Neither Tech nor Macro

[fxintruder]

Quote from fxintruder:

Here are some concepts about how I read liquidity clusters on a daily chart.

The blue dotted lines are my running positions, the lower being the core at 77.44 and the add on is at 78.45. There are 100 pips between them and its just a fortuity. I’d have added more to this core if I wasn’t already positioned on EurJpy. Anyway on the chart we can see a white rectangle, this is where likely massive liquidity is gathering because it’s above a rounded number which is in the 200Dma influence area and a daily big fib level. We also have in the same area stacked higher highs (red lines) where usually intraday and weekly players are pending or looking to exit. The interest of these confluences is that it attracts big players who want to enter the market without pushing the price against themselves and for that they need sufficient liquidity. A tech would use it as a place to fade or to buy according to his strategy, while a fundie will ignore it completely. Me, I am Jpy bearish (UsdJpy bullish), and I always seek to buy/sell/ at a better price on the best place; a place where price will quickly move away from my position. And I also think that no indicator or pattern can by its signal push back a structural move in a currency, but a liquidity cluster can generate turbulences (local volatility) . Therefore I will add prior of each important data release this week that can impact the risk perception. This will help to cross the turbulence at a fast pace from an average level hopefully low enough to avoid the subsequent volatility. I can add massively because I am strongly convinced that the big players will buy there hence pro-pulsing the price higher and that they are targeting the 80s as I am. But again it’s just my own opinion.

The UsdJpy core is going its way as planned above. As I said I am looking at some catalysts to bring the price, after retracements, around the levels on the chart. Initial jobless claims this PM Gmt or any bomb from the EU summit could be opportunities for 79 and 79.40 . The bigger picture on daily as a remainder is showing the liquidity distribution as explainedin the quoted post. Above the 80′s I will decide if I maintain the position fully, partially or close it.

 

[contra]

wooo, I totally missed this journal. This is what I kind of intended on doing when I started a journal here, but was waaay to lazy. Though I wouldn't have went so in depth on my strategy.

I didn't read it all just enough to know what you are doing and who it's from. I think we come from the same school, but I am not sure who this is.

Does the journal help you? I am not sure of your intentions here but there doesn't seem like many FX traders here, so you won't get a lot of feedback.

one thing... you are using both tech and fundies here actually.

 

[fxintruder]

Let's talk a bit about the way I trade, rather let me try to summarize it.
As I mentioned in the first post, I don't like systematic trading (systems) whether they are based on tech indicators or fundamental indicators. For me reading the markets is more like a mindset than a strategy, I don't believe in strategies. I don't belong to a school of thoughts or rather I've studied everything and I don't think to be more successful than a tech or a fundie, but I do know that knowing everything is vital to see that 95% of what you learnt is crap.
If I had to formalize my grid of reading and what drives it, I would say:

Trend: Global macro

Positioning: Liquidity distribution and market dynamics, information flows.

Timing: Tech behavior due to tech levels (above daily) Fundamentals behavior due to data releases. Calendars. Current sentiment.

Global macro is not the same as fundamentals. Its linked to macroeconomics, like monetary policy, global monetary and economics flows and the broader view of fundamentals and global politics. Global macro is also tightly linked to politics (e.g. knowing that the newly elected French president will allow Draghi to resist Germany and deliver the OMT program; that is, a printing machine. Or knowing that Merkel would in the end support Greece and Spain because the German elections are in 10 months and she wouldn't want until then any collateral damage to the German economy). Another illustration of Global macro is is for e.g. knowing, in terms of macroeconomics, that QEs carries hyperinflation risks and also that a global QE like now is an unknown situation. What conclusion to draw from this in terms of markets and trading ??. A fundie is just waiting for the cpi to tell him that inflation is knocking at the door to buy precious metals. A global macro will see that QE with no rising CPI means a more or less coordinated fight of the developed countries against creeping deflation. That intervention will bring an answer from emerging markets, hence adding to systemic risks, distorting flows and promoting false safe havens A global macro will also know that with all the coming bailouts and haircuts Greece is mechanically doomed, and will leave the Eurozone , but not before the tail risk is eliminated and this, is Euro bullish.
The best markets for global macro traders are the Forex by its sensibility to monetary policies, gold, oil and global indexes by their sensibility to anticipations. These markets are global by their very nature and indeed are more or less overlapped.
All this is very wordy but actually I do prefer being interested in global economies and politics than in what is driving AAPL or FB.

Knowing global macroeconomics is a thing you can study. Timing and positioning is more difficult. More on this later.

Note: By posting here I am not looking for a feedback and please understand I will not answer questions as I said in the first post. I don't tell much about my trades on ES (30% of my trades), Oil and gold, neither about my new passion for options strategies . But these times we are trading risk on/off behavior and this is what driving all the markets so far. I find it more interesting to deploy a swing trade plan and its follow ups than talking about every thing, mainly if the incentives are the same.

 

[fxintruder]

Third add-on filled.

 

[contra]

cool man. I don't care to say global macro, for me it's in the same bin along with political and geopolitical stuff etc. = fundies. simpler that way for me, and I am all about keeping it simple.

I know what you are doing and where you learned the core of your principles from. I think I know who you are too. Full time since 2006? The way you are trading FX wasn't happening until the past 6 months or so?

good luck.

 

[fxintruder]

Quote from fxintruder:

Here are some concepts about how I read liquidity clusters on a daily chart.

The blue dotted lines are my running positions, the lower being the core at 77.44 and the add on is at 78.45. There are 100 pips between them and its just a fortuity. I’d have added more to this core if I wasn’t already positioned on EurJpy. Anyway on the chart we can see a white rectangle, this is where likely massive liquidity is gathering because it’s above a rounded number which is in the 200Dma influence area and a daily big fib level. We also have in the same area stacked higher highs (red lines) where usually intraday and weekly players are pending or looking to exit. The interest of these confluences is that it attracts big players who want to enter the market without pushing the price against themselves and for that they need sufficient liquidity. A tech would use it as a place to fade or to buy according to his strategy, while a fundie will ignore it completely. Me, I am Jpy bearish (UsdJpy bullish), and I always seek to buy/sell/ at a better price on the best place; a place where price will quickly move away from my position. And I also think that no indicator or pattern can by its signal push back a structural move in a currency, but a liquidity cluster can generate turbulences (local volatility) . Therefore I will add prior of each important data release this week that can impact the risk perception. This will help to cross the turbulence at a fast pace from an average level hopefully low enough to avoid the subsequent volatility. I can add massively because I am strongly convinced that the big players will buy there hence pro-pulsing the price higher and that they are targeting the 80s as I am. But again it’s just my own opinion.

Remember the explanations given here about market dynamics and how price helped by catalysts gonna cross a liquidity cluster. Here is the daily chart showing the pair headed to the 200dma after macro data releases as planned. I have now 4 add-ons averaged at 78.94. therfore protecte by the 79.00 rounded number. I will add more as said here if the stops above the 200Dma are tripped. Decison area is around the eighties.

On the global macro incentive, it’s interesting to notice that only Jpy pairs have a clear direction, that is a weaker Yen.

 

[fxintruder]

Quote from contra:

cool man. I don't care to say global macro, for me it's in the same bin along with political and geopolitical stuff etc. = fundies. simpler that way for me, and I am all about keeping it simple.

I know what you are doing and where you learned the core of your principles from. I think I know who you are too. Full time since 2006? The way you are trading FX wasn't happening until the past 6 months or so?

good luck.

Are you a friend of mine? I learnt a lot about market dynamics in the past 6 months, but I trade full time for a while now and the most lucrative period was when I was scalping. I have nothing to hide, here my pseudo is fxintruder, but I post elsewhere under the name of Ocean, flytox and neoflytox. Who you? Imf?

 

[ammo]

fx, just for fun look at mp on you index

 

[ammo]

if this were a popularity contest the widest spots on the graph,are areas where it traded the most often,which may provide resistance..i like your approach

 

[contra]

Quote from fxintruder:

Are you a friend of mine? I learnt a lot about market dynamics in the past 6 months, but I trade full time for a while now and the most lucrative period was when I was scalping. I have nothing to hide, here my pseudo is fxintruder, but I post elsewhere under the name of Ocean, flytox and neoflytox. Who you? Imf?

I knew it was you ocean, wtf dude. lol... yea imf... how you been?

don't get defensive bro, i was just fukin with ya.

last i heard you went on vacation?

I should say this dude is a good trader.