TA or something you don't know about. - page 23
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Your posts look strange, some kind of mix of scientific theses and science fiction, where is the reality and where is the myth...
In which post in various topics you post a screenshot of the market stack, and what do you see there? Limit orders are visible there, but the price moves the market orders, and the fact that limiters follow the price at a minimum distance from the price is a well-known fact, this fact is manipulated by brokers, and only a broker knows the total position of market orders, and only a broker can use this knowledge to his advantage
Why only limit orders? A covered sale or buy out of a short position at a predetermined price will work in the same way as a limit order. You bought at 187000 and set your TakeProfit at 187740. Your order has now hit the betting market and as soon as the price reaches the 187740 you will sell your asset.
No, you're the one who doesn't understand what the FA is.
The market does not read newspapers. There is no meaningful correlation between the content of the news and further course following. Again, the market does not read newspapers.
And what is the market as you understand it? I (and not only) always thought that the market is the economic relations between the subjects of the market. And these subjects are always people or collectives of people. Do you think the market is populated by robots? Or have people stopped reading newspapers? Or has the market become an abstract construct "a thing in itself" and can do without people?
Is it that Trichet and Bernanke's press conferences do not affect the exchange rate? So a downgrade in a country's credit rating has no effect on its exchange rate? 9/11 didn't cause changes in exchange rates and stocks?
Let's say that the effect of lowering the discount rate will affect the market not through newspapers or TV, but through the cost of borrowing, which in turn will increase leverage (leverage), which in turn will increase fund liquidity (more money for investment/speculation), which automatically means higher stock indices.
A great example! Even ignoring the questionable nature of the relationship (as a rule, the money flows from countries with low interest to countries with high interest and causes the growth of stock indices NOT in the country that lowers the interest - carry trade, man), another question arises - and what about when the currency reacts significantly before the announcement of the interest?
On the 7th of April 2011 the ERU % was raised. In contrast,the DAX did not change during the 2 weeks before the announcement of the future increase and rose for 20 days. Was the rise due to rumors? Maybe on the assumption ofa future % change?
Trading on the news can in the full sense refer to noise trading (haphazardly making trades in different directions), but not to FA.
If trading on news and macro indicators does not belong to FA, then what does belong to FA?
And I repeat the question - what does FA rely on if not past prices? How does it make predictions? For example, US employment data has come out, how does the FA make a prediction about the dollar exchange rate without reference to past prices? Maybe the market is looking at how asset prices have reacted in the past to a decline/increase in that indicator?
All FA works tell the story of how the market reacted down/up (predicted or not) to the release of certain macro data and rumours. So FA is based on past price behaviour.
You have a very interesting but strange idea of FA. So what do you think FA is?
Here is the EURUSD chart at the time of September 11, 2001 (marked with a dotted line):
The Euro did rise that day, but from the outside, the rise that day was just part of a more general upward trend at the time.
Now let's look at the internal price dynamics during that period:
The chart shows the wild tails of 9/11 (the surge in volatility) and the next day there was a strong downward correction, the rate ended up where it would have been without the events of 9/11.
Would it have been possible to make a profit, knowing in advance about this event and the time of its occurrence? Of course not. The very next day the price had already deflated to its previous value. At the height of the terrorist attack, the maximum bar price was 0,9064 at 15:00 and by 15:15 the price was 0,8975, i.e. a significant correction took place. And one can speculate after the fact, why the Euro fell and did not rise at that moment, but there is only one truth: it is just the increased volatility, which does not say anything about the direction the exchange rate will go in.
The magnitude of the event did not become clear until much later. It is as if time was split before 9/11 and afterwards. And how did this event influence the exchange rate of the dollar in the long term? Not really, the dollar began to strengthen and the euro began to fall.
Oh, please, don't say that this movement was caused by the inflow of foreign capital to "cleanse" America and all that. That's complete nonsense to somehow justify the ridiculousness of the news theory and its impact on the exchange rate. It is much easier to admit the obvious fact: there is no impact. There is a spike in volatility, but volatility makes the candles bigger, but not more predictable.
))
how?
A broker does not guarantee the liquidity on the real markets. Your order if it is in the market may be executed with any slippage depending on the limit orders and the volume of your market order. If you buy 100 lots, they might be filled in parts at different prices.
Yes. I didn't want to go into the mechanism of spread and slippage
Why limit orders only? A covered sale or buyback of a short position at a predetermined price will act in the same way as limit orders. You bought at 187000 and set your TakeProfit at 187740. Your order has now hit the betting market and as soon as the price reaches the 187740 you will sell your asset.
This must be a market order - a typo? Yes, you described the situation correctly when the nearest limit orders were taken over, but at that moment the limit orders became market orders, didn't they?
I don't know about price formation on electronic exchanges, I read, but I haven't seen any specific document describing the whole mechanism. As far as I understand it, the limit orders form spread and slippage, but they do not determine the current price. In my opinion, the limiters is like me waving a hundred dollar bill in front of you and saying let's exchange it for the euro, and in 5 seconds I changed my mind regardless of whether you agreed to exchange or not, I did not let my hundred dollars at the market price - so teased and hid in his pocket.
ZS: I did not have any luck with MT5 administration, they are at the helm in terms of orders for articles, who is closer try to throw an idea about an article about the work of electronic exchanges, for MT5 is positioned as the exchange terminal, and suddenly they will write, so that any programmer can be sent to read
The Euro did go up that day, but from the outside, that day's rise was just part of a more general upward trend at the time.
The "general upward trend at the time" you only see AFTER September 11. The exchange rate went up two days - the 8th and 9th and after that on the 10th it went down. And I will formulate the hypothesis that there was a general upward trend in the market. It started on the 10th, but as the result of the terrorist attack, the price reversed upwards and passed through about 350 pips. And only after that the news worked out, and the DECREASIVE trend continued.
You can see the wild tails of the 11 September (volatility spike), and on the next day there was a strong correction downwards, and as the result the price ended up in the same place it would have been without the 11 September event.
Where the exchange rate would have been without 9/11, only God knows. Be modest.
You could have made money knowing in advance about the event and when it would take place. Of course not. The very next day the price had already deflated to its previous value. At the height of the attack, the maximum bar price was 0,9064 at 15:00 and by 15:15 the price was 0,8975, i.e. there was a significant correction. And one can speculate after the fact, why the Euro fell and did not rise at that moment, but there is only one truth: it is just the increased volatility, which does not say anything about the direction in which the exchange rate will go.
The exchange rate rose for five days. There isno need to make any ridiculous assumptions about it, it can be seen on the chart.
The magnitude of the event did not become clear until much later. It is as if time was split before 9/11 and afterwards. And how did this event influence the exchange rate of the dollar in the long term? Not surprisingly, the dollar began to strengthen and the euro began to fall.
It depends on what your outlook is. For me 5 days are perspective and 350 pips at 0.89 EUR is perspective.
Oh, don't tell me now that this move was caused by the influx of overseas capital to "cut off" America and all that. That's utter nonsense to somehow justify the ridiculousness of the news theory and its impact on the exchange rate.
You are a self-sufficient person - you come up with the hypothesis yourself and call it nonsense.
It is much easier to admit the obvious fact: there is no influence. There is a spike in volatility, but volatility makes candles bigger, but not as more predictable.
In practice, it is not easier - if the US employment data of 08.07.2011 causes a 2-day drop of $4.75 in oil, I do not know what TS can withstand that. Purely theoretically it is easy to accept easy theories, in practice - you have to reckon with the news.
You have a very interesting but strange idea of FA. So what do you think FA is?
Wonderful example! Even disregarding the dubiousness of the connection (usually money flows from low interest countries to high interest countries and causes stock indices to rise NOT in the interest-reducing country - cherry trading, man) another question immediately arises - what about when the currency reacts much earlier than the interest is announced?
And I repeat the question - what does the FA rely on if not past prices? How does it make forecasts? For example, the US employment data came out, how does the FA make a prediction about the dollar exchange rate without taking into account past prices? Maybe the market is looking at how asset prices have reacted in the past to a decline/increase in that indicator?
You forgot to add that firstly, a carry trade cannot affect the stock market directly as it is linked to a guaranteed interest rate. The money of carry trade goes to the banks, not for speculation. And banks from the abundance of money coming to them through the channels of carry trade begin to lower interest rates (they compete with each other), which in turn leads to lower cost of borrowing, which increases the margin component of trading, which leads to an increase in the value of funds.
FA relies on fundamental values. For example, on the cost of production. Let us say that if the wage bill of the collective farmers has increased, the cost of production of their products, e.g. the cost of grain production, will increase accordingly. The current market value of grain may not reflect this change, which the fundamentalists will take advantage of. It is not at all important for them how much grain is now or how much it cost before, the important thing is that the current prices do not yet reflect the fact of rising production costs and therefore they will start to buy grain at any price to bring the current price in line with the new fundamental value. This is the FA.
You forgot to add that firstly, carry trade cannot influence the stock market directly because it is linked to a guaranteed interest rate. The money from carry trade goes into loans to banks, not into speculation on the stock market. And banks from abundance of money coming to them through channels of carry trade begin to lower interest rates (they compete with each other), which in turn leads to lower cost of borrowing, which increases margin component of trading, which leads to increase of fund's value.
Of course! Casual links are a problem. And to transfer money from country A to country B don't you have to sell currency A and buy currency B? Isn't that the exchange rate of the two currencies?
FA relies on fundamental values. For example, on the cost of production. Let's say that if the collective farm workers' wage fund has increased, the cost of production will increase accordingly, e.g. the cost of producing grain. The current market value of grain may not reflect this change, which the fundamentalists will take advantage of. It is not at all important for them how much grain is now or how much it cost before, the important thing is that the current prices do not yet reflect the fact of rising production costs and therefore they will start to buy grain at any price to bring the current price in line with the new fundamental value. This is FA.
Once again FA in forex - ?
All you have presented a vivid example that everyone sees the same situation in his or her own way. We are looking at the same chart and you see a downward trend, I see an upward one. The final result will be 50/50, and it will be the same in any scale and with any number of participants. Therefore, if it is a 50/50 situation, there is no bull and bear trend, only the current price.
For every example you give, I can find a counter-example in the same place at the same time. And I will be right, and so will you, because both you and I will always have 50% of supporters.