Currency market: Day trade changes

Brian Twomey Brian's Investment

Changes are coming to FX day trades and the developments are not good. Post 2016 and the invention to brand new traded markets never seen before since the 1972 free float experienced central banks to hide the most appropriate interest rates and market information required to trade accurate day trades.

Central banks contracted information to Bloomberg, Thomson and others for big monthly fees yet if one knows what they are doing, no need exists to pay these people as good money is thrown away. Our required information is all done by pen, paper and calculator.

The central banks will work on delays next week to report Fx rates required for day trades. Took hours but I found how central banks factor exchange rates and ironically, its very simple.

Most important candles and times for Fx trading is 9:00 to 9:30 pm and 2:00 to 2;30 am EST. Required is 3 numbers and the day trades are set in stone as normal. The Fx price must enter and factor to central bank interest rates then the day trade is known and factored perfectly.

I assure all to 3 vital points. To know the correct numbers without its understanding and not factored to interest rates is a waste of time and energy because supports, resistance and ranges must be known from opposite exchange rates such as EUR/USD and USD/EUR.

The relationship to EUR/USD, USD/EUR changes comstantly frpm central bank to central bank therefore supports, resistance and ranges must re adjust.

The stipulation to interest rates is after almost 6 years of daily calculations and twice daily for 9 currency pairs, I'm at the point where interest rates are not required for day trades. Seen daily over many years is the same old thing, constantly.

AUD is a perfect example as AUD and RBA interst rates are Fixed in stone and AUD won't change unless the RBA changes rates. pretty much the same story for all central banks.

Secondly, I now understand how computers beat every trader on the planet pre 2016 when the ECB reported at 8:30 am. EST. Its quite easy to know the correct numbers in advance much the same as computers did pre 2016 to beat every trader on the planet. Beat means to trade the best prices for best profits immediately and leave the scraps to retail traders.

Third, the 9:30 pm and 2:30 am candle price is guaranteed wrong. The 10:00 pm and 3 am candle will always be wider than the 9:30 and 2:30 candle.

Fourth, the currency price is a forward price. It trades, thinks and acts in the future. Candles inform to the next set of information required for future candles.

The 3 numbers required so far to consistent calculations are GBP/USD, AUD/USD, NZD/USD and USD/CAD but 3 numbers changed calculations to EUR/USD, GBP/JPY, EUR/JPY, USD/JPY. Its assumed AUD/EUR is on the consistent list.

After 3 days of twice daily tests. The above information is wrong as no consistency exists for the most part. Why is due to opposite pair relationships. Take EUR/USD Vs USD/EUR.

Built into the relationship is a 2 pip differential from the differnce between nation interest rates. Certain pairs contain wider differentials yet not much more. The inconsistency to daily numbers is interest rate based and reflected in the daily exchange rate numbers.

The monster in the crowd is GBP/JPY yet it remains a highly special currency pair as calculations change and the prices are never correct from central bank to central bank and the reporting services. Bloomberg and Thomson and others.

GBP/JPY is always close to correct but never perfect. We want accuracy and perfection but GBP/JPY will never offer perfection. The exchange rate number is to large as the main problem but in legacy terms, the exchange rate number was always to large dating to the 1930's.

The above information written yesterday on my blog is also wrong. GBP/JPY is just another currency pair and its daily numbers may be correct or near correct. The 3 number calculation is an imperative to ensure the number is correct.

Remember the purpose to day trades as reported 2016 by central banks: to trade UK, Europe and USD 8:30 am news announcements and all within a 7 1/2 hour period. If the central banks go through with proposed delays and we wait then the mission is viable to trade news announcements and day trades.

Or the question is can I calculate fast enough and correctly to beat the central banks. I don't know the answer yet especially on 9 currency pairs. We've seen these types of delay proposals before and central banks backed off by assumption from complainers.

Author

Brian Twomey

Brian's Investment

Brian Twomey is an independent trader and a prolific writer on trading, having authored over sixty articles in Technical Analysis of Stocks & Commodities and Investopedia.

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