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Seasonality is interesting to me because it seems like a powerful tool. However, just as you have mentioned that intermarket correlations are great until they don't work anymore, seasonality only isolates a few variables (like weather to some degree, holidays, fund flows, etc), but it does not take into consideration geopolitical and current context, let alone other factors. Clearly you do not feel it's something to blindly follow, but isn't a bearish January for the Euro based on the last 14 years as (ir)relevant as the relationship between stocks and bonds during a certain time period, etc.? If I could ask it this way: how much weight do you put into seasonality, as an actual support decision tool? If you had convincing reasons to be bullish Euro, and the past data of bearish seasonality conflicted with it, what would you do?
Theory suggests this seasonality has worked in the past due to the fact that multinational corporations based in the US repatriate funds after the New Year, and this has a tendency to depress prices, which definitely puts it into the "funds flow" category. So the question is flow oriented or value oriented. Let price action be your arbiter.
I have been tinkering with some trades in 6E. Picked up some longs on the dump today, sold half 1.3693, still holding half with targets at 1.3708 and 1.3731 for the runner. Moving my stop in tight so I lock my current gains, if it is going to hit my targets, the move needs to happen fairly quick (Upward resumption in the next couple hours). A move below 1.3675 +/- a few pips would invalidate the type trade I am doing as it would likely spend significantly more time near the lows or potentially fail.
I am wondering if you would be interested in a project of creating some of these ideas into strategies (I am not yet capable) This is a thread that talked about automatic posting of strategy trades to a thread on nexusfi.com (formerly …
Stopped out on way back to 3914 on original trade (gave back maybe more than I should have but wasn't around to watch it)...back in at 3859 (with tight stop) looking for at least 3983.
will come up with new plan after that...could be a short, depends on what happens at 3983....providing it gets there that is.
Oops...I mistyped, I meant 3883 not 3983.
Anyway it made it to 3883 and is playing yoyo around it. I'm going to wait a bit and see what happens from here, more specifically see if it goes to 3900 or through 3859 down to 3832
I reread this and am pretty sure I got the numbers right this time.