Titan's PipWorld

[Titan]

Some of you may not have read my post about the MTF HAS indicator, first and foremost I am not using it as Don Steinikz teaches. My use of the indicator is completlely different. Second, I personally could not consistently generate a profit based on how Don Steinikz explains his MTF HAS indicator, hence the reason I develope my own trading method/rules using this particular indicator inconjuction with a couple others.


Titan

[Titan]

Institutional Bank Style Trading: Balance Point Trading is how the banking institutions and large retail investors make their money. This is how we as well are going to make ours. Welcome to Titan's PipWorld...

Date: Thur, Dec 27th 2007
Time: 9:40pm New York Time

No changes have been made.


To enlarge pic once loaded just click on image.


Titan


p.s. For those of you who follow my trades in your own demo or real accts, don't get nervous when a move against you has taken place. This is not a short term trading system but a medium to long term trading system where in many cases a trade is for 100 pips or more per position. *Note: If you have not read post #54 about reducing your unit size then please do so before placing any trades based on my trading method.

[Titan]

Institutional Bank Style Trading: Balance Point Trading is how the banking institutions and large retail investors make their money. This is how we as well are going to make ours. Welcome to Titan's PipWorld...

Date: Fri, Dec 28th 2007
Time: 12:42am New York Time

I have changed my pending order as shown in the pic-image below.


To enlarge pic once loaded just click on image.


Titan

[Titan]

Institutional Bank Style Trading: Balance Point Trading is how the banking institutions and large retail investors make their money. This is how we as well are going to make ours. Welcome to Titan's PipWorld...


Update: Fri, Dec 28th 2007
Time: 10:54am New York Time

Week 1 Performance:

Starting Balance: 25k Demo-Acct
Current Balance: 25,102.54
Current Equity: 24,884.06

Gain: +102 pips
Loss: 0 pips
Number of trades: 1

Number of wins: 1
Number of losses: 0

DrawDown: -160 pips (which includes open positions)

Overview: I closed out my Cable (GbpUsd) trade due to sell signals being generated for next week. The plan is to re-enter at a lower price and buy-back-in before Non-Farm Payroll on Friday, Jan 08.


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The below pic-image shows all current open trades and pending trades. There have been some changes to my pending trades for GbpJpy.


To enlarge pic once loaded just click on image.


Titan

[et_phonehome_2]

Where can I find more information on this Balance Point Trading?

[Titan]

Hi et phonehome 2

There are a few forex indicators that are balance point methods, like Heiken Ashi which means, Balance Tree or Balance Candle stick. There's also the indicator Ichimoku Kino Hyo, which means Balance Chart.

Based on my observation Balance Point Trading is simply a method inwhich one is attempting to find the Tru-Value of a given currency pair. This particular method has nothing to do with fundamentals or pure T & A (technical analysis). Although you can use fundamentals or pure T & A to help determine such.

I hope this helps to answer your question, in short I have no knowledge of a website or book which speaks directly to Balance Point Trading, itself. If you come across such please share the info.


Titan


p.s. For the most current update on my trades read post #64...

[Titan]

Ok, I just did a quick search on the web for Balance Point Trading to see what would come up. Personally, I didn't think much of anything would along the lines inwhich I speak and sure enough thats what I found.

Most of everything I came across spoke of Balance Point Trading as Pivot Points or referred to Balance Point Trading as s/r points (support resistance).

I can tell you from personal observation that the Banks and large retail investors are not using pivot points or s/r points to trade their large sum of money. Why do I believe such, because pivot points and s/r points move and change from time frame to time frame -while the tru-value of a given currency pair does not-...


Titan


p.s. For the most current update on my trades read post #64...

[Titan]

Institutional Bank Style Trading: Balance Point Trading is how the banking institutions and large retail investors make their money. This is how we as well are going to make ours. Welcome to Titan's PipWorld...

Date: Sun, Dec 30th 2007
Time: 6:49pm New York Time

Update: A new Buy-Signal for GbpJpy was generated at 224.40.


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Titan

[Titan]

Date: Mon, Dec 31st 2007
Time: 6:37am New York Time

Good Morning Traders ... Now its the waiting game for the trades I have open. I will only open a new trade if GbpJpy were to pull back to 221.42 otherwise I will keep the five positions I now have open until 228.00 is reached. 228.00 is first exit on my trades, so it may be a while before I post again may be a week or so.

Hope you guys were able to get in at the 223.15 or 223.73 level for the move up, if so your in a good position.

Okay, well then I'll be back to post an update when GbpJpy reaches 228.00, see you then.


To enlarge pic once loaded just click on image.

Titan

[Titan]

Why is the carry trade so dangerous? - Money Week



Update: Read The carry trade: a tsunami in the making for more insight into the risks facing the carry trade.
This feature is part of our FREE daily Money Morning email. If you'd like to sign up, please click here: sign up for Money Morning.

Few people can resist the lure of free money. Hence the recent fad for ‘stoozing’; borrowing large sums on credit cards with a 0% interest rate and investing the proceeds in a savings account.

Without having to advance a penny of their own money, the borrower can pocket a few hundred pounds a year in interest. When the credit card’s zero-rate period comes to an end, the borrower pays back the loan or, even better, rolls the debt over on to a new card. At one point a couple of years ago this trick was so popular that personal finance pages filled up with tips on how to do it.

Stoozing has gone out of favour somewhat since most credit cards began charging a balance transfer fee, making the returns less attractive (although you can still net 2%-3% a year from it). But the grown-up version of this trick hasn’t vanished; indeed, it continues to power asset markets around the world. And that may be storing up serious trouble for the future…

Of course, in institutional circles, stoozing goes by the more respectable name of the carry trade. But the principle is the same; borrow money at a cheaper rate than you can earn on an investment elsewhere, then sit back and enjoy the profits.

The big difference is that carry trades are a lot more dangerous than stoozing. Firstly, rather than being invested in a safe savings account, the money increasingly flows into riskier place, such as emerging market assets. Secondly, carry trades are often cross-currency carry trades, which carry extra risks

In a currency carry trade, the speculator borrows money in a low-interest rate currency and buys higher-yielding assets in a different currency. Today, the low-rate currency is generally the Japanese yen; the higher-yielding assets are often US dollar bonds, but sometimes more esoteric assets such as Icelandic housing bonds or even emerging market equities or commodities.

The carry trade is appealing because of the type of returns it can earn, particularly if the proceeds are invested in bonds. These returns may not be huge, but they’re steady and consistent, and so they appeal to money managers who want a steady income stream – for example, hedge fund managers with pension fund investors.

But the counterpoint to these small, steady returns is the possibility of a very large, very sudden loss. The biggest risk is generally that the exchange rate moves against you – the higher-interest rate currency rapidly devalues, reducing the value of your assets relative to your borrowing. That's why these trades are often described as “picking up nickels in front of a steamroller”

We saw a good example of this earlier this year. The yen bounced sharply against the dollar in April as the Bank of Japan tightened the money supply; in response, many carry trade speculators bailed out of their assets to repay their yen debts. The knock-on effects from this were at least partly responsible for the global sell-off in May.

Since then the yen has fallen back and the carry trade has returned with a vengeance. Speculators now believe that the Bank of Japan is likely to let the yen fall further, in order to help its exporters. That reassures them that they’re unlikely to be hit by a rising yen; in fact, they believe they’ll benefit from a falling yen (which reduces the cost of their debt relative to their assets).

But there’s something that they – and all other investors – should bear in mind. Firstly, when the yen rebounds against the dollar, it often snaps back very fast. A graph of the yen/dollar exchange rate shows very rapid bounces that are equal to or bigger than the April’s rally in almost every year for the past decade. It also tends to hold onto those gains for a while. So carry trades can go from profit to loss with almost no warning.

Secondly, many asset prices now seem to be extremely dependent on the glut of cheap liquidity that comes from the yen carry trade; if you look a chart of the yen/dollar exchange rate against the MSCI emerging markets index this year, the correlation between the two is very striking. The implication is that if the yen rises and carry traders bail out of their assets again, we’ll probably see another sharp global sell-off in all assets.
So what might cause the carry trade to unwind? Dresdner Kleinwort strategist Albert Edwards identifies one route. Plenty of carry trade money has flowed into risky cyclical assets. As we head into the economic slowdown, these assets are likely to fall in value. As a result, speculators in them will cut their losses, bail out and repay their yen debts.

If you click on the link the article continues...


Titan