Inter-Market Indicators

Discussion in 'Order Execution' started by InterMarketA, Jul 27, 2008.

  1. Hello everyone,

    There are some useful Sentiment indicators based on FX Options trading activity and US Yeild Curve analysis.

    Just to start a discussion...

    As of 07/25/08, US Options Markets Open Interest Ratio was:

    EUR/USD 1.13 Neutral
    GBP/USD 1.85 Bearish
    USD/CHF 3.59 Bearish
    USD/JPY 0.83 Bullish
    AUD/USD 0.35 Bullish

    US Yield Curve is shifting upward, my reading for 10Yr Yield / 2Yr Yield Ratio is -1.57% at a close on 07/25/08 - Bullish for US Dollar..

    Let me know if this is an interesting piece of info. I have more stuff on Oil, Gold, Stocks, Bonds influence on Forex Markets. Inter-Market Analysis is pretty powerful addition to the Trend and Momentum analysis...Opinions welcome!
     
  2. One of the best intermarket indicators is bonds/ES. Roughly a 90% negative correlation, and one of em always seems to move before the other, giving you a heads up on the lagging contract before it moves. I watch both like a hawk all day (90% of my trading is in these two contracts).
     
  3. Not sure what you referring to, but thanks. Do you understand put/call ratio and US Yield Curve readings?
     
  4. Picaso

    Picaso

    Hi Intermarket, what about oil (apart from the USD, indeed)?

    Thanks, best trading,

    Jorge
     
  5. Xuanxue

    Xuanxue

    Internal ratios are read from an advancing position relative to a declining, who are always one.

    A ratio of .11, for an example, would be 1 appreciating stock or option for every 10 depreciating. Not the best of odds for a call or long.

    Yield curve spreads are simliar but a little bit more complex.

    http://www.cbot.com/cbot/pub/cont_detail/0,3206,1070+12541,00.html
     
  6. Very simple, just referring to prices of ES and ZB. Extremely highly correlated. Sharp movement in one more often than not gives a heads up to take the other the opposite direction, before it breaks. I do this all the time (doing it as I type actually).

    Yes, I used to look at put/call and yield curve stuff ages ago. Complicated things too much. I take my trading as simple as humanly possible. Don't use "indicators" either.
     
  7. Dear Jayford, what are you trading? I am trying to reach FOREX traders.