Study1: multi-currency analysis for scalping and beyond - page 4
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And one more thought about the multicurrency analysis. Since we are discussing analysis of linked pairs here, it makes sense to normalise the rates before analysis.
I don't know what you mean by the notion of rationing. But in this case all relative changes in rates are investigated.
Example:
time frame 2010.08.12 11:23 - 2010.08.12 11:30
Marked in red is skewed, with the rest of the relative changes standing next to each other.
This is all information from the script I posted. Therefore I supplement this case with screenshots for clarity:
It seems to me that we should consider the last quotation as a rationing point.
I don't know what you mean by the notion of rationing. But in this case all relative changes in rates are investigated.
Example:
time frame 2010.08.12 11:23 - 2010.08.12 11:30
So that's exactly what I mean.
Doesn't it mean continuous redrawing of the whole image? Of course, one can analyze such an image as well, but it is the way to a completely different amount of calculations.
Yes, it does, but what to do.
But to be fair, I didn't find anything of value. :(
For me MT5 is a must, on mt4 doing this kind of analysis is not serious. And what is the analysis without testing and optimization? Do you have to count deals by hand, like the trader does?
Then in MathCad this type of analysis is not serious, since there is no multitool tester. The tester is needed for research of Expert Advisors. Expert Advisors are initially written based on ideas that must be somehow investigated and justified. From an idea to an Expert Advisor, there is a huge amount of research work. It does not matter where to do it. MT4 allows us to do it, MathCad and others do it too. So does MT5. If I do the same research on MT5, it will not give me anything yet. Because I still have a long way to go to the Expert Advisor.
Regarding the fact that the sign suggested by hrenfx does not always work I agree with Yurixx, pairs are of course correlated, but it does not mean a complete loss of individuality. Otherwise we would have long ago had the same situation as at cross-courses - practically a complete absence of opportunities for arbitrage.
Therefore, in case a pair drops out of the "peleton", imho, we can think about additional analysis, for example, to consider the previous "habits and connections" of this pair.
Regarding the fact that hrenfx's sign does not always work, I agree with Yurixx, pairs are certainly correlated, but it does not mean a complete loss of individuality.
The fact that the sign does not always work was shown in the first post in the screenshots. And the sign in the example above sounds like this:
5 majors have changed by the same amount in 7 minutes. The probability that this happened due to USD is very high, because the changes occurred in a short period of time and the changes are the same for 5 majors. And suddenly we see that the changes of the 6th major are completely different, and there was no news about this major. I.e. the fundamental has nothing to do with it. So there was a skew in the 6th Major. Well, if it is skewed, it should be used somehow...
If we speak about FULL individuality, then multicurrency analysis may be fucked.
The fact that the sign does not always work was shown in the first post in the screenshots. And the sign in the example above sounds like this:
5 majors changed by the same amount in 7 minutes. The probability that this happened due to USD is very high, because the changes occurred in a short period of time and the changes are the same for 5 majors. And suddenly we see that the changes of the 6th major are completely different, and there was no news about this major. I.e. the fundamental has nothing to do with it. So there was a skew in the 6th Major. Well, if it is skewed, it should be used somehow...
There was a question why it does not always work, Yurixx answered it.
"Fundamentals have nothing to do with it" is one possibility, the other is that it does, we just don't know this news yet. That is, we have a local manifestation of individuality, and it is at this particular moment that "multicurrency analysis can be shoved to hell" :)
Let's take 6 major currencies (EURUSD, GBPUSD, AUDUSD, USDJPY, USDCHF, USDCAD) and look at relative changes of their rates.
If, for example, during the last 10 minutes, all 6 major rates have changed by 0.05% (in one direction relative to USD), then we assume that USD has played the main role.
Now, if we observe only 5 pairs with the same change, and 6 with a different one. We still assume that the change of rates was due to USD. But the 6-th pair has a skew which should be neutralized. I.e. we open on the skewed pair to the opposite side of the skew.