The Quantum volatility indicator captured dramatic price action in the yen pairs during this month's BOJ meeting, confirming what had already been signaled in the options market for the currency. The overnight implied volatility, which is the metric we watch, was at 50% (a six-year high), so violent price action was expected, of which the aud/jpy was one example. As we can see on the hourly chart featured above on the MT4 profile for the pair, we can see the relentless move higher and the volatility trigger on the huge up candle. This trigger of the purple arrows happens in real time and warns us that the price action is outside the average true range for this time frame. Trader reaction is usually one of FOMO, with many jumping in just when the price is likely to pause or reverse, as in this case. This is a classic trader trap and happens all the time. However, when we read the...
We are seeing some significant moves in sterling this week, and none more so than in the gbp/cad, a commodity cross pair that can often deliver solid and consistent trends. However, on a time chart, it can be challenging to gauge the strength and momentum of a trend, which is why traders use either tick or Renko charts. For traders who like to use tick charts, the problem has always been knowing what tick value to use, so they either guess or rely on values suggested by other traders. However, as activity and momentum in the market are constantly changing, these static values are no better than a time chart.
This is why we developed the Quantumtickspeedometer, which calculates the optimal value for the chart and, in addition, uses a traffic light system to tell us when the market is active or not. The indicator is attached to a time chart, allowing us to use our volume price analysis methodology, which...
This morning's move in the aud/usd was a great example of using multiple timeframes, including a Renko chart and all our Quantum indicators. The charts are from the MT4 platform, and since writing the analysis, the pair did indeed bounce higher once Wall Street opened.
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As the DXY index (USD) continues to strengthen, many traders would like to know how much further it is likely to rise. The simple answer is that from a historical perspective, the DXY reached a high of 151 in 1984, so there is plenty of travel left. We must consider the daily and monthly charts to view their current trajectory. The monthly is interesting because last month's price action triggered the Quantum Dynamic Volatility indicator confirming the candle range is outside the ATR for this time frame. The reaction to this trigger is that the price action will most often retrace into the spread of the candle and consolidate before any direction is re-established, which is what we are seeing now. In addition, last month's volatility candle gives us key support and resistance levels for the DXY.
The daily chart below is where we will find the week's important support and resistance levels. On this chart, we are using both price...
The Currency Matrix for Tradingview comes with a ranking score of the 28 pairs we follow and a score that allows us to judge at the extremes whether the values displayed are all-time highs or lows, along with the average high and low on the timeframe in question. This additional information tells us in an instant whether the move underway has further to go or whether there is potential for a reversal.
This video explains this in more detail.
https://youtu.be/DOVu_zYXg54...
The recent volatility in the British pound created some great trading opportunities, particularly for traders who include volume price analysis as part of their tactics. In this video, David explains how he applied vpa to the long side in the sterling pairs despite extremely negative headlines in both the financial and mainstream media.
https://youtu.be/gFIJW9_s1Zw
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In this first segment from this week's webinar, David & I look at the USD, bond yields, this week's Non-Farm Payroll release, and the volatility we can expect as we move towards year end. We also cover how the labour market impacts inflation and how this is likely to influence the FED's rate-setting agenda.
https://youtu.be/fbUjvFb7vuY
By Anna Coulling
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A roundup of one of the busiest days for forex traders that started with the RBNZ interest rate decision and ended with the FOMC minutes. In this video, David & I cover the events of the day and their impact on the relevant currencies and currency pairs. We also focus on the Heatmap, an indicator that can be used both for intraday and longer-term trading. Intraday, the indicator can be used to monitor existing positions across multiple timeframes as the values are based on the currency matrix. The indicator then weights these values to rank the pairs allowing traders to look for reversals.
https://youtu.be/7HeHoUriok8...
A recording of a recent webinar where David and I looked at using the MT4 Renko in conjunction with multiple time frames on the aud/usd to identify not only entries and exits but also demonstrate how a Renko chart can help traders stay in a trade. Also a look at the Currency Heatmap on Tradingview which can be configured to any timeframe.
https://youtu.be/KjWThEWdeTg
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This morning's forex webinar gave us a great example of how cross-market analysis can help not only to explain price action but also its likely direction particularly ahead of an important news release which today was the FOMC.
https://youtu.be/CnFQezWG4zU
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