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Forex linear regression enables you to predict future price movements by comparing the current and historical currency pair prices. In our article, we will understand the Forex Linear Regression tool in depth.

What is forex linear regression?

Forex linear regression is a statistical tool that finds the best-fit line between the current and historical exchange rates to identify the current market trend. You can analyse the trading signal based on the direction in which the Forex Linear Regression line moves. When the line is moving upwards, it signals to place long orders, and when it is falling, it signals to place a short order and exit long positions. The Forex Linear Regression consists of two important elements:

• The regression curve is a line that best fits the data points and represents the relationship between the current and past price levels.
• The slope of the line represents the rate of change of the current price level in relation to the historical price level.

What is the Forex Linear Regression channel?

The Forex Linear Regression channel consists of three lines indicating a trend's high point, low point and middle point. The three lines help in analysing the upper and lower limits of a trend to place orders accordingly. When the current currency pair prices are nearer to the upper or high limit, it signals to place long orders due to an uptrend continuation expectation. On the other hand, when the currency pair prices are nearer to the lower band, it indicates a downtrend continuation expectation and signals to enter a short order instead.

• The upper (lower) Forex Linear Regression line is made by plotting the top (bottom) price points on the chart.
• The mid or median Forex Linear Regression line is plotted right in the middle of the upper and lower lines.

How to calculate Forex Linear Regression

1. Simple Forex Linear Regression line/slope

The Forex Linear Regression line/slope helps in identifying if the market momentum is positive or negative. y = a + bx Where: y = the dependent variable (for example, the current closing price of a currency pair) x = the independent variable (for example, the previous closing price of a currency pair) a = the y-intercept, representing the value of y when x = 0 b = the slope of the line, representing the change in y for a unit change in x

2. Forex Linear Regression indicator

The Forex Linear Regression indicator can be calculated by multiplying the value of the slope calculated above by and dividing it by the currency pair price level. The default period is set to

Top Forex Linear Regression strategies

1. Curve strategy

The Forex Linear Regression curve strategy is used to present unique price points that are missed by the moving average indicators. You have to wait for the Forex Linear Regression curve to move above the current currency pair candlesticks to open a short trade. However, if you want to enter a long trade, wait for the slope to move below the currency pair’s candlesticks. This strategy is most effective over the long-term timeframe as it helps in comparing the currency price levels to the historic price levels.

2. Slope strategy

Forex Linear Regression slope is an oscillator indicator that helps identify the current trend's strength. In this strategy, you wait until the currency pair price levels reach the support or resistance level to identify a bearish or bullish trend. When the currency pair price hits the upper line, touching the resistance level, it signals traders to sell existing long orders and enter long orders. This indicates a bearish reversal strength. On the other hand, when the currency pair price hits the lower line, touching the support level, it signals trades to buy the long orders and exit short orders, indicating a bullish reversal signal. If the currency pair is in an uptrend and crosses the middle band from below, it indicates that the uptrend is strong and going to continue, signalling long order opportunities and vice versa.

3. Channel strategy

Forex Linear Regression channel trading strategy helps you identify the ideal support and resistance price reversal to predict possible reversal price points. In this strategy, you combine another technical analysis tool like Bollinger Bands that calculates the support and resistance level on the linear regression curve. The Bollinger Bands depicts the mean value of the currency pair through a red line. It is a buy signal whenever the currency pair price goes below this line and vice versa.

How to trade with Forex Linear Regression

1. Determine the trend

Identify the current trend in the market by examining the charts and finding the direction of the market. Compare the current price levels with the previous price levels to understand the strength of the ongoing trend to predict if the markets are going to reverse or continue.

2. Plot the Linear Regression line

After calculating, plot the Linear Regression line on the chart by finding the best-fit line representing the market trend.

3. Identify support and resistance levels

Use the Linear Regression line to identify potential support and resistance levels. If the current prices are near the support level, enter a long trade, and if they are near the resistance level, enter a short trade.

4. Enter a trade

After analysing the forex regression bands, support and resistance levels and the closing prices, you can enter a trade in the direction of the current trend.

5. Monitor the market

Combine the Forex Regression Line with other technical indicators like Bollinger Bands to monitor and confirm the market signals that the former provides. Exit the trade when there is a change in trend.

Use the Forex Regression Line on your charts today

The Forex Regression Line is a trend-following indicator that helps in analysing trends. You can increase your chances of placing successful market orders by including this indicator in your trading strategy. Blueberry Markets is a global trading platform that can help you kickstart your forex journey and use forex regression line indicator, along with several others. Sign up for a live trading account or try a risk-free demo account.

The colossal size of the global foreign exchange (“forex”) market dwarfs that of any other, with an estimated daily turnover of $ trillion, according to the Bank for International Settlements ’ triennial survey of Speculative trading dominates commercial transactions in the forex market, as the constant fluctuation (to use an oxymoron) of currency rates makes it an ideal venue for institutional players with deep pockets – such as large banks and hedge funds – to generate profits through speculative currency trading. While the very size of the forex market should preclude the possibility of anyone rigging or artificially fixing currency rates, a growing scandal suggests otherwise. (See also "Forex Trading: A Beginner's Guide.")

The Root Of The Problem: The Currency “Fix”

The closing currency “fix” refers to benchmark foreign exchange rates that are set in London at 4 p.m. daily. Known as the WM/Reuters benchmark rates, they are determined on the basis of actual buy and sell transactions conducted by forex traders in the interbank market during a second window (30 seconds either side of 4 p.m.).The benchmark rates for 21 major currencies are based on the median level of all trades that go through in this one-minute period. 

The importance of the WM/Reuters benchmark rates lies in the fact that they are used to value trillions of dollars in investments held by pension funds and money managers globally, including more than $ trillion of index funds. Collusion between forex traders to set these rates at artificial levels means that the profits they earn through their actions ultimately comes directly out of investors’ pockets.

IM collusion and “banging the close”

Current allegations against the traders involved in the scandal are focused on two main areas:

• Collusion by sharing proprietary information on pending client orders ahead of the 4 p.m. fix. This information sharing was allegedly done through instant-message groups - with catchy names such as “The Cartel,” “The Mafia,” and “The Bandits’ Club” - that were accessible only to a few senior traders at banks who are the most active in the forex market.
• “Banging the close,” which refers to aggressive buying or selling of currencies in the second “fix” window, using client orders stockpiled by traders in the period leading up to 4 p.m.

These practices are analogous to front running and high closing in stock markets, which attract stiff penalties if a market participant is caught in the act. This is not the case in the largely unregulated forex market, especially the $2-trillion per day spot forex market. Buying and selling of currencies for immediate delivery is not considered an investment product, and therefore is not subject to the rules and regulations that govern most financial products.

An example

Let’s say a trader at the London branch of a large bank receives an order at pm from a U.S. multinational to sell 1 billion euros in exchange for dollars at the 4 pm fix. The exchange rate at p.m. is EUR 1 = USD

As an order of that size could well move the market and put downward pressure on the euro, the trader can “front run” this trade and use the information to his own advantage. They therefore establishes a sizeable trading position of million euros, which they sells at an exchange rate of EUR 1 = USD

Since the trader now has a short euro, long dollar position, it is in their interest to ensure that the euro moves lower, so that they can close out their short position at a cheaper price and pocket the difference. They therefore spreads the word among other traders that they have a large client order to sell euros, the implication being that they will be attempting to force the euro lower.

At 30 seconds to 4 p.m., the trader and their counterparts at other banks - who presumably have also stockpiled their “sell euro” client orders - unleash a wave of selling in the euro, which results in the benchmark rate being set at EUR 1 = The trader closes out their trading position by buying back euros at , netting a cool $, in the process.

The U.S. multinational that had put in the initial order loses out by getting a lower price for its euros than it would have if there had been no collusion. Let’s say for the sake of argument that the “fix” - if set fairly and not artificially - would have been at a level of EUR 1 = USD As each move of one “pip” translates to $, for an order of this size, that pip adverse move in the euro (i.e. , rather than ), ended up costing the U.S. company $ million.

Worth the risks

Odd though it may seem, the “front running” demonstrated in this example is not illegal in forex markets. The rationale for this permissiveness is based on the size of the forex markets, to wit, that it is so large that it is nearly impossible for a trader or group of traders to move currency rates in a desired direction. But what the authorities frown upon is collusion and obvious price manipulation.

If the trader does not resort to collusion, they do run some risks when initiating their million short euro position, specifically the likelihood that the euro may spike in the 15 minutes left before the 4 p.m. fixing, or be fixed at a significantly higher level. The former could occur if there is a material development that pushes the euro higher (for example, a report showing dramatic improvement in the Greek economy, or better-than-expected growth in Europe); the latter would occur if traders have customer orders to buy euros that are collectively much larger than the trader’s 1-billion client order to sell euros.

These risks are mitigated to a great degree by traders’ sharing information ahead of the fix, and conspiring to act in a predetermined manner to drive exchange rates in one direction or to a specific level, rather than letting normal forces of supply and demand determine these rates.

Asleep at the switch

The forex scandal, coming as it does just a couple of years after the huge Libor-fixing disgrace, has led to heightened concern that regulatory authorities have been caught asleep at the switch yet again.

The Libor-fixing scandal was unearthed after some journalists detected unusual similarities in the rates supplied by banks during the financial crisis. The forex benchmark rate issue first came into the spotlight in June , after Bloomberg News reported suspicious price surges around the 4 p.m. fix. Bloomberg journalists analyzed data over a two-year period and discovered that on the last trading day of the month, a sudden surge (of at least %) occurred before 4 p.m. as often as 31% of the time, followed by a quick reversal. While this phenomenon was observed for 14 currency pairs, the anomaly occurred about half the time for the most common currency pairs like the euro-dollar. Note that end-of-the-month exchange rates have added significance because they form the basis for determining month-end net asset values for funds and other financial assets.

The irony of the forex scandal is that Bank of England officials were aware of concerns about exchange rate manipulation as early as Years later, in , Bank of England officials reportedly told currency traders that sharing information about pending customer orders was not improper because it would help reduce market volatility.

Growing repercussions

At least a dozen regulators - including the U.K.’s Financial Conduct Authority, the European Union, the U.S. Department of Justice, and the Swiss Competition Commission - are investigating these allegations of forex traders’ collusion and rate manipulation. More than 20 traders, some of whom were employed by the biggest banks involved in forex like Deutsche Bank (NYSE:DB), Citigroup (NYSE:C) and Barclays, have been suspended or fired as a result of internal inquiries.

With the Bank of England dragged into a second rate-manipulation scandal, the issue is seen as a stern test of Bank of England Governor Mark Carney’s leadership. Carney took the helm at the BOE in July , after garnering worldwide acclaim for their adroit steering of the Canadian economy as Governor of the Bank of Canada from to mid

The Bottom Line

The rate manipulation scandal highlights the fact that despite its size and importance, the forex market remains the least regulated and most opaque of all financial markets. Like the Libor scandal, it also calls into question the wisdom of allowing rates that influence the value of trillions of dollars of assets and investments to be set by a cozy coterie of a few individuals. Potential solutions such as Germany’s proposal that forex trading be shifted to regulated exchanges come with their own set of challenges. Although none of the traders or their employers has been accused of wrongdoing in the forex scandal to date, stiff penalties may be in store for the worst offenders. While the balance sheets of the biggest forex players in the interbank market will be able to easily absorb these fines, the damage inflicted by these scandals on investors’ confidence in fair and transparent markets may be longer lasting. 

Traders who base their trading decisions on technical analysis tools will ultimately face a few dilemmas when it comes to choosing the “best” price to apply in their technical tools calculations. Since nowadays most traders use Japanese candlesticks to understand price on their price charts, it’s important to note that there are four obvious available prices: open, high, low and close. Of course, this is the bare minimum number of choices that a trader has on the candlestick chart. There are also many different possible combinations, making the selection of the “price” a potentially difficult task – especially for beginners.

Closing price

It is no secret that a lot of traders, beginners and professionals alike, consider the closing price to be the most useful. This perception is mostly driven by stock market traders who believe that the last price of the day captures everything needed to make informed trading decisions. This includes the day’s sentiment (based on economic releases, monetary developments, political stance and, inevitably, crowd psychology), and also reflects what is anticipated to happen before the next session of the market opens.

Even Charles Dow, often considered one of the “forefathers” of technical analysis, considered the closing price to be the most important price of the day. But how should those trading foreign exchange approach the closing price? Unlike the stock market, which is not open 24 hours and instead opens at a certain time in the morning and closes at a certain time in the afternoon, the foreign exchange market is open 24/5. It is a continuous market without any set opening and closing times!

What the foreign exchange markets offers instead of set opening and closing times are different timeframes. Each candlestick represents the price activity over an adjustable amount of time: namely, 1 minute, 5 minutes, 15 minutes, 30 minutes, 1 hour, 4 hours, 1 day, 1 week and 1 month. Forex traders can treat the close price at the completion of a candlestick in much the same way as stock traders do in the stock market.

Other price options

So, irrespective of the market that one trades, the question persists: what is the “best” price to use? For that reason, trading platforms offer a few choices:

• Open
• High
• Low
• Close
• Median
• Typical
• Weighted Close

One could argue that the choice is subjective, but I believe that there are cases where one price is better than another.

One way to choose the “best” price is by market convention. For example, in the stock market the majority of the traders observe the daily closing price, so it can often make sense to use it when calculating technical tools as well.

Open price

On the other hand, the open price represents the reaction of traders to any developments since the last close. The Market Profile methodology makes use of the open price to provide clues for market reactions.

Median price

Traders can also choose the midpoint of a candlestick – that is, (high + low) / 2 – instead of relying on just one price; this is the median price. The Alligator indicator makes use of the median price to calculate the lips, teeth and jaws.

Typical price

Another way to account for the two extremes of prices during a session (high and low), as well as the closing price, is to use the typical price. The formula for the typical price is (high + low + close) / 3.

Weighted close price

Furthermore, since the closing price is considered by a respectable number of traders to be the most important, it is not surprising that the weighted close price is another popular choice when it comes to making trading decisions. For this, the formula is (high + low + close + close) / 4. It’s simple to see that there is more emphasis on the close price, compared to the rest of the prices. Moreover, support and resistance lines are drawn including the high or low price of a candlestick. Likewise, price confirmation of candlestick patterns observes the high and low price.

Therefore, when it comes to making trading decisions, there is no one “best” price to apply when calculating a technical tool or drawing a technical line or object. The choice may be indeed purely subjective. In other cases, it can be decided on market convention or based on just mathematics. The choice is yours!

The RSI is another forex indicator that belongs to the oscillator category. It is known to be the most commonly used forex indicator and showcases an oversold or overbought condition in the market that is temporary.

If the price trades are above the moving average, it means buyers are controlling the price, and If the price trades are below the moving average, it means sellers are controlling the price.

Fibonacci is another excellent forex indicator that indicates the exact direction of the market, and it is the golden ratio called
Several forex traders use this tool to identify areas and reversals where profit can be taken easily. Fibonacci levels are computed once the market has made a big move up or down and looks like it has flattened out at some specific price level.

One indicator that you will be seeing time and time again as you learn Forex trading is a moving average (MA). Moving averages are lagging indicators — this means they do not predict price direction but are rather calculated from the past prices. There are four popularly used types of moving averages: Simple, Exponential, Weighted, and Smoothed. You will rarely see Weighted moving averages used in Forex, but we will cover them anyway. Most traders prefer to stick with Simple and Exponential moving averages. The default is to calculate moving averages using closing prices, but you can also choose to calculate using High, Low, Open, Median, Typical, and Weighted prices. You will be able to choose how to calculate your moving averages in your charting platform unless you wish to calculate them manually.

Let's start with simple moving averages (SMA). A simple moving average is calculated by adding up the most recent N number of prices and then dividing that sum by N. What is N? It is called the period of a moving average and you can set it via your charting software. It can take any positive integer value from 1 to infinity. It indicates how many days (or hours, or weeks, or any other chosen periods of time) you will be averaging. The general formula for calculating a simple moving average for a given moment of time is:

For example, you chose 5 as the number of days (period), and the Close prices for those are (from oldest to most recent): , , , , and  Then the simple moving average can be calculated as:

SMA = ( + + + + ) / 5 =

With an exponential moving average (EMA), the calculation is more or less the same, but the difference is that exponentially less weight is given to the older data. This is done to reduce the lag. Here is a general formula to calculate an EMA:

It means that the EMA for today is calculated based on the EMA value yesterday, today's price and the special multiplier α, which can be anything from 0 to 1 (the higher it is, the sharper is the exponential decline of the weight of the older data). In Forex, α for an exponential moving average is usually calculated as 2 / (N + 1), where N is the period of the MA.

For example, we have the same data and period as in the above example for SMA. Let's calculate α:

α = 2 / (5 + 1) = ~

The EMA of the first day is considered equal to the price of that day:

EMA₁ =

EMA₂ = + × ( − ) =

EMA₃ = + × ( − ) =

EMA₄ = + × ( − ) =

EMA₅ = + × ( − ) =

As you see, it is quite different from the result obtained using the simple moving average calculation.

A weighted moving average (WMA) is similar, except that in case of an EMA, the weight given to each older point of data decreases exponentially. In case of a weighted moving average, the weight decreases incrementally. In general case, the WMA is calculated as follows:

If, for example, we choose the same data and period as in the examples above, we will get the following result for the weighted moving average:

WMA = (5 × + 4 × + 3 × + 2 × + 1 × ) / (5 + 4 + 3 + 2 + 1) =

Once again, the result is somewhat different from both SMA and EMA.

A smoothed moving average (SMMA) is like a mix of a simple moving average and an exponential moving average. In general, it is calculated the same way as the EMA except that the multiplier α = 1 / N:

Consider the same example with the same 5 pieces of data. Let's calculate the multiplier:

α = 1 / 5 =

The SMMA of the first day is taken as the price of that day:

SMMA₁ =

SMMA₂ = + × ( − ) =

SMMA₃ = + × ( − ) =

SMMA₄ = + × ( − ) =

SMMA₅ = + × ( − ) =

Although it differs from all of the three previous variants of an MA, as you see, it is closer to the result obtained with the EMA calculation.

The nice thing about charting software is that you do not have to learn all these formulas; your charting platform will do the calculation for you. All you have to do is choose the period you want to calculate the moving average across and let the software plot it. Here is a MetaTrader chart of the daily GBP/USD showing all four types of moving averages applied to the closing price with a period of  The SMA is red, the EMA is blue, the WMA is green, and the SMMA is orange:

As you can see on the chart, the exponential and weighted moving averages are faster than the simple moving average, and the smoothed moving average is the slowest of all. The longer the period of any moving average, the greater will be the lag.

What can you do with moving averages? Most people who trade moving averages use them either to provide context for other systems or as the main indicators in MA crossover systems. Moving averages tend to act as support and resistance levels: a lot of people like to place a slower moving average and a faster moving average on their chart, and then wait for the faster moving average to cross under or over the slower one. This can indicate an opportunity to sell or buy respectively. But one should also remember that moving average is not some magical trading tool and it will often fail.

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Hello,

My name is Median, and i’d like to share my strategy with everyone…

I have aquired a lot of insights because of publicly available knowledge and never had to pay for a course or an indicator… and therefore i feel obliged to contribute back to the trading community who made me the trader i am today.

By no mean do i claim this to be a holy grail or an all time success… but at least it works for me… and it MAY actually work for some of you…

The other reason for sharing my strategy is that it is not perfect… and sharing it will put it up for criticism… and this is exactly what i am looking for… “constructive” criticism that can further improve the strategy…

So… Let’s begin…

First: This is how our setups looked like yesterday…

Zoomed in… since babypips compresses images effectively killing details!

Sell Setup, TP1 was hit… BE was hit at +3 pips … 18 pips

Buy Setup, TP1 and TP2 were hit … 55 pips

Buy Setup, TP1 and TP2 were hit … 48 pips

Awesome … right? let’s move on…

Second: Credits… A big thank you to Spotware for an awesome platform… and to the creators of the following indicators: Fractals, Fisher Transformation, Center of Gravity and Candlestick tendency.

Third: The Setup:

Timing and Pairs:

I have used this strategy ONLY on GBP/USD… you may try it on other pairs but this is how i do it.

It is crucial to trade this strategy only between 6am and 5pm GMT… i NEVER take chances even if i see setups outside this timing. This is due to relative volatility on this specific pair.

Requirements:

1- Fisher Transformation

• Period , if it disappears try shifting periods between

2- Center of Gravity Oscillator

• Period to match Fisher Trans at all times.

3- 2x Candlestick tendency

Timeframe M15 and M30

4- Fractals

When to BUY:

• Fisher Transformation: Trigger Line is ABOVE Fisher line.

• Center of Gravity: LAG line is ABOVE CoG line.

• Candlestick M15 is ALL BUY.

• Candlestick M30 is ALL BUY.

• Distance from bar close to last fractal is more than 10 pips!

When to SELL:

• Fisher Transformation: Trigger Line is BELOW Fisher line.

• Center of Gravity: LAG line is BELOW CoG line.

• Candlestick M15 is ALL SELL.

• Candlestick M30 is ALL SELL.

• Distance from bar close to last fractal is more than 10 pips!

Trade Parameters:

Size: Depends on your MM strategy, if you do not have one… DO NOT TRADE!

StopLoss is always at the nearest fractal + 3 pips.

TakeProfit is at the same distance as SL.

However; I find it is usually better to define a TP1 and TP2… where TP2 is Double the distance of SL.

Check the image above and let’s discuss this further…

For all those critics out there… i’d love to hear from you! but please do test it in a demo to confirm first…

[B]UPDATE: Feb
The Strategy is now LIVE, and FREE!

eunic-brussels.eu[/B]

Happy Pippin everyone :

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<strong>Identifying</strong> <strong>High</strong> <strong>Probability</strong> <strong>Forex</strong><br />

<strong>Trades</strong> <strong>Using</strong> <strong>Median</strong> <strong>Lines</strong>, <strong>Trend</strong><br />

<strong>Lines</strong> & Fibonacci Retracements<br />

David Emerick, CME Group<br />

Disclaimer: Futures and options trading are speculative and involve risk of loss. The information in this seminar is taken from<br />

sources believed to be reliable. It is intended for information and education only and is not guaranteed by the CME Group as to<br />

accuracy, completeness, nor any trading result. It is not intended as investment advice, nor does CME Group endorse or<br />

support any product or service represented in the presentation. The views and opinions offered by individuals or their associated<br />

firms in interactive seminars are solely those of the authors, and do not necessarily represent the views of the CME Group. The<br />

Rules & Regulations of the CME and CBOT remain the authoritative source on all current contract specifications & regulations.

<strong>Forex</strong> E-micro Futures<br />

Benefits:<br />

• Trading in a Regulated market<br />

• Credibility of Quotes & Executions vs. Margined FX Platforms<br />

• Fully Transparent Markets<br />

• Investor Protections<br />

• Counterparty Credit Risk Virtually eliminated by the CME Clearing House<br />

• Segregation/ Safety of Customer Funds at US-based FCM’s<br />

• Fair & Level playing field for all participants<br />

• Trade exclusively on CME Globex – delivering millisecond response time<br />

• Standardize Quarterly Rolls vs. Cash Rolls every 2 days<br />

For more information, visit eunic-brussels.eu .<br />

9

<strong>Forex</strong> E-micro Futures Contract Specs<br />

• Six currency pairs • 1/10 th the standard contract size • Quoted in Interbank terms<br />

E-micro EUR/USD<br />

Futures<br />

E-micro USD/JPY<br />

Futures<br />

Contract Size 12, euros 10, U.S. dollars<br />

Delivery<br />

Minimum Tick<br />

Size<br />

USD/EUR<br />

(=US$)<br />

JPY/USD<br />

(=¥)<br />

E-micro GBP/USD<br />

Futures<br />

6, British<br />

pounds<br />

USD/GBP<br />

(=US$)<br />

Cash-settled<br />

E-micro USD/CHF<br />

Futures<br />

E-micro USD/CAD<br />

Futures<br />

10, U.S. dollars 10, U.S. dollars<br />

CHF/USD<br />

(= CHF)<br />

CAD/USD<br />

(= CAD)<br />

E-micro AUD/USD<br />

Futures<br />

10, Australian<br />

dollars<br />

USD/AUD<br />

(=US$)<br />

Contract Value<br />

If<br />

USD/EUR=<br />

then contract =<br />

$16, (=€12,<br />

x $/€)<br />

If JPY/USD=<br />

then contract =<br />

¥, (=$10,<br />

x ¥/$)<br />

If<br />

USD/GBP=<br />

then contract =<br />

$9, (=£6, x<br />

$/£)<br />

If CHF/USD=<br />

then contract =<br />

12, CHF<br />

(=$10, x <br />

CHF/$)<br />

If CAD/USD=<br />

then contract =<br />

12, CAD<br />

(=$10, x <br />

CAD/USD)<br />

If USD/AUD=<br />

then contract =<br />

US$6, (=10,<br />

AUD x<br />

US$/AUD)<br />

Contract<br />

Months<br />

Last Trade<br />

Date/Time<br />

2 months in the March quarterly cycle (Mar, Jun, Sep, Dec)<br />

a.m. Central Time (CT) on the 2 nd business day immediately preceding the 3 rd Wednesday of contract month<br />

(usually Monday), except for E-micro USD/CAD futures which is on the business day immediately preceding the<br />

3 rd Wednesday of the contract month (usually Tuesday).<br />

Trading Hours<br />

<strong>Trades</strong> exclusively on CME Globex electronic trading platform:<br />

Sundays: p.m. – p.m. Central Time (CT) the next day.<br />

Monday – Friday: p.m. – p.m. CT the next day,<br />

except on Friday - closes at p.m. and reopens Sunday at p.m. CT.<br />

For more information, visit eunic-brussels.eu .<br />

10

E-micro <strong>Forex</strong> Future Margins*<br />

1/10 the size of current standard contracts<br />

• Euro FX (EUR/USD) - (M6E) $ Margin Per Contract<br />

• Japanese Yen (USD/JPY) - (M6J) 36, Yen Margin Per Contract<br />

• British Pound (GBP/USD) - (M6B) $ Margin Per Contract<br />

• Canadian Dollar (USD/CAD) - (M6C) CAD Margin Per Contract<br />

• Swiss Franc (USD/CHF) - (M6S) SF Margin Per Contract<br />

• Australian Dollar (AUD/USD) - (M6A) $ Margin Per Contract<br />

*Margins may fluctuate due to market conditions<br />

*Exchange Initial Margin Rates as of 5/02/09; broker margins may differ<br />

11

<strong>Identifying</strong> <strong>High</strong> <strong>Probability</strong> <strong>Forex</strong><br />

<strong>Trades</strong> <strong>Using</strong> <strong>Median</strong> <strong>Lines</strong>, <strong>Trend</strong><br />

<strong>Lines</strong> & Fibonacci Retracements<br />

Timothy Morge, President<br />

Blackthorne Capital<br />

Disclaimer: Futures and options trading are speculative and involve risk of loss. The information in this seminar is taken from<br />

sources believed to be reliable. It is intended for information and education only and is not guaranteed by the CME Group as to<br />

accuracy, completeness, nor any trading result. It is not intended as investment advice, nor does CME Group endorse or<br />

support any product or service represented in the presentation. The views and opinions offered by individuals or their associated<br />

firms in interactive seminars are solely those of the authors, and do not necessarily represent the views of the CME Group. The<br />

Rules & Regulations of the CME and CBOT remain the authoritative source on all current contract specifications & regulations.

Cash FX, CME Futures, CME E-Micro <strong>Forex</strong> Futures<br />

Mix and Match the Charts and Prices Easily!

Trading the Canadian Dollar Intraday<br />

Catching Rides on the Slides!

Even I Take Saturday and Sunday Off…

Trading The EURO Against the U.S. Dollar<br />

Combining Market Structure, Changes in<br />

Behavior, <strong>High</strong> <strong>Probability</strong> Trade Entries and<br />

Money Management to Improve Your Trading

eunic-brussels.eu<br />

eunic-brussels.eu<br />

“Master your tools, Master yourself.”<br />

®Timothy Morge<br />

Email me: [email protected]<br />

Follow me on Twitter: TimothyMorge

Question & Answer Period<br />

Contact Information:<br />

Timothy Morge<br />

Blackthorne Capital<br />

[email protected]<br />

Interactive Brokers<br />

Cynthia Tomain<br />

[email protected]<br />

T () <br />

CME Group<br />

Michael Hohman<br />

[email protected]<br />

T () <br />

eunic-brussels.eu<br />

eunic-brussels.eu<br />

64

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Greetings everyone,

Last night was a great night to be using this system.

Unfortunately, all the action happened while I was sleeping!

But, I had been lucky enough to take a slight risk that paid off big time.

In an earlier post, I posted a picture of a possible trade setting up on the EUR/USD. The EMA’s were close to crossing and the RSI was descending and hovering around the 50 Line.

I set a SELL STOP order at This was around 20 - 25 pips lower than the current price at the time (not sure exactly, but around there).

I figured that if the price went down that much, the lines WOULD have crossed and the RSI WOULD have crossed below

In short, I was right! My SELL STOP was executed while I was counting sheep. My T/P was hit for 50 pips even. I had used a S/L of , too.

Below, I’ll post the pictures of how it all went down. You’ll notice that in the second picture I have added the MACD indicator.

Here are the settings I use:

MACD
FAST: 5
SLOW: 9
MACD SMA: 4

I’ve noticed that this indicator only works about 75% of the time. Sometimes it’s late! Sometimes it does not agree with the RSI.

I think it’s only very accurate if it crosses from the top of the indicator bar to the bottom (with a big downward slope). It can provide justification though if both the EMA’s and RSI are showing a trade setup.

The MACD settings may need to be tweaked.

PICTURE 1 shows the possible setup approaching.
PICTURE 2 shows what actually happened.

The rest of the pictures will show you trades that all took place overnight that we all missed! We had literally a handful of viable trades.

Perhaps the best time to trade is during the night, after midnight?

Anyways, I’ll describe in another post a possible way to benefit from this.

Stay tuned.

Account Statistics:

Starting Balance: 1,
Current Balance: 1,
Equity Increase: 5%
Pips Gained: 50

Not bad for one night’s worth of sleep!

-ForexPhantom-

Median, Typical, Weighted prices

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