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Home Currency Bias?

  • #1
  • First Post: May 21, 2006 11:35am May 21, 2006 11:35am
Does anyone know if there is a home currency bias in forex? What I mean by that is that during the Asian session the YEN/AUD/NZD side of a pair would show a statistically relevant bias toward strength relative to the other 16 hours of a day. Same for USD/CAD or EUR/GBP/CHF. Clearly each currency can go down and does during its primary timezones but does it drop more slowly or less than indicated by the 16 hours before and after? I don't have the statistical background to analyze it and thought maybe someone already had...

Thanks!
  • #2
  • May 21, 2006 11:42am May 21, 2006 11:42am
Quoting Korak
Does anyone know if there is a home currency bias in forex? What I mean by that is that during the Asian session the YEN/AUD/NZD side of a pair would show a statistically relevant bias toward strength relative to the other 16 hours of a day. Same for USD/CAD or EUR/GBP/CHF. Clearly each currency can go down and does during its primary timezones but does it drop more slowly or less than indicated by the 16 hours before and after? I don't have the statistical background to analyze it and thought maybe someone already had...

Thanks!
I don't know about that...most of the moves for the USD happen during the NYSE session...and this includes anti-dollar moves. Grant it, the Euro session is still open during the first half of trading of the NYSE...but, I believe the Asian seession shares some time with the Euro session as well.

I would be interested to find out if anyone has back-tested the reversal tendencies (or strength bound tendencies) for the USD based currencies AFTER 12pm EST (or whenever the Euro session closes). I could run some tests later and see what happens.
  • #3
  • May 21, 2006 1:58pm May 21, 2006 1:58pm
I think the recent article by Kathy Lien might answer some of your questions...
http://www.forexfactory.com/forexfor...ead.php?t=5425
  • #4
  • May 21, 2006 4:44pm May 21, 2006 4:44pm
Well that articles talks about trading ranges in regards to the most active times for each pair to trade. I think what mrmikal is getting at is whether there is a bias towards strength or weakness for currencies that are the home currencies of the particular session, such as the Yen or Aussie dollar through Asia.

In my experience, and I have no statistic to back it up, there is no clear bias that I can see through each pairs home town session. There are many times where Asia, Europe and the US fail to agree though, however I think that has less to do with bias, and more to do with USD strength or weakness as the big money comes online.
You can quit and they won't care, but you will always know.
  • #5
  • May 21, 2006 7:29pm May 21, 2006 7:29pm
I don't think there is a home bias...This is the second week in which the AUD weakens against the USD during the Australian session just after the markets open on Sunday night....


Thanks,

Nader
  • #6
  • May 22, 2006 5:40am May 22, 2006 5:40am
i have noticed usd/jpy to have an opposite home bias during jpn open..
Trade what you see, not what you believe.....
  • #7
  • May 22, 2006 6:24am May 22, 2006 6:24am
There is a home bias in equities, larger than is rational. But currencies, I don't know?
  • #8
  • May 22, 2006 8:36am May 22, 2006 8:36am
There is somethin' that's called Big Ben, for GBP / USD.

But i never understood how that acctually works.

It somehow predicts how the chart develops between 8 and 9 o'clock GMT

For Details look at

http://forexbigwave.blog39.fc2.com/blog-entry-25.html ^^
  • #9
  • May 22, 2006 9:43am May 22, 2006 9:43am
Quoting tojoko
There is somethin' that's called Big Ben, for GBP / USD.

But i never understood how that acctually works.

It somehow predicts how the chart develops between 8 and 9 o'clock GMT

For Details look at

http://forexbigwave.blog39.fc2.com/blog-entry-25.html ^^
Tojoko, I know we could babblefish this puppy, but for those less inclined to know how to do that, would you be so kind as to translate into english seeing as the majority of the people on this forum write in english, and I would venture to say that only a small minority can read Japanese.

I'm sure this information be useful for some people.
  • #10
  • May 22, 2006 9:51am May 22, 2006 9:51am
Quoting mrmikal
Tojoko, I know we could babblefish this puppy, but for those less inclined to know how to do that, would you be so kind as to translate into english seeing as the majority of the people on this forum write in english, and I would venture to say that only a small minority can read Japanese.

I'm sure this information be useful for some people.
Problem is, i'm from germany and don't know any japanese.

I just thought the picture would be great - and, hey, we have international
people here - isn't there anybody who could translate that for us?

However, i found a thread in Forexfactory about "Big Ben" (not B. Bernanke!)
in englisch. Mighty be the easier way for most of us.

http://www.forexfactory.com/forexfor...88&postcount=2
  • #11
  • May 22, 2006 1:32pm May 22, 2006 1:32pm
A quick way to translate the page is to go to google and click on the "Language Tools" option. Paste the website url into "Translate a Web Page" , select the "Japanese to English" and click translate. Works pretty well. Though it would be best if someone who speaks japanese could look at the translation for accuracy.
In trading, there is no bullshit. You either make money or you don't.
  • #12
  • May 22, 2006 2:15pm May 22, 2006 2:15pm
I think there are some logical reasons why GBPUSD and GBPJPY are the most volatile pairs.

For example when you are selling 100 000 GBPUSD, your need over 185 000 USD
Thus you are throwing large amount of dollars in the market which could cause volatility. Also as JPY per pip is less than 1$ GBBPJPY is even more volatile.
kiss the trend
  • #13
  • Last Post: May 23, 2006 3:23am May 23, 2006 3:23am
Just wanted to give a quick thanks to you guys for sharing your thoughts so quickly...

Korak
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