Baruch's Forex System Journal

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Quote from Baruch:

Hi again,

All indicators (I suppose) are lagging, and that's the problem with them.
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To be honest, I don't know that there's anything inherently wrong with indicators; I think it's really in how you use them. As long as you're of the mindset that you won't be right all the time, and that's okay, I think indicators are fine.

Personally, I know myself. I'm not experienced enough to trade strictly off price action and I won't get news fast enough to capitalize on it. That leaves indicators, or throwing darts at a board. While the latter definitely sounds more fun ( :D ), I think I found a way I'm comfortable with and that produces decent results in predicting direction. Who knows, maybe I'll get everything wrong, but for now, it seems to work okay.
 
Quote from SteveL91:

To be honest, I don't know that there's anything inherently wrong with indicators; I think it's really in how you use them. As long as you're of the mindset that you won't be right all the time, and that's okay, I think indicators are fine.

Personally, I know myself. I'm not experienced enough to trade strictly off price action and I won't get news fast enough to capitalize on it. That leaves indicators, or throwing darts at a board. While the latter definitely sounds more fun ( :D ), I think I found a way I'm comfortable with and that produces decent results in predicting direction. Who knows, maybe I'll get everything wrong, but for now, it seems to work okay.
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Hi again,

OK. I also like - as you can see in my thread - a fundamental approach. It's nice to know what's going on - and why. But does a big fundamental knowledge makes pips? Well, I heard that Warren Buffett is down with 800 m in his short dollar play, so I don't think so.
P.S. Do you trade divergences in your indicators?
 
Quote from Baruch:

Hi again,

OK. I also like - as you can see in my thread - a fundamental approach. It's nice to know what's going on - and why. But does a big fundamental knowledge makes pips? Well, I heard that Warren Buffett is down with 800 m in his short dollar play, so I don't think so.
P.S. Do you trade divergences in your indicators?
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Ironically enough, I prefer the fundamental approach. I've only become interested in trading and technical analysis over the past few months. I'm still more of a long-term investor, but I don't have enough money to devote to any one stock position to make it worthwhile (in my eyes).

I've done a lot of reading and research on Buffet, and I take his approach (or, at the least, something similiar) when it comes to picking companies to hold for the long haul. However, over the short term, I don't know that the fundamentals really play much of a role. Two quotes I always keep in mind when going between the two styles and time frames (roughly paraphrased):

1) Over the short term, the market is a voting machine; over the long term, it's a weighing machine. It's late, but I'm pretty sure that was Benjamin Graham.

and of course, 2) The market can stay irrational a lot longer than you can stay solvent.

Now that I think about it, while I'm comfortable with both fundamental and technical analysis, the reason I tend to disregard the fundamengtals in forex is because I don't think I have an edge there while I *might* have an edge when it comes to predicting direction. I do, however, think I have somewhat of an edge in fundamental analysis when it comes to picking companies as investments.
 
Quote from Baruch:

Maybe I went flat to early? You never know...
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Sorry, I forgot to answer your question. I tried to edit my post, but there's something wrong with my browser and it wasn't working.

Anyway, I do look for divergences, but I may or may not play them. I try and get a general idea of things, and go from there. If that involves playing the divergence, so be it; if it doesn't, no big deal. I try to remain fluid and not lock myself into anything as I'm still learning and building a foundation.
 
Quote from SteveL91:

Ironically enough, I prefer the fundamental approach. I've only become interested in trading and technical analysis over the past few months. I'm still more of a long-term investor, but I don't have enough money to devote to any one stock position to make it worthwhile (in my eyes).

I've done a lot of reading and research on Buffet, and I take his approach (or, at the least, something similiar) when it comes to picking companies to hold for the long haul. However, over the short term, I don't know that the fundamentals really play much of a role. Two quotes I always keep in mind when going between the two styles and time frames (roughly paraphrased):

1) Over the short term, the market is a voting machine; over the long term, it's a weighing machine. It's late, but I'm pretty sure that was Benjamin Graham.

and of course, 2) The market can stay irrational a lot longer than you can stay solvent.

Now that I think about it, while I'm comfortable with both fundamental and technical analysis, the reason I tend to disregard the fundamengtals in forex is because I don't think I have an edge there while I *might* have an edge when it comes to predicting direction. I do, however, think I have somewhat of an edge in fundamental analysis when it comes to picking companies as investments.
More...

Hi again,

No 2 was from Keynes, the famous british economist. He was also a great speculator/investor - but he knew his very big fundamental knowledge wouldn't help him if he was wrong. So he learned to listen to the market instead of himself.

I think fundamentals are important if you want to be a long-term trader. It's more easy to hold your position if you know why it moves.
 
Quote from Baruch:

Hi Steve,

How do you trade GBP/JPY? What's driving this pair?
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I think it's mostly the oil prices. Do you want action? Wow - trade this pair.
 
hi all,
what do you think will be the reactions to the data today?

we have at 8:30

- retail sales
- initial jobless claims
- ppi

and then later mr greenspan speaking.

i think the news will point to more inflation/rate hike.
that should be a long usd signal.
maybe in eurusd the low at 1,175x will be broken if the data is looking like inflation very much.

im still short eurusd @ 1,1900
 
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