Currency Correlation Matrix
October 2009

(click on the above graph to view a larger version)

Chart Key:

- strong positive correlation
- moderate positive correlation
- negligible correlation
- moderate negative correlation
- strong negative correlation

The correlation table shown above is based on correlation coefficients derived from 15-minute chart closing prices on GFT’s DealBook 360 platform, from October 1 through 30, 2009.

Inter-Market Correlation Matrix
September 2009

(click on the above chart to view a larger version)

Chart Key:

S&P 500 = December 2009 S&P 500 e-mini contract
10yr T-note = December 2009 10-year US T-note contract
Oil = November 2009 Light Sweet Crude oil contract
Gold = December 2009 Comex Gold contract

- strong positive correlation
- moderate positive correlation
- negligible correlation
- moderate negative correlation
- strong negative correlation

The correlation table shown above is based on correlation coefficients derived from 15-minute chart closing prices on GFT’s DealBook 360 platform, from September 1 through 30, 2009.

Currency Correlation Matrix
September 2009

(click on the above graph to view a larger version)

Chart Key:

- strong positive correlation
- moderate positive correlation
- negligible correlation
- moderate negative correlation
- strong negative correlation

The correlation table shown above is based on correlation coefficients derived from 15-minute chart closing prices on GFT’s DealBook 360 platform, from September 1 through 30, 2009.

Click on the above graph to view a larger version.

Chart Key:

- strong positive correlation
- moderate positive correlation
- negligible correlation
- moderate negative correlation
- strong negative correlation

The correlation table shown above is based on correlation coefficients derived from 15-minute chart closing prices on GFT’s DealBook 360 platform, from August 3 through 31, 2009.

Stellar day for the British Pound Sterling. We started off pre-London a bit slow, but gave no reason to doubt continuation of our GBP strength started yesterday during the London session, as the EUR/GBP was tipping it’s hand early letting us know it’s intentions for the Pound tonight.. While there were numerous GBP long related entries speckled through out the European/London sessions, in this video I focus on one of the latter entries, a News scalp. In this video I show why we felt bullish still on the GBP to begin with, how we built our trade plan, where we planned to stop our loss and take our profit. After which we simply awaited the news release, and plotted our Fibonacci pullback entry zone after initial direction was known. What we ended up with for a news scalp was about as good as it gets, a 45′ish pip trade bouncing right off our target for a full hit, for only a 10-12 pip risk. We had larger spot traders today, but I really wanted to share this news scalp with you, as I believe this type of trade is where many have a hard time dealing with. Today was a wonderful British Pound Sterling buffet, I do hope you got your fill as well!

Have a fantastic holiday weekend!

FXBootcamp London Currency Coach-
Christian Stephens

Just as we opened the London session today, we immediately found ourselves in a beautiful price trap on the GBP/JPY on a 15m/hourly basis. This trap had a very precise bottom at 157.29, which just so happened to be overlapping our new hourly 21ema, and happening exactly at the London open. Also we were bouncing off a 61.8 Fib zone and 2hr 21ema on the USD/JPY to the upside, and the EUR/GBP was starting to fall off yet another lower high itself, all at the same time. So let’s see, we have correlation telling us likely Japanese Yen weakness, British Pound strength, at a precise trap bottom, solid looking support on the 1 hour chart (21ema) all exactly at the London open. Hmm.. Long GBP/JPY anyone? What was so nice about this entry was it’s risk. The horizontal trap bottom/21ema overlap was so precise at 157.29 that one only needed to wait for any green on a short term chart around that area, we used a 1minute there, and place a buy order on GBP/JPY with a stop as close as 10-15 pips below, targeting a trap projection about 120 pips away. The cool thing with this sort of entry, is the risk vs reward was very much in our favor. Probability favored that even if we were wrong on the trade idea, that we would bounce from our entry certainly far enough to lock in break even, therefore having a zero risk trade! Sure enough, within 5 minutes we were +35 pips locked in break even, the rest is history. I detail this trade entirely in this video, and had you held on until London lunch we did eventually make our target of 120 pips or so before falling 50 pips just after, I suppose we were not the only traders seeing this scenario.

Have a great weekend folks, see you at the Forex and Options Expo in Las Vegas at Caesars Palace Monday morning! Visit our blog at http://blogs.fxstreet.com/fxbootcamp/ for more information.

FXBootcamp London Currency Coach-
Christian Stephens

Today we found ourselves hitting support just as the London market opened while were were still in the midst of a solid 4hr/daily downtrend on cable and the yen pairings. While there is no reason to think the downtrend is over, the charts were certainly showing many clues of needing to hit some upper support, such as the 1hour 21 ema or daily 5ema, in order to continue it’s strong downtrend. So throughout London we adopted the ‘Scalp up, so we can Spot trade down’ mentality. In this video I focus on just one of these trades we took as a countertrend scalp, which made as much as around 45 pips before stopping us out at MAP (minimal acceptable performance) of 15-20 pips. The rest of London ended up being a nasty range until London lunch, looking very much like we will have some strong entries south sometime during the New York session as the hourly 21’s are nearing price action. It was an extremely difficult London session that required intense patience and discipline. Difficult, but still there were pips to be had, even if follow through was non-existent.

FXBootcamp London Currency Coach-
Christian Stephens

Asia into Pre-London today offered some wonderful Yen pairing short entries off resistance that seriously paid the bills if you took a basket of them. Yet into the London open we had the USD/JPY bouncing off today’s M1 reversal pivot point right at the open. Also we have a fantastic looking 4hr GBP/USD Head & Shoulders reversal pattern shaping up that formed it’s right shoulder during this session. So with potential GBP weakness, and quite obvious JPY strength, we zoomed in primarily on the GBP/JPY during our trade session, as well as the Yen pairings as a basket trade overall. In this video I show how we plotted a potential short off of a Fibonacci pullback zone that overlapped with pivots, ema’s and other levels of visual resistance, planning for a nice continuation for the London money to short the Yen pairs. Sure enough we finally got our entry and, with relative ease, banked another 150 pips on the GBP/JPY alone, or several hundred pips if you took an overall Yen basket trade. Between pre-London and London trading today it was a stellar day to short the Yen pairs, with several traders in the room up 500 to over 1000 pips for the night. Fantastic way to end the week!

Have a super weekend!

FXBootcamp London Currency Coach-
Christian Stephens

Today’s London session opens up with the British Pound/USD pairing making yet another higher low on the longer term charts, and hinting a return to the top of it’s very clear Daily up channel, 150 or so pips away. At the same time the EUR/GBP pairing showing clear MACD divergence, and a break of it’s own shorter term (2hr time frame) trend line, indicating Pound strength for near term anyway, at least until the low 89 cent range. With this all in mind we awaited the break of today’s central pivot point on the GBP/USD, followed by a Fibonacci pullback. What makes today’s pullback entry so different is correlation. As Cable began it’s slight pullback where we were all poised for likely long positions around the CPP retest at the 1.4140 area, the USD suddenly expressed weakness which countered the GBP/USD pullback in it’s tracks. While simultaneously the EUR/GBP had hit it’s pullback resistance perfectly, which hinted at GBP strength - Right Then -. All of this is illustrated in today’s video. If one had ‘Only’ been watch GBP/USD they could have very well missed this entry around 1.5150 as the subtleties of the USD weakness, along with the EUR/GBP resistance, are what caused us to take the long the very moment we saw red on 1m EUR/GBP (green on 1m GBP/USD). After that it was off to the races to our daily m4 reversal pivot point, and then beyond to 1.53. This video shows how interconnected all of these currencies truly are, and when you focus on any one pairing, you should have keen eye on everything technically involving the 2 currencies involved in that pairing. Tough entry, fantastic ride the 5 ema on the 15m for a 130-150 pip trade, marvelous.

FXBootcamp London Currency Coach-
Christian Stephens