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Market timing strategies

  • #1
  • First Post: Feb 25, 2013 10:56pm Feb 25, 2013 10:56pm
Hi everyone,
I am after an explanation regarding strategies which enter the market at specific times. I am guessing everyday the trader enters the market slightly before open/at open with a possible direction for that particular pair in mind. Can anyone guide me in the right direction?
Thanks a lot.
Angie


  • #2
  • Feb 25, 2013 11:09pm Feb 25, 2013 11:09pm
I only know that around market open, people need that currency so they going to buy it...

for example like eur/usd before market open you might want to place buy order and set it target 10 pips.
  • #3
  • Feb 25, 2013 11:12pm Feb 25, 2013 11:12pm
Thanks, but the profit of the strategy I'm talking about varies with each trade, and can be like 50 pips for holding for a few days.
  • #4
  • Feb 26, 2013 10:51pm Feb 26, 2013 10:51pm
Quoting angieFX
Thanks, but the profit of the strategy I'm talking about varies with each trade, and can be like 50 pips for holding for a few days.
IMO these sorts of strategies useful for scalping purposes. Need to consider risk and stop loss levels if you gonna hold it for a long period of time.
  • #5
  • Mar 15, 2013 12:26pm Mar 15, 2013 12:26pm
Quoting angieFX
Hi everyone,
I am after an explanation regarding strategies which enter the market at specific times. I am guessing everyday the trader enters the market slightly before open/at open with a possible direction for that particular pair in mind. Can anyone guide me in the right direction?
Thanks a lot.
Angie


Hi Angie,
I think a further look into trading something like “opening ranges” may answer your question. An opening range can be defined by the amount of price movement that occurs in a specific period of time and is observed at a specific time, like the open of the NY, London or Tokyo trading session (see Forex Factory Home page for session opens). An example of this would be to take the first 30 minutes of a session as your opening range, although the time interval may vary depending upon the pair you are trading.

The conventional way the opening range strategy can be used to define directional movement for that trading session is based upon a price breakout (higher or lower) of the defined range. There are multiple interpretations, so it’s something you’re going to have to look into and experiment with.

As with anything else the opening range is used in conjunction with other technical indicators, such as moving averages and oscillators, like the RSI and Stochastics. Once again, the ball’s in your court with choosing which ones. You may also want to make sure that you keep an economic calendar (see ForexFactory home page) in mind to make sure that a market moving announcement doesn't throw off your assessment.

Finally, like it’s been said many times before, trading is more an art than a science, so the interpretation of the opening range trade approach is up to you. Hope this helps.
  • #6
  • Mar 15, 2013 2:25pm Mar 15, 2013 2:25pm
.
I really honesty came to the conclusion that there is nothing in strategies at certain specific times.
The only ones are the economical news.

The open of NY, London etc... they almost make no sense. There is really no "opening". All Major banks are exchanging at all times
except some do not on weekends.

True that people in certain financial areas start placing order when banks open. But not all walk into the banks at the second the Bank opens the doors. Some of the strategies are almost a joke... they even call for the first tick at 8:30 am
like that is going to be the trend after that or whatever nonsense.

People see what they want to see. But guaranteed if I hand someone 30 charts of 30 consecutive day, say from 14:00 to 15:00hrs
and 30 consecutive day from 8:30am to 9:30 am ... NO one would be able to tell which one is the one is from the "opening".

Meaning, the market is going to behave like any other time.... supply and demand each millisecond.

J.
  • #7
  • Mar 17, 2013 4:03am Mar 17, 2013 4:03am
Quoting jeuro
.
I really honesty came to the conclusion that there is nothing in strategies at certain specific times.
The only ones are the economical news.

The open of NY, London etc... they almost make no sense. There is really no "opening". All Major banks are exchanging at all times
except some do not on weekends.

True that people in certain financial areas start placing order when banks open. But not all walk into the banks at the second the Bank opens the doors. Some of the strategies are almost a joke... they even call for the first tick at 8:30...
The opening of each session corresponds to the local equities markets opening up. I don't pay a ton of attention to them but you can definitely tell when the regional market has opened, in particular London, as activity picks up very quickly and some of the biggest moves of the day tend to happen not long after.
  • #8
  • Mar 17, 2013 5:16am Mar 17, 2013 5:16am
Quoting angieFX
Hi everyone,
I am after an explanation regarding strategies which enter the market at specific times. I am guessing everyday the trader enters the market slightly before open/at open with a possible direction for that particular pair in mind. Can anyone guide me in the right direction?
Thanks a lot.
Angie



opening is what you want to stay away because direction is unpredictable in general.

I suggest you to pull 10 opening charts and see if there is a pattern. I persoanlly have tried to pull more than 100 opening charts, but then there is nothing good i found was solid enough.

Hope this helps.
More than a hobby. Never a game. US Client at 1:50.
  • #9
  • Mar 17, 2013 7:25am Mar 17, 2013 7:25am
Quoting Kanzler
The opening of each session corresponds to the local equities markets opening up. I don't pay a ton of attention to them but you can definitely tell when the regional market has opened, in particular London, as activity picks up very quickly and some of the biggest moves of the day tend to happen not long after.

Yea.. of course. "Equity Markets" or stock market moves only from opening to close each day. Anybody can tell. Goes from Zero traded
to whatever volume and prices. At the time the bell rings activity start and activity picks up quickly.

But the question was placed in regards to the forex market ---. was it? There is no direct or little connection
to money exchanged. Most of the biggest moves happens during economical news, and that sometime coincide with those
early hours of the morning.



J
  • #10
  • Mar 17, 2013 1:06pm Mar 17, 2013 1:06pm
I'm not sure then. I think of it in terms of banks and institutions/businesses becoming active for the day, both of which need to exchange currencies to execute business deals. The open of a session really isn't that strict either; I notice activity seems to get started a little before the actual open. As far as making a strategy of it, I know seneca_pilot uses data from the London session to make trade calls but it isn't something I'm personally doing. You might want to take a look at his thread as I think perhaps it might be of interest.
  • #11
  • Mar 18, 2013 2:41am Mar 18, 2013 2:41am
Quoting angieFX
Hi everyone,
I am after an explanation regarding strategies which enter the market at specific times. I am guessing everyday the trader enters the market slightly before open/at open with a possible direction for that particular pair in mind. Can anyone guide me in the right direction?
Thanks a lot.
Angie



I am assuming you are trading on the Daily chart. If so, then it is correct to wait for the New York market to close before deciding on your trade entries.

Whether you enter the trade before New Zealand/Australia market opens or just after they open is immaterial as the difference in entry price is very likely to differ by a few pips. On the context of Daily chart trading, a few pips difference in entry should not affect your trading analysis.
  • #12
  • Mar 19, 2013 12:29am Mar 19, 2013 12:29am
Quoting Jack Morris
Hi Angie,
I think a further look into trading something like “opening ranges” may answer your question. An opening range can be defined by the amount of price movement that occurs in a specific period of time and is observed at a specific time, like the open of the NY, London or Tokyo trading session (see Forex Factory Home page for session opens). An example of this would be to take the first 30 minutes of a session as your opening range, although the time interval may vary depending upon the pair you are trading.

The conventional way the...

Hi Jack,
Thanks for your comprehensive reply. I have been working on opening range systems, in particular a variation of the Big Ben system for GBP/USD.Exactly as you say, I use a higher and lower limit and trade in direction of the breakout after London open.
I've found this strategy (probably like many other ones) works quite well "most of the times".
Backtesting on last year's data and live trading this year, I've found that the number of false signals given by this system can be very high in the month preceding to a quarter end, i.e. September last year and March this year. So much so, that it might had been profitable to do the opposite that the system is saying..or use fractals to filter fake signals.
In comparison, January this year showed much more (relatively) smoother trends after breakouts.
Am I correct in any way in these assumptions?
Thanks again!
Angie
  • #13
  • Mar 19, 2013 12:37am Mar 19, 2013 12:37am
Quoting Chi
opening is what you want to stay away because direction is unpredictable in general.

I suggest you to pull 10 opening charts and see if there is a pattern. I persoanlly have tried to pull more than 100 opening charts, but then there is nothing good i found was solid enough.

Hope this helps.
Like you say, I have looked at patterns as well.Especially, how the market moves after the open, based on the pattern formed just before the open, e.g. considering London open and GBP/USD. I found some similarities..but it's more complex than it looks I think....Anyone else here knows anything about this?
  • #14
  • Apr 8, 2013 10:37am Apr 8, 2013 10:37am
This sounds like a similar strategy to trading news releases, such as the NFP. I have had some success trading not the release itself, but the retracement of the price after the first move. You could try something similar on the opening of the day. For example, if it makes a big move at the opening of the day look for some pressure the opposite direction and enter a position against the initial move. I have found this to be more profitable than trying to guess the initial move and you can use very tight stop losses to get a decent risk/reward ratio.
  • #15
  • Last Post: Nov 4, 2020 10:44am Nov 4, 2020 10:44am
Strategy is the main key to success. Many traders lose their money because of their wrong strategies. So, try to choose the best strategy.
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