The Lawrence Chan Blog

Forex 1-minute data is now available from the historical data download page.

https://www.daytradingbias.com/?page_id=105159

Depending on my team’s progress, they should have some other data ready for download in a few days.

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Be ready for major messy price actions as US government is about to give us a completely confusing Non-Farm Payroll Report on October 22, 2013 this coming Tuesday.

First, the data is likely to be a mess.

Is it the original data collected as of the last cut off day?

Or does it incorporate the adjustments that BLS usually receive in the weeks following the cut off day?

Second, within 2 weeks the next NFP will be out.

I am not sure how people fit this piece of data back into their analytical models without questioning its validity.

This data point is now likely a dirty one as adjustments could be made based on what happened in the global financial markets so far over the past 2 weeks.

If I am going to predict anything, I will say welcome to a major roller-coaster ride this coming week.

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This video is a talk / Q&A back in 2009 on his book Outliers. This video is 50 minute long.

There are 2 things in the video worth special mentioning here:

First, the 10,000 hours rule is approximately 10 years for many people in the research results he has look into. Trading, an intensive mental exercise, can range from about 4 hours to 10 hours a day depending on the instrument you choose to trade. If you are really focused in learning to trade properly, it will still take at least 5 years (i.e. 10 hours a day) to get you to a point you are very good at trading.

The point is that you have to be patient and persistent in your quest to become a good trader. You need a plan where you will put in at least several years that you know you may not be profitable at all. There is really no shortcut.

Second, a recurring theme in the video is privileged advantage which can affect your chance of success in your pursuit of a career in trading significantly. When you are young, you may not be in a position to choose trading as a career. When you have already established a career in another field you may not be in a position to jump ship and give it 5 years to achieve consistent performance in trading.

For those who are not lucky enough to have support from their family or a cushion of capital large enough to sustain the long road to trading successfully, my advice is to look at alternative trading. Trading is not a single path skill. There are many markets to choose to choose from that require very low initial capital. There are also many trading styles that allows you to trade while you are making your ends meet.

If you plan your trading carefully, you will be able to overcome the initial disadvantage eventually.

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Some forex historical data are now available. We’ve got a simple download area setup for beta testing. More data (market breadth, indices, etc.) will be made available soon.

You can check out the download area here,

https://www.daytradingbias.com/?page_id=105159

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Don’t expect to see the following news in any mainstream media outlets in North America.

Important development in the currency world that everyone should pay attention to:

1. United Kingdom in negotiation with China on trading China’s currency and bonds

http://uk.reuters.com/article/2013/10/15/uk-china-uk-rqfii-idUKBRE99E06Y20131015

2. China and ECB currency swap deal

http://www.bbc.co.uk/news/business-24486685

3. Bitcoin is now accepted as payment for part of Baidu’s online services

http://finance.yahoo.com/blogs/the-exchange/bitcoin-validity-price-gets-big-boost-baidu-160640862.html

Remember that every direct transaction eliminating the US dollar as intermediary will further collapse the premium built into US dollar. There is no turning back to the old ways of international commerce where US dollar was king. China is not the only country trying to protect its interest. All the other countries are doing the same.

Do not take this as a directional call of US dollar weakening across the board. All it means is that US dollar will be stripped of its premium. There are always other countries that will do worse than United States hence US dollar will stand its ground at a lower equilibrium. It is difficult to estimate the impact at this point. It can be an overall discount of 15% or 25%. It can be worse. There is not enough information to figure out the possible scenarios, yet.

For example, countries like Japan and the whole EU complex are heading down the drain. Without reasonable competitive advantage, these places will have a hard time going forward in generating positive growth within their region. Thus euro and yen are likely going a lot lower against the other major currencies in the next decade.

The Bitcoin development is just natural progress of our economic system in search of a solution to the biggest currency problem of our time – something that can replace US dollar which is not controlled or bounded by any single country. The development in this area will dictate the direction of commerce in coming 10 to 15 years. Even if you do not believe in Bitcoin as a currency of the future, you should at least understand the basics of virtual currencies and be ready should they become more prominent over time.

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