scholarly journals RANDOM STRATEGY VERSUS TECHNICAL ANALYSIS STRATEGY: THE CASE OF EUR/USD INTRADAY TRADING

2020 ◽  
Vol 3 (1) ◽  
pp. 34-39
Author(s):  
Miroslav Svoboda ◽  
Martina Sponerová
Keyword(s):  
Foreign Exchange ◽  
Foreign Exchange Market ◽  
Technical Analysis ◽  
Moving Averages ◽  
Exchange Market ◽  
Random Strategy ◽  
Analysis Strategy ◽  
Strategy Versus ◽  
Similar Risk

This paper provides a comparison between the strategy based on technical analysis and the strategy based on random trading on a highly liquid EUR/USD foreign exchange market. The authors analyze three years of data, and in every intraday trading session. Technical analysis strategy uses essential indicators such as moving averages (MA). Every trading position will have the risk-reward ratio (RRR) 3 to 1. In addition, another trading positions on the EUR/USD currency pair will be opened at the same time each day, without technical analysis. The time of entry into position will be indicated by past high liquidity on a given currency pair at a given time with a similar risk-reward ratio (RRR) 3 to 1. This paper aims to compare the strategy of technical analysis and the random strategy in intraday trading concerning the profitability of these trades.

scholarly journals RANDOM STRATEGY VERSUS TECHNICAL ANALYSIS STRATEGY IN THE US MARKET

2020 ◽  
Author(s):  
Miroslav Svoboda ◽  
◽  
Martina Sponerová ◽  
Keyword(s):  
Market Research ◽  
Technical Analysis ◽  
Relative Strength ◽  
Strength Index ◽  
Random Strategy ◽  
The Us ◽  
Analysis Strategy ◽  
Strategy Versus ◽  
Similar Risk ◽  
Interesting Alternative

Random strategy is currently an interesting alternative to traditional trading of financial instruments. The paper builds on existing research into the trading of investment instruments through random strategy and strategies based on technical analysis. The highly liquid USD/CAD currency pair was chosen for the US market research. We analyze five years of data, and in every intraday trading session, only a single position will be opened. Technical analysis strategy uses essential indicators such as Bollinger Bands, relative strength index (RSI), moving averages (MA) and other. Every trading position will have the risk-reward ratio (RRR) 3 to 1. In addition, another trading positions on the USD/CAD currency pair will be opened without technical analysis. The time of entry into position will be indicated randomly with a similar risk-reward ratio (RRR) 3 to 1. The aim of this paper is to assess which of the above strategies is more suitable for the investor. In other words, this paper aims to compare the strategy of technical analysis and the random strategy in intraday trading concerning the profitability of these trades. We expect that a random strategy will be more suitable for the investor in many points.

scholarly journals Technical Analysis in the Foreign Exchange Market: A Cointegration-Based Approach

1999 ◽  
Vol 3 (3) ◽  
pp. 147-172 ◽  
Author(s):  
Norbert Fiess ◽  
◽  
Ronald MacDonald ◽  
Keyword(s):  
Foreign Exchange ◽  
Foreign Exchange Market ◽  
Technical Analysis ◽  
Exchange Market
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