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Operators' intentions read by Dr. S. Sivaraman, of i-knowindices.com

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market near low

Posted on June 15, 2009 at 14:49 in Market comment, Market forecast, Operators' intentions by Dr. S. Sivaraman

EURO and GBP made the rise during close of European session and gap time to slide again during Early US session.Now EURO cut the low and GBP is near low.The bearish feel is created but the players have done more than the permissable net change in EURO and AUD.This they make to handle the respective crosses.They are expected to adjust the net change towards close of the session.They are expecting traders to sell during drop before making the extended upward stop and then drop.It is only week beginning and they make such moves to create market sentiments then they are known to act against the traders.

Regards

Dr.Sivaraman

31 Responses to “market near low”

on 15 Jun 2009 at 3:11 pm1Nazali

Hi Dr

Do you expect the extended stop hunt to break todays high possibly tomorrow in eur? I want to know where to short and as you say an upward stop hunt always happens but to what possible level. Many thanks
on 15 Jun 2009 at 3:33 pm2saad

hi there

waht i understand from the market if eur/usd fall then every cross fall i mean gbp/jap,,, gbp/usd,,, and eur/gbp … also i notice stock also fall,, Am i right,,,,

i hope that EUR/GBP will go up
on 15 Jun 2009 at 3:42 pm3Reez

Dear Dr,

What is ur expectation for gbp/usd for this week..?

Thanks in advance..

Rgrds,
Reez
on 15 Jun 2009 at 3:44 pm4Ahmed

Dear su25,
Is it possible for you or any other guy to plesae post Net daily and weekly changes for the majors here?
I have lost my notes!
I’ll be thankful.
Regards
on 15 Jun 2009 at 3:44 pm5Ahmed

Dera Dr,
Once again thanks a lot for this timely information.
on 15 Jun 2009 at 3:55 pm6Nazali

Hi Dr

Eur has a huge net change of 235 pips. If the weekly is approx 350 would that give an indication of a large correction?
on 15 Jun 2009 at 4:25 pm7Dr. S. Sivaraman

Dear Nazali

Tomorrow or day after there will be squeezing od upward stops for maximum permitted net change.around 1.4150-1.4250 area.
Regards
Dr.Sivaraman
on 15 Jun 2009 at 4:34 pm8Dr. S. Sivaraman

Dear saad
It amy appear all are falling to create the sentiments.We will recall in rest of the week and understand their intentions.
Regards
dr.Sivaraman
on 15 Jun 2009 at 4:35 pm9Dr. S. Sivaraman

Dear Reez
GBp/USD is expected to make upward extended stop hunt unassumingly and then drop.
Regards
Dr.Sivaraman
on 15 Jun 2009 at 4:37 pm10Dr. S. Sivaraman

Dear Nazali

They have done more than permitted net change during week beginning.but they are suppose not to breach the weekly permitted net change in this week.
Regards
Dr.Sivaraman
on 15 Jun 2009 at 4:39 pm11Nazali

Hi Dr

What do you understand from the players doing more net change than they are suppose to?
on 15 Jun 2009 at 5:02 pm12shoora

Dear Doc,

When you say that the stop hunt in GBP/USD will be “unassuming” do you mean “modest” or “unexpected”?

And when you talk about maximum permitted net change, is this a fixed value, like say a 1% change in one day, or is this value derived somehow from previous price action?

Thank you
on 15 Jun 2009 at 5:42 pm13Dr. S. Sivaraman

Dear Nazali
the banks at times get the relaxation of the permitted net change inorder to get liquidity during such drop or ephoric rise.But they adjust that with in the week.
Regards
Dr.Sivaraman
on 15 Jun 2009 at 5:45 pm14Dr. S. Sivaraman

Dear shoora

unassuming = unexpected.
The permited net change is 150-250 pips and the maximum such extended stop hunt the players make to hit the stops of the short sellers who are not willing to close their higher level shorts out of greed.
Regards
Dr.Sivaraman
on 15 Jun 2009 at 5:46 pm15Nazali

Thank you.
on 16 Jun 2009 at 5:40 am16frank

Could someone explain about the net change and how it can be used and also the importance of the weekly, daily range etc and how it all comes together.
on 16 Jun 2009 at 5:47 am17Arun Kandyal

Hi Dr
what is the concept of net change in gbp/usd.could you pls provide me the link of net change in currencies.

Regards
Arun Kandyal
on 16 Jun 2009 at 6:10 am18Dr. S. Sivaraman

Dear Arun Kandyal
Net change can be seen in live market quote page.
http://www.i-knowindices.com/saxo_bank.htm
Regards
Dr.Sivaraman
on 16 Jun 2009 at 6:16 am19Arun Kandyal

Hi Dr
Thx For providing the links but how it uses to knowthe range and net changes.

Regards
Arun Kandyal
on 16 Jun 2009 at 6:18 am20frank

That is what i am also wondering….in the webinar i find i cannot keep up with the Dr’s explanation of how the net change works.
on 16 Jun 2009 at 6:20 am21frank

Su25 if you are about then feel free to explain the ins and outs because as you know it is hard to grasp maybe you could explain in laymans terms, you can email me if you would prefer. thanks
on 16 Jun 2009 at 7:08 am22su25

Net change is defined as the difference between open for the day (week) and current price. This is a constantly changing figure (as price is dynamic and open for day (week) is static/fixed). Net change can be positive or negative.

Application of net change concept:
Assume that “permissible” net change for Gbp/Usd is say 200 pips per day.
Once a +ve net change of about 200 pips has been made, that is, price is about 200 pips above the open price, then use the 10~30 min strategy to do a sell/buy trade.
Once a -ve net change of about 200 pips has been made, that is, price is about 200 pips below the open price, then use the 10~30 min strategy to do a buy/selll trade.
Rationale for these trades being that the max net change for the pair is done is one direction, and price should move in the opposite direction or consolidate. However, be sautious while applying this concept during end of session and end of day. Ideally it should be applied during the 1st half of the session.
Obviously, there are days when the levels are breached, so use it with a hedging strategy!

Net change is different from range for the day. And, this is crucial and needs to be grasped.

Price may go below open price by about 200 pips and THEN go above open by 200 pips which would give a daily range of 400 pips. Once a trader understands the net change concept, then any volatile movements can be seen as trading opportunities. Also, it is usefuls in placing stops and entries appropriately. And, one can remain calm while trading, although market is volatile. It also helps in trading impulsively, such as sell at the lows and buy at the highs!

Please share other benefits of this concept.

Doc, as usual, please correct me if I am wrong.
on 16 Jun 2009 at 7:13 am23su25

It should read “It also helps in PREVENTING trading impulsively”

Please excuse the other typos
on 16 Jun 2009 at 7:25 am24Constantin Lucian

in my view it is best used in position trading as position trading allows you to withstand volatile moves in the market. Also you can do position trading using the net change rules together with the direction of the trend for the month. For example this month eur and gbp are forecast to a downtrend so it will have more selling than buying, so if let’s say for a week the allowed net change for eur usd is 350 pips, if for example yesterday we had a rise of 250 pips instead of a fall then i don’t need to say what a great opportunity would have been for a sell/buy position trade. This is my current strategy..position trade..as soon as i will master this i will try to improve on day trading which is a lot harder. So if it’s to hard or you don’t have time to take in consideration all the rules and apply also the 10-30 30min-2hrs rules you can use the trend for every month in pairs together with allowed net change for day/week and do position trading starting with 1 mini lot.
on 16 Jun 2009 at 7:46 am25frank

su25 thanks for taking the time out of your day to explain this it is much appreciated the same also goes to you Constantin Lucian, i will now go and digest what you both wrote.

thanks again
on 16 Jun 2009 at 8:28 am26Arun Kandyal

Hi Su25
if you have some time then could you pls clear thoroughly the 10-30min strategy and 30 min 2hr rule for new sessions which you have posted earlier actualy i didnt get it properly many thanks.

Regards
Arun Kandyal
on 16 Jun 2009 at 8:34 am27su25

Sorry, cannot do better than that.
on 16 Jun 2009 at 8:53 am28Arun Kandyal

HI SU25

OK WIL TRY TO UNDERSTAND THOROUGHLY BY OWN WAY.
on 16 Jun 2009 at 9:53 am29su25

Would like to share thoughts running through my mind:
Gbp/Usd @ 1.6450 GMT 0947
Trading at yesterday’s high. 100% retracement from yesterday’s low to high. Opened @ 1.6305, and max permissible net change of 200~250 pips would imply a high of 1.6505~1.6555.
High so far is 1.6480 around 40 minutes ago, which is about 35 pips above high of yesterday.
If price breaks 1.6480 then potency of additional 70 pips. We have more than half of European session and a full US session. Trading ranges are set every 30 min ~ 2 hours.

Drawing trendlines, I would prefer to leave a sell around @ 1.6430 being previous swing low (on 1min) with hedging stop buy order @ 1.6460.

I am TRYING this on a DEMO a/c and trying to use Doc’s input as additional

Eur/usd setup is completely different from Gbp/Usd.

Any comments?
on 16 Jun 2009 at 10:22 am30Arun Kandyal

HI SU25

I HAVE READ YOUR PREVIOUS POSTS THOROUGHLY AND NOW I GOT THE 10-30MIN AND 30MIN-2HR RULES.THX FOR IT.

REGARDS
ARUN KANDYAL
on 16 Jun 2009 at 10:54 am31Dr. S. Sivaraman

Dear su25
use hedging and handle the hedging using 10-30 min time frame to see whether it is making loss or profit and book profit in the buy using trailing stop and then book profit in the sell in rest of the week drop.
Regards
Dr.Sivaraman

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