So I’ve completing given up on scalping with this amount of capital. Until I can risk less than 1% of my bankroll on each scalp trade and develop an iron mind that can handle intraday volatility, I am sticking to my other strategy that uses intermarket analysis, H4 candles, and RSI.
The less I trade, the more my costs decrease and I am correct on direction/sentiment more often, if not every time. I’ve found that paying the spread many times versus paying it once or twice while finding the lowest interest charges, the easier it is to decrease holding costs and catch hundreds, if not thousands, of pips over days and weeks.
Are intermarket strategies viable long-term strategies?
Are gold and oil correlations to major currencies (specifically USD/CAD, AUD/USD, and CAD/JPY) going to last or do correlations come and go over long term trends? Will we always be able to say that Gold goes up when USD goes down? Will the variance in an intermarket strategy be lower than scalping or swing trades off pure price action?
I also hate using RSI because it is a lagging oscillator, but it useful for gauging general long-term overbought and oversold territories.
Another challenge to implementing intermarket strategies is really understanding the markets for each needed market. I do not understand the Gold market at all, and the oil market seems mostly about supply than it is demand. Inventories go up and down but whatever the biggest players’ sentiments are every week and month, the more the price sways in their direction. Oil seems to be more concerned with political news than Gold. It is easier for me to understand the general health of the economies, currencies, and bonds of those major pairs mentioned above than it is to track and truly grasp the movements of oil and gold.
I sweat if I use pure price action. It just seems too simple and a bit ignorant of major news, economic health, bond valuation, gold and oil markets, major stock market indexes, and political sentiment.
Bankroll management is easier and I am more profitable with longer term strategies, especially if intermarket analysis is added into the mix. For example, scalping for two weeks got me an average win rate of 34% and a net loss of -6.8% at a leverage of 20:1 on micros. The intermarket swing strategy over the past two weeks has a 100% win rate and a net profit of +5.6% at a leverage of 10:1 on micros. The intermarket strategy is also simpler, has lower costs (although I am charge spread and interest, I am not holding positions over the weekend and entering and exiting limits/stops on tight spreads), and has risked less of my bankroll per position. I’d love to be doubling my account every week like a lot of these gurus online claim, but I’m sticking to conservative, consistent gains at lower leverage and lower risk per position, and taking the least amount of trades I can per week and month.
I just wanted to know if anyone had any strong opinions or advice on intermarket strategies and where the best resources for understanding gold, oil, and bond markets.