The purpose for today is parity curves and one day the intention to write this most fascinating and definitive way to trade perfectly by interest rates. Most importantly is by very simple math to how and why interest rate trades work so perfectly for day trades and longer term views. My perspective is this is original work and never revealed or written in the literature.
To construct the required system to trade takes minutes and once set then the only prerequisite is enter the proper number.. All are trading by moving averages yet not from a yield curve but interest rates and interest rate curves.
No difference exists to interest rates for day trades from the Fed, RBA, RBNZ, BOC, ECB. All offer the exact same trades and all are perfect. Missing is the BOE and Sonia rates but no difference exists to GBP/USD from central bank to central bank as all report the same exact trades. Sonia is vital only to traders of Sonia. The BOE redesigned their website and I can’t find daily Sonia rates but I also didn’t search very hard nor did I write the BOE.
The elimination of Libor offered a massive wholesale change to interest rates as all the central banks melded all interest rates to reveal the exact same interest rates to trades. The numbers are different but the trade remains the same. A time once existed when each nation’s interest rates required entry as each currency was massively different to daily ranges. Today, its all the same.
The BOJ is the anomaly as negative interest rates must convert to positive rates by 1+ interest rate. The BOJ only offers 3 daily numbers and not enough information for day trades except to offer 1 support point below and 1 resistance point above. But not enough for a full day trade’s price path. Required is enter the 3 daily numbers along with Tibor and Japanese Yield rates.
Yet the BOJ is not required for USD/JPY trades as any central bank will offer the same daily trade by entering the proper number.
The BOJ and ECB are the only central banks to offer longer term range views. No difference exists to longer term views. USD/JPY for example offers from the BOJ as 122.46, 127.81, 129.42, 133.40 and extremes at 140.88. The ECB reveals 129.48 and 133.34. The BOJ and 3 numbers are far better at long term views than the ECB.
EUR/USD from the BOJ factors as 1.0434, 1.0557, 1.0870, 1.1005. From the ECB, EUR/USD factors as 1.0550 and 1.0865.
All roads lead back to USD/JPY 131.40 and EUR/USD 1.0707. AUD/USD factors as 0.6583 to 0.6779, NZD/USD 0.6297 to 0.6115. GBP/USD 1.2430 to 1.2070.
Daily interest rates must change day to day to allow accuracy.
Today’s EUR/USD and USD/JPY and the proper set up.
Long Short Line 1.0707
Most Important 1.0680 and 1.0699 Vs 1.0713, 1.0720, 1.0727, 1.0734, 1.0747, 1.0754, 1.0761
Bottom 1.0653 achieves by 1.0667 and 1.0680
Upper Target 1.0761
Continuation Fail 1.0734
Every number today is perfectly accounted.
Long Short Line 131.40
Most Important 131.07 and 131.30 Vs 131.48, 131.56, 131.64, 131.73, 131.89, 131.97, 132.06
Bottom 130.74 achieves by 130.90 and 131.07
Upper Target 132.06
Continuation Fail 131.73
I realize all are not supposed to understand this stuff nor are any interested in doing work apart from a chart.