Before I get on to today’s subject matter, a couple of changes to the IVIX INDEX
table … 1) I’m dropping the NDX100 cuz it’s simply out in “la-la land” when it
comes to IVIX INDEX levels, meaning it’s almost impossible to trade it with any
kind of sane reward / risk capability, and replacing it with EURUSD ... 2) I’ve
expanded the time each day for coverage starting with the Asian open [0300
server time, 8 PM EST New York time], and by doing this you get the complete
picture of the entire day from Asia open to NY close at the NYSE close … and by
default, it covers 100% of the trading day for the DAX30 [0330 - 2300 server time].
Directly below, last week’s IVIX INDEX levels for DAX30, EURUSD, & GBPUSD.
Some things to consider when looking at the table … 1) trading FX pairs in the
Asian session is a waste of time, and 2) the DAX30 is a volatile market from start
to finish each and every day … trust me, it wasn’t always like this … a few short
years ago, there were days when you couldn’t get a 40 index point range … but,
throw in complete fiscal & monetary uncertainty into Germany’s 30 largest
companies, along with a pandemic and E.U. problems everywhere, and you get a
bubbling stew of volatility not seen before the pandemic started in earnest back
in March.
Each one of the 3 markets presents different problems for traders … 1) Cable
[GBPUSD] is the most volatile of the FX major dollar pairs, but like it has been for
4+ years running it’s got major “rumor problems” associated with BREXIT, that
sees some horrific spikes in price, both up & down, that can turn a decent day
into a nightmare … the POLS & Apparatchiks continue to play “feed the mistress
funds”, and the number of traders who continue to get caught in this BS get hurt
… “I marvel at how often these assclowns get away with this crap and go
unpunished” … so with Cable, you’re playing Russian Roulette.
As we saw on Friday, EURUSD can be D.E.A.D., sometimes putting in ranges that
are so small it’s hard to believe … then, at the flip of a switch, it will put in a
decent day’s range, often exceeding 100+ PIPS … and this lack of CONSISTENCY
is what makes trading EURUSD a very big problem.
Then there’s the DAX30, which lately has been on a range explosion, although this
week sees the 20 Day Range MA come down substantially [about 15% - 20%]
… and a quick study of the IVIX INDEX table will give you an idea what you’re up
against, as often times that market simply blows through algorithm signals like a
sharp knife through a soft butter stick.
And this brings me to today’s subject matter … RED pill or BLUE pill? … the RED
pill is the bat shit crazy market, the BLUE pill is the D.E.A.D. market … you got no
choice, which one do you swallow? … Cable isn’t even in the discussion cuz
50 - 100+ PIP moves in seconds cuz some Dipweed in the E.U. or Britain opened
his PIE HOLE isn’t trading … the D.E.A.D. EURUSD isn’t always gonna stay dead,
so judging IVIX here is a major problem, cuz you don’t know whether to take a
2 PIP profit or let it ride some … ditto with a loss … and if you get caught in an
IVIX shift from either higher to lower or vice versa, it can make for some painful
trading decisions.
So, we got the RED pill = DAX30, and the BLUE pill = EURUSD … I think it’s an
easy decision, cuz one has CONSISTENCY and the other doesn’t … and quite
frankly, if I have to sit through another trading day watching paint dry, like
EURUSD on Friday, it’s time to resubmit my resume to the circus … so, time to
swallow the red pill and live with it.
As long as the IVIX INDEX level doesn’t stay consistently above 200+ [which it did
for multiple weeks], I think the trading algorithm can handle the action pretty well
… sure, there will probably be some signals that get blown through, but it’s better
than sitting on my donkey and wondering if it can move at all within the next hour
… the highest IVIX INDEX levels last week came around the 0900 - 1100 server
time [2 AM EST - 4 AM EST], as that is not only the last 2 hours of the Asian
session, but also the time pre-market equities open up in central Europe, notably
Germany … the last 3 days of last week seeing 200+ IVIX INDEX levels during that
time, which not incidentally were the highest readings of the day … other than
that, readings were mostly capped BELOW 160 - 170, which in and of itself is
plenty volatile, but it’s nothing like 200+ … so, swallow the RED pill and learn to
live with it, letting the algorithm do its “thing”, and hopefully we don’t get any, or
at least minimally, blown through signals … seriously, what’s the alternative here?
I’ve had enough of “market hopscotch” … Cable I’ll revisit AFTER BREXIT is a
“done deal” one way or the other, and we’ll see what that market looks like then
… EURUSD is gonna need to see some sizable consistency in the IVIX INDEX
levels over many weeks to get me to spend time looking at it … that leaves the
DAX30, so let the party begin in earnest!
Onto the week … until tomorrow … Onward & Upward!!
-vegas
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