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Monday, August 20, 2018

THE EUROPEAN SESSION … GRAVEYARD OF TRADING

“The European trading session hard at work!”

Yea, I know, it’s August … but it feels like EURUSD in the first half of the 
European session has been in “August” for the last 10 years … does anything 
happen anymore, or is it simply Asia & the U.S.? And for like the 4 millionth 
time, once the Asian session is over, the market feels like it’s “sleepwalking” 
through to the point the U.S. traders start hitting their desks around 7 - 7:30 
A.M. EST. … then, once the U.S. wakes up, I guess Europe can go back to 
being elitist idiots giving their cultural heritage away to refugees … what else 
is there?

Today sees very limited volume flows, worse liquidity, and “worse-er-er”  
volatility, and pretend this is a market. What a joke … “shut the shit down and 
we’ll see ya in September”!

Today sees the first trading day of the EURUSD algorithm … and one of the 
important criteria I developed specifically for this algo, is the concept of a 
“volatility heat map” to guide trades … without going into specifics cuz I can’t, 
the point is I developed code for measuring volatility, where certain intraday 
thresholds have to be met for trades to occur … if intraday volatility is too low, 
then all trade signals have to be ignored, simply cuz when activity collapses, 
even the tiniest moves will trigger “false positives” nobody wants to see … and 
believe me, seeing 3 PIP moves over half an hour isn’t something you want to 
get involved in or have a trade outstanding, wondering when the next 
explosion will occur and which way … cuz if it's against you, you got no chance 
getting the money back in slop like this.

Turning to today’s EURUSD market … “let’s be honest, shall we? This is a 
bucket of warm bat guano” … a couple of spikes, the last one being from one of 
President Trump’s tweets, and then … “crickets” … mind numbing boredom, 
then TNT going off … back to mind numbing boredom until the next random 
act of market violence occurs.

Only 2 trades today … PAMM up about $50, or a hair over 0.1%.

There were only two [2] short windows of opportunity where volatility had 
expanded to the point of making any kind of trade worthwhile … I made both 
trades, and that was it! … the rest of the day, a complete waste of time, with 
ZERO going on, and price movement insulting the word “pathetic”. Sure, 
there were other signals during the day, but I ignored them due to the fact the 
“volatility heat map” was below my proprietary level for trading … some 
worked and some didn’t, and that’s the reason they have to be ignored … too 
damn many false positives that hurt profitability … the 2 signals that the 
EURUSD gave when the “volatility heat map” said “OK”, were both 2 for 2 in 
profitability and were immediate winners.

Today looks to be the worst day of the week for trading action … at least let’s 
hope so … FED minutes Wednesday, ECB on Thursday, and the annual 
Jackson Hole snob get together on Friday, should keep things better than 
today. More than likely, I don’t see trading conditions getting any worse than 
today, and we’ll probably have a lot more trades during the other days of the 
week … only 2 trades is awfully small, but you take what the market gives you.

All told, I’m exceptionally happy with what I saw today, notwithstanding the 
terrible trading conditions already mentioned, and how the EURUSD 
algorithm responded to these highly challenging market conditions … yes, 
we’d all like to see 100+ PIP range days, and let the good times roll … the 
challenge comes with “shit days”, when volatility is severely compressed and 
price appears to be drifting to nowhere in particular … what happens then? 
“Today, in every instance, the algo showed the way with 1) being on the right side 
of the market, meaning the easiest side to make money, 2) buying very near the 
low, and 3) selling the spike up for the best fills, which were right on the market 
with zero slippage … I simply can’t ask for better than that and expect to 
consistently get it”!

Volumes today at the low end of our spectrum, simply cuz the market is not 
conducive for higher volumes due to the lack of liquidity … so, while the 
dollar amount profit today made up for Friday, considering the conditions 
seen today, I’m not terribly disappointed … granted, I’d like to see better, but 
remember, we’re in late August and half the world could care less, and the 
other half has the beach on their mind as Summer dwindles away. Onto 
tomorrow mi amigos! … Onward & Upward!! PAMM Spreadsheet will be 
back soon.

Have a great day everybody!!

-vegas

OUR TURNKEY FOREX “PAMM/MAM” IS NOW OPEN AND
OPERATIONAL; SEE “PAMM/MAM MONEY PROGRAM” IN
“DOWNLOAD LINKS” SECTION IN RIGHT HAND COLUMN
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