What I discovered was how the large financial institutions time their foreign exchange transactions. There seemed to be a distinct repetition of a particular pattern on all of the momentum overlays. Kind of like everything bunched up on nearly the same values only to be a signal for upcoming volatility change. My job was to figure out the signals for turns and the direction it would take the market and what levels the market would retest. Markets with high liquidity really do have a gyration to them that makes it easier to forecast the direction while determining the best point of entry to time a turning point. That’s where the real skill in trading comes in. Nimble or agile trading is an absolute necessity for surviving and thriving in these markets. People using long term trend trading approaches, especially with the currency market, are setting themselves up for disaster when things go bad. If you’re in cash you’re much, much safer than having an open position where a central bank changes the exchange rate within minutes. Depending on the direction of an open position you could go broke or hit a jackpot with the decision of a central bank. If you want to test this theory, play with the Swiss franc and the yen. The  central banks love adjusting rates downward, so if you’re long the base currency, you hit a jackpot. If you’re short the base currency, an account can suffer catastrophic losses. So never forget: cash is king in the world of currencies. And cashed currencies must always be converted to money to gain a store of value. Never forget: Gold is king in the world of money. 

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