SUNDAY UPDATE: THE EURUSD

 

“Who needs excitement in life when there’s FX?!”

Special “Sunday Update” on the EURUSD … the old pit traded Swiss Franc 

futures from back-in-the day it ain’t; in fact there is almost nothing remotely 

similar to trading back then versus now, other than markets fluctuate, some 

moves are violent, and the market does its best to foil any and all attempts to 

defeat it. The psychology is the same, the players are roughly the same, and 

the turns in market sentiment are sharp and wicked.

What is different is the scope and magnified difference in 1) technology, and 

2) government participation in markets. The first has made the entire world 

one giant trading pit, where nobody except the TBTF scumbag LP banks, has 

any advantage over the market. The second, though, has seen a rather

remarkable acceptance by financial markets that heretofore would have 

been unthinkable … day to day “meddling” by central banks, politicians, and 

their sycophantic puppet banks and offshore IBC shadow accounts, that skew 

markets considerably for “policy” purposes … “of course, you realize it’s for 

your own good … right”? 

The one thing, though, which major FX pairs have going for it, and is of 

primary importance, is the fact [not opinion] that “net costs” to trade them 

has never, ever been lower. The three [3] leaders, of course, are EURUSD, 

USDJPY, & XAUUSD, where spreads during the European & U.S. sessions 

[without pending news] fluctuate between 0 and 2/10ths of a PIP most of the 

time for FX, & about 8 -11 cents per OZ. for spot gold. And if you watch them 

closely during the day, most often the spread is right at 1/10th of a PIP, or 

around 8 - 9 cents per OZ for spot gold. RT [round turn] commissions at 

Turnkey are about 2/10ths of a PIP, or two cents per OZ. for gold … in any 

event, filled and round turned traded with a ½ PIP gain in the trade makes 

you money [about 12 cents in gold]… granted, it’s not a lot, but it’s profit 

nonetheless. The result of this, is that the largest futures exchange in the 

world, the CME, has reduced it’s futures contract to ½ PIP minimum ticks 

per contract in FX. However, you still have to pay commissions to the futures 

broker, which will probably be around $5 per 1 lot, whereas the offshore spot 

forex trade is “net profit” at ½ PIP … advantage “bigly & yuuge” for offshore 

spot forex.

The implications of this are enormous for traders over the course of a year 

… in the past I’ve gone over the math, but to simply recap, if you traded a 1 

lot EURUSD [100,000 notional], averaging seven [7] trades per day for the 

year, and you simply paid ½ PIP MORE than what is available at Turnkey 

[very easy to do, since many offshore brokers trade EURUSD with spreads 

for clients of 1 PIP to 1 ½ PIPS per 1 lot], you just handed the scumbag LP 

bank AND the brokerage house $7400 of your money FOR ABSOLUTELY 

NOTHING IN RETURN!

I’ve said in the past, and it bears repeating again here, there is NO perfect 

brokerage house … regular readers know very well, I do NOT hesitate to 

criticize any brokerage house for their failings, including Turnkey when 

appropriate. What I can tell you, though, is that trading EURUSD doesn’t get 

any better than at Turnkey, where the “net cost” to trade is about as low as any 

retail spec can reasonably expect to get, now or in the future … As for the LP 

banks … they’re crooks & petty thieves, and it’s no secret what they do, no 

matter the market you trade OR the brokerage house … everybody knows this, 

it shouldn’t be a surprise to any trader in the market. However, in the heavily 

traded and watched EURUSD, the room for any scumbag LP bank to 

maneuver a scam trade off the market by more than a fraction of a PIP, gets 

tighter by the day … “the banks are essentially reduced to stealing nickels and 

dimes from traders via the HAL9000 slippage software for fills, and they simply 

can’t get away with the robbery their brethren in FX crosses and CFD’s [stock 

indices, energy markets] get away with on a regular basis” … this puts money 

back into your pocket, and literally means EURUSD is one of ONLY three [3] 

markets [USDJPY, & XAUUSD being the other two] worth trading, that isn’t 

going to grind you down like a Las Vegas casino … everything else, FX crosses 

and especially any CFD’s, are a complete waste of time and money.

I hinted during last week’s blog, that staff and I were working on and almost 

finished with … something … that something is EURUSD. And what I 

specifically told Cousin It & CoS Milton Waddums over a month ago, was a set 

of specific set of research objectives where I wanted to see the results, and when 

the results were known, run through my Ph.D. level math software and 

crunched with specific guidelines I gave them. And, when they were done with 

that, anything they could think of on the spur of the moment that might be 

intriguing to them or they were interested in seeing,  plug that in and see what 

happens. In other words be real researchers and not just order takers!

I did this about a month ago, right as we were smack dab in the middle of the 

NDX100 clusterfark with the scumbag LP banks … I let ‘em loose, and they 

didn’t disappoint … half way through, and we “tweaked” some of the 

parameters. As regular readers know, a few months ago we finally got all 

major markets on the MT4 with tick history going back to 1999, in specific 

formats that the math software can read, decipher, and analyze. Now, please 

understand, this isn’t/wasn’t some half-assed goofy “dot plot” to fit data 

… “what I want is a definable history that lends itself in a highly probabilistic 

way to immediate future patterns where we can profit, and the risk of loss is 

minimal … I added some extra variables, most notably “TIME”, and that 

exponentiated the volume and difficulty of the project … bottom line, though, is 

that we researched EURUSD, LITERALLY a “1,000 ways from Sunday”, and 

after each analysis, checked off things that had no statistical significance for 

profit, took the remaining and further narrowed the guidelines, and ran 

everything again … seriously, if done by hand, it would have taken the three [3] 

of us 1,000+ years to know what we know now … that doesn’t mean everything 

is suddenly “The Holy Grail”, but it’s “Hoover Dam” close”. So, what does it 

mean?

This last week Cousin It, having gotten caught on an oil inventory report and 

sworn off oil futures forever, traded spot EURUSD in his personal account 

with simply a 1 lot, and the results were impressive [understatement], with a 

model for EURUSD trading in live conditions. Quite frankly, we haven’t 

named it yet, but this coming week I’m going to be trading EURUSD based off 

this model … and you’ll see the results this upcoming week versus EURUSD 

trading up ‘till now using the older algorithm I’ve used in the past for 

EURUSD trading … there’s a huge difference in profitability. More 

importantly, I understand more about the specific EURUSD market than I did 

before, and that’s saying something given my decades of experience. 

However, a couple of factors here that need to be considered; 1) I didn’t 

develop this on my own, it was a collaborative effort from all three of us 

… granted, I did almost 100% of the initial “brain work”, but the legwork was 

entirely different … and after that, the input parameters from all of us were of 

equal importance, 2) this took over a month of real continual work, both 

theoretical and then practical application and building rules, and most 

importantly for all readers 3) this model algorithm is NOT gonna be available 

to the general public … only the “signals” will be available, and they aren’t free 

of charge … in fact, before they revealed anything, I had to agree to NOT 

reveal anything behind the model, or they weren’t gonna share any results.

Now, what we have decided to do, is make the model available for PAMM 

trading … through the PAMM Spreadsheet, people will get to see the trades, 

but won’t have a clue what generated the buy/sell signals behind them, and 

there is literally no way anyone can “reverse engineer” the process, as the 

permutations are literally infinite in scope. For the general public at large, in 

the coming days we’ll be joining the world’s largest distributive hedge fund, 

which is ‘Collective 2’, or C2 as it’s known, [ https://trade.collective2.com/ ], 

and offering the trading model signals to the public on a subscription basis in 

EURUSD, the price of which we haven’t determined as of yet … we’ll get that 

figured out in the coming weeks. Here, people can see the trade history of 

signals as well.

For people who are currently in the PAMM, if you want the EURUSD signals, 

all you have to do is let me know when the time comes, and I’ll provide that 

later, and they will be provided FREE as long as you remain in the PAMM. 

This way, if you trade your own account as well, you get the double benefit. 

Once we get the pricing on C2 figured out, there will be a threshold for newer 

PAMM participants to get the free C2 signals, and again that threshold hasn’t 

been determined yet … the purpose of this, is to not allow people with 

minimum PAMM account balances to take advantage of the signals and get 

free pricing for a personal account that is far larger than what is in the 

PAMM. For example, somebody puts $500 in the PAMM, gets free pricing & 

signals, then puts $100,000 into their own personal account and gets the 

signals for free, and thus takes advantage of the entire system … “yea, that’s 

not gonna happen”. 

In addition to EURUSD, our very own CoS [Chief of Staff] Milton Waddums 

is doing the legwork at present on XAUUSD [spot gold], which aside from 

shiny new red staplers, is his passion and has been like forever. And while the 

PAMM concentrates on EURUSD only, at the appropriate time this Fall, 

we’ll most likely roll out the trading model on C2 for XAUUSD as well 

… again, one step at a time, and we aren’t anywhere near pricing at this point 

… a lot of work needs to still be done with spot gold, but the EURUSD trading 

model gives us great clues to where we need to look and evaluate, thus cutting 

the original workload considerably.

I must admit, seeing the entire thing, why didn’t I think along these lines a 

long time ago? SHORT ANSWER: “Cuz I wasn’t specifically looking for the 

trades in the universe of parameters the data literally said, ‘hey look at this’, and 

then proceed from there to trade resolution. Looking backward, yea I can see it 

… sitting with nothing, it’s like somebody telling you the answer to your fervent 

wishes is “4”, now go find me the CORRECT equation given the problem, when 

there are infinite equations available that will take you to “4”, and you haven’t a 

clue where to start or even to where to begin your search … ahhh, but the power 

of computers and extremely advanced math software, and you got a fighting 

chance”!

So, it’s on to this week’s EURUSD trading via our new model, which I 

fervently believe is far superior to what was used before … it’s gonna be an 

interesting week, to say the least, and on Thursday the ECB has an interest 

rate meeting as well. I’m looking forward to all of it … exciting times directly 

ahead! Onward & Upward mi amigos!! PAMM Spreadsheet will be back up 

soon!

Have a great rest of your weekend everybody!!

-vegas

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