Forums Trading Systems Discussion Fundamental Currency Strength

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  • #13687
    simplex
    Moderator

      At the moment, I am considering to align my CIX based currency strength analysis with results of fundamental analysis.

      So my question is: do you consider fundamentals in your FX strategies? And if yes, what are your sources of information?

      I found the quarterly SEB currency strategy report as an example, see pic (single page out of 58 pages). See here and scroll down for topic ‘Currency Strategy’.

      s.

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      A good trader is a realist who wants to grab a chunk from the body of a trend, leaving top- and bottom-fishing to people on an ego trip. (Dr. Alexander Elder)

      #13692
      Joakim
      Participant

        Hi Sir, I think GG53’S should help us in your thread, he is the master of “Currency Strength” theme  :whistle:

        #13693
        Anti
        Participant

          @Joakim: If you’d know simplex, you’d know that he is a true master in what he is doing …


          @simplex
          : Is it really necessary to align CIX with fundamental data? CIX operates on prizes only. And I believe we concur that prizes are the cumulative sentiments of all market participants. Thus, fundamentals should be already visible in prize itself (“eingepreist”). The only question is if the CIX reacts fast enough in order to see when sentiment hast changed. Nevertheless, I’m sure that you’ll get most important fundamentals from forexfactory’s calendar.

          (Just my 2 cents.)

          #13695
          simplex
          Moderator

            @Anti: Thanks ‘for the flowers’, first of all! ;-)

            Is it really necessary to align CIX with fundamental data?

            Well, I’m not really sure. That’s why I started this discussion. One example: lately I aligned CIX output with some fundamentals like Central Bank Interest rates for all 8 CIX currencies, looking for some correlation. I found none.

            Thus, fundamentals should be already visible in prize itself.

            Hmm, efficient markets, right? Maybe CB interest rates are not as ‘predictive’ as some would suggest, maybe CBs interventions are more reacting to market changes, hardly being able to influence market participants’ sentiment to a greater extent.

            The only question is if the CIX reacts fast enough in order to see when sentiment hast changed.

            Basically CIX algo will react instantly on any price change, with no lag implied. Any possible amount of lag is caused by the smoothing component, which you can tune to your liking or switch off completely. Any causal lowpass filter (for smoothing) will inevitably cause some lag.

            Nevertheless, I’m sure that you’ll get most important fundamentals from forexfactory’s calendar.

            No, not really. What I’m after goes beyond a simple listing of upcoming events. It’s the interpretation of what has happened recently and is about to happen in the near or mid term future. This is why I posted that link to the SEB report as an example. There may be better sources for this compared to SEB.

            My basic question would be: are such experts’ analysis and outlooks worth being considered in any trading strategy?

            To be clear: I do not plan to implement fundamentals into CIX. CIX is pure and causal, price based strength analysis. I’m considering whether it makes sense or not to align CIX output with fundamental considerations for real trading decisions.

            s.

            A good trader is a realist who wants to grab a chunk from the body of a trend, leaving top- and bottom-fishing to people on an ego trip. (Dr. Alexander Elder)

            #13698
            Anti
            Participant

              Thank you for clearing those points. It could imho only mean a few things if you don’t see correlations between CIX outputs and fundamentals:

              • Market isn’t as sufficient as we would expect it (I remember an article I found where the authors came to the conclusion that the markets are only weak sufficient at all …).
              • Fundamentals have nothing to do with real currency pair prizes (i.e. news and governmental rates are just fake).
              • CIX doesn’t work.

              After your reply I also did some research on sufficient fundamental news resources. Like you, I also couldn’t find some more advanced reports …

              #13699
              Joakim
              Participant

                @Joakim: If you’d know simplex, you’d know that he is a true master in what he is doing …

                Nobody say that Simplex is a bad programmer or trader. But I’m sure that GG53 has more experience in using Currenct Strength, than any on this forum. I mean this and nothing more, nothing less

                #13700
                Anti
                Participant

                  @joakim: Sorry, I didn’t want to attack you …

                  #13859
                  gg53
                  Participant

                    Simplex:

                    Using CIX_v_2_2_post.mq4:

                    How can I get previous value of a currency?

                    I mean something like EUR[2] – EUR[1]?

                     

                    G.

                     

                    • This reply was modified 7 years, 1 month ago by gg53.
                    #13866
                    simplex
                    Moderator

                      @gg53:

                      Long time no see – welcome back! ;-)

                      From earlier discussions I remember that you’re a real fan of iCustom() calls. So this would be the obvious and simple solution to try. I’m sure I don’t have to explain to you how this works.

                      If iCustom is not preferred this time, you might start looking at function OnCalculate(), lines 389 – 406. These would have to be recoded, and possibly a bit more.

                      Looks like you’re going for the 1st derivative of the original CIX line. Since I have no idea what’s the purpose driving your request I can’t give a more detailed advice at the moment.

                      Best, s.

                       

                      A good trader is a realist who wants to grab a chunk from the body of a trend, leaving top- and bottom-fishing to people on an ego trip. (Dr. Alexander Elder)

                      #13867
                      gg53
                      Participant

                        I’m trying to evaluate your code, but can’t find an easy way to find a solution (NOT iCustom…).

                        Can I have a simple (coded) answer, or have to re-read the code?

                        Thanx,

                         

                        G.

                        #13868
                        simplex
                        Moderator

                          Ok. In this early CIX implementation, it’s not that easy.

                          First step might be to integrate functions

                          • setAllCurrencyIndexBuffers
                          • setAllRawValueBuffersResetting OR setAllRawValueBuffersContinuous (depends on what you prefer)
                          • setAllSmoothedBuffers

                          in one single function, which can then be called multiple times to calculate the 1st derivative.

                          Next step could be to integrate calculation of the derivative(s) in that single function as well.

                          I’m afraid there’s no really simple answer to your request in terms of code, based on CIX 2.2. There’s quite some work to do.

                          s.

                          A good trader is a realist who wants to grab a chunk from the body of a trend, leaving top- and bottom-fishing to people on an ego trip. (Dr. Alexander Elder)

                          #13869
                          Lowphat
                          Participant

                            i did something like this but i dont know if it works with the original. ill attach my rough hack    cname = “CIX_v_2_2_post-PHaT-Mod-all

                            ExtMapBuffer1=iCustom(NULL, TimeFrame, cname,0,i+1 )-iCustom(NULL, TimeFrame, cname,0,i+2 );

                            ExtMapBuffer2=iCustom(NULL, TimeFrame, cname,1,i+1 )-iCustom(NULL, TimeFrame, cname,1,i+2 );

                            ExtMapBuffer3=iCustom(NULL, TimeFrame, cname,2,i+1 )-iCustom(NULL, TimeFrame, cname,2,i+2 );

                            ExtMapBuffer4=iCustom(NULL, TimeFrame, cname,3,i+1 )-iCustom(NULL, TimeFrame, cname,3,i+2 );

                            ExtMapBuffer5=iCustom(NULL, TimeFrame, cname,4,i+1 )-iCustom(NULL, TimeFrame, cname,4,i+2 );

                            ExtMapBuffer6=iCustom(NULL, TimeFrame, cname,5,i+1 )-iCustom(NULL, TimeFrame, cname,5,i+2 );

                            ExtMapBuffer7=iCustom(NULL, TimeFrame, cname,6,i+1 )-iCustom(NULL, TimeFrame, cname,6,i+2 );

                            ExtMapBuffer8=iCustom(NULL, TimeFrame, cname,7,i+1 )-iCustom(NULL, TimeFrame, cname,7,i+2 );

                            “I believe the very best money is made at the market turns. Everyone says you get killed trying to pick tops and bottoms and you make all
                            your money by playing the trend in the middle. Well for twelve years I have been missing the meat in the middle but I have made a lot of
                            money at tops and bottoms.”
                            – Paul Tudor Jones

                            #13874
                            simplex
                            Moderator

                              Thanks and yes, this is how it works using iCustom …

                              But as G. wrote he’s seeking a solution without iCustom.

                              s.

                              A good trader is a realist who wants to grab a chunk from the body of a trend, leaving top- and bottom-fishing to people on an ego trip. (Dr. Alexander Elder)

                              #13878
                              Lowphat
                              Participant

                                @simplex good call. @gg53 you may can just change near line 438

                                if (useLowphatAlterateDrawMethod)
                                {
                                double b1,b2;
                                if (displayAUD){bAUD[shift]=phatCalcAUD[shift+1]-phatCalcAUD[shift+2];//change these lines to this?

                                “I believe the very best money is made at the market turns. Everyone says you get killed trying to pick tops and bottoms and you make all
                                your money by playing the trend in the middle. Well for twelve years I have been missing the meat in the middle but I have made a lot of
                                money at tops and bottoms.”
                                – Paul Tudor Jones

                                #13901
                                thomas
                                Participant

                                  Simplex: Using CIX_v_2_2_post.mq4: How can I get previous value of a currency? I mean something like EUR[2] – EUR[1]? G.

                                  Wellcome back G, nice to see you again ….
                                  Regarding the CS, how to use it properly ? My take is like this :
                                  Lets say the 8 major currencies are : A (AUD), E (EUR), D (CAD), F (CHF), G (GBP), J (JPY), N (NZD), U (USD)  and the pairs are the combination of all 8 currencies, and will build 28 pairs. I will look at higher TF, and pay attention to 4 currencies (2 strongest and 2 weakest). Lets say i get A & E as the 2 strongest currencies, and G & N the 2 weakest currencies. I will look only at these 4 lines, and if the line A or E going down, and the line G or N going up, i see the opportunity there. Trading GA, EG, EN, or AN. will be nice, depending on the direction of these lines. In this case, many traders will trade the CROSSING  of the lines  as their entry point.
                                  If i am not mistaken, you will see currency strength in every morning (i think it will be in Asian session), BEFORE you decide which pair is the best one to choose as your trading pair for that day. With helping of other tools, i think this will be give us BETTER win probability to our entry. Is it right ?

                                  From your question above, I think you are trying to get the slope (velocity) of the E lines by looking at the difference of some previous bars : EUR[2] – EUR[1]. Can you explain the use of this velocity ? Does it idea to choose which from the 2 strongest / weakest currencies are the best one ? Lets say at i=2 ,  the line A is at the top, line E the second and N at the bottom, line G just right above line N. As line A & E going down at the same time at bar i=1, we will pay attention to them. But …. the VELOCITY of E is bigger than A, so it is better to trade EG and EN  instead of GA and AN (although line A is still at the top, above line E) ? Or is there another reason ?
                                  Thanks in advance.
                                  tom.

                                  #15621
                                  Fai
                                  Participant

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