Ssi trading strategy

Ssi trading strategy

Posted: Glock Date of post: 23.06.2017

My Favorite Trading Tool, How to Use the SSI

Gold Prices Slide into Swing Support. Trend-Line Support as New Resistance. When someone asks me what my favorite trading tool is, I quickly lead them to the Speculative Sentiment Index or SSI.

The turning around of my Forex trading career from my first two years in the red to the profitable trader I am today I attribute to the SSI and its direction filtering ability.

How to Read SSI

The best part is that it's free to use and DailyFX offers historical SSI for historical testing for free as well.

Inside this article, I will explain what sentiment is and how we can dow nload this data for testing our own strategies with this powerful filter. Sentiment is a description of how a person or a group of people feel about something specific. In the case of trading, it's going to describe the ratio of bulls vs. It tells us how many people have long positions and how many people have short positions for a given instrument. In the case of DailyFX's Speculative Sentiment Index, it gives us a comparison between how many retail Forex traders are currently long and short on each major pair.

Why does this matter you ask? Because when the SSI moves to an extreme level, price usually moves in a predictable direction against the retail crowd.

The USDCHF is a recent example of this phenomenon. Knowing this, we should have looked to Sell the USD CHF for three reasons: USDCHF SSI is Still in Positive Territory.

We should all understand how SSI works now. We find out what the retail crowd is trading and look for an opposing trade.

ssi trading strategy

But what if we want to analyze SSI's impact on price over a larger sample size? How can we know if using SSI as a filter will work for our own personal trading strategy? Luckily, DailyFX offers historical SSI data that we can use to semi-manually backtest strategy performance with and without SSI as filter. This allows us to directly assess its strength as a filter over a greater amount of time.

To access the data, we need to login to www. Once we log in, we need to select "Speculative Sentiment Index", click the top most recent SSI submission, then click "SSI data via this ZIP file. Downloading Historical SSI Data. Now that we have this historical SSI data, we can look at our trading history to see what trades would have been filtered out by SSI and see if this filter would have been an improvement.

Better still we can backtest new strategies by only allowing them to buy when SSI was negative and only allowing them to sell when the SSI was positive and see what affect it has. My next article will feature just that, backtesting an ordinary strategy and comparing its trading results to the exact same strategy that uses the SSI as a filter.

We will then be closer to definitively calculating SSI's strength. Watch this introduction video. In the course, you will learn about the basics of a FOREX transaction, what leverage is, and how to determine an appropriate amount of leverage for your trading. Register HERE to start your FOREX learning now! DailyFX provides forex news and technical analysis on the trends that influence the global currency markets. Market News Headlines getFormatDate 'Wed Jun 21 Technical Analysis Headlines getFormatDate 'Wed Jun 21 Trend-Line Support as New Resistance getFormatDate 'Wed Jun 21 Education Beginner Intermediate Advanced Expert Free Trading Guides.

Click here to dismiss. Get Your Free Trading Guides With your broad range of free expert guides, you'll explore: News getFormatDate 'Wed Jun 21 News getFormatDate 'Tue Jun 20 Can SSI Improve Our Forex Trading Strategy? Collecting Data getFormatDate 'Wed Mar 19 Sentiment describes how the majority of traders view a currency pair.

Trading With the FXCM SSI - Automate the Range2 Trading Strategy | DailyFX | Foreign Exchange Market | Technical Analysis

The Speculative Sentiment Index from DailyFX tracks retail sentiment specifically. Downloadable Historical SSI is available to backtest its effectiveness. What is a Fundamental? Upcoming Events Economic Event.

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