I think the pressure is always essentially “equal”. with this simulation, I am assuming the outcomes produce a normal distribution with 3 kurtosis? can you run the simulation, and with a kurtosis of 4-5 to see how that changes the candles? I imagine ...

Questions for real pros: How to trade with reference points only?

I think a good question to ponder in this discussion is, what’s the different between “momentum” and a “long-tail” move? is there any? Fat-tailed distributions by nature would make long tail moves appear like momentum since in these distributions ...

Questions for real pros: How to trade with reference points only?

if the market is perfectly 50/50. It doesn’t mean that most candles close at their open prices, it means 1/2 them close above and 1/2 close below. So for the duration of the candle, most of the time is spent in the direction it will close in (on ...

Questions for real pros: How to trade with reference points only?

Hey AntiCre, I enjoy reading your work and share a lot of the sentiment regarding the state of discussion in online forums being at an all-time low. Hopefully that changes. To add to your and newhope's discussion I will throw some thoughts out ...

Questions for real pros: How to trade with reference points only?

I typically do it manually. Sometimes I will automate it if I need to step away but I typically don't like to leave trades on if I can't watch them. Here is some data for NFP tomorrow on GBPUSD. The average High-Low range for a 5-minute candle is ...

f(x) News Trading

Here is some great Saturday reading I’d recommend to anyone looking for a clearer understanding of dynamic replication: url url I will try and post more chart examples this weekend if I have time. Both of these talk about dynamic replication in ...

f(x) News Trading

Looks like long was the play on GU for fed fund rate. Have seen 50 pip range in first 2 minutes. Expect it to increase another 50+ pips for nest 235 minutes. Will see which direction it grows in... I was playing short so am mostly reduced to only ...

f(x) News Trading

Look at the round-trip from GU this morning: image As expected, we saw more than 1/3 of the move happen almost instantly as the range expanded upwards for the remaining 235 minutes (7:00-11:00). Surprised how it completely turned around after ...

f(x) News Trading

Thanks for the feedback! I will try to post something like this today.

f(x) News Trading

Next 2 events I'll be watching: image Will most likely trade GBP/USD for both of them. For GBP CPI our 5-minute High-Low range is about 21 pips compared to a typical average of 8. The 4-hour one is 65 pips compared to 45. So roughly 33% of the ...

f(x) News Trading

Has basically played out exactly as described. we broke back above the initial range and have continued to trend in one direction for the rest of the 4-hour period If you were playing long side gj, if you played short side, don't fret, your ...

f(x) News Trading

So far nothing but chop on the CAD inflation. Have an about a 15 pip high low range currently on USDCAD. Over next 3 hours and 45 mins there is at least a 50% chance we see a move of 45+ pips in either direction beyond the current high-low range. I ...

f(x) News Trading

obvious edge doesn’t mean it’s easy to use. everyone knows what hands to bet on in Hold’em, most people still suck at the game though

Where's The Edge?

It's better to just focus on volatility over volume. There is no source of truth in terms of volume, but regardless of what broker data you use to calculate volatility, you get results that are essentially the same.

(binned per thread starter's request) Volume in Forex

I was reading some of my initial posts and I want to clear a few things up regarding a couple of points I made previously. The first one is the statement below This is a formula to detect a directional advantage. But just because there is no ...

Where's The Edge?

This is a great point and I completely agree with you. Many people argue that kurtosis will converge towards 3 (normal) if you have enough samples or as the time horizon increases. It's a core principle of modern portfolio theory. Unfortunately, ...

Where's The Edge?

anything data mined will fail in the future unless it specifically targets a characteristic of prices distribution that is different what is normally expected. Things that appear to be winners are really just long leads. If you flip a coin 100 in ...

Survivorship Bias

Thanks for sharing Driven! This sounds like a pretty sound method of essentially machine learning, using a 75/25 split on the data (75% for training (last 3 months), 25% for testing (next month)).

Where's The Edge?

I completely agree with this. The market is only directionally random. But in terms of expansion/contraction of volatility, the distribution of prices is far from "normal".

Where's The Edge?