0:00Remember gold is going every single day just by using this simple technique and it makes trading
0:03Tom's a great trader by the way.
0:05Gold feels so easy. It generally feels like there's a glitch in the markets.
0:08Like this is how much money I've made in the past year just because of this one simple component.
0:12So whenever you're looking to take a trade on gold, you first need to look at how DXY has moved
0:15because you should already know by now that gold and DXY have an inverse correlation.
0:20So when DXY moves bullish, gold moves bearish.
0:22But what should you do if gold and DXY are both moving in the same direction?
0:25Well, first you want to look for a mismatch between the volume of gold and DXY.
0:28where on DXY we had this big push up,
0:30but on gold it's just really low volume price action.
0:32So we needed this massive move on DXY
0:34just for gold to pretty much move sideways.
0:36This means if we have a small pullback on DXY,
0:39we can expect a massive push on gold.
0:41And so if we just go back and look
0:42for a little correction on DXY,
0:43you can see that gold has had this massive push up
0:46just from the small little pullback on DXY.
0:47Okay, so this is really good information.
0:49What's really nice is I'm actually gonna take the transcript
0:52from this and bring it over to Quant
0:54and build an indicator based on this idea.
0:56I'm going to bring that over to Quant and say, I want to build an indicator around this idea.
1:05I'm going to paste in that transcript here.
1:07I'm just going to delete the hook.
1:08I'm going to add something here at the end.
1:10So to add context to what we're doing, I just said, so Quant knows.
1:15So we need a unique way to show when DXY is making a big move while XYU is just trading sideways.
1:19Then a signal would occur when DXY retrace back from that big move So I going to send that and let see what it builds All right we got our code here Gold slash DXY mismatch Z score normalization mismatch detection
1:32big push, gold sideways,
1:33and then it triggers when it detects that mismatch.
1:36So I'm just going to copy that code here.
1:39Go over to trading view, go to pine editor.
1:42I'm going to paste that in and let's see what we got.
1:45All right, cool.
1:46So we got some cool signals here.
1:47So far, pretty decent.
1:48It got some short signals there.
1:50Very nice short signal there.
1:52To be honest, I'm not a huge fan of how it's signaling these longs during shorts as well.
1:57So I feel like we could filter out these signals a little better.
2:00So I want to add something to help with that.
2:02I'm going to go back to quant and describe what I want.
2:05Okay, what I said was this is looking very promising.
2:07I want to add a better confirmation to this indicator.
2:09Can you figure out a good confirmation system that aligns with this indicator to eliminate false signals?
2:13Also add more information on the dashboard on the DXY and XYU correlation.
2:19Don't change anything.
2:20Just add these things.
2:21All right.
2:21So we have our updated code here.
2:23I'm just going to copy that and then bring this over.
2:25And let's see if we got the filter and dashboard.
2:28Wow.
2:29All right.
2:29This actually filtered it really well.
2:30Remember, we had all those buy signals down here.
2:32Now we just have shorts.
2:33We also have a correlation status and the correlation information on the dashboard.
2:38This is looking very, very promising.
2:39There's a long.
2:40Let's go and see another one.
2:41Pretty decent moves off those signals.
2:43I'm actually very satisfied with what we've built so far.
2:46If you want to build indicators just like this, comment, quant, and I'll send you the link.