The Lawrence Chan Blog
I have diverse interest in many things from science and technology to martial arts and ancient health practices. Obviously, discussion of these topics should be done within my own blog as oppose to keeping them here. Hence my blog is created so that I can have a venue to express my creativity and thoughts on my other interests. For those of you who share similar interests, you can check out my site TheLawrenceChan.com
Due to the sheer volume of articles I have written about trading, many of which are trading related yet not technically in line with what DaytradingBias.com is offering, they have to be split from my blog into yet another site. Hence for my non-technical writings about trading, videos I have curated from various sources that I think are useful for traders and my reviews of trading related products, you can find them at the site Essence of Trading
The reason why I picked the Tai Chi picture above for this page is best explained by my article Tai Chi Traders in a World of Chaos at Essence of Trading.
Below are the old blog posts that were originally posted here. To avoid broken links from other sites, I have decided to keep them here.
First Bitcoin Bank Run (Sort Of)
2014 Feb 7 Fri 14:02:37 | by
First real major crisis in Bitcoin world finally emerged.
From the biggest Bitcoin exchange:
If it is not a bank run, I don’t know what is.
The interesting question would be the response of Bitcoin prices and eventual resolution of this event.
As I mentioned before Bitcoin has to go through various crisis before it can mature into something that the public will accept (i.e. going mainstream).
This is one of the many tests it has to face.
Real-Time Chat Room and Price Levels Tool Backend Testing Over The Weekend
2014 Feb 7 Fri 12:45:45 | by
We are going to conduct some stress testing on our real-time messaging capability over the weekend.
It may affect the real-time chat room and our real-time price levels tool from functioning properly.
If our conjecture is correct, we will be moving to a new backend to further improve our real-time messaging capability. This can open more options for me in terms of implementing the real-time bias reporting tool.
Exciting time!
Manuel Forjaz: 15 Steps To Become A Millionaire
2014 Feb 4 Tue 19:47:57 | by
A 22 minute talk from Mr. Manuel Forjaz.
It is a talk about how to start from knowing next to nothing in business and make it work out at the end.
His message right from the beginning hammers home the problems with majority of trading novice – not willing to change themselves (mentally and to certain extend physically) to align with the drive necessary to succeed.
Good advices for running your own business throughout the video. Many newcomers in trading do not realize trading is very much a business you are operating. You have to learn, adapt and change yourself to survive in the ever changing world of financial markets.
In case you are wondering what Bacalhau is, you can learn more from the page Bacalhau on Wikipedia.
Market Breadth Primer: Forex Majors And Their Surprising Correlations With Historical Volatility
2014 Feb 3 Mon 19:46:28 | by
Traders often talk about volatility. Many brokerages even offer volatility reports on various timeframes across all the forex pairs as a service to their clients. People talk about volatility because they think that if they know something about the volatility they can find better trading opportunities when the volatility picks up. They also like to improve their money management with better control of their stops so that they will not be stopped out of their positions prematurely.
But is that all you can do with volatility measures?
Are they missing something important?
Here is a completely different take on the subject.
Forex Majors Are Affected By Its Derivatives More Than You Think
Due to the strong liquidity of the forex majors, their OTC options, swaps and other derivatives are very actively traded too. These secondary markets do not just trade off the price of the majors. Instead, they dictate the important directional moves in the majors behind the scene.
People often assume that the forex markets are so liquid that it is not possible for any single party to control the price movement in these markets for long. The truth is far more surreal. All major market making activities on forex derivatives are conducted by the same small group of institutions all over the world while their hedging models (or algorithms if you prefer the term) are all similar to each other. Hence, their aggregated approach in hedging these derivative products created a force that is many times stronger than all the other players combined.
So, it is not a single entity that control the behaviour of the currencies. Instead, it is a group of entities that somehow thinking alike acted upon on the currencies based on their models that all telling them the same damn thing. In the eyes of a third party observer, the aggregated result is no different from the market having a mind of its own that loves to mess with the small traders.
These constant position adjustments to the forex derivatives affects the way the forex majors move structurally around various round number levels. The hedging actions of these derivatives sometimes dampen and sometimes exaggerate the underlying forex markets. Since many of these derivatives are volatility driven, they cause skewered behaviour in both the volatility and the forex market price movements.
(member only content below)
Members only content, login now or sign up to view the rest of this article.WTF Chart of the Day: Google Going Down 50 Bucks
2014 Feb 3 Mon 13:53:05 | by
Talking about Google going down $50 since open at my chat room.
Update of my chart from last week.
Follow up on my last post, WTF Chart of the Day: Google Weekly And Quarterly STOPD Play
I have finally completed the first advanced chart lesson for Art of Chart Reading Online. It turns out that it is so long I need to break it up into multiple parts so that the concepts presented can be isolated for better understanding. Premium mem …
I mentioned that I am having the market breadth reporting section completely revised so that everyone can see the custom market breadth data and charts easily. After market close today I was shown the first prototype. I like the design – simple and …
Last year I posted a chart on Dow based on the Chinese calendar’s solar lunar cycle. It is quite fascinating to see how the market unfolded last year where many of the turns are matching that chart. I am not sure if it can do the same for us this yea …
Google chart before earning announcement with relevant trend lines and patterns marked. Previous quarter top 50% highlighted in blue on the left. First week of 2014 STOPD Levels highlighted with the expansion levels. Notice how Google reacted at …
Premium member will find a new section called Real-Time Tools on the S&P Signals page. Currently there is only one button available there for opening the Emini S&P Real-Time Price Levels window. For explanation of what it does, see the shor …
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