This pair is not for the faint hearted.
No one ever talks about this pair. I rode this beast for a month 3 years ago, spectacular wins, awesome losses!!!
Anyone here with some insight into this creature of a currency pair? I want to tackle it one more time, preferred to have some insight before I gun for it this time.
Nobody talks about this pair because nobody cares about this pair.
ok then…Thanks for the info. I might just “like your post”.
Isn’t HKD kinda positively correlated with USD? I would view EURHKD as EURUSD. But again nobody cares about this pair it’s kinda true… Correct me if I’m wrong.
No, You cannot view EUR/HKD in same view as EUR/USD.
As per Wikipedia:
A linked exchange rate system is a type of exchange rate regime that pegs the exchange rate of one currency to another. It is the exchange rate system implemented in Hong Kong by Honorary Vice-President at the University of Hong Kong, Professor Y.C. Jao, to stabilise the exchange rate between the Hong Kong dollar (HKD) and the United States dollar (USD). The Macao pataca (MOP) is similarly linked to the Hong Kong dollar.
Unlike a fixed exchange rate system, the government or central bank does not actively interfere in the foreign exchange market by controlling supply and demand of the currency in order to influence the exchange rate. The exchange rate is instead stabilized by an exchange mechanism, whereby the Hong Kong Monetary Authority (HKMA) authorises note-issuing banks to issue new banknotes provided that they deposit an equivalent value of US dollars with the HKMA. The Government, through the HKMA, authorises three commercial banks to issue banknotes:
So in a concise manner:
It is the holy grail of profit…Or the demise of a trading account.
Since it means nothing to you, why did you reply with nothing?
I have never traded exotics, simply because there are certain particularities of these markets which should be well investigated by traders, before they enter it. Certainly, if there is correlation with USD, figure out how to benefit from it, but try it on demo account first
This is my nemesis…I do this one in real time.
USD correlation? Good luck
Maybe someday I will run into someone who has this pair on their radar. I just need to fill some blind spots.
You probably have some advantages over people who trade with usual pairs here anyway. So it really do not work correctly, you could trade RUB/USD and RUB/EUR with same rate. I know a lot about this pairs cause I have some local knowledge of market and so on.
Just came across this thread by accident.
Been looking for a reasonable answer to something and maybe this is just the very place to get such answer.
Take a look at the two charts below. USDHKD. Daily and Weekly.
What’s with the almost brick wall type of resistance at the top??? Is that because of a currency peg or something that’s in place??? Never seen this before on a chart. And look at the bottom going back some months. Same thing. Almost as if it’s bounded between those two prices.
USDHKD Daily:
USDHKD Monthly:
Now you start to see why I like the EUR/HKD. Hit that sweet wall right, and you get the most profits you have ever seen on a single trade.
I stepped away from it for awhile, learned that it is a 3-4 trade a year deal. Trying to get my logistics right on how and when to hit it, then to walk away…Greed always made me suffer with this one! Get the pips, then try to milk the cow, cost me my pips!
Yeh but WHY the wall is my question???
Put another way:
Being somebody notoriously bad at picking support and resistance: even I can see that on those charts. Even a blind man could see that on those charts. Never seen anything as exact as that on a chart.
In short, you need to learn history before you understand that “exact”. A Chinese guy who declared himself as emperor, fighting communism before and after world war 2 set the stage for the HKD. Even Mr. Mao did not give an order to kill him. He set a system in place where they embrace capitalism… His name was Chiang Kai-shek.
The mainland China will defend support and resistance levels as see fit, but as general the HKD is a floating currency.
Hence my dilemma in figuring this crap out.
Welcome to my world!!!
Pretty strange though huh. Honestly thought it was a peg or something like that.
I’ve looked at it though (as you know I don’t trade FOREX but those charts captured my interest) but the moves are small (at least in my world anyway). The charts are deceiving I think. Those huge drops now and then (when the wall is hit) are only around 300 pips or whatever. Nice work if you can get it with a huge position of course. But even if I was tempted: the ESMA put paid to that (not that I’m complaining though to be clear). I’d have to mortgage the farm just to cover the margin requirement to get $1 per pip on that pair!!! LOL!!! Still. High probability trades I suppose i.e. seems to be it’s a pretty sure bet that price bounces off of that wall every single time. Unless it’s a peg or something we don’t know about and somebody wakes up one morning and decides to remove it (EURCHF mean anything to you??? LOL!!!).
Yeah, most people talk crap, you are the only one to mention the huge margin. That’s why I ignore most comments…Don’t give me advice if you cannot follow the trade with your money.
But I am glad you saw the unique aspect of it…and the value.
Thank you for your insight. I truly mean that.
Well. Let’s stay in touch. As I say: not something I normally would be looking at i.e. was a moment of weakness the other day (in the absence of valid equity trades)!!! LOL!!! Actually not REALLY true i.e. was actually looking around to see if I could see any good reason why the Hang Seng was out of kilter with the other indices so figured ???HKD might be a place to look. But no correlation whatsoever.
Hmmmnnn…
Dunno why I didn’t think of this before:
LOL!!!
It is pegged against the USD and has been since 1983 (and some change or the other in 2005).
(But then just read your thread again and you did mention this i.e. I missed it first time around).
Both events you mention were part of the special administrative region revamp, known as Hong Kong. They can adapt fast economically, since mainland China uses them as a playground for making money, where mainland China can’t with their rules in place. Hong Kong also bypasses the trade dispute currently going on, making them extremely unique in this aspect.
What do you prefer to trade? You mentioned Forex is not your game.
Take you pick:
Those are what I am monitoring and trading at any given point in time. But then I’ve got single Stocks and Futures as well (Equities, Commodities, and Metals Futures) although I don’t trade them too much anymore i.e. the ESMA has severely curbed my shotgun approach to trading (everything at once) with their margin restrictions. Not complaining though. I’m one of those people that needs oversight as I’ve always had the propensity to over trade and looking back on my trading career (for want of a better term) it’s quite possibly been my ONLY cause of failure. Even some of the crappy systems that I traded years ago would have made at least some money were it not for over trading. So I’m a happy camper to be honest. It can get frustrating I’ll admit i.e. I find that I now have to be a bit more choosy as to which instruments I trade i.e. sometimes the margin requirements don’t warrant the expected payoff (you’ll note that Australia’s ASX200, for example, is not on my list i.e. hogs margin and goes nowhere relative to the other Indices that I trade). I guess if anything I’ve been forced to finesse my trading.
So yip. That’s me.
Must say when I was posting my little tongue in cheek Google thingy I was quite surprised to see how many other currencies are subject to pegs. Unfortunately not for me but could be some edge there for a FOREX trader.
Oh and from this little bit of research: I’m actually of the opinion that if there was NO peg on USDHKD you would indeed see a correlation between the Hang Seng and USDHKD. Because there’s a peg in place you’re not seeing the asymmetrical charts (again for want of a better term) or highly correlated charts (haven’t quite thought this through yet). But a little deceiving actually. But hey: learned something new this year!!! LOL!!!
P.S.
The above and the fact that they take too many lunch breaks and holidays in Hong Kong!!! LOL!!!
Once a year, the start of August…My broker that I trade through (GT247) has something tongue in cheek called “Trade Wars”. We gun for weekly and monthly prizes by who gets their trading account up the highest % wise. S&P500 and DAX30 are always the highest gains in trade wars. I am doing Forex for the last year, knowing that you need 2-5 Forex pairs with S&P500 and DAX to cut the line…Need that edge.
If I can get a EUR/HKD once a month for the 3 month competition, then I can sustain with the other currency pairs and run fast with the front runners with S&P and DAX.
Any advice on S&P and DAX would be awesome.
Hey.
GT247. Are they not a South African broker??? Seem to remember seeing their platform once on somebody’s PC some years back. Never mind. GLOBAL TRADER. Just remembered now while I was finishing off my post below. Not South African but GLOBAL I think???
Much as I’d love to sound posh and give you some inside track on the S&P and the DAX I’d just be trying to sound like a know it all!!! LOL!!! I just trade them blindly with my trading system. Only thing I can tell you though is that the S&P is probably the best all 'round payer and bang for buck and I’m guessing that’s why a lot of equity traders will trade only the S&P day in and day out and some make a really good living as far as I know. And there is also this thing of the S&P being “the market”. I concur with that notion. But I do also believe that the NASDAQ leads. And of course: the Dow isn’t the Dow isn’t the Dow anymore and as we used to know it either i.e. the weighting on the index insofar as industrials are concerned is negligible nowadays as some of the heavyweight tech. stocks have manged to weasel their way into the index. Hmmmnnn… Maybe I do know SOMETHING (in just reading my last few sentences!!! LOL!!!).
