This blog was created in 2007 and contains a theme to cover market events, developments and trades. Information is found by the search button on the lower right.
The 2007 date applies to many articles written for Stocks and Commodities Magazine and Investopedia.
I offer examples. Years ago, trades were factored based on yields, yield spreads, yield crossovers, yields factored forward by the yield price to the 2nd and 3rd power depending how far to view the price. How about Yield Methodologies.
Years ago, markets moved far and wide so it was an imperative to know what you were doing plus banks used the methods highlighted in this blog and outlined in research reports. The EUR/USD for example moved 200 and 300 pips per day, 1500 – 2000 pips per month. Trade strategies had to be solid or markets would take you out faster than anybody could ever know.
Ability to hit targets in 2012 was a far different proposition than today due to movements far and wide in the old days compared to dead trade days today. This explains the abundance of trades offered throughout the past 16 years.
Much of the information I had to teach myself so each theme was written, figured and factored extensively. Hit the search button for yields and tons of educational articles will materialize. And all within the time frame when yields were the trade methodologies.
Note the current Import / Export escapade and note the abundance of articles covered during the current period. This is the way to all themes.
Interest rates is another giant theme as interest rates factored to day trades, interest rates Vs money supplies, money supplies Vs Futures prices and trades. EUR/USD Futures for example trades on ECB money supply volumes. At the time of the example, the ECB money Supply was 11 billion and the top for EUR/USD was 20 billion to the money supply. The bottom was opposite as 1 billion.
Another trade was the M1 and M2 crossover trades. The trade was taken long or short based on the M2 direction to the cross.
Yet another trade was done by Forward Points as a Forward Point is an interest rate and the best location for a Forward Point to find is between levels at the 2 year yield. This took extensive work to find and knows this information.
The massive changes to interest rates was the 2016 overhaul by the ECB. Libor was eliminated and markets since 2016 died a horrible death to ranges. All conceived and implemented by the ECB.
Currency Realignments. Here’s EUR/USD as 2 opposite currencies. Which side, EUR or USD is dominant in markets. EUR was dominant from 1999 to 2008 then USD became the overriding theme. Realignments last about 10 year in markets.
As a former college professor, Politics was covered as themes hit markets. Monetary Policy and central bank statements was covered extensively.
SNB no longer uses Debt Register Claims in daily trades. A long explanation to Debt Register Claims was covered in February 2016 as well as Tom /Next trades.
Statistics was covered from Simple Regression to Z Scores to much more. Simple Regression is a great tool to learn for today but take the next step and factor Residual Plots as Residual Plots bound ranges solidly. A Residual Plot range can’t break mathematically.
Back in the day, EM trades were abundant but not covered much today. A gazillion EM trades exist in this blog. USD/MXN was once a great mover and day trades were factored based on Mexican TIIE interest rates. Then Banxico changed TIIE rates so today, USD/MXN is a non mover in markets.
2016 was the giant change to interest rates and day trades had to re work based on the new system.
Bad trade losing. The Repair trade was shown and how to exit at breakeven or trade to target but never lose.
Correlations to USD/CAD and OIL, USD/JPY and Yields, Currency Price to interest rates. NZD to Milk, AUD/USD to Eastern Wool. Covered.
The point of this article today is the search button to assist anybody interested in how market trade, operate and the massive work devoted to the topics over nearly 20 years.
Most are lost and blinded in the entry, exit = profits category and are not interested in the how’s ands why’s of markets. But friends and followers are quite different here than in the wider spaces as all are interested, many are, traders students and market professionals.
Brian Twomey [email protected]