Trade smaller than rational because the market is irrational...
- #66,982
- Apr 9, 2013 8:18pm Apr 9, 2013 8:18pm
- | Joined Dec 2011 | Status: Rags to riches | 1,316 Posts
Money never sleeps...
- #66,983
- Apr 9, 2013 8:36pm Apr 9, 2013 8:36pm
- | Commercial User | Joined Nov 2012 | 3,178 Posts
Trade smaller than rational because the market is irrational...
- #66,987
- Apr 10, 2013 1:46am Apr 10, 2013 1:46am
- Joined Oct 2012 | Status: Chart can tell you everything! | 1,721 Posts
Option expires for today 10th april usdjpy 98.00, 98.50,99.00,99.50,100.00,102.00 eurusd, 1.2900,1.2980,1.3085,1.3125,1.3200 gbpusd 1.5200,1.5300, audusd 1.0350,1.0400,1.0415,1.0450,1.0550 eurchf 1.2150,1.2200,1.2350 audjpy 98.60
- #66,988
- Apr 10, 2013 1:58am Apr 10, 2013 1:58am
- Joined Aug 2008 | Status: Persist Until Something Happens | 17,898 Posts
How to read the option expires? I am newbie.. Can explain for me Master? Thanks
Magnetic effect of FX Option expiries
Posted on August 28, 2012 by PipTrapper
Why are FX Options magnetic to price?
Options in the FX markets are like put or call orders which grant the trader the “option” to sell or buy a specific currency pair at a set price.
One could place a call option on the EUR/USD currency pair at 1.2400.
That option price is known as the strike price.
This give the option holder the right, but not the obligation, to buy the EUR/USD at 1.2400, which becomes attractive should the value of the currency move higher than 1.2400.
The majority of FX Options expire at 1400 GMT (10 am NY time).
Over time, it became apparent that price is magnetically attracted to these FX Option strike prices as the expiry date and time draws near.
Whilst major economic and political news tends to have more of an effect on price than anything else, the effect of FX Option expiries cannot and must not be discounted
The main reason why options have this magnetic attraction is hedging. Whether it is a put or a call option, each trader is looking to benefit on either side of the strike price.
If we use the 1.2400 EUR/USD call option mentioned in the example, as long as the market price stays at 1.2401 or higher, institutions and/or traders backing the call option gain exposure to risk, whereas traders supporting the USD do not.
This results in a battle for position as an FX Option reaches its expiry date and time, which has a magnetic pull on the currency pair value towards the option’s strike price of 1.2400
Those who say it cannot be done should not interrupt those who are doing it
- #66,989
- Apr 10, 2013 2:02am Apr 10, 2013 2:02am
How to read the option expires? I am newbie.. Can explain for me Master? Thanks
Options are the levels the big guy have places trades to buy or sell for the trading day so just place this levels on your chart. @ the time of ploting this levels all lines above price actions i make them red and all lines below i make them green. RED for sell or "close my trade if my indicators tells me overbought" and green for buy if am already oversold.
NOTE:option expires 10am EST. "this means you shouldnt be concerned bout them after 10am)
Life is beautiful the way you dress it.
- #66,990
- Apr 10, 2013 2:04am Apr 10, 2013 2:04am
- | Commercial User | Joined Jan 2013 | 1,169 Posts
Hello all,
FibStalker is back (and who cares?). Okay enough for self-greeting!
. Hope you all are well. My Easter trip was awesome!
Immediately back to business... I want to remind you all my latest reviews on the Euro FX currency futures I made before leaving:
post #6524356 and in my newsletter (last one sent on March 17th).
This is my up to date view of the Euro (daily chart):
Attached Image (click to enlarge)
http://www.forexfactory.com/attachme...1&d=1365577267
In the last weeks/months we have heard a lot about the Euro demise and lower prices projections. But the failure level indicated before leaving for my trip (1.2715 on the June contract) was never violated on the downside. The potential to 1.41 area is still intact and, indeed, this target will be confirmed if/when prices climb above 1.3360.
As usual my two scenarios going forward:
Scenario 1. The Euro is not likely to offer a throw-back at this stage and it is very possible that will just continue generally higher into the 1.3360 area (and higher) before we get a sensible correction. Such a move downwards could bring prices into the 1.3140 before a renewed move higher to the next level of profit taking (close to February highs). Congratulations to those who followed my advice and were not distracted by the heavily negative news!
Scenario 2. There is still a possibility that we get a retrace here, in which case we could see price back into the 1.3000 area where the 20-day SMA could be met and offer support. This would be a good long entry to those who lost the train.
If you lost the train now be patient. If we don't get scenario 2 (lower probability), you will need to wait for price to move higher into and above the 1.3360 area before a potential retrace into 1.3140. Good luck.
PS: if you find my analysis compelling and correct, as well as, if it helped you, feel free to vouch me!
All the best.
FibStalker is back (and who cares?). Okay enough for self-greeting!
. Hope you all are well. My Easter trip was awesome!Immediately back to business... I want to remind you all my latest reviews on the Euro FX currency futures I made before leaving:
post #6524356 and in my newsletter (last one sent on March 17th).
This is my up to date view of the Euro (daily chart):
Attached Image (click to enlarge)
http://www.forexfactory.com/attachme...1&d=1365577267
In the last weeks/months we have heard a lot about the Euro demise and lower prices projections. But the failure level indicated before leaving for my trip (1.2715 on the June contract) was never violated on the downside. The potential to 1.41 area is still intact and, indeed, this target will be confirmed if/when prices climb above 1.3360.
As usual my two scenarios going forward:
Scenario 1. The Euro is not likely to offer a throw-back at this stage and it is very possible that will just continue generally higher into the 1.3360 area (and higher) before we get a sensible correction. Such a move downwards could bring prices into the 1.3140 before a renewed move higher to the next level of profit taking (close to February highs). Congratulations to those who followed my advice and were not distracted by the heavily negative news!
Scenario 2. There is still a possibility that we get a retrace here, in which case we could see price back into the 1.3000 area where the 20-day SMA could be met and offer support. This would be a good long entry to those who lost the train.
If you lost the train now be patient. If we don't get scenario 2 (lower probability), you will need to wait for price to move higher into and above the 1.3360 area before a potential retrace into 1.3140. Good luck.
PS: if you find my analysis compelling and correct, as well as, if it helped you, feel free to vouch me!
All the best.
"markets traded by programs/HFT offer a significant trading edge..."
- #66,992
- Apr 10, 2013 2:06am Apr 10, 2013 2:06am
- Joined Oct 2012 | Status: Chart can tell you everything! | 1,721 Posts
no probs broda, Options are the levels the big guy have places trades to buy or sell for the trading day so just place this levels on your chart. @ the time of ploting this levels all lines above price actions i make them red and all lines below i make them green. RED for sell or "close my trade if my indicators tells me overbought" and green for buy if am already oversold. NOTE:option expires 10am EST. "this means you shouldnt be concerned bout them after 10am)
- #66,996
- Apr 10, 2013 3:00am Apr 10, 2013 3:00am
- Joined Jan 2007 | Status: Trader | 11,838 Posts
Trading Levels with WRBs
- #67,000
- Apr 10, 2013 3:58am Apr 10, 2013 3:58am
- | Joined Oct 2011 | Status: Fake signal is a real good one too | 159 Posts
Hello all, FibStalker is back (and who cares?). Okay enough for self-greeting!
