Predictable trend trading ForEx markets.

Discussion in 'Forex' started by The Kin2, Jan 28, 2008.

  1. Strictly my own opinions, but forex market is highly inefficient as many have yet to adapt to the possibility of super weak US dollar. This has created trends where the dollar is slowly decreasing in value but, pull backs slightly followed by new lows. Short the USD with tight stops. Cover and maybe even buy during short-term reversals. Repeat. Unlike the stock market, ForEx markets don't usually adjust 40 or 50% immediatly following a shock.

    Which is where the USD should be IMHO.
  2. i respect your opinion, but i will have to disagree that the forex is inefficient.

    it's anything else BUT inefficient. due to NO slippage and large capital going eitherway, trends are much more rare and much harder to trade than individual stock trends.

    this is just my 2 cents and bear in mind that i daytrade. the picture is a bit different on the longer term charts, but still, i don't believe in inefficiency the way you made it sound.

    HOWEVER, a rule of thumb would be that the larger the spread, the more inefficient the market is because of the lack of ultra short term traders and the limited access to go countertrend at any convenient time.

  3. All markets are somewhat inefficient.
    It they were completely efficient, they would be much like a smooth curve, without jitterness, since fundamentals seldom change that often and that fast.

    IMO dollar has hit a bottom, whether this is a final or intermediate term bottom, only time will tell.

    Some people (importers/exporters, manufacturers, industrials) will always buy or sell their currencies at whatever price is quoted. They just can't cease to sell their products or buy their raw materials.
    People in the stock market can always say, nah! let's wait a couple months before buying this shares.
  4. fxopco