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Forex Market Mechanics

  • #1
  • First Post: Aug 19, 2006 6:26pm Aug 19, 2006 6:26pm
I posted the following around page 65 of the Sidus Thread:

Watch the mirror..
<HR style="COLOR: #d1d1e1" SIZE=1><!-- / icon and title --><!-- message -->I sense the Gold rush has settled here with the ebb/flow of fresh information.
As I said before it is all a matter of individual perception. Any combination of indiactors will yield good trading.. So as long as the settings are primed per the time interval you are watching. Being as the actual control of the forex flow is cross breed between different currencies, this is your true indication of direction. As we find that the USD/YEN is opposit of the EUR/USD most all the time with the exception of a stronger tug from say the GBP/USD as that is the buddy currency to the EUR/USD or say the USD/CHF pulls against the USD/YEN as it is the buddy currency to the USD/YEN notice I call them buddy currencies as they complement each other in same overall direction. Now lets throw in a curve... EUR/JPY This a Part time lover to the USD/YEN sometimes it will compliment the USD/YEN as a buddy and on other occasions it will do it's own thing such as tonight and for some Morning.. 8-18-06 it had all time highs over-night while the yen and euro were basically at a total stand still.. KEY:::: watch the key bid offer levels for the currency you like to trade as well as the bid offer levels of the counter currency. This will explain to you total technical traders why you get whipsaws you can't figure out most of the time but not all as nothing is infinate with this ride called forex. The Big dogs like to run stops on each other and we sometimes get caught in the wake.. i.e. option expires a favorite chase down.. Perception is key to it all! You can program a million setups and if you can't see or at least reolize what going on out the runway, you trades will get run-down! A good portion of the time. You all have been told it's all about support and resistance I buy You sell Some hesitate then enter.. This all contributes to what we all know as the trend. Note the attached images as an example of mirrored effects on flow and stall dependant on in the currency or out of the currency influx.

I Was informed all who dance in that thread were bacically only intrested in Sidus.... "Squiggle line following technical traders" Little do they know practically any ma combination and choice of a good dozen oscillators will do exactly the same thing!!!! As a pro would already know.. Every few weeks some new or fairly new trader(Demo-ologist) Comes up with a new combination and the herd flocks to that thread. The originating poster usually has a line of text that go's " I have been back testing this for about two weeks now with great success" Key lure for the trade Junky. Most always nothing more than a regurgitation of somebody elses trade system with what::: A new magic touch.
Purpose of the initiation of this thread is for veteran traders that trade for real pip's no demo junkies or newbies. No offense, it is merely not in the scope of a pretender or unexperienced trader here. To collaborate back and forth the Mechanics of ebb/flow concerning the market beneath the charts, In all actuality this is where the market begins. For decades pit traders did not use charts they used wit, Momentum and right now statistics to in and out trades all day long from bell to bell day after day. We are not quite the same people as we trade gazing into nothing more than a computer monitor. However the dynamics have not changed behind the wizards curtain.
"Look Left Think Right"
  • #2
  • Aug 20, 2006 10:14pm Aug 20, 2006 10:14pm
I am reponding to my own thread as no one has show any intrest?? or rather lacks Inner market knowledge. Oh well just goes to show how many minimals are in the market, Happy trading I will sure enjoy trading against you.

CURRENCYANALYST OUT!
"Look Left Think Right"
  • #3
  • Edited 11:18pm Aug 20, 2006 10:21pm | Edited 11:18pm
Quoting CURRENCYANALYST
I am reponding to my own thread as no one has show any intrest?? or rather lacks Inner market knowledge. Oh well just goes to show how many minimals are in the market, Happy trading I will sure enjoy trading against you.

CURRENCYANALYST OUT!
You are welcome to trade against us but do not be angry with us.
BTW I saw your post just now.A good trader has always patience and does not jump to conclusion so quickly and immaturely.
You are welcome in FF.

kolachi
  • #4
  • Aug 20, 2006 11:16pm Aug 20, 2006 11:16pm
I too just saw your post.....it takes some time for the response you may be waiting for since some of us do catch a little sleep from time to time....

By the way I found your post very interesting please continue.....
Same Whore .... Different Dress
  • #5
  • Aug 21, 2006 11:19am Aug 21, 2006 11:19am
I should have taken into concideration it was the weekend when I opend the thread.. I did however have a bitter taste as regarding the original post I placed in the Sidus Thread... This was my second ever post to a blog board forum or what ever you may call it.. Reminded me of a few students I had last year at a seminar that were very biased and ignorant to the harsh realities of trading. In this business no love> only passion. Some have the addiction to achieve power, others for the money, yes even if it is manapoly demo account gains. Believe it or not many phantom traders are out there just sitting and waiting until they think they got it Perfect (Holy Grail). They fund a real account and blow the the thing up in 10 days!! Classic month after month. A series 3 CTA broker buddy of mine shares many of these stories every time we talk. And then on the other hand I do hear of on accasion a very good story such as a trader last week that made 48,000 usd in 4 days. This thread is a starting point for traders that are in the real money to bounce fear, Pain and anguish Off each other. I can tell you how to trade, and I can show you. But you wont see it. But you will dang well will feel it when you fail just as much as when you succeed. I have gone thru the 5 levels of trader psychology over the years. In the begining I lost a good 20+ k over a span of 3 different accounts. I was one of those holy grail seekers! After many hard knocks I came to reolize that I was an fools trader. I had every ebook pdf word doc.. etc etc. that one could scour from all the peer 2 peer apz. I tossed and turned with ma's without .. Indicators no indicators. Gabldy goop.. Supercalafragalisticexpalidoshus did I get that right?? I will say this very thing Simple SImple KISS..... Seek out a method of analysis that is to your comprehendable style... One that you can Understand.. Then tweak it to your PERCEPTION (KEY WORD). Leave it alone and begin to follow it learning the setups squeeks and bubbles. Don't touch it! follow it! Let the trades come to you then decide do you want to accept the trades each day or fade based on you market understanding of ebb and flow!

let Our Journey begin..
"Look Left Think Right"
  • #6
  • Aug 21, 2006 12:14pm Aug 21, 2006 12:14pm
Quoting CURRENCYANALYST
I should have taken into concideration it was the weekend when I opend the thread.. I did however have a bitter taste as regarding the original post I placed in the Sidus Thread... This was my second ever post to a blog board forum or what ever you may call it.. Reminded me of a few students I had last year at a seminar that were very biased and ignorant to the harsh realities of trading. In this business no love> only passion. Some have the addiction to achieve power, others for the money, yes even if it is manapoly demo account gains. Believe it or not many phantom traders are out there just sitting and waiting until they think they got it Perfect (Holy Grail). They fund a real account and blow the the thing up in 10 days!! Classic month after month. A series 3 CTA broker buddy of mine shares many of these stories every time we talk. And then on the other hand I do hear of on accasion a very good story such as a trader last week that made 48,000 usd in 4 days. This thread is a starting point for traders that are in the real money to bounce fear, Pain and anguish Off each other. I can tell you how to trade, and I can show you. But you wont see it. But you will dang well will feel it when you fail just as much as when you succeed. I have gone thru the 5 levels of trader psychology over the years. In the begining I lost a good 20+ k over a span of 3 different accounts. I was one of those holy grail seekers! After many hard knocks I came to reolize that I was an fools trader. I had every ebook pdf word doc.. etc etc. that one could scour from all the peer 2 peer apz. I tossed and turned with ma's without .. Indicators no indicators. Gabldy goop.. Supercalafragalisticexpalidoshus did I get that right?? I will say this very thing Simple SImple KISS..... Seek out a method of analysis that is to your comprehendable style... One that you can Understand.. Then tweak it to your PERCEPTION (KEY WORD). Leave it alone and begin to follow it learning the setups squeeks and bubbles. Don't touch it! follow it! Let the trades come to you then decide do you want to accept the trades each day or fade based on you market understanding of ebb and flow!

let Our Journey begin..
i agree keep'n it simple! Stop changing the charts weekly/daily but spend ample time learning the chart..."Leave it alone"
i think (hope) i'm past the "newbie/seeking holy grail" stage i've reached my 1 year bday
  • #7
  • Aug 21, 2006 12:27pm Aug 21, 2006 12:27pm
I don't know in which stage am I at the moment. I have blown 3 accounts over the 1,5 years I trade. Now I am a demo junkie. I take all systems I see, read, hear and test it. 98% of which don't work consistently and the some that do work a little I take the good stuff out and add to my system.

You'll agree that a good trader needs his own system.. so most of us are still on the journey of finding it and understanding it.

Not only should you monitor all major currency pairs at once but also add some gold, oil and major stock market indices.

And I have read a lot of books and most of them don't have more than one paragraph of new or interesting ideas.

And, yes, I also find it funny that people test something for two weeks and go live with high hopes. Maybe they blow their $300 and if they learn from it.. it is worth the price.
  • #8
  • Aug 21, 2006 7:39pm Aug 21, 2006 7:39pm
Quoting CURRENCYANALYST
I can tell you how to trade, and I can show you. But you wont see it. But you will dang well will feel it when you fail just as much as when you succeed. I have gone thru the 5 levels of trader psychology over the years. In the begining I lost a good 20+ k over a span of 3 different accounts. I was one of those holy grail seekers! After many hard knocks I came to reolize that I was an fools trader. I had every ebook pdf word doc.. etc etc. that one could scour from all the peer 2 peer apz. I tossed and turned with ma's without .. Indicators no indicators. Gabldy goop..
My trader friend, you write some very excellent thoughts. However, I have a very hard time reading your posts, because you don't break them up into paragraphs. Please consider doing so next time, so I can read your words.

I have been trading Forex for almost 2 years now. I agree with many of your observations. Dissappointingly, I have discovered that many noobies will not take advice from experienced traders. They strongly argue against it until they are blue in the face, believing they are "right". The market is a stern teacher however, and everyone pays the price for pride before long.

Part of the reason I don't really post on message boards is because everyone else I see is still in the "wow a shiny new system" phase. They don't have the depth of experience to see that they all just use lagging indicators, and are all essentially just history-dervied pictures. I don't have much in common with traders at this stage. There is nothing new for me to learn. I have browsed the different forums on a daily basis, looking for something new to me. I rarely find what I am looking for.

On a different tangent, maybe what would be useful is to have a BBS set up for only experienced traders. Like a minimum 3-5 years or something similar. That would weed out all the noise about brokers and "System of the Week". On another tangent, I see almost nobody talking about statistical or numerical methods to analyze the market. They are highly applicable, yet noone applies them. My hunch is that most don't have the educational background nor the patience to learn all the math and do the research, so perhaps only a select few will ever profit from this focus.

Good luck to you.
  • #9
  • Aug 21, 2006 8:47pm Aug 21, 2006 8:47pm
I just finished reading his thread for the third time and I am still lost as to what your asking, implying, or suggesting. I will however take a stab at addressing some of the little nuggets I did manage to comprehend...

1)Your buddies analogy is appropriate depending on the dominant theme in the market. CHF and JPY are the funding currencies for carry trades so when the interest rate picture looks stable at home, they'll both drop in relation to EUR, GBP, and USD. Geopoliticical events will see USD and CHF rising against the field as safe haven bets. The commodity theme sees activity in CAD, AUD, and NZD. There are others, but those are the dominant ones at present...

2)There are really 3 kinds of people you will find at this (and probably any other trading related) forum. You have the Noobs which are by far the largest percentage of the population. It seems they are the ones your expressing frustration with.

Then there are the helpers, who are sufficiently profitable/competent and make every effort to get the noobs to the next level. Unfortunatly there are very few of them anywhere; but it seems FF has a good group with James16, Dialist, Muddbuddah, etc.

Finally you have a silent army of people like myself that visit the forum occasionally to see if anything is new. The problem is that once you develop a certain level of skill, what do you really have to talk about? More then likely you have a completly unique way of trading and are somehwat reluctant to hand it out to the world of noobs. It also seems that trading is an intensly personal experience. Each one of us is at an entirely uniqe point in our development and seldom does the experience we have developed transfer well. So most of us wind up making little suggestions when we can and spending the rest of our time doing more productive things.

3)A private "experienced traders" group was started a few months ago that went nowhere. We even shared our complete trading systems with each other and still had nothing of significance to discuss. Maybe we were all just bad communicators, but it seems unlikley. Before you go through all the effort of setting one up I would suggest talking via email for a few months and see if you can make it last...

4) I agree with you in that indicators are all crap.

If there was something else of significance in here, feel free to point it out. Good luck to you.
  • #10
  • Aug 21, 2006 8:53pm Aug 21, 2006 8:53pm
Good thread...

Silverpike...speaking of statistics and numericals...

Gbp is still a stuffed pig...
  • #11
  • Aug 21, 2006 11:52pm Aug 21, 2006 11:52pm
bump......want to keep this thread in the public eye....I think there is some potential here.
Same Whore .... Different Dress
  • #12
  • Aug 22, 2006 12:06am Aug 22, 2006 12:06am
Quoting silverpike
The market is a stern teacher however, and everyone pays the price for pride before long.
wow, crucial statement. there are years of expereince in these few words.
Quoting silverpike
On another tangent, I see almost nobody talking about statistical or numerical methods to analyze the market. They are highly applicable, yet noone applies them. My hunch is that most don't have the educational background nor the patience to learn all the math and do the research, so perhaps only a select few will ever profit from this focus.
this post tells me that you have been in the trenches, you have been through the long and challenging process of becoming a trader. i am a stats junky too, that is where we all end up isnt it? you start out by looking for magic systems, and you end up studying statistics and the scientific method!

anyway, silverspike, i hope to see you around here man, i know you have some good high level knowlege that some of these guys on here are looking for. maybe we have something to give back as well.
Relax and be happy.
  • #13
  • Aug 22, 2006 12:08am Aug 22, 2006 12:08am
Quoting Darkstar
There are really 3 kinds of people you will find at this (and probably any other trading related) forum. You have the Noobs which are by far the largest percentage of the population. It seems they are the ones your expressing frustration with.

Then there are the helpers, who are sufficiently profitable/competent and make every effort to get the noobs to the next level. Unfortunatly there are very few of them anywhere; but it seems FF has a good group with James16, Dialist, Muddbuddah, etc.
I agree with this view. God bless the "helpers", most of them have lots of patience and good attitudes toward others. I might fall into this category if I could be convinced that noobies would actually pay attention. Alas, I have lots of evidence that they don't. I find this bizzarre, because I am a member of other online communities as well. In those cases (not trading related), noobies seem to learn very well from the more experienced. Why this doesn't occur with Forex is beyond my comprehension.

Quote
Finally you have a silent army of people like myself that visit the forum occasionally to see if anything is new. The problem is that once you develop a certain level of skill, what do you really have to talk about? More then likely you have a completly unique way of trading and are somehwat reluctant to hand it out to the world of noobs. It also seems that trading is an intensly personal experience. Each one of us is at an entirely uniqe point in our development and seldom does the experience we have developed transfer well. So most of us wind up making little suggestions when we can and spending the rest of our time doing more productive things.

3)A private "experienced traders" group was started a few months ago that went nowhere. We even shared our complete trading systems with each other and still had nothing of significance to discuss. Maybe we were all just bad communicators, but it seems unlikley. Before you go through all the effort of setting one up I would suggest talking via email for a few months and see if you can make it last...
I find this also true. From a personal perspective, I am surprised that none of your experienced traders group found subjects to discuss. In my own view, I am always looking to learn something new about Forex. Perhaps it's why I have been successful, I don't know. I am interested in learning about subjects that don't relate to my current projects. Perhaps this is not true of most traders. Maybe when they find "their system", they are content to rely on that, and aren't interested in more exploratory material.

Regardless of all of this, my comment about statistics and random number theory still applies. To date, I have seen only 1 informative post about random walk analysis, and that was on another board. I guess the theory goes over the heads of too many.
  • #14
  • Aug 22, 2006 12:09am Aug 22, 2006 12:09am
Quoting silverpike
The market is a stern teacher however, and everyone pays the price for pride before long.
i still cant get over the gravity of this statement. there is so much truth in so few words. and its an undeniable truth, bigger than anyone who would dare to disagree. great stuff man, really great stuff.
Relax and be happy.
  • #15
  • Aug 22, 2006 12:12am Aug 22, 2006 12:12am
btw i agree with darkstars comments on an online pro trader group. i find that pro traders are either solitary thinkers or involved in a real live trading group. i dont see us getting a big group together on the forum, but i would love to see someone prove me wrong!
Relax and be happy.
  • #16
  • Aug 22, 2006 12:32am Aug 22, 2006 12:32am
Quoting merlin
btw i agree with darkstars comments on an online pro trader group. i find that pro traders are either solitary thinkers or involved in a real live trading group. i dont see us getting a big group together on the forum, but i would love to see someone prove me wrong!
In forex there are many stars:morning star, evening star, shooting star and darkstar.The last one is of most significance because of his good posts.
Plz dont listen to him.If you all veterans will leave us for a pro group then who will take care of orphans of FF.
  • #17
  • Aug 22, 2006 2:52am Aug 22, 2006 2:52am
Quoting merlin
i still cant get over the gravity of this statement. there is so much truth in so few words. and its an undeniable truth, bigger than anyone who would dare to disagree. great stuff man, really great stuff.


Wow, thanks merlin. Very kind words. I didn't mean it to be that profound, but I'm glad you like it.

When I get some time, probably later in the week, I will make a post here about basic profitability analysis for trading systems. This will be geared toward new traders, and beginner-intermediate "systems seekers".

I am primarily a grad student at USC, so my time devoted to new system theory is limited. However, I will see what time I can collect to see if new traders on this forum respond differently than what I am used to.
  • #18
  • Aug 22, 2006 3:19am Aug 22, 2006 3:19am
Quoting silverpike
I agree with this view. God bless the "helpers", most of them have lots of patience and good attitudes toward others. I might fall into this category if I could be convinced that noobies would actually pay attention. Alas, I have lots of evidence that they don't. I find this bizzarre, because I am a member of other online communities as well. In those cases (not trading related), noobies seem to learn very well from the more experienced. Why this doesn't occur with Forex is beyond my comprehension.
Try me, I can't find what I need with indicators, and, like most learners, I've tried them all.
Quote
Regardless of all of this, my comment about statistics and random number theory still applies. To date, I have seen only 1 informative post about random walk analysis, and that was on another board. I guess the theory goes over the heads of too many.
You may be right, but with a sound explanation, and a good teacher, some of us may grasp your ideas. Those who just want to scalp won't bother to learn, whereas those of us who are trying to rise above the herd may just make the effort.
I suggest you start a proper thread, locked if you like to keep out the great unwashed, and see who 'salutes the flag'
Peter
  • #19
  • Aug 22, 2006 5:28am Aug 22, 2006 5:28am
Looks as though this thread is begining to unfold it's corners. I sense the the hindsight of pain in each post here. We all learned the hard way with the markets. Another major detail to take not to is the fact that many traders in here are not doing this for the money. It's the power over defeat, to perpetually sustain a forward thrust movement for success. Mental or Monitary.
Welcome all..... We are not to expect to gain facts figures or the like here, as one would assume by the initiative of this thread " Forex Market mechanics" Rather think Perception of word play. We are the Mechanics of the Forex Market as we each work silently uncontiously unified selling or buying night and day.
"Look Left Think Right"
  • #20
  • Last Post: Aug 23, 2006 12:26am Aug 23, 2006 12:26am
at the risk of being redundant, I shall reiterate....the reason most fail is I believe 1st they are always jumping from system to system, The greener grass syndrome if you will..........
When they find a system they miss trade it, stops are to close,TP is to far out, or they overtrade for whatever reason...they see the price turn against them and get nervous and jump out, then when they see the market turn back around they jump back in with revenge on there mind to regain the lost pips only to lose more.
the list goes on and on as to why traders lose, greed, fear, EGO, impatience.
I have been guilty of them all and untill recently when I found a rediculesly simple strategy, have I just begun to become profitable....now I will see if I can keep from improving this one to death.
Same Whore .... Different Dress
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