self employment gave me a sense of motivation and drive that in and of itself gave me a kind of existential joy and true freedom that I knew I had to pour myself into trading for a living. I think my subconscious craved the redundancy. I don't think anyone in the office actually wanted to be there beyond supporting their families. I was client facing but the pay wasn't even that stellar.

It has not been an easy ride but I not can't imagine doing anything else
  • #394
  • Jan 28, 2023 7:06am Jan 28, 2023 7:06am
I have been working on identifying tools to assist with the preparation of daily charts for this forum.
Here are a couple of contenders from Tradingview:
Day Trading Booster by DGT (set the sessions to range, hide the Global Forex ..., hide price). It is ineffective in the 1 min time frame. Provides session high and low, support and resistance levels and more.
Smart Money Concepts by Lux provides market structure, order blocks, FVGs and more
Market Structure BOS/CHOC/MSB/OB... by Nephew Sam has a pretty obvious title, the only change I made was to extend boxes and hide them after they are filled
Super OrderBlock / FVG / BOS Tools by Makuchaku is another
Fair Value Gap by SpacemanBTC provided fair value gaps in multiple time frames.
Key Levels by SpacemanBTC is great for all of your daily, weekly and so on highs, lows, etc

If you are using something else that you are happy with, please share it.
  • #395
  • Jan 28, 2023 7:21am Jan 28, 2023 7:21am
Quoting mysterio
{quote} refer to my previous posts, i forecast this level {image}
If you really forecasted all these trades before happening than my compliments to you
  • #396
  • Jan 28, 2023 7:32am Jan 28, 2023 7:32am
Quoting Merka
{quote} If you really forecasted all these trades before happening than my compliments to you
Check the timestamps if you wish

Not gonna lie though that was an unusually good day

First week of this year I struggled and stopped midweek

One of the tougher aspects of trading is recogizing the different phases of the market and adjusting your approach accordingly.

Last couple of weeks of December in contrast were an absolute breeze

We can delve into these topics along with trading psychology as the thread progresses
  • #397
  • Jan 28, 2023 8:08am Jan 28, 2023 8:08am
Quoting dantpm
I have been working on identifying tools to assist with the preparation of daily charts for this forum. Here are a couple of contenders from Tradingview: Day Trading Booster by DGT (set the sessions to range, hide the Global Forex ..., hide price). It is ineffective in the 1 min time frame. Provides session high and low, support and resistance levels and more. Smart Money Concepts by Lux provides market structure, order blocks, FVGs and more Market Structure BOS/CHOC/MSB/OB... by Nephew Sam has a pretty obvious title, the only change I made was...
Go for it, whatever makes it easy for you

I prefer doing it all manually

I've tried the order block indicators and honestly find them quite useless

If you want a good educator for supply and demand I recommend checking out white oak fx. Canadian guy named Kevin with a wealth of experience. More of a swing approach but he teaches S&D properly, frequently I see supply and demand being used improperly but it's a great way to view the market. I have no affiliation he's just one of the genuine educators out there. Anyone with a job and wants to learn to trade part time alongside their job and can only devote say an hour or two a day I'd say start with his course.

ICT is good too, I'm gonna go ahead and say he basically teaches the turtle soup setup alongside some supply & demand and hidden gap stuff but, that is no bad thing

I think every trader should study volume analysis in some depth too.
  • #398
  • Jan 28, 2023 6:22pm Jan 28, 2023 6:22pm
Quoting mysterio
{quote} Go for it, whatever makes it easy for you I prefer doing it all manually I've tried the order block indicators and honestly find them quite useless If you want a good educator for supply and demand I recommend checking out white oak fx. Canadian guy named Kevin with a wealth of experience. More of a swing approach but he teaches S&D properly, frequently I see supply and demand being used improperly but it's a great way to view the market. I have no affiliation he's just one of the genuine educators out there. Anyone with a job and wants...
I'm a S&D trader as well but always struggled with why certain zones don't work and others yes.
Maybe volume and or order flow are the answers?
TBH never used volume because in FX is useless unless you pay for it.
  • #399
  • Jan 28, 2023 7:57pm Jan 28, 2023 7:57pm
Quoting Merka
{quote} I'm a S&D trader as well but always struggled with why certain zones don't work and others yes. Maybe volume and or order flow are the answers? TBH never used volume because in FX is useless unless you pay for it.
The answer S&D fails is seen in the order flow data, of course after it fails.

Reason 1 .... Cascading stop pools
Reason 2 ..... Strong Volume with market trades in the bias of direction
Reason 3 ...... Market weakness within the resistance zone due to lack of aggressive market orders.

50% of the times you can "work it out before and during its visit to the zone"
50% of the times we have no fuckin idea which way it will go to after.
Trading thin liquidity at the boundary of the charts
  • #400
  • Jan 29, 2023 4:55am Jan 29, 2023 4:55am
Quoting Merka
{quote} I'm a S&D trader as well but always struggled with why certain zones don't work and others yes. Maybe volume and or order flow are the answers? TBH never used volume because in FX is useless unless you pay for it.
Correct, it is useless unless you pay for it

What Rick says I agree with too
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