| versed in currency trading, or trading of any kind, will | | | | determined; from that, trading opportunities will start |
| tell you that trend detection is important. Whether | | | | to show themselves. |
| the forex market is trending up, down or sideways; it | | | | How Can I Add This to My Own Forex Analysis |
| doesn't matter, it's the movement that counts. | | | | Rodriguez has been working on a set of analysis |
| However, trend detection can be complicated and | | | | tools with Muhammad Hafeez, software engineer for |
| there are many tools available. Finding the right | | | | Their tools, the Price Analysis Tool (PAT) and |
| combination of tools to work for you is important. | | | | Temperature Charts, are available at the website |
| Forex Analysis and Trend Detection | | | | Hafeez says that, "The Price Analysis Tool performs |
| There are many tools available to the currency | | | | analysis on quotes of currency pairs over a specified |
| trader. Charts, graphs, forex news, regressions, trend | | | | period of time and projects the same period into the |
| lines, moving averages, Fibonacci (numerical | | | | future, assuming that the regression slope and the |
| sequences) and oscillators are all part of the tool box. | | | | randomness will remain constant. Historic data alone |
| No one tool is king; it's not possible. If it were, there | | | | cannot help forecasting the future. For example, |
| would be a lot more successful currency traders. In | | | | recently the news agencies were reporting that |
| fact, it's not really possible for a tool to identify | | | | Greece and Portugal may default on their national |
| trends. The key is to pick a few, learn them, watch | | | | debt obligations; this may further bring the EUR down |
| them and develop a money-management strategy | | | | against the USD. The PAT will help the investor in |
| that works. | | | | quantifying this effect." |
| It's been proven again and again that forex markets | | | | Temperature Charts Sound Hot |
| are too free and random to apply trading strategies | | | | The Temperature Charts are based on Brownian |
| successfully. It always comes down to the savvy of | | | | Motion. When a flow or a trend occurs, the direction |
| the trader. You should never let someone or | | | | can be difficult to determine. When the market |
| something tell you what to trade, the responsibility of | | | | becomes volatile (warmer in the Brownian Analogy) |
| due diligence and action lies with the trader. | | | | short-term movements, which have no bearing on |
| "I don't believe that such a thing as a trend detector | | | | underlying trend, can completely mask market |
| can actually exist as a tool. Trend detection is a | | | | direction. Temperature Charts measure how hot or |
| human task; it is the investor who figures that some | | | | volatile the market is. On one hand, Temperature |
| event of international relevance will be affecting the | | | | Charts can be used to warn against trading when it's |
| quotes of some of the currency pairs," says | | | | too hot and trend is obscured. On the other hand, |
| Armando Rodriquez, a forex analyst and software | | | | hot times mark market volatility and higher stakes |
| engineer. | | | | for those who believe they know where the trend is |
| Rodriguez, who also holds a PhD in physics and is an | | | | heading. |
| expert in Random Walk and Brownian Motion, adds | | | | For more information, visit: |
| that, "With movement comes opportunity; taking | | | | Tommy Hughes is a successful and largely self taught |
| advantage of opportunity leads to profits." | | | | economy watcher and market speculator. He has |
| Random Walk and Brownian Motion in Forex Analysis | | | | extensive knowledge of risk management and asset |
| There is a school of thought in forex analysis based | | | | allocation, stock and options trading as well as market |
| on randomness. If this sounds familiar you probably | | | | analysis. Tommy has worked in the fast paced |
| are schooled in stochastic analysis of the stock and | | | | restaurant industry for over 15 years. Tommy also |
| futures markets. Each day the market is open and | | | | writes for food publications such as Becket Media's |
| currency trades there will be a measurable amount of | | | | "Grilled" Magazine. Tommy enjoys mountain biking and |
| "randomness." Over time, this randomness will form a | | | | brewing beer. Tommy lives in the Asheville, North |
| range and within the range, movement remains | | | | Carolina. |
| random but upper and lower limits can be | | | | |