it is called correlation ....... eur, gbp, aud, nzd are all positive correlated currencies the correlation coefficient is .69 which is pretty strong....... if you do a linear regression on returns you get the intercept at .000153 and eur= .882142 so ...

Correlation - Good Way to Trade?

please research that for yourself I gave two links my frustration with people is that THEY DO NOT UNDERSTAND what a THEORY is, a theory is not an Idea that some one thought about that might be so (this is gross misinterpretation, and it is used in ...

Extracted Thread (per thread starter's request)

I do not purport to know what is going to happen or how the market will react post fiscal cliff What I do know however is that Bush era tax cuts will be reversed and INCREASED expenses will not take effect, this is supposed to drain liquidity out of ...

EurAnalysis

explain why you use your indicators....the time frame and how to derive the calculation. what are the weakness in them and what are their assumptions? exactly what are you trying to measure?

EurAnalysis

you do realized that although Einstein was a Genius and I have a lot of admiration for him......everything he said is not always as profound or intelligent as you think. his definition of insanity is pretty stupid....I can disprove it in a minute ...

EurAnalysis

hahahaha I give too much detail because I am used to corroboration and replication by peers. here it is simply standard deviations are are how much the closing price can vary from the average. because of the nature of random like movement things can ...

EurAnalysis

the problem with statistics is the use of past data and one MUST NEVER assume that it is predictive in any sense although my drift weights the current momentum into account... the NUMBER ONE RULE is that price is moved by orders and hell if I know ...

EurAnalysis

I do a MLE test on my data..... and also corroborate that with a GARCH fit via R

EurAnalysis

ok I will try as simple as I can when you take the euro returns it resembles a normal distribution correct with heavy tails. usually on a normal distribution , you get the mean and median at 0. to make price simulation you need to turn the normal ...

EurAnalysis

I wonder how you came about your projection.....that 1.2874 seems very much like my mean for the next 16 days.....I am not sure however we come about targets the same way

EurAnalysis

yeah I have that problem I have enable it but still doesnt work......that is why I have m email there.

Looking at Exchange Rates in a Scientific way

I wonder how reliable is extrapolating data from oanda's costumers......I mean in real terms they are a very small portion of retail....and retail doesn't move the market. i suppose the question is how representative are they of the market?

EurAnalysis

eur/usd and eur/jpy are the only official pairs.....all others are synthetics and for these two you get two highly correlated pairs....I am not sure how advantageous that is.....so then you could be watching the eur/usd eur/jpy and the usd/jpy in ...

EURUSD

I often do that to anchor my first position like i did in december 3 "using a 10,000 unit position = mini lot short the euro with 1 mini lot, and buy 1 mini lot of the yen time frame for stats= last 6 months sigma(yen)/sigma(euro)= .7791 that means ...

EURUSD

not sure what you meant there.....if you would explain in more detail so i know exactly what your thought is? are you talking about hedging via correlation and risk assessment by linear regression and relative movement in standard deviation? like ...

EURUSD

yes, once you get a best fit linear model you can figure out how y moves in relation to x Call: lm(formula = chf.returns ~ eur.returns) Residuals: Min 1Q Median 3Q Max -0.022767 -0.000898 -0.000053 0.000611 0.043093 Coefficients: Estimate Std. Error ...

EURUSD

now at the pain of sounding ignorant.......how do you read it. Looks alien to me so If you would be so kind as to instruct me. There are the option strikes and the difference in calls and puts but i don't quite know what I am looking at

EURUSD

to me the advantages are more psychological ....because you see as pattern seeking primates looking at the eur/usd chart can lead me to see all kinds of things. kind of like staring at the clouds..... when I see these two charts together and as they ...

EURUSD

not to mention it is trading at .83 right now and it seems to me that it has trouble finding liquidity at that area as evidenced by the loss of momentum in the current bullish impulse plus looking at the daily it seems like it is a resistance level.

EurAnalysis

the AUD and NZD are highly correlated and both are about .69 correlation coefficient with the eur/usd ( I used daily returns for the calculation over the past 2 years) so just by that alone I can tell you that if EURO is going short a safe bet would ...

EurAnalysis