True Range

 True range is different with the price range.

To calculate price range, we only need to find the distance between high and low during a specific time.

But to calculate True range we should find the biggest distance between high(H), Low(L) and Previous close (Pc).

1. Previous bar’s close (C.1)
2. Current bar’s high (H)
3. Current bar’s low (L)

True range is not a very useful indicator, however Average True Range is widely used.

You can find more information about ATR here.

Active or passive investment

Active or passive investment. 

Which one is better?

I think we should have a mix.

Actually, this is the best way to have and manage a very diversified portfolio. 

We can have a core long-term investment including a mix of different assets like tech, metal base, travel, transport, etc.

And then for the active part of the portfolio monitor and analyze a few markets based on what is trending. The active part is short-term and will change from time to time. For example, if you have tech stock sticks as active investment and after a few months Tech reaches a stop then we may trade other markets like travel, etc.

This is very similar to the core-satellite strategy.

Asset allocation

Is diversification enough to achieve the investment/trading goals?

No! You should not go and invest in a 1000 different stocks and think thus is the best approach. 

Asset allocation is another important part of a good strategy. 

To allocate your money towards different assets, you should consider the following:

   Your risk tolerance 

   Targeted performance 

   Meeting your investment wealth objects.( maybe more money in your pocket)

Strategically you should think long term : 

This means you should decide which asset classes you want to invest in and how much.

Example:

You may have 50% Stocks 

40% bonds and 10% cash long term

Tactically you may change the allocation to meet short term goals. These can be achieved by taking advantage of temporary market situations. 

Example:

Asset manager may realise that stock will underperform in short term then changes the allocation in short-term to achieve wealth objectives. 

They may decide to change the allocation in short term to 30% Stocks 

50% bonds and 20% cash(Or Cryptocurrencies or FOREX)

#forex 

#gold

Triple Exponential Average (TRIX)

 

Triple Exponential Average (TRIX)

·       TRIX is an Oscillator: Oscillates around zero

o   Overbought if it is above zero - I do not like this definition!

o   Oversold when it is below zero - I do not like this definition!

·       When TRIX is used as a momentum indicator

o   Positive value means the momentum is increasing.

o   Below zero line suggests the momentum decreasing.

·       When TRIX is used as a trend indicator

o   More time staying above the zero means uptrend.

o   More time below the zero line means downtrend.

·       Signals

o   Many analysts believe that when the TRIX crosses above the zero line it gives a buy signal, and when it closes below the zero line, it gives a sell signal.

o   I prefer combining TRIX with a moving average with smaller time period

§  Buy only if in an uptrend and you see the TRIX crosses above MA

§  Sell only if in a downtrend and you see the MA crosses above TRIX

·       Divergence

o   A divergences between price and TRIX can indicate significant turning points in the market.

Time Series Forecast Indicator (TSF)

 The Time Series Forecast tries to calculate a best-fit line over a specified time period using Linear Regression. This line is then plotted forward for a user-defined time period.

I use this in an identical way as I use 2 moving average indicators.

So the same setups will be used here. You can watch the video for how to use moving averages here .

The advantages of using TSFs over MAs are:

1. Moving average has more delays.
2. TFS also tries to forecast the price.

INDUSTRIAL METALS IN 2021

 

I think we have very good investment opportunities in industrial metals.

Which of these industrial metals ( $COPPER, $NICKEL, $ALUMINUM  $SILVER  ) is best to invest?

Commodities had a tough year and they may rise fast.

I do not think $GOLD will be part of this, though! 

• 1.Will Copper outdo the performance of other commodities in 2021?

According to a White & Case 2021 survey, yes!

 The demand for copper is rising as it is an essential metal in electric vehicles, also it is widely used in Green technologies. 

The Chinees economy is recovering fast which is one of the biggest consumers of industrial metals.

• 2. How Nickel will perform?

I call this the battery metal. Nickel prices reached an all-new high level in February this year before dropping down to under 16000USD levels. Considering overall market recovery and increasing demand for Nickel I expect this to rise as well.

• 3. Aluminum will rise steadily

The next one to follow is Aluminium. Looking at the aluminium importers like Germany, South Korea and the Netherlands make me feel more confident about the future of this metal. Now that importers' economies are recovering, I expect a steady price rise for this.

• 4. Silver will be affected by the vaccine performance!

If investment demand rises, the silver price will increase...

The biggest catalyst for $SILVER and $GOLD will be monetary dilution as these are precious metals and can not be produced by few clicks like Cryptocurrencies and there are many people who are still thinking and supporting the traditional safe havens. 

Happy trading!

Swing Index Indicator (SI)

1. Swing Index is used to compare a price movement to price swing 
2. The purpose is to defining the strength of price movement.
3. Positive SI reading can be a sign of a price up-move and negative SI readings considered as a sign of price down-move. 
4. Swing Index is based on the 2-bar data
5. I prefer to use SI on shorter time frames as it is only reliable to predict just several bars into the future. 

Signals:

• Buy signal: when the Swing Index crosses over zero. (Duration of trade only next few candles)
• Sell signal: when the Swing Index crosses below zero. ( Stay in trade or change SL after only a few candles)
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