FOREX - Trends, Forecasts and Implications 2015(continued) - page 1658
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I'm sorry, I got a little excited.
To the centre means to the centre of the range. The one shown in Strange's screenshots. The matter is that at contract expiration it "drops out" of the general picture and in the last two days before expiration it may show serious flights in either direction, and it may go back and forth about three or four pips by 100 during the day. This is because during the last days the delta of the option contract is close to one, the time value is nearly zero, it's traded almost like the futures. And speculators are taking advantage of that, getting in different directions on futures and options at the same time, minimizing risk. That's why there are such flights.
After the expiry, the range down will be widened considerably by the December contract fallout.
Basically, we are talking about the same thing. But there are a few points:
1. the OI is of no interest to me at all.
Explanation. If the traded volume per unit time (per hour or day) is a relative thing, but at least comparable (you can see the absolute ratio - for example, when compared to historical data (for example, the maximum volume of the last month/contract/year was traded per day), then the OM is not comparable to history.
Phrases such as "OI is falling, it means this will happen" are nonsense to me. Because it is impossible to know the moment when the OI value will be the lowest. If I knew that "this is the bottom of the OM" - then the analysis of OM would be of no value. But as it is....
2. Exactly what I was talking about.
3. IMHO. This is all suitable for intrade or short term.
When a trend lasting six months is reversed at least for a correction, no tape etc. will help you in this. To see this reversal, which even in case of correction will last for weeks...
Ivan, the OI should be looked at cumulatively from the beginning of the contract, not over a period. Then you will understand exactly whether it is increasing or decreasing.
Well, we were talking about intraday. And we never said anything about a mid-term, because the working methods there are different. I'm using Vadimchi's channels and option analysis to work long and mid-term. Sometimes I work in intraday, but cluster analysis is obligatory there. The analysis itself is in Excel using VBA. Vadimcha's channel indicator is available online for 4. Few people simply know how to use it properly.
Actually, Vadim, with whom I communicated closely for three or four years, rightly said that if you tell everything, you will not get an understanding. Giving a fish and giving a rod are two significantly different actions. Words usually pass over the consciousness.
If you wish, I can show you the channels and the work on them. But it takes a long time to grind it out, otherwise it won't do any good.
Lesorub:
ну покажите, ночь длинна...
I sleep at night. And you won't understand anything in one night.
Lactone, I'm writing this to you personally, because you should just ignore the duckbills with their +%, they will never bring in -%, which they have much more of.
The sellers and buyers are always equal, it's an axiom, and it's not even up for discussion.
Again an example on the same potatoes. I want to buy 10 kilos of potatoes at 10, i.e., I put a limit on the buy at 10 for 10kg, creating a demand.
But no one is willing to sell at 10, the lowest price at which they are willing to sell at 11. There's an offer at 11.
So I buy at 11 because I have to.
What happened to the price? It went up one point. What moved it? Demand and supply. That's the only thing that moves the price.
So what should we be tracking in the market? The intentions of the participants, that's one, the OI is two, at what price the highest volume of transactions took place, three.
That's it.
If we can see that, we're good.
I sleep at night. And you won't understand anything in one night.
I'm sorry, I got a little excited.
To the centre means to the centre of the range. The one shown in Strange's screenshots. The matter is that at contract expiration it "drops out" of the general picture and in the last two days before expiration it may show serious flights in either direction, and it may go back and forth about three or four pips by 100 during the day. This is because during the last days the delta of the option contract is close to one, the time value is nearly zero, it's traded almost like a future. And speculators are taking advantage of that, getting in opposite directions on futures and options at the same time, minimizing risk. That's why there are such flights.
After the expiration, the range down will be extended considerably by the December contract fallout.
Statistically, 9-10 times a year out of 12 expirations occur at parity(blue).
As for "will be extended downwards" I don't know, the range of the January option contract is now 1.0591-1.0962.
Judging by this and subsequent posts, you are overcome by wild jealousy, which we periodically fuel. Perhaps the man has no closed negative trades. He should draw them to you so you can say, I told you so, duckbills!
and the euro is about to hit the limit:
You'd better be careful what you say, or they might bite you in the corners.