Why did the market reacted like this | Forex Factory

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Why did the market reacted like this

  • #1
  • First Post: Aug 10, 2006 8:13am Aug 10, 2006 8:13am
Hey

Why did EURUSD reacted like this in the release of the trade balance. The trade balance was -64.8 and the forecast was -64.5. That means its bad for the dollar right?? US are importing more than they are exporting.

Can somebody answer why the euro went down against USD
  • #2
  • Aug 10, 2006 8:18am Aug 10, 2006 8:18am
The EURUSD is overbought. Keep in mind that not movement in Forex is based on Fundamentals. Some are based on technicals as well. The Terror PLot in the UK might be a factor weighing on the market as well.



Quoting nimakhaki
Hey

Why did EURUSD reacted like this in the release of the trade balance. The trade balance was -64.8 and the forecast was -64.5. That means its bad for the dollar right?? US are importing more than they are exporting.

Can somebody answer why the euro went down against USD
  • #3
  • Aug 10, 2006 8:30am Aug 10, 2006 8:30am
Quoting Yardie
The EURUSD is overbought. Keep in mind that not movement in Forex is based on Fundamentals. Some are based on technicals as well. The Terror PLot in the UK might be a factor weighing on the market as well.
So hier I stand and dosent know what to trade when a news come out like this...How could you see that the EURUSD is overbought..I know that its possible to see it in the technical...but it has been overbought for long time know...
  • #4
  • Aug 10, 2006 8:54am Aug 10, 2006 8:54am
Quoting nimakhaki
So hier I stand and dosent know what to trade when a news come out like this...How could you see that the EURUSD is overbought..I know that its possible to see it in the technical...but it has been overbought for long time know...
Not only overbought but the price was under 55 ema which is bearish.Moreover all MA crossings since 4 am EST were suggestive of bearish tone.
Just my humble words.
  • #5
  • Aug 10, 2006 11:22am Aug 10, 2006 11:22am
Quoting kolachi
Not only overbought but the price was under 55 ema which is bearish.Moreover all MA crossings since 4 am EST were suggestive of bearish tone.
Just my humble words.


Really? And since when lagging technical indicator, EMA nonetheless, dictate a nation's currency value.
  • #6
  • Aug 10, 2006 12:59pm Aug 10, 2006 12:59pm
Quoting larmand
Really? And since when lagging technical indicator, EMA nonetheless, dictate a nation's currency value.

  • #7
  • Aug 10, 2006 1:05pm Aug 10, 2006 1:05pm
Quoting larmand
Really? And since when lagging technical indicator, EMA nonetheless, dictate a nation's currency value.
WOW

Hay Larmand... Doesn't take much to pull you out from lurking does it.
First Post since joining in 2004. Have a seat I'd like to buy you a drink.
  • #8
  • Aug 10, 2006 1:22pm Aug 10, 2006 1:22pm
Because trading fundamentals in short-term is like playing in casino but withought free drink


Only tech can make you be profitable in long-run
kiss the trend
  • #9
  • Aug 10, 2006 1:38pm Aug 10, 2006 1:38pm
Quoting nimakhaki
So hier I stand and dosent know what to trade when a news come out like this...How could you see that the EURUSD is overbought..I know that its possible to see it in the technical...but it has been overbought for long time know...
Now you can see that nobody can predict the future. The market moves in the direction it wants. None of fundamentals or technicals can guarantee the direction of the market. That's why I say there is no perfect system in the market than can consistently make big money in Forex. I'd rather to be conservative and safe.
  • #10
  • Aug 10, 2006 1:41pm Aug 10, 2006 1:41pm
Quoting fx-trader777
Because trading fundamentals in short-term is like playing in casino but withought free drink


Only tech can make you be profitable in long-run
Care to share some of your "tech know how"?

What indicators do you use? Much appreciated if you could help me out.
  • #11
  • Aug 10, 2006 1:42pm Aug 10, 2006 1:42pm
Quoting larmand
Really? And since when lagging technical indicator, EMA nonetheless, dictate a nation's currency value.
I like this one. I believe that technicals can't react properly to news effects. There are cases that you can predict to some extent the limits of a move with the help of Fibonacci retracement/expansion but predicting the future move...It's another story.
  • #12
  • Aug 10, 2006 1:52pm Aug 10, 2006 1:52pm
Quoting fx-trader777
Because trading fundamentals in short-term is like playing in casino but withought free drink
Only tech can make you be profitable in long-run
Neither technical nor fundamental analysis are much reliable to trade news. If somebody wants to trade in such hectic times it's better to use special approaches that are more of money management nature rather than relying on numbers and statistics.

I consider myself a technician and I do beleive that with T/A you can be very profitable (this is the way I make money in Forex). However, I also beleive that making money based on news is possible and you can make huge money in a very short period of time. That's why I've started working on these techniques and so far it's been very successful.

I'll hopefully publish the results of my studies very soon and will hopefully publish them for free for the benefit of everybody.
  • #13
  • Aug 10, 2006 1:56pm Aug 10, 2006 1:56pm
Quoting aparsai
I like this one. I believe that technicals can't react properly to news effects. There are cases that you can predict to some extent the limits of a move with the help of Fibonacci retracement/expansion but predicting the future move...It's another story.
I think so too.

Techs dont trade (even closes positions or put stops nearer) during news time.

However, news have 30-60 minute effect with up to 150pips movement. The techs dominate the rest of the day.

Personally, I havent decided how to trade. Trading the News seems the profitable path thus far. tech requires too much discipline and patience - perhaps once I have achieved discipline and patience as well as what indicators to use. I could not sit down and look at MA, MACD, RSI and STO to predict the future movement.
  • #14
  • Aug 10, 2006 1:58pm Aug 10, 2006 1:58pm
Quoting BurgerKing
Care to share some of your "tech know how"?

What indicators do you use? Much appreciated if you could help me out.
BurgerKing,

I like the irony hidden in the combination of your avatar and your user id. Is there a reason that you picked this combo?

It's not just the indicator that makes T/A a successful approach it's actually a combination of ...

  1. Chart analysis
  2. Technical indicators (trend followers and oscillators)
  3. A strategy based on chart analysis and indicators
  4. Money management
  5. Psychology of trade

Without all these together being successful is almost impossible (or at least your chances are low).

  • #15
  • Aug 10, 2006 2:23pm Aug 10, 2006 2:23pm
aparsai,

Several years ago, I ate at BK; I got very good sniffing noses back then and smelled molds on the bun. Though I did not sue, that branch closed no soon after. I have memorable moments with McD in my younger years - but I'd rather not dwelve on "THAT" past anymore.

I agree with all the points you mentioned.
I am a forex newbie and seeing that I dont have all of those in the basket, news is the better path for me at this stage.

I am a programmer and I personally would like to automate tech analysis to eliminate "emotion" out of the way. One trading methodology I am particularly interested is a simple RSI(14) and ATR(21) system that was backtested with 3.5 years of data making 60x return.

http://www.traders.com/Documentation...OREXfocus.html

I have back tested it for several currency pairs and 3 of 4 were winners. Now, I am planning to see if this could be done on MT platform.
  • #16
  • Aug 10, 2006 2:49pm Aug 10, 2006 2:49pm
Burgerking,

So you are a great fan of both eateries.

I'll give this system a try. Based on the article it is tested on a daily chart. Did you also use a daily chart?

Apparantly the author of the article has used RSI(21) and duration for ATR is not mentioned. Is there a reason that you used RSI(14) and ATR(21)?

Thanks,
Al


Quoting BurgerKing
aparsai,

Several years ago, I ate at BK; I got very good sniffing noses back then and smelled molds on the bun. Though I did not sue, that branch closed no soon after. I have memorable moments with McD in my younger years - but I'd rather not dwelve on "THAT" past anymore.

I agree with all the points you mentioned.
I am a forex newbie and seeing that I dont have all of those in the basket, news is the better path for me at this stage.

I am a programmer and I personally would like to automate tech analysis to eliminate "emotion" out of the way. One trading methodology I am particularly interested is a simple RSI(14) and ATR(21) system that was backtested with 3.5 years of data making 60x return.

http://www.traders.com/Documentation...OREXfocus.html

I have back tested it for several currency pairs and 3 of 4 were winners. Now, I am planning to see if this could be done on MT platform.
  • #17
  • Aug 10, 2006 2:54pm Aug 10, 2006 2:54pm
Ah yes, RSI 21. the ATR is 21 too according to someone who have the magazine.

Can you program this on MT? Im still new to MT.

I no longer patronize those two. I'd better eat healthy now.
  • #18
  • Aug 10, 2006 2:54pm Aug 10, 2006 2:54pm
Quoting BurgerKing
I think so too.

Techs dont trade (even closes positions or put stops nearer) during news time.

However, news have 30-60 minute effect with up to 150pips movement. The techs dominate the rest of the day.

Personally, I havent decided how to trade. Trading the News seems the profitable path thus far. tech requires too much discipline and patience - perhaps once I have achieved discipline and patience as well as what indicators to use. I could not sit down and look at MA, MACD, RSI and STO to predict the future movement.
Just beware that news trading is very risky. Don't try it before setting up a proper strategy and testing it several times on demo and then micro and/or mini accounts. Not every broker gives you the chance to easily trade based on news. Make sure to pick a proper broker.
  • #19
  • Aug 10, 2006 3:03pm Aug 10, 2006 3:03pm
I use entry orders on both sides for trading news. However, its another matter when the broker would give you a whopping +40 slippage.

I hope I could get enough profit out of fxcm before i close it completely. currently opened a NF account - but they seem to be SLOWER than fxcm... Im using them for trading gold. gold makes nice +1000 pip movements per day, more predictable than currency pairs and is mostly range bound.
  • #20
  • Aug 10, 2006 3:20pm Aug 10, 2006 3:20pm
Quoting nimakhaki
Hey

Why did EURUSD reacted like this in the release of the trade balance. The trade balance was -64.8 and the forecast was -64.5. That means its bad for the dollar right?? US are importing more than they are exporting.

Can somebody answer why the euro went down against USD
dont give so much weight to the forecast. thats not always what the market is expecting.

to see what the market was REALLY expecting, listen to the market itself (unfotunately this can only be done after the fact). today, obviously the market was expecting someting worse than -64.8, because the dollar strengthened on the news.
Relax and be happy.
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