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Trading Currencies using Purchasing Power Parity (PPP)

In this post I want to cover one of the factors that enters into the creation of the benchmark index outlined in my Trading Approach. This factor is called Value, and provides an underlying fundamental reason for trading various currencies. To explain value let’s assume that the water company Evian sells an identical bottle of […]

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EURUSD tick data for the period 6th March 2016 to 11th March 2016. Zip file contains CSV files for each day. The format of the CSV files are: Local Time, Server Time, Server Time Milliseconds, Bid, Ask. The time resolution is in seconds. This means that there can be multiple quotes per second.
Tick Data EURUSD, 20160306 - 20160311, Broker 1
Wouldn’t it be great to forecast what the outcome economic news-releases would be?  News trading is a favourite for many traders, professionals and novice alike. For the long-term trader who holds positions over several days or weeks it might lead to clues as to the next big trend. For intra-day traders it can be a treacherous path. Usually day traders end up losing money, usually because of massive slippage on their stop-orders followed by knock-outs on their protective stops because o…
A Painful Way of Learning NOT to Trade the News: a Lesson for Day Traders: ADP Slippage and the EURUSD
More Money Than God: Hedge Funds and the Making of the New Elite is simply WOW! All I can say is WOW! Mallaby apparently held in excess of 1000 interviews and was given access to emails by some of the main players in the history of hedge funds. If you have read the Market Wizards trilogy, then this book actually fleshes out some of these individuals and provides the historical setting. The book is made up of 14 Chapters, which track the history of hedge funds both chronologically and stylist…
Book Review: More Money Than God
Many people ask if there are any particular technical setups that I like to look at and what the best way to trade them is. My all-time favorite heavily involves Support and Resistance levels, and using these as breakout levels. The art lies in finding them and then managing trades appropriately. In this article we’ll focus on using Bullish and Bearish Engulfing Bars to identify support and resistance levels, and present the analysis that goes behind implementing such a system. Implementati…
Bullish & Bearish Engulfing Bars (Part I)
In this article I’ll follow up from Part I, on using the UK Services PMI to trade the GBP. The questions we’ll answer are:
  1. What economic indicators for GBP are out there and which can we use?
  2. How do you set up a macro system?
  3. What does it mean to trade a basket of currencies against GBP, or is there a preferred pair to trade?
Let’s cover the main themes that affect the Foreign Exchange Rate:
  1. Inflation: influences Central Bank behaviour, but also tells us about price increas…
4 Economic Indicators to help your Fundamental Trading of GBP– Part II
Welcome
Mean Reversion and Market Regimes
In this second part of the Mean-Reversion in Equities series we’ll cover the reasons behind why mean reversion works in various market regimes. In the previous article we combined the idea of looking at two consecutive down-days combined with buying the S&P 500 while it was below its five day moving average. A question that stands out: why does it work so well?  And, will it ever stop? The answer to this question lies at the heart of developing good trading strategies.  

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Equities Mean Reversion and Market Regimes