A Simple Forex Strategy: Interest Rates + External Debt/GDP + Trading Ranges

Discuss this with us here: http://www.informedtrades.com/608804-simple-forex-strategy-interest-rates-external-debt-accumulation-distribution.html#post667513 This video discusses a simple forex trading strategy. Here are the key points: 1. Limit ourselves to 9 currencies: USD, EUR, GBP, JPY, NZD, AUD, CAD, CHF, SGD 2. Sort them by their overnight interest rates. 3. Sort them by their external debt/GDP ratios. 4. Out of the 9 currencies, look for currencies that have both a low interest rate and a high external debt/GDP ratio relative to the others; that is the currency to short. Likewise, go long the currency with both a high interest rate and a low external debt/GDP ratio. 5. This tells us the currency pair and the direction to trade in. Then, look for trading ranges to appear on the chart. Put your stop loss outside of the trading range, and exit after the market trends and a new trading range forms that signals the end of a short-term trend. Of course, trade management can get much more sophisticated as you learn more about money management and technical analysis. This strategy is just a simple starting point.

Comments

1. people help me.... pleeeezz!!!! WHERE TO GET ALL OF THOSE DATA, CHANGES ??? ALL THIS STUFF... PLEASE!!!!
    
2. Yeah the internet has destroyed the historical meaning of hyperinflation. The modern definition is 3% or anytime you personally are short on cash. "Look at these bills. Damn you Bernanke!"
3. Although the speaker really doesn't have any historical understanding about "Hyperinflation" ...
4. This will definitely work. Though you likely will want to work on your entries and exits. And of money management.
5. You can trade any time frame, but you'll need a more refined technical analysis approach the shorter the time frame you want to go. Personally, I trade primarily off the 4 hour timeframe, but I use a technical analysis/money management approach that is a bit more refined. We have other videos on this (see our video on pyramiding, for instance).
6. The chart that you showed towards the end of your video was a monthly chart. What is the usual time frame of the trades you're discussing here? Seems like one trade could last for a couple of years based on the chart you were using to demonstrate the strategy.