Posts by "montmorency"

Slightly off-topic for this thread perhaps, but since the market is relatively quiet at this time, and we seem to be in a discursive mode:

With all this talk of parity, what do people think about the possibility of EUR/GBP parity some time in 2010?

It almost happened in 2009 (and I was surprised it didn't become established).

Also, unrelated, I have been wondering where to ask this question, and in a discursive mode again, and because it is relatively quiet, what do people feel is the balance between fundamental and technical in their own trading?

I ask because I tend to think of Ashraf's approach as being mainly fundamental, but from time to time he makes some strong technical points, and he is usually pretty accurate.

However, in my own mind and my own trading I can't quite reconcile these two approaches. Just to say where I am coming from: I've been trading (spread-betting) for about 2 years, in a fairly small way. Like most people I began to learn TA, and went through the whole multiple indicator experience, eventually ending up with a minimal-indicator, price-action approach, pretty well ignoring fundamentals. I then realised that I was missing something by ignoring fundamentals, and began to try to learn more about how the market worked and how all the currencies, commodities and the stock market fitted together. Clearly Ashraf's approach has helped enormously with trying to understand all that. (I have the book and workbook). However, once I got into fundamentals, I tended to find myself deprecating technicals altogether, which I see is NOT the way Ashraf works.

And now I'm unsure how much weight to give each approach.

Just to elaborate further, I've read some market analysts who seem to have a lot of knowledge of the market who have (at best) deep reservations about TA, even about such cornerstones as support and resistance.

So why, for example, if we believe that it's really fundamentals that drive the market, why on earth should we believe that some historical level from the past should have any bearing, whether as support or resistance, in the future? This is my dilemma.

The only answer I can come up with is the old "self-fulfilling prophecy" one, but I don't think it's all that satisfactory.

I would be interested to read anyone else's thoughts on this.

Hi Jack,

Thanks for your clarification. Interesting what you say about the spike in the USD index chart. One of the brokers I use showed it. Another didn't. The one who did seemed to correct it later, although it still showed a healthy jump. Fortunately, it didn't affect me either way, that is to say, the erroneous spike.

As it happened I _did_ buy EUR/USD at the wrong time (I thought it had dropped as far as it was going to. However, it came back in my direction eventually, as I expected it to (eventually :-) ). [Don't trade like this at home kids .... :-) ]

I agree it's as well to be prepared for what might happen. Everyone (not here necessarily, but in the wider world) seems to have written off the dollar, but there seem to be several scenarios in which it could stage recoveries or mini-recoveries, each one of which is a potential pip-generating opportunity (or pip-losing threat, of course).

Regards,
Montmorency


P.S. Xaron: Are you the same (BWILC) guy who posts on FF under that name? Interesting posts/blog.

Also I think the mood in the UK at the moment (especially on the government side) is terribly negative. The weekend press seems to be full of bad economic news and pessimistic opinion. Any talking up of the pound that might occur would seem to be whistling in the wind.

Qin (if your comment was directed at me), was it George Soros (or maybe Warren Buffet) who said that if reading books could make you rich, then librarians would be some of the richest people on Earth. So, no, I don't think I have too many illusions. I just want to read what I know will be an enlightening book, and also to save asking dumb questions here that are probably answered already in the book. I am mostly annoyed with myself for trying to save a few pounds which probably contributed to the delay in getting hold of it. That was a classic case of a false economy.

Yes - Oct 12th Columbus Day - 2nd Monday in October, apparently:
http://www.buyusa.gov/uk/en/us_bank_holidays.html