Thats very internesting I don’t have the programming skills to implement it but I also thought I would love to try and develop an AE for MT4 which would include the ability to add a weighting according to the strength of current news events that could have a bearing on the forex markets
Fundamentals in forex for me anyway, are the difference between wanting to invest in a currency, or trade it.
Gimme the technicals.
Gimme Neither;)
You’ll know now not to waste your time! 
My idea was to use an existing AE which appeared to have a good track record and modify it, (mainly because in my strictly limited skills as a programmer I have found it much more within my abilities to modify someone elses code rather than try to write my own from scratch).
Part of my modifications would be to include the ability to add a weighting of +1 to +5 for each peice of information that day which should have a favorable consequence to the pair in question and a weighting of -1 to -5 for each peice of information that may have an adverse consequence.
Therefore I would decide how important a piece of information is so for instance if there were rumours of a central bank intervention I would give something like that a 3 or maybe a 4 positive or negative depending on if the bank would be intervenening to stop its currency devaluing or vice versa.
Something less influential like a slight rise or fall in unemployment would probably get a 1.
This would cause my AE to favour going either short or long more than it would have without my weightings. I have no idea how well this would work in practice but I find these kinds of experiments fascinating I just wish I had better programming skills so i could try it out.
When I was noob (and I mean I still a noob bot I know better) I used to believe fundamentals was news… but it is more complicated than that.
For example recent US trade deficit wasn’t nice but dollar still rallies, that’s because of Greece crisis and risk aversion and you know no matter how the market behaves today or tomorrow, this is not being solved in a couple of days, bears are still in charge.
Absolutely right, it could be an earthquake in Japan tomorrow, that would have a bit of a negative effect on the YEN, or it may be on Oil Disaster off the coast of Scotland, as well as the GDP forecast, where does your analysis end? does it end with the little butterfly that flapped it’s wings off the Coast of Australia that caused the hurricane that devastated the Orange crop in Florida that weakened the Dollar because there had just been a big bull market on orange Juice?
The current Greek crisis includes news of a possible bail out by the ECB which I would imagine could have a strongly negative effect on the euro so that particular item of news would get the euro a negative 4 weighting
ahhh yes the butterfly effect butterflys get a 0.1 - 0.25 weighting depending on how much damage they do
And then there may be a meeting at midnight that changes the whole perception of it all so it rebounds, and in the meantime the US becomes jittery because Bernanke is pulling the plug on liquidity instigating a massive psychological bear run on the USD sending the EURUSD flying high
you could guestimate the amount of damage they do by the size of their wings! 
To give a ‘balanced’ view it’s the same with technical analysis, say with Fibs, the MA example is a little simple, but say with Fibs, do you trade the last retracement or was it too small, so you may think the next, but that’s a bit big for your chart say your 5 mins, so you have a look at the 15 mins, but in case it’s just a trendy swing as opposed to a trend you check the 1 hour chart, but you’re really trading something different if you’re looking at the 1 hour chart, this could be medium term trading, so you think, yes medium term it’s more predictable, but this doesn’t really agree with your money management, you always will have this dilema of where to start and when to stop.
yes obviously under such a system you could take the economic analysis too far but remember my idea was not to formulate a system bases on economic analysis but rather to use a technical based system and add to it the ability to take into consideration some major economic factors thereby creating a system that uses both technical analysis and fundimental economic inputs. Like I said earlier I really have no idea how well this would work in practice its just something I would like to try out if and when I have the time to try and implement a working model.
Having said all that if I was ever to have a famous quote attribituted to me, from my life experiences it would have to be something like “It is a lot easier to have ideas than it is to implement them.”
This is [B]exactly[/B] what I was looking for when I created this thread
I worry about you two :D:rolleyes:
Here’s a possible trade I’m eying up at the moment - short EUR/GBP
On the daily chart it’s hitting the top trend channel line. The overall trend is down and I’m looking for a nice short trade.
But EUR and GBP… both in a bit of a pickle at the moment, it also looks like it’s breaking the top trend channel and trying to go up…
I want to short it if it bounces off the upper trend line and goes south but even then I’d need more reassurance just because of the 2 currencies being as volatile, high profile and unpredictable as they are.
So in the red corner we have GBP weighing in at…???
and in the blue corner we have EUR weighing in at…???
I’m thinking of what they might do over the course of next week - any thoughts?
No idea, see you’ve got this Greek thing, you will need to evaluate that and then draw your own conclusions, they will probably be as good as anyone elses’
The thing is, and I must admit I’m not that familiar with the situation, but this is the way I read it, the Germans want to get it sorted and will do whatever they can, Germany will be hell bent on the EURO succeeding as a currency as it it, now the Greek situation compromises the whole show, If Greece would to virtually go bankrupt you’d have a whole Country using EUROs while being bankrupt and bankrupt stocks as we now are worthless, so is it a part bankruptcy? The mind boggles! Then you’ve got the Irish just to the left of me over here, now they are having a hard time, but they’ve managed to sort of balance the books on their own, so whatever the Germans might do for the Greeks, the Irish might start kicking a fuss, because they’ll want a piece of the cake and then you can’t put the lid back on that can of worms, so where does it all end?
But then again a tidy agreement might be reached which might see the EURO rally since it proves the ‘strength’ of the EURO as a region/economic zone/currency, and by Monday everything is hunky dory again.
Well from a technical persective the signal (if it happens) will be to go short EUR/GBP. Which would involve going long on HMS Blighty which I’m not exactly comfortable with at the moment, then again if our friends across the channel are in a worse state it could be a good trade.
I’ll just see how it all looks on Monday morning… hopefully there will be some more solid trades to take instead. I’ve already banked over 400 pips this week and up another 350 so I’ll happily miss out the trades that make me nervous. This isn’t a funfair afterall!
400 pips, good going, I’ve got 14 or so, translates into a 4% profit, for 6 hours work or so - it makes me happy.