Forex Books - page 127
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"Forex Trading Using Intermarket Analysis: Discovering Hidden Market Relationships That Provide Early Clues for Price Direction" by Louis B. Mendelsohn : the book
Contents
FOREWORD
PREFACE
INTRODUCTION
Chapter 1. WHAT IS FOREX?
If you have traveled internationally, you may already know something about the forex market, today’s hottest marketplace. Discover why you might want to trade forex.
Chapter 2. THE FOREX MARKETPLACE
The forex market is the world’s largest marketplace, dwarfing all other markets combined. See how forex grew so large and how you can participate.
Chapter 3. FUNDAMEN TALS AND FOREX
Forex traders can get plenty of information, sometimes so much that it can be hard to sift through it all. Here are some reports a forex trader needs to consider.
Chapter 4. APPLYING TECHNICAL ANALYSIS TO FOREX
With fundamental information overwhelming, many forex traders analyze price action in charts. Chart patterns and indicators have shortcomings, but see how predictive moving averages can help with market forecasting.
Chapter 5. INTERMARKET ANALYSIS OF FOREX MARKETS
What happens in one market is influenced by what happens in a number of related markets. Discover why single-market analysis should give way to intermarket analysis in today’s global marketplace, especially in forex markets, which are ideally suited for this type of analysis.
Chapter 6. USING NEURAL NETWORKS TO ANALY ZE FOREX
With so many fundamentals and so much influence from related markets, it’s hard to see all the patterns and relationships in the forex market. Find out how neural networks can uncover hidden patterns in data and select the best to make short-term market forecasts.
Chapter 7. TECHNICAL TACTICS FOR TRADING FOREX
Once you understand how the forex market works and the basics of technical analysis, you are ready to put theory into practice. Here are a few more practical tips and chart examples to help you apply your knowledge to actual trading.
Chapter 8. WAVE OF THE FUTURE: SYNERGISTIC MARKET ANALYSIS
Using only one approach to trade no longer works in today’s global markets. Successful trading requires the synthesis of technical, intermarket and fundamental approaches.
TRADING RESOURCE GUIDE
ABOUT THE AUTHOR AND MARKET TECHNOLOGIES, LLCIn these days, trading automation is one of the major topics in the field of financial research. Buy and sell are the key rule to an automated trading system which is possible to generate by various technical indicators in Forex (Foreign Exchange) market. Each indicator has its advantages and disadvantages. The evaluation is based on application of the Parabolic-SAR indicator for four currencies namely EURUSD, GBPUSD, USDCHF and USDJPY individually to identify effectiveness of the indicator regarding to the amount of profit generated, using hourly data of market stretch from January 2001 to December 2010. Virtual Historical Trading Software (VHTS) is developed for the purpose of computing the indicator based on its original formulas and interpretations; for applying the assumptions; for trading based on buy and sell signals generated by the Parabolic SAR (P-SAR) indicator. 1. Introduction Trading in foreign currencies began in 1973 following the collapse of the Bretton Woods agreement under which gold held by central banks underpinned currency values. Forex is a free market in which currency prices are based on supply of and demand for a particular currency [1]. The Forex market has several distinct advantages over other financial markets, such as: operation on a 24-hour basis 5 days a week, no fixed location, and an over-the-counter market. Besides, Forex market currently generates a daily volume of over USD 3.2 trillion thereby making it the largest financial market [2]. Any currency can be traded as long as there is no restriction by central banks issuing the currencies [3]. Ding et al. (2010) added that rapid technological changes to increase efficiency in Forex transactions have enabled the market to grow at a tremendous pace by reducing entry and transaction costs as well as overcoming geographical limitations.
Technical trading rules are extensively used by foreign exchange (forex) traders. Despite the essential need to the forex diversification, it is not addressed by academic researches to generate forex portfolio trading systems based on technical indices. This paper aims to develop an interpretable and accurate Takagi-Sugeno-Kang (TSK) system for forex portfolio trading. The system uses technical indices of the forex rates and delivers the preferred portfolio composition among multiple foreign currencies. The proposed model considers the transaction cost and trading risk, which are the two important factors in the high frequency trading strategies. The proposed model was implemented to develop a trading system for portfolio trading among the five of the most traded currencies in the Tehran forex market. Four experiments were designed to examine the performance of the proposed model in different market trends, in terms of the portfolio return and risk adjusted return.According to the experimental results, the proposed model is able to extract profitable portfolio trading systems in this market, especially when the market is in the downward trend.