A few respectful words regarding currency prices, hopefully to assist readers but also posted for myself. I encourage all to read in FX Trader magazine my History of the FIX Price. The Fix price dictates currency markets and prices since 1919. Its a tradition and can’t ever leave markets.The FIX price is for central banks. But central banks use the FIX price to control their currency pair prices. They know and control every Pip every second of every day and night and they view their pairs in many ranges. Those that report currency markets are manipulated don’t have a dam clue regarding currency prices and the why and how’s of movements. Those signal or news services that report the FIX price are not doing anybody any favors. Its pure public relations because the market is so far ahead of that game. Former price highs and lows is more fallacy reported for public relations. Highs and lows are good for maybe 24 hours if you are lucky, that’s it unless a reason exists to look longer term. And only then the calculation must be known and how to use it. I’m not writing to criticize only to inform and because I quantified every last fact I report here.
What central banks offer daily are free target trades everyday and that includes every currency pair on Forex God’s earth. The trades are not only free but they are guaranteed winners. But to take advantage of these free trades, it takes automation because the human mind and hands can’t calculate fast enough. Its impossible. By the time the calculation is done, the best, easiest, most profitable, guaranteed winner trade is over because the market already responded. Who is this market I mention, I don’t know but they are brilliant. My assumption is they are banks. But the impossibility of fast calculations also comes because a Pip is so small, the human eye can’t see it even if it was written on paper with use of a magnifying glass. I knew from my post last night for example that NZD/USD bottom was found at 0.6562 and NZD/CAD 0.8555. NZD/USD had a double bottom at 0.6544 on the hourlies. What good was 0.6544 at that stage when I knew the bottom was actually 0.6562. By the time I posted both pairs, the free trade was over. Now profits had to be earned. and with risk involved. Because the PIP is so small, tons of math formulas are failures. Yes some will payoff in a day or two but why bother, risk is involved. What the central banks offer is no risk, guaranteed winning target trades. By the time a trader applies a math formula and earns what 100 pips 200 pips in a day or two, tons of free trades were missed to earn quadruple 100 in a few hours at most. The more money in an account then the more free trades available since every pair offers free trades simultaneously. What’s further interesting is not all pairs are calculated the same. GBP is a stand alone and highly transparent currency pair with a simple calculation. CAD as well. But AUD, NZD and EUR must be caclulated in multiple steps to be exact. INR is highly transparent, SGD and most Asia pairs are simple and transparent. Even JPY. The best advice I can offer is view currency prices in 50 pip increments as reasonable estimates and be happy to earn it because currency markets are not designed to be easy or to win. And please most respectfully speaking here. AUD is my example for readers to trade today and follow each and every point and range, target, everything. I will post AUD again this afternoon with the changeover.
AUD/USD. Bottoms first. 0.7245. Overall Range bottom 0.7282 – 0.7209, 73 pips. Shorter range bottoms 0.7282 – 0.7233, 49 pips. Now see the bottom 0.7245. They are protecting the range bottom at 0.7233 and 0.7209 by insertion of 0.7245 because then price heads to next range bottom at 0.7136 if 0.7209 breaks. Above, price must clear 0.7281 ans 0.7282. Then range becomes 0.7282 — 0.7330 and 0.7354. That’s 48 pips from 0.7282 – 0.7330 and 24 pips from 0.7330 – 0.7354. Overbought sell point 0.7330 – 0.7354. Now points in between cause the trade must be earned and points must be highly respected.
0.7281, 0.7282, 0.7283, 0.7286, 0.7289, 0.7292, 0.7304. The AUD/USD trade today was designed by the central banks to short 0.7281 to target something very close to the bottom at 0.7245 but note how the trade taken to 0.7245 would’ve paid 36 pips. That’s actually okay and good for Monday. So instead we have sell 0.7330 – 0.7354 to then tackle the points below. Instead of earning this trade and rislking money, we could’ve already earned much money on the free trades that would’ve taken minutes to earn and exit. And who knows how many round trip trades we could’ve entered and exited. I will post AUD again around 1:00. Maybe a better opportunity exists then.
Brian Twomey, Inside the Currency Market, btwomey.com