2009.09.10 DRAIN THE BANKS - LIKE A RAT

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Patch
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Postby Patch » Sun Oct 18, 2009 3:48 am

What are the reasons to be a Red Rat or a Green Rat? What are the reasons against being a Red Rat, or a Green Rat? Given market movement, is one of the rats fatter than the other?

Does it make sense to be a Red Rat because the market falls much faster, and farther over a shorter period of time than a market rising?

Does the fall from strength to devaluation of the USD impact the RAT decision? Does the pair traded affect the Rat as well.?

Patch
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ENOUGH being a Yalie for me Back to the Sea. "What i can lose, i can win" "YES YOU CAN" - dragon33 -"Pick one method and one pair and stick with them until you master it. "The choice is yours - success or failure." TRO

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Postby prochargedmopar » Sun Oct 18, 2009 4:16 am

I'm looking to trade g/u, u/chf, and e/u so that I will have options for shorts most days.
$ weak, u/c going down.
$ strong, g/u and e/u going down.
Could add u/j also to the mix but for now I'm only looking at e/u on one account and g/u-u/c on the other.
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aVi
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Postby aVi » Sun Oct 18, 2009 5:09 am

MightyOne wrote:(EDIT) :shock:


Don't do that. I feel like I'm missing out on something... Scared_Smile
Wake up Mr. Green...

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Postby foreman01 » Sun Oct 18, 2009 7:34 am

Patch wrote:Does it make sense to be a Red Rat because the market falls much faster, and farther over a shorter period of time than a market rising?


Might be true for stocks, but forex pairs are relative. If EUR/USD was instead called the USD/EUR pair, then it would go in reverse -- so what does it mean to fall or rise? You buy one EUR you sell the USD at the exact same time - that's what always happens.


As to the idea of only playing one direction. The DTB rat - as I recall - was based a statistical study that said "20 pips from the high, OR LOW" -- both directions were equally valid.

I think on a more generic level one could be a rat by always playing their "system." One often hears pros say "learn one system and stick with it." So in this sense the system could be stated as: be a red rat when 20 pips from the high; and be a green rat when 20 pips from the low.

I feel pretty confident that if this forums experienced traders were to trade both red rats and green rats, that they would still have the same percentage of successes.

LMAO (at myself for this next statement) ON THE OTHER HAND -- it may be that by only playing one direction on one pair that the price action would be different for a red rat than a green rat and thus one would become better at recognizing a successful trade (especially the price action for exiting - because the entrance rules are pretty much ground in stone).

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Postby TheRumpledOne » Sun Oct 18, 2009 1:54 pm

Patch wrote:What are the reasons to be a Red Rat or a Green Rat? What are the reasons against being a Red Rat, or a Green Rat? Given market movement, is one of the rats fatter than the other?

Does it make sense to be a Red Rat because the market falls much faster, and farther over a shorter period of time than a market rising?

Does the fall from strength to devaluation of the USD impact the RAT decision? Does the pair traded affect the Rat as well.?

Patch
Signing off from Purple VA
Tonight


http://www.yale.edu/admit/freshmen/appl ... index.html
IT'S NOT WHAT YOU TRADE, IT'S HOW YOU TRADE IT!

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Postby TheRumpledOne » Sun Oct 18, 2009 1:56 pm

prochargedmopar wrote:I'm looking to trade g/u, u/chf, and e/u so that I will have options for shorts most days.
$ weak, u/c going down.
$ strong, g/u and e/u going down.
Could add u/j also to the mix but for now I'm only looking at e/u on one account and g/u-u/c on the other.


I told you to stick to ONE METHOD, ONE PAIR!

http://www.yale.edu/admit/freshmen/appl ... index.html
IT'S NOT WHAT YOU TRADE, IT'S HOW YOU TRADE IT!



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Postby TheRumpledOne » Sun Oct 18, 2009 3:25 pm

Image

White line is WEEKLY OPEN. If you are a GREEN RAT what side of the line do you want to be trading? If you are a RED RAT what side of the line do you want to be trading?

DOUBLE CROSS ABOVE: Price crosses below then above, then below and above again.


DOUBLE CROSS BELOW: Price crosses above then below, then above and below again.

What happens when price doubles crosses a line ending in 00?

CAN YOU SEE IT?
IT'S NOT WHAT YOU TRADE, IT'S HOW YOU TRADE IT!



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TheRumpledOne
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Postby TheRumpledOne » Sun Oct 18, 2009 3:32 pm

Image

If you are a GREEN RAT and price is BELOW the weekly open, doesn't it make sense to WAIT for price to move at least 100 pips below the weekly open since that happens almost 2/3 of the time or wait until price gets above the weekly open BEFORE you turn left?
IT'S NOT WHAT YOU TRADE, IT'S HOW YOU TRADE IT!



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Postby MightyOne » Sun Oct 18, 2009 5:58 pm

foreman01 wrote:
Patch wrote:Does it make sense to be a Red Rat because the market falls much faster, and farther over a shorter period of time than a market rising?


Might be true for stocks, but forex pairs are relative. If EUR/USD was instead called the USD/EUR pair, then it would go in reverse -- so what does it mean to fall or rise? You buy one EUR you sell the USD at the exact same time - that's what always happens.


As to the idea of only playing one direction. The DTB rat - as I recall - was based a statistical study that said "20 pips from the high, OR LOW" -- both directions were equally valid.

I think on a more generic level one could be a rat by always playing their "system." One often hears pros say "learn one system and stick with it." So in this sense the system could be stated as: be a red rat when 20 pips from the high; and be a green rat when 20 pips from the low.

I feel pretty confident that if this forums experienced traders were to trade both red rats and green rats, that they would still have the same percentage of successes.

LMAO (at myself for this next statement) ON THE OTHER HAND -- it may be that by only playing one direction on one pair that the price action would be different for a red rat than a green rat and thus one would become better at recognizing a successful trade (especially the price action for exiting - because the entrance rules are pretty much ground in stone).


You would only benefit from switching rats if you could tell that price was going to make a strong trending move.

Over one period of time there will be more green than red bars and over another period there will be more red bars than green.

There may even be near equal distribution of red and green bars :shock:

Upon entering into the market you cannot know if price will move 11 or 1,100 pips nor can you tell for sure the beginning of a move from its end.

What you can know are the statistics of individual bars or how the current bar usually interacts with its neighbor(s).

Pick one color and stick to it and maybe later, when you are not subject to an alarm clock, you can attempt to switch just before a strong trending move should you have the experience to do so.

ImageImage

oldmangeezer
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Weekly Chart Inidcators

Postby oldmangeezer » Sun Oct 18, 2009 7:14 pm

Hi TRO,

What are the names of the indicators you are using on your EUR/JPY chart?

Interesting you price stopped at about 10 pips difference. FXDD has price at 135.34.

Thanks!!

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