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Technical Analysis Fallacy

  • #24,861
  • May 12, 2011 12:42am May 12, 2011 12:42am
Quoting jacson101
Well put, seems too big too fail only has one blessing from the CB, no one else that I can see would be behind (or is) this type of arrangement.

Regards.
http://www.reuters.com/article/2011/...74A3GZ20110511
noted, thanks jacson.

regards
  • #24,862
  • May 12, 2011 12:54am May 12, 2011 12:54am
interesting chart:

Also, I hear that the interbank may be switching platforms from reuters dealing to something else?
Attached Image
  • #24,863
  • May 12, 2011 1:02am May 12, 2011 1:02am
Quoting fti
Hedging.
whats so funny boss?

is it hedging negative correlating currencies a risk on to intself so it cannot be seen as inverted, hedging position per se?

"forage on enemy supplies" its how we avoid risking the bottom line
AVT INVENIAM VIAM AVT FACIAM
  • #24,864
  • May 12, 2011 1:10am May 12, 2011 1:10am
Quoting MaMood
Hi friends,

I want to ask you a question. I'm taking that one with me for a long time already. I'm very unsure about your reactions and comments. However - I decided to just ask you. I'm sure you will give me your honest opinion ....

Would it be of any use for you or some newcomer, when I would provide my trading live and in realtime to you? Im trading nearly almost every day and I'm making good profits also nearly every day. So it could give you an idea, how straight it could be to trade the dance actively.

Yeah - I'm aware of possible...
That would be great......like someone said.....running with the torch. Let me know when you do it.
  • #24,865
  • May 12, 2011 1:10am May 12, 2011 1:10am
Quoting the redlion
whats so funny boss?

is it hedging negative correlating currencies a risk on to intself so it cannot be seen as inverted, hedging position per se?

"forage on enemy supplies" its how we avoid risking the bottom line
Hi RedLion,

very easy to explain.
fti's is not laughing about hedging in the most serious sense, but about having long and short positions in the same pair at the same time. Something that is considered as "non-sense" ;-)

Cu,
Niels
  • #24,866
  • May 12, 2011 1:35am May 12, 2011 1:35am
Quoting MaMood
Hi RedLion,

very easy to explain.
fti's is not laughing about hedging in the most serious sense, but about having long and short positions in the same pair at the same time. Something that is considered as "non-sense" ;-)

Cu,
Niels
Hedging is a profession, Arbitrage is a profession.Even speculation can be made profession , if know how to manage risk.
Speculators Hedging?

regards
  • #24,867
  • May 12, 2011 1:48am May 12, 2011 1:48am
Quoting fti
Hedging is a profession, Arbitrage is a profession.
Speculators Hedging?

regards
arbitrage traders - arbitrageurs
hedge traders - hedgers
speculate traders - speculators
market maker - marketmakers?
To Live is the rarest thing in the world , Most people exist , that is all
  • #24,868
  • May 12, 2011 1:59am May 12, 2011 1:59am
Quoting fti
Hedging is a profession, Arbitrage is a profession.Even speculation can be made profession , if know how to manage risk.
Speculators Hedging?

regards
Hedging is the antithesis of speculation...I've never understood how so many people are convinced that there is some magic in "hedging"(net squared positions), and they cannot be persuaded otherwise. Always good for a laugh though.
  • #24,869
  • May 12, 2011 2:06am May 12, 2011 2:06am
managing risks is a tricky thing.

and although i was under the impression that attacks and rescues were merely a flexible scale in strategy.

ive been running some calculations and i have changed my mind.
listening to the art of war opened a different strategy.

i am ballsy kinda trader, i look at rewards before ruin.

but the art of war states that one needs to protect our army and position ourselves as to not be defeated first, as for the enemy we should wait for him to show us his weakness and how to defeat him. forage on enemy supplies as $1.00 USD from the market is better than $5.00 of my own.

so not only should we be aware of price acceleration, thrust, velocity and exhaustion. counter waves, and stop loss levels. to strategically postion our troops avoiding risk.

but lets use our foreing capital to continue to escalate attack.
there is two types of failed trades

1 a postion initiated with our own supplies turning into a failed trade = loss of troops, loss of morale, and negative impact on our bottom line

2 a trade failed but risk calculated as to use foreign capital as our cushion = loss effort.

i like 2 better lol

as far as hedging i used to think buy euro/ hedge on inverse correlation currency but then is a two front war.

and if one cancels out our position, then taking into account the spread. how do we manuver out of a guaranteed loss position?

wouldnt it be harder to dance. canceling your postion and paying the spread double. then wiggling out of a guaranteed loser? mamood i dont doubt you dont know what youre doing but would you care to explain further the benefits
AVT INVENIAM VIAM AVT FACIAM
  • #24,870
  • May 12, 2011 2:08am May 12, 2011 2:08am
Quoting usw
Hedging is the antithesis of speculation...I've never understood how so many people are convinced that there is some magic in "hedging"(net squared positions), and they cannot be persuaded otherwise. Always good for a laugh though.
its mostly psychological , prefers paying double the spread instead of seeing a loss

there are liquidity providers who takes both sides but they get paid by exchanges for doing it
To Live is the rarest thing in the world , Most people exist , that is all
  • #24,871
  • Edited 2:37am May 12, 2011 2:11am | Edited 2:37am
Quoting usw
Hedging is the antithesis of speculation...I've never understood how so many people are convinced that there is some magic in "hedging"(net squared positions), and they cannot be persuaded otherwise. Always good for a laugh though.
Exactly usw, exactly.
if i live long life.
I will start thread teach setup requirements, mindset and mo for setup hedge ops and arbitage ops. For speculators thinking hedge, is really ward 13 stuff. No wonder hedge funds are speculating. They hedging probably lead by CBs. The only thingy i know heli is doing is hedging his salaries. Do you see how many real treasury pro dare approach? Whatever happened to paulson?


regards
  • #24,872
  • May 12, 2011 2:27am May 12, 2011 2:27am
Quoting fti
if i live long life.
I will start thread teach setup requirements, mindset and mo for setup hedge ops and arbitage ops. For speculators thinking hedge, is really ward 13 stuff. No wonder hedge funds are speculating. They hedging probably lead by CBs. The only thingy i know heli is doing is hedging his salaries. Do you see how many real treasury pro dare approach? Whatever happened to paulson?


regards
Henry Merritt 'Hank' Paulson, Jr. (born March 28, 1946) served as the 74th United States Treasury Secretary. He previously served as the Chairman and Chief Executive Officer of Goldman Sachs. He is currently a fellow at Johns Hopkins University's School of Advanced International Studies (SAIS). According to Wikipedia.

Glad to see you are up and about Fti. Ray
  • #24,873
  • May 12, 2011 2:31am May 12, 2011 2:31am
Quoting fti
if i live long life.
I will start thread teach setup requirements, mindset and mo for setup hedge ops and arbitage ops. For speculators thinking hedge, is really ward 13 stuff. No wonder hedge funds are speculating. They hedging probably lead by CBs. The only thingy i know heli is doing is hedging his salaries. Do you see how many real treasury pro dare approach? Whatever happened to paulson?


regards
Chief,

may be i missed what happen to "Long sword" and some option trading thing u stated when u started...just curious ...i remember u clearly saying people have hard time making a binary buy and sell decision the options are multi variant game...h

V
  • #24,874
  • May 12, 2011 2:33am May 12, 2011 2:33am
Quoting the redlion
[...]
wouldnt it be harder to dance. canceling your postion and paying the spread double. then wiggling out of a guaranteed loser? mamood i dont doubt you dont know what youre doing but would you care to explain further the benefits
Hi,

to say it very clear:

THERE IS NO BENEFIT IN TAKING LONG AND SHORT AT THE SAME TIME!

What I do is:
If you have 3 long positions open with together 20 lots.
Then I sell 1 short position with 20 lots.
So I can squarre my exposure in one step only.
And my broker does NOT bill me additional spread on this ...

That's all.

But maybe I got your question wrong and you are relating to another benefit. Then please give me some more input ;-)

Cu,
Niels
  • #24,875
  • May 12, 2011 2:50am May 12, 2011 2:50am
Hi FTI,

Thought I might ask while you're here if you don't mind, what is the largest gap you've seen in your career where prices instantly jumped X cents before liquidity could be found? I'm wondering as I'm not quite sure what exposure would be considered safe given we can't really predict black swan type moves. Certainly your experience will give me a better clue than just a random guess though.



I've seen you mention something like historical volatility is 10-15%, but I never really understood what you meant. Is that in any way related, as in we should be prepared for an instant 10% revaluation?
  • #24,876
  • May 12, 2011 2:52am May 12, 2011 2:52am
I want to share my 2 cents regarding hedging. There is no benefit to hedging, as in taking opposite positions on the same pair, they cancel each other out.
What I used to do was, if I entered a trade, but due to my clumsiness got in at the wrong time and the trade went against me, I would hedge so as to neutralize the trade and prevent the loss from getting bigger, and wait until the price turned back in my direction. Then I would have another position in the same direction of the original trade so that by the time the price went by my "hedge" entry point, I'd cancel that one and would have 2 positions going.
The truth was that it was basically a strategem I used due to being boneheaded and my reluctance in admitting that the first position was wrong in the first place, and instead of killing it the hedge would allow me to hold on and turn it around. Lately, since I've gotten better at the dance per fti's teachings I don't use that anymore.
I must also say that, what I described above is much harder to execute properly than it sounds, and most of the time I lost money with it. So, no more.
Alex
If only I knew then what I know now...
  • #24,877
  • May 12, 2011 2:57am May 12, 2011 2:57am
I think, that for begginers is more important to study how to trade, sizes, timing... than solving problems with black swans and evil in the market... Yes it is important, but dont overload your capacity with the focus what is not the priority.
- looking for holy grail
-looking for excusess
regards
  • #24,878
  • May 12, 2011 2:58am May 12, 2011 2:58am
Quoting usw
Hi FTI,

Thought I might ask while you're here if you don't mind, what is the largest gap you've seen in your career where prices instantly jumped X cents before liquidity could be found? I'm wondering as I'm not quite sure what exposure would be considered safe given we can't really predict black swan type moves. Certainly your experience will give me a better clue than just a random guess though.
SNB intervention 2 years ago made eur/usd move 240pips in 1 min. I don't remember what was the "gap" exactly but you could be lucky to get out at -200 I guess.. not sure what was the spread.

9/11 move was even bigger but I did not trade then.

That is why 200 was my recommendation.
  • #24,879
  • May 12, 2011 2:59am May 12, 2011 2:59am
Quoting Alexgee
I want to share my 2 cents regarding hedging. There is no benefit to hedging, as in taking opposite positions on the same pair, they cancel each other out.
What I used to do was, if I entered a trade, but due to my clumsiness got in at the wrong time and the trade went against me, I would hedge so as to neutralize the trade and prevent the loss from getting bigger, and wait until the price turned back in my direction. Then I would have another position in the same direction of the original trade so that by the time the price went by my "hedge"...
The simple fact is all you were doing was squaring, then reopening the position when the market started moving your way again.
  • #24,880
  • May 12, 2011 3:00am May 12, 2011 3:00am
Quoting Fana
I think, that for begginers is more important to study how to trade, sizes, timing... than solving problems with black swans and evil in the market... Yes it is important, but dont overload your capacity with the focus what is not the priority.
- looking for holy grail
-looking for excusess
regards
While I'm not necessarily a beginner, I have to disagree. Being prepared for a possible move that could swallow your whole account is one of the first details that should be worked out.
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