0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Bullish
Oil - US Crude
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Wall Street
Mixed
Gold
Bearish
GBP/USD
Bullish
USD/JPY
Mixed
More View more
Real Time News
  • Indices Update: As of 16:00, these are your best and worst performers based on the London trading schedule: US 500: 1.33% Wall Street: 0.82% France 40: -0.07% Germany 30: -0.10% FTSE 100: -0.30% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/aeuc1S326s
  • Hey traders! What is driving the markets today? Find out from @DailyFX Chief Strategist @JohnKicklighter 👇 https://t.co/yC5XVJC5fY
  • Canadian #Dollar Outlook: $USDCAD Five Weeks Down, Five Month Low - https://t.co/O1op1wYcdT https://t.co/GaYTjFmjtc
  • RT @C_Barraud: 🇺🇸 *PELOSI SAYS `MILES APART' ON SOME ISSUES IN #STIMULUS TALKS - BBG *PELOSI: `VERY FAR APART' ON MONEY FOR GETTING KIDS TO…
  • White House Economic Advisor Larry Kudlow: -Data suggests economy only needs 'targeted money' -Thinks economy is entering a 'self-sustaining recovery' -Trump 'completely opposes' bailing out states $USD $TNX $SPX
  • FTSE 100 IG Client Sentiment: Our data shows traders are now net-short FTSE 100 for the first time since Jul 20, 2020 when FTSE 100 traded near 6,264.90. A contrarian view of crowd sentiment points to FTSE 100 strength. https://www.dailyfx.com/sentiment https://t.co/iX4wB4HOah
  • Fed's Rosengren says the #Fed has been clear that negative interest rates are unlikely to be used
  • Back from vacation and back on schedule Going live for today's stock market webinar in 10 minutes - https://t.co/rmwDABTiN2 https://t.co/oC3Igu2muT
  • I've seen three more headlines today suggesting that there is significant money still on the sidelined despite the climb in markets. Is the assumption that some small tech milestone or new headline would excite investors to pay record amounts to get into a stretched market?
  • Forex Update: As of 14:00, these are your best and worst performers based on the London trading schedule: 🇨🇭CHF: 0.57% 🇪🇺EUR: 0.41% 🇨🇦CAD: 0.40% 🇳🇿NZD: 0.14% 🇬🇧GBP: -0.16% 🇯🇵JPY: -0.43% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/3mZjwCXcwc
Calculating Trade Targets and Duration with Market Conditions

Calculating Trade Targets and Duration with Market Conditions

2017-02-16 05:00:00
John Kicklighter, Chief Strategist
Share:

Talking Points:

  • Rather than leaving targets and trade time frames up to chance, proper calculation helps craft better opportunities
  • The Average True Range (ATR) - perhaps along with the absolute Rate of Change (ROC) - can help quantify these elements
  • With a reference to market conditions more conducive to range, we discuss AUD/USD's break and GBP/USD's range

See what live coverage is scheduled to cover key event risk for the FX and capital markets on the DailyFX Webinar Calendar.

Most traders and strategies put the emphases on finding opportunities and plotting the best entries. These are certainly critical aspects of a fully formed trade, but they are collectively only half of the trip. Exiting the trade determines whether the trade is profitable or not and dictates how long capital is locked up. Yet, even when this leg of the journey is considered; it is often left up to emotion or happenstance. A successful engagement in the market should think of the trade the whole way through. And, while fundamentals and technicals should play a role in duration and exit of a trade; a quantitative reference to historical conditions may be the most probability-oriented techniques that could be employed.

The law in physics that a body in motion tends to stay in motion has good corollary to markets. If there is not a prominent technical level or high profile event/theme to alter an assets course, it is reasonable to suspect it will hold its bearing and pace. Given the baseline probability that reality produces, we can use simple indicators to aid an assessment of holding period and objective through the exposure. The Average True Range (ATR) offers a scale of market activity which set the guidelines for pace. If the average daily range is 50 pips, a 200 pip objective may be somewhat aggressive. Furthermore, without intervention from a technical or event-based accelerant; an expected holding period less than four days would be unreasonable.

While the ATR measures full ranges rather than actual progress, it can nevertheless set the bounds for a minimum. A complementary measure of progress to help refine the expectation for a reasonable target and time could be a Rate of Change (ROC) or an 'absolute value' ROC; but complication is not necessary to improve the strategy. We discuss this concept of defining the second half of a trade against the backdrop of a range-defaulting market with reference to the Aussie Dollar's (AUD/USD, AUD/CHF, AUD/JPY) effort to force breakouts and the Pound's (GBP/USD, GBP/NZD) comfort in sticking to range in today's Strategy Video.

To receive John’s analysis directly via email, please SIGN UP HERE

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.