Time Cell Trading

If not so, then the positions could be hedged,..., no problem at all.

EURUSD, M15, 2011 February 01

M15 looks like this...

Volatilities
http://www.mataf.net/en/tools/02-01-volatility

In finance, volatility most frequently refers to the standard deviation of the continuously compounded returns of a financial instrument within a specific time horizon. It is common for discussions to talk about the volatility of a security's price, even while it is the returns' volatility that is being measured. It is used to quantify the risk of the financial instrument over the specified time period. Volatility is normally expressed in annualized terms, and it may either be an absolute number ($5) or a fraction of the mean (5%).
http://en.wikipedia.org/wiki/Volatility_%28finance%29

http://www.tradingmarkets.com/.site/...lity-79092.cfm

5 Steps For Trading In Forex Market Volatility
By Richard Lee

An increase in market volatility often leads traders to find a lot more trading opportunities. The huge market usually swings lots of potential for gain, but also for loss, especially if traders do not take the necessary precautions.
During times of volatility, traders need to adjust their strategy to compensate for erratic market. The FX Markets also provides a great section on their site showing traders which currency pairs are experiencing the most and least volatility that day.

1. Decrease in Leverage
During times of extreme volatility, losses may seem traumatic. With the average daily pip movement increased in volatile times, traders should be considering how their leverage will affect their trades. At a one percent or even a half percent margin, investors should be mindful of how much leverage, or even the size position being traded, can affect their portfolio.
In normal market conditions, placing a 2 lot position is fine when you are looking to make about 50-100 pips. During a more volatile time, when the potential loss is 100-200 pips, it stops being an effective risk to reward ratio. To compensate, traders should look to taking on smaller trading positions, in this case only one lot as opposed to the average 2 lot position.


2. Use Tighter Stops
Many traders are hesitant to use tighter stops in volatile markets because they see the large swings increases the likelihood that the position will be taken out. Having tighter stops can also provide great risk managers in times of extreme volatility. For example, on a EUR/USD trade, rather than setting an 80 pip stop to protect your position, consider placing a 50-60 pip stop. This will insure the protection of your currency position and if the stop is broken, there is a higher likelihood that the trend will continue lower and the stop took you out before you could potentially lose more money.
The width of the stop being set does depend on the currency pair being traded, as some pairs have wider ranges. In a Yen cross like the GBP/JPY or AUD/JPY, traders may be more likely to have wider stops as their average daily range is 50% more than that of the EUR/USD. With that said, stops during volatile market conditions should not be as wide as before. Instead of a stop of 100 pips below entry, traders may consider a 25 pip reduction and have a 75 pip stop.


Below is a chart showing the EUR/USD and the GBP/JPY on the same very volatile day in the forex market. The EUR/USD had an impressive range of nearly 600 pips! The GBP/JPY far dominated though with nearly a 2000 pip trading range.


http://images.tradingmarkets.com/200...o/1105Lee1.jpg

3. Be Selective with Trades
In volatile market conditions, traders are often tempted to place an increase in trades as the market is going wild and they want to take advantage of all the trading opportunities. It is important to remember that in volatile times, losses are likely to be big. Before placing a trade, assess risk tolerance levels. How much risk is acceptable for the trader both psychologically and financially? It may be a good idea for a trader to shift their interest somewhere else until things settle down, instead of trading a violent pair.


4. Increase Discipline When Trading
During all market conditions, traders should follow their predetermined trading strategy. During volatile market conditions, it is important to use that same level of restraint and self discipline. Any set stops, contingency plans or risk management benchmarks must be adhered to without hesitation. This will help in defining how much risk is taken and should price action be uncontrollable.



5. Know Before You Go
It also helps a trader to know what is causing the current spate of volatility in the markets in order to be prepared for the unexpected. As such, an investor can accommodate their strategy to the market environment and not just the currency pair being traded. The first of these considerations is accounting for emotions in a market: is fear currently driving the market lower? Or is it buyer's mania that is keeping the bullish tone alive? Traders' overreaction and emotion tend to push markets to overextended targets. This fact alone creates volatility through simple supply and demand.
Volatility can also, and more than likely will, be sparked by economic events. In this instance, market participants may interpret fundamental data differently and not as cut and dry as the more novice trader. A perfect example of this is usually monthly manufacturing reports that are released in pretty much all industrial economies.


The classic scenario has the market honed in on a particular number for the month. However, traders young and old will sometimes wonder why the market sold off if manufacturing showed positive growth. The answer is simple. The market had a different interpretation and positions were violently reshaped and shifted. These tend to create great opportunities for some and horrible memories for others. Below is an hourly chart of the EUR/USD during ISM Manufacturing for October 1, 2008. Here we can see the huge price gap that occurred due to market volatility as well as the resulting trend.


http://images.tradingmarkets.com/200...o/1105Lee2.jpg


Panic and erratic momentum can additionally be found in certain market environments. Not to be confused with fear or greed, panic selling and buying can create very choppy and relatively untraceable markets. These conditions will lead some to flip flop their positions while leaving others gaping at the fact that the position was right, only to be stopped out prematurely. These two common examples will create further panic and volatility as traders abandon their own individual strategy for the possibility of instant profits or stoppage revenge. As a result, a vicious cycle of volatility ensues until a definitive market direction can be established.
The simple rules above, and a task of getting to know the current trading environment, can empower every trader through the ranks. Although some relate volatility with difficult and untouchable markets, opportunities continue to remain abound in these less than attractive conditions to those focused and fortunate.


By following these five simple steps, trading in volatile market conditions should be a little simpler. Remember to adjust leverage based on volatility, stick to how much risk your trading plan already determines, use tight stops and don't jump into every trade that looks good.


Richard Lee is the Chief Currency Strategist for Online Forex Trading, a forex website that focuses on providing unbiased forex broker reviews as well as forex news. Richard has been featured on Bloomberg, FX Street, Yahoo Finance and DailyFX.

http://forex-indicators.net/volatility-indicators

Forex Volatility Indicators
Volatility Indicators show the size and the magnitude of price fluctuations.
In any market there are periods of high volatility (high intensity) and low volatility (low intensity).

These periods come in waves: low volatility is replaced by increasing volatility, while after a period of high volatility there comes a period of low volatility and so on.

Volatility indicators measure the intensity of price fluctuations, providing an insight into the market activity level.

Volatility Indicators:
Average True Range (ATR)
Bollinger Bands (BB)
Bollinger Bands Width
Chaikin Volatility (CHV)

The methodology of using Volatility indicators
Low volatility suggest a very little interest in the price, but at the same time it reminds that the market is resting before a new large move
Low volatility periods are used to set up the breakout trades. For example, when the bands of the Bollinger bands indicator squeeze tight, Forex traders anticipate an explosive breakout way outside the bands limit.

A rule of thumb is: a change in volatility leads to a change in price.

Another thing to remember about volatility is that while a low volatility can hold for an extended period of time, high volatility is not that durable and often disappears much sooner.

EURUSD, M5, 2011 February 01
Trade Example

EURUSD, Daily, 2011 February 01

Global View

EURUSD, M30, 2011 February 01

M30 Divergence could be seen.

Yes i understand your view. Now on the note of volatility, as you posted some info in that just now and as we are seeing a lot of that right now i am wondering if you know any website that tries to make predictions of volatility/volume based on scheduled news and things like that? To me there is no real difference between volatility and volume, and i really need a way of at least giving me some indication of what volumes to expect during the day.

On another note i asked you a while ago if you used specific levels for CCI, watching if anything significant happens at these times. You told me you hadnt delved into that specifically. On that note i want to tell you that i use CCI 20, typical price with such levels at 190 and -190. Applied to E/U M1. So heres what it means to me: Beyond/above those levels price is strongly bought/sold, thats the basic interpretation. But thats not all: If this level is surpassed fast, often in one candle, then the re-entry is a key moment, the 190 is a decent reason to sell, the -190 is a decent reason to buy. Now i would not enter a trade based only on that, but watch it and you can see there is at least something to it. As you and i well know, you need more reasons then one to enter a trade, but it is a guideline i use as well as envelopes, moving averages, S/R and stochastic.

By the way i sometimes enter a trade, it goes well and i close it and afterwards i realise it was a CCI divergence, and then i think of you.

Anyway happy pipping meanwhile and ill check back with you in a while.

P.S. I see brent crude has just touched 102 USD, oh how the yankies will whine and dine over their "expensive" gasoline, here its about 2 USD/litre (13+SEK) because of our high taxes on gas.

http://www.investopedia.com/articles...tner=fxweekly1


Taking Advantage Of Central Bank Interventions

by Richard Lee (Contact Author | Biography)
It seems that every country's central bank these days is involved in some sort of capital control over their currency. Set aside from standard monetary and fiscal strategies, these policies are used to keep domestic denominations under control while keeping a country's growth stable. One of the most frequented strategies used by policy makers is direct market intervention. Japan's central bank has used the strategy on more than one occasion. By printing Japanese yen to sell, and buying back U.S. dollars, the Bank of Japan is controlling the value of its exchange rate against the American currency. (To learn more, see The U.S. Dollar And The Yen: An Interesting Partnership.)

But that's not the only method that is being used, and the Bank of Japan is certainly not the only one intervening in the FX market. So let's take a look at some other capital control strategies that are being used by global central banks and how to take advantage of such an opportunity.

Korea's Intervention
South Korea, with an export economy similar to Japan's, is a country that has also been known to intervene in the foreign exchange markets directly in order to control the rise and fall of its currency, the South Korean won (KRW). But things have changed, and South Korea's central bank is looking for additional means of control. An alternative to applying direct intervention in the markets, government officials and the Bank of Korea are beginning to audit banks and larger institutions handling currency market transactions.

Aimed at curbing speculation, the regulations tighten requirements on the country's banks trading in large currency derivatives, potentially punishing those that are unprofessionally or improperly transacting in the market.
Aiding in the reduction of currency speculation, the strategy increases government scrutiny over market positioning and would support higher requirements on currency positions for foreign currency speculators. All in all, the measure looks to gradually reduce interest in the South Korean won as it becomes more costly to trade currency in the country.
Another way to curb interest and speculation in a country's currency is through higher foreign investment taxes.

Brazil's Tax Change
The Brazilian government implemented measures in order to curb its own currency's speculation – aside from directly selling Brazilian reals and buying U.S. dollars. One such measure is to increase the foreign tax rate on fixed income (or bond) investments. The tax rate would affect foreign investors attempting to take advantage of a stronger BRL/USD exchange rate through large purchases of Brazilian bond investments. Originally at 2%, the tax rate increased to 6% as of October 2010.
Increasing the country's foreign tax rate is going to make transacting in Brazil more costly for speculators in banks and larger financial institutions abroad – supporting a disinterest in the Brazilian currency and decreasing the amount of "hot money" flowing into the Brazilian economy. (To learn more, see The New World Of Emerging Market Currencies.)

Using Central Bank Interventions to Your Advantage
Global central banks sometimes refer to strategies and tools that are already at their disposal. We all know that market speculation accelerates when central banks raise interest rates. During these times, investors look to capture any yield difference between their own currencies and higher yielding currencies. But, in times of massive market speculation, central banks may be forced to actually cut interest rates – hoping to deter any speculation on higher interest rates.

Central banks lowering interest rates are hoping to narrow the yield differential with other economies – making it less attractive for currency speculators attempting to take advantage of a wider yield difference. But, how can one take advantage of these opportunities?
It's simple. Although central banks apply capital controls on their domestic currencies, these policies tend to do little damage to the overall trend. In the short term, the announcement will temporarily shock markets. But, in the long run, the market ultimately reverts back to its original path. (Learn more in Interest Rates Matter For Forex Traders.)

An Example of How to Profit
Announcements of intervention offer great opportunities to initiate positions in the same direction as the recent trend. Let's take a look at the direct intervention efforts of the Bank of Japan on September 15, 2010.
In Figure 1, the USD/JPY exchange rate was moving lower since May 2010 on massive currency speculation. It was during this time that traders bought Japanese yen and sold U.S. dollars on the news that China was investing in Japanese bonds. The momentum helped the Japanese yen appreciate against the U.S. dollar from an exchange rate of about 95 per U.S. dollar to 84 in a matter of three months.



http://i.investopedia.com/inv/articl...ntralBank1.gif Figure 1

As a result of the yen's quick appreciation, the Bank of Japan decided to intervene for the first time in six years. At 84, the USD/JPY exchange rate was becoming too much for exporters to handle. The stronger yen was making Japanese products uncompetitive overseas. The announcement caused the USD/JPY currency pair to jump almost 300 pips overnight. In Figure 2, we can see the effects of intervention on our daily chart.



http://i.investopedia.com/inv/articl...ntralBank2.gif Figure 2
Now, this is where it gets interesting. The intervention efforts by the Bank of Japan drove the currency to test projected resistance (red line) dating back to the currency's short-term top in May. Zooming in (Figure 3), we can see that the next two days produced two dojis just below support at 86.00 (red line). Dojis signify that momentum in the market following the intervention is exhausted – a sign of resistance failure.



http://i.investopedia.com/inv/articl...ntralBank3.gif Figure 3

Attempting to enter into the current bearish trend, we place a short entry at 85.50. This is just enough to confirm a breakdown in the short-term price action while remaining just below the 86.00 support. A corresponding stop is placed about 100-125 pips above our entry price - just enough to keep us in the position.
As expected, the overall bearish USD/JPY market trend continued with the pair dropping to support 80.25 before retracing a bit. This makes the USD/JPY short trade profitable by a maximum of 525 pips – maintaining a risk to reward ratio of almost five to one.



http://i.investopedia.com/inv/articl...ntralBank4.gif Figure 4
Bottom Line
With increased speculation in the market, central banks will continue to apply capital controls in order to control their currency's exchange rates. These present great opportunities for retail investors and traders to seize entries into longer-term trends – as intervention scenarios rarely work for the policy makers. (For a step-by-step guide to trading forex, check out our Forex Walkthrough.)

by Richard Lee (Contact Author | Biography)

Richard Lee is currently a contributing editor of the Daily Reckoning. Employing both fundamental and technical models, Lee has previously been featured on DailyFX.com, Bloomberg, FX Street.com, Yahoo Finance and Trading Markets.com. In analyzing the markets, he draws from an extensive experience trading fixed income and spot currency markets in addition to previous stints in options, futures and equities.

Today

Profit: 5'892.68$

(Target 1'000.-$ a Day)

Hi Yaed

That's not correct. I have make many trials with the CCI at different levels, before I go public at FF with the CCI(14), ...before so also the CCI 20. My final results have get the option that the CCI14 is for my trading style with the multiple time frame analyzes the favored one.

Kindest regards
FXcube

Hi Yaed

I wish you success & happiness!

FXcube

Hi yead

Here're some Basics
Volume is volume of trades. In exchange-based markets, discrete information about the quantity of trades over delta t is available. In forex, however, one relies on price ticks per delta t.

Momentum is rather subjective. In my case, I view momentum as how the bullish moves compare to the bearish moves. If one side is bigger than the other, the momentum is "heavier" towards one side.

Volatility is a measure of price displacement over delta t. I guess you can also call it speed, as volatility does not tell you exactly where price is going or if it is even going anywhere, for that matter. ATR is a good measure of volatility and you'll notice that it changes throughout the day as sessions begin and end.


You can google all these by yourself. I'm not your secretary!

e.g.
google search: "volume volatility forex" (287'000 results 0.22 sec.)

I won't waste time on it!


Kindest regards
FXcube

Here are two links I found on google for this search:

http://fuckinggoogleit.com/

http://lmgtfy.com/?q=volume+volatility+forex

there you go! all you need

2011 February 03

Profit: 8'550.89$

(Target 1'000.-$ a Day)

Closed Trades Today

see #1516 et seq., please.


self-explanatory!

DR1 1.3762 (2011 February 01) - DS31.3570 (2011 February 03)

Profit: +192 pips

see #1518 et seq., please.

...the same at H4

see #1519, please.


...the same at the daily chart.

see #1517, please

...and here again (H1)