Anyways I do sometimes use it from a long term and hopefully Today we're here to talk about the SPX index Today: The index is trading at and we saw stabilization in the last trading session. Now the market is in the zone of consolidation with subsequent exit from it to the level of - Negative phenomena continue to be observed on the market. Bulk sales are still ahead. Today we are waiting: Today we The market feels overdone, and we are way basing into the BB bottom right now.
The BB width is also quite wide and this suggests we should see a correction somewhat. I feel we can correct back towards 3,, Hi Traders. In the previous few analysis, i've been calling selling opportunities as price continued to develop signs of a healthy downtrend. For now, there are only two questions I'm asking myself: 1. How far could the price stretched? Would it If it is, the bull trend will eventually resume, but if not, we will likely see a bear trend.
Other previous Chart says it all.. On June 13th SPX opened the week by heading straight down, it tried to rally on Wednesday on the Fed news of a rate hike LOL but could never get above Monday's high and then failed miserably the rest of the week to produce a bearish weekly closing candle. And this was a week after an already bearish close the previous week which produced a Possible bounce to the upside soon.
Extreme selling pressure noted. Price is stretched to the downside and is below the lower Bollinger band set on Often price will snap back in to the bands, but the bands do move with price. This just looks like some relief from the selling is due. The overall trend is Down. I thought the last 2 candles in this chart was If we're to assume that the current bear market may be around that average, then we're looking at the ish level which we are approaching quite fast and furiously.
There's also moving average support here so it Get started. SPX Chart. Top authors: SPX. GammaLab Pro. RealTima Premium. Badcharts Premium. ProfitHarvest Premium. AlanSantana Premium. Sizing up SPX shorts Tracking close to the drop. A mixed method combining the results of qualitative and quantitative research will be used to empirically verify the hypotheses related to the research question presented.
Qualitative research is based on ab descrip- tive analysis, and quantitative research will include statistical information systemisation based on data analysis, static dependence methodology. Sustainable Development Versus Fiscal Sustainability andb Public Finance Stability The European Union, as part of its initiatives European Commis- sion, , aims to implement economic solutions based on the concept of sustainable development. It identifies ways in which the financial sector can re-connect with the real economy to support the transition to ab more resource-efficient and more circular economy.
The document indicates the lines of action aimed to achieve abdurable and sustainable development based on efforts to combine economic welfare with environmental and social sustainability. Sustainable development requires ablong-term horizon and ensuring long-term funding for the critical infrastructure as well as an adequate response to long-term threats.
As part of those actions, it is also concluded that the objective of sustainable development must be supported by sustainability finance. Real economic and financial activities have increasingly overstepped state borders as reflected in ab sharp increase in the cross-border liabilities, and made the achievement of these financial system goals even more effective Rutkauskas, Such real actions are due to the fact that the financial system is an element of the economic system, which consists of two prin- cipal components: public finance sector and market-based finance system Holscher, Actions undertaken as part of the sustainability finance concept could contribute to changing the orientation of finance measures and to strengthening the efforts to generate ablong-term positive impact on the socio-economic development Chapman, Actions undertaken in this field can be exemplified by various types of investments and initiatives generating social and economic benefits.
The European Commission has developed ab general outline of sustainability standards, in which detailed specifications of financial products standards, the course of the process and information to recipients labels were made. European Commis- sion, A particular role and importance in this respect is ascribed to public authorities, which use public finance to achieve sustainable development. Fiscal sustainability is defined in abrather standard way: the fiscal policy is said to be sustainable if the present value of the future primary surpluses equals the current level of debt Krejdl, Actions pursued by public finance sector institutions with regard to maintaining fiscal sustainability and public finance stability must be considered, as abrule, from two perspec- tives: narrow and broad.
In ab narrow perspective, public finance stability is defined as measures oriented to maintaining budget stability. Their goal 36 DOI This means that ab broadly defined concept of fiscal sustainability is directly related to fiscal policy and to the value and dynamics of public debt. It is ab cur- rent ability to service debts. This can be achieved by developing an effective public spending and revenue system for the public finance sec- tor.
Fiscal consolidation in case of abrapidly increasing public debt level can clearly be welcomed as ab way to restore fiscal sustainability Bohn, Also the ratio of public finance revenues and expenditures to GDP Berti etbal. The question arises as to whether the fiscal rules currently applied at the national and European levels enable authorities using this fiscal instrument to achieve the objectives that are inherent in the concept of sustainability develop- ment.
In this context, it is important to examine whether the instruments applied as part of fiscal rules adopted at the EU and national levels not only contribute to issues related to fiscal sustainability and public finance stability, but whether they take account of elements that are required to achieve sustainability development and finance sustainability. This is mainly due to democracy being relatively young and to the lack of well-structured institutional and collegial structures. Indirectly, the use of fiscal rules can also enforce the implementation of the necessary system reforms and activity of central banks Dabrowski, ; Larch, The purposes of the rules should be established consistently with their structure, or their scale of impact.
Rules often provide the basis of fiscal policy and are intended to discipline public finance and limit its imbalance as well as to promote sustainable economic growth. It remains important to keep in mind that, when it comes to evaluating fiscal sustainability risks, abholistic approach is required, and no simple metric will ever be able in itself to fully capture the ability of ab sovereign to honour its debt Berti et al. Fiscal rules can be divided into procedural and numerical ones.
Procedural rules involve, among others, legislative procedures, establishing proper institutional framework with respect to transparency of the budget process, control and sanction mechanisms Schaechter, ; Calmfors, Meanwhile, numerical rules consist in setting fiscal thresholds with respect to, first and foremost, public debt, budget deficit, public expenditure and public revenues. The predominant fiscal rules applied in OECD countries are debt rules 62 countries and budget balance rules 61 countries.
In the early s, only five countries worldwide Germany, Indonesia, Japan, Luxembourg, and the USA had in place regulations related to fiscal rules. At the end of , as many as 76 OECD member states had regulations introducing ab long-term discipline in the public finance sector fiscal rules at the level of general government. These included rules implemented at both the national and the supranational levels. In the European Union, there are two levels of fiscal rule implemen- tation: 1 EU level and 2 national level.
At the same time, in many countries, e. The purpose of introducing rules at the supranational EU-wide level is to discipline national policies European Commission, , , , for more detail. For the eurozone countries, these regulations are definitely more rigorous as they introduce monetary sanctions of up to 0.
The Stability and Growth Pact has two arms: preventive and repressive. To fulfil those provisions, Member States prepare and submit stabilisation programmes applicable to the eurozone countries and convergence pro- grammes applicable to the other countries.
The repressive arm involves the excessive deficit procedure and the attendant sanctions if ab eurozone country fails to meet the recommendations of the European Commis- 38 DOI ThebEuropean Commission annually evaluates the scale and effectiveness of the fiscal rules used by Member States, its opinion being expressed in the form of the standardised fiscal rules index created and monitored by the European Commission. The index is based on the information on the stage of implementation of fiscal rules in ab given EU Member State.
Theb basis for its calculation is the fiscal rule strength index FRSI , which takes account of five principal criteria: 1 the statutory base of the rule, 2 the room for revising objectives, 3 the mechanisms of monitoring compliance and enforcement of the rule, 4 the existence of pre-defined enforcement mechanism, and 5 media visibility of the rule. This methodology was inspired by Deroose, Moulin and Wierts For the above criteria, results are allocated in the following way for each rule: the compound FRSI is calculated for each rule, aggregating the above results.
If there is no strong theoretical basis or preference as to the weight to be given to each criterion, the index is calculated in many different ways, reflecting various possible weights for the five criteria. The scores for the five criteria are first standardised to ensure they range from 0 to 1.
Then, the random weights technique is used, based on the method applied by Sutherland et al. This technique uses 10, sets of randomly gen- erated weights to calculate the index in 10, different ways. Random weights come from the even distribution between zero and one, and then are normalised to one. The resulting index distribution reflects the possible range of values while no abpriori information is provided about the weight to be given to each of the components.
Considering the weights are drawn from an even distribution, and the mean value of the compound index is asymptotically equivalent to the index calculated using identical weights for components, this is ab non-weighted arithmetic mean of the criteria. A stronger anti-cyclical effect of fiscal rules is also demonstrated by the results of studies conducted by Guerguil, Mandon and Tapsoba and Bergman and Hutchinson A similar conclusions is reached by Manasse based on the results of his study conducted for 49 developed and developing countries for the period from to Manasse builds abpanel based on the fiscal reac- tion function.
Relying on the paper by Kopits and Symansky among others, he identifies countries and years where fiscal rules were in effect. Moreover, in our opinion, numerical restrictions imposed on institutions responsible for fiscal policy also contribute, on average, to the deficit going down. Hence, they are an instrument that stabilises fiscal policy both in the short and long term Kasdin, Ayuso-i-Casals et al.
They create these based on the results of ab survey conducted by the European Commission in European Commission, and include respective fiscal rule index sequences as an additional variable in model panels based on the fiscal reaction function. It turns out that while rules applicable to defi- cit and debt have ab marked positive impact on the balance, the impact of expenditure rules on the level of expenditure has proved statistically insignificant. A detailed and elaborate analysis using this index leads us to infer, among other things, the stabilising impact of fiscal rules in countries where the rules are structured in ab way not to disrupt the stabilising function of the fiscal policy Poterba, , Turrini , in turn, focuses on analysing the impact of expenditure rules on fiscal policy.
The aim of this study is to verify the assumption that expenditure rules in fact effectively limit the expenditure expansion in the periods of fast economic growth, and to test the hypothesis of their stabilising impact on the fiscal policy. Based on the data from the afore- mentioned survey conducted by the European Commission, he divides EU Member States into those where, between the years and , strong and weak expenditure rules were in effect, analysing separately those two groups of countries.
This analysis confirms the hypothesis of ab significant role of strong expenditure rules in limiting destabilisation of the fiscal policy at times of economic upturn. In general, in the early s, all over the EU there were only 13 fiscal rules in effect. As of the end of , the most developed framework for disciplining the fiscal policy was in place in Poland and Slovakia. In these countries, there were four fiscal rules applicable at the end of In summary, in the period analysed, the Visegrad Group countries, despite the excessive deficit procedures imposed on them, were quite effec- tive in their attempts to meet the economic integration criteria set out in the Treaty.
They definitely had ab greater problem meeting the deficit criterion than the one related to public debt. The global financial crisis showed that external factors play ab major role in the disturbance in the area of debt financing issuance of government bonds.
Debt management measures taking account of the current and future changes in the external 40 DOI Hence, such balance is defined as measures intended to maintain safety through inte- grated continued debt servicing and contracting new obligations e. The research question in this context is: Do fiscal rules applied by the Visegrad Group countries contribute to efforts to only achieve and maintain the required deficit and debt values, or do they play ab role in achieving the optimal level of sustainability finance.
The research sample consists of the V4 member states, which, as Euro- pean Union Member States, are obliged to apply supranational fiscal rules supported by national solutions at the central and local levels. The years between and are adopted as the research period due to the comparability of data. The point of departure for the analysis conducted was the pre-defined standardised fiscal rules index and the available data in this respect. The standardised fiscal rules index values in the period analysed for the Visegrad Group countries compared to the European Union as ab whole are presented by data in Figure 1.
Standardised fiscal rules index in the years between and in the Visegrad Group countries. Methodology and Data The first fiscal rule index analysis conducted by us consists in observing the value of this index in respective V4 Member States over the period between and Another element of the analysis applied to fiscal rules in V4 Member States is their impact on budget deficit and public debt developments — this makes ab reference to the hypothesis whereby an assessment based on the fiscal rule index as used by the European Commission has no significant effect on public debt developments measured as ab share of GDP.
Having that in mind, we will also conduct an analysis of inter- dependencies between the fiscal rule index and quantities such as public investment and consumption. The selected parameters indicating the level of economic development contain the economic growth parameter in real and nominal terms as well as the principal economic aggregates having abmajor impact on generating this growth.
The second group involves indicators that are directly related to the condition of public finance, on which fiscal rules should have the strongest impact, according to the original assumption. The indicators defined in the Treaty of Maastricht were analysed deficit and public debt to GDP ratios , broken down into the central government and local government sectors, as well as long-term lines of public intervention, i.
The last group of factors studied refers to issues involving abbroadly-defined category measuring sustainability finance. To this end, indicators such as the following indices were selected: Gini coefficient, resource productivity and domestic material 42 DOI It is abparametric method to study the relation- ship between two variables measured on ab quantitative scale. Statistically significant results mean that there is abrelationship between variables.
Rela- tionships between variables can be positive when one variable increases, so does the other one or negative when one variable increases, the other one decreases. Results close to 0 mean no correlation, while results close to —1 andb1 mean abstrong correlation, abnegative and positive one, respectively. Thebstrength of the relationship may be measured with the following intervals: 0—0.
Then, as the next step of research, for variables for which the correlation analysis yielded statistically significant results, series of regression analyses were conducted to study the impact of the standardised fiscal rules index on the other indicators. The significance of the impact is tested by t statistics and its corresponding level of statistical significance.
Non-standardised B coefficient and its SE error can be also presented in the description of results. This coefficient determines by what factor the dependent variable analysed will increase if the level of the standardised fiscal rules index goes up by 1 unit. R2 determination coefficient is also expressed, which shows the percentage of dependent variable explained by the standardised fiscal rules index.
The higher the R2, the better the standardised fiscal rules index describes the variation of the indicator analysed. The results of model studies from this stage are broken down into countries analysed. A statistically significant impact of the standardised fiscal rules index on abnumber of financial, economic and social variables was demonstrated for the Czech Republic Table 1. The strongest positive impact was demon- strated for total general government expenditure in millions of euros basic research.
The analysis for Hungary also demonstrated ab number of variables influenced by the standardised fiscal rules index achieved Table 1. Correlation analysis results for economic growth indicators, public finance indicators, social development indicators. Source: Own compilation. Negative impacts were also demonstrated in Hungary on the level of percentage of gross domestic prod- uct GDP , government bond year yield, local government expenditure as abpercentage of GDP, local government revenue as abpercentage of GDP, and people at risk of poverty or social exclusion.
A number of correlations were also demonstrated for Poland Tableb1. Meanwhile, the strongest negative rela- tionship was demonstrated for total general government expenditure as ab percentage of GDP. Slovakia was the V4 country for which the largest number of statistically significant correlations with the standardised fiscal rules index was dem- onstrated Table 1.
The strongest positive relationship was demonstrated for total general government expenditure in millions of euros public debt transactions. By contrast, the strongest negative relationship for Slovakia was demonstrated for government bond year yield. The study results obtained indicate that the condition of V4 economies, as well as their financial and economic results, are not only the outcome of the fiscal policy and of the assessment of the condition of public finance.
The imbalance of the economic system can also have its roots in the pri- vate sector rather than the public sector. Results Research conducted in V4 countries into the impact of the fiscal rules index not only on the condition of public finance but, in broader terms, of socio-economic development helped to address the propositions.
This analysis focused, first of all, on the impact of fiscal rules in the V4 countries on GDP growth and the level of its composing economic aggregates. The results obtained indicate that in all countries analysed statistically, significant and positive trends were observed for nearly all economic growth indicators depending on the standardised fiscal rules index. Such ab result 46 DOI If the government increases spending and, at the same time, cuts taxes and does so at the time of recession when tax revenues are falling , such measures can lead to ab growing budget deficit.
A deficit increase, in turn, will make it necessary for the government to issue more debt securities which will have to be paid for in the future. If the debt is not paid back on time, it will grow each year, forcing the government to encourage investors to buy new debt securities by increasing their interest rate.
This move will increase the yield of treasury debt securities but will make them competitive to investment such as consumer and mortgage loans, car loans, and industrial bonds. This situation may lead to higher costs of credit for other market participants, who, in turn, may contribute to lower household spending, as well as to companies reducing their capi- tal expenditure. When the government has problems paying off the public debt, the interest rate of treasury debt securities may grow too high and then those in power, to cover the deficit, may opt to print more money.
However, for this to be possible, one condition must be met: public debt must be denominated in the national currency. Such conduct, when money competes with goods and causes their prices to go up, must lead to inflation, resulting in yet higher interest rates and ab higher share of private sector spending going to aid for the public sector. The rules defined in V4 countries do not follow this pattern of thinking about eco- nomic growth.
Unfortunately, there exists no fiscal stimulus that has only advantages as fiscal policy instruments unlike monetary policy instruments which can be implemented right away take time to implement and involve costs of inadequate expenditure and unnecessary legislation designed to get more votes in the election. The results of model research in the V4 countries also confirm this. A flawless fiscal stimulus package should result in higher revenues and faster economic growth in the future, among other things.
The increase of the standardised fiscal rules index was correlated with the increase of those indicators in Hungary. It is worth noting that no statistically significant correlations were demonstrated for Hungary between the standardised fiscal rules index and the final consumption expenditure index and the labour productivity and unit labour costs index. The increase of the stan- dardised fiscal rules index was correlated with the increase of the other indicators in Poland.
The increase of the standardised fiscal rules index was correlated with the increase of the other indicators in Slovakia. Another group of factors directly refers to the impact of the increase of the standardised fiscal rules index on the condition of public finance as it is important to establish whether the main expected outcome for which the rules were defined has been successfully achieved.
The results obtained indicate correlations, with different scales, and these are directly dependent on the type of fiscal rules used by respective countries. The analysis found one correlation shared by all the countries, namely an inverse correlation between the interest rate of long-term securities and the increase of the standardised fiscal rules index. This resulted from public debt rules being implemented or successively strengthened in the respective years.
Such abresearch result may suggest that the rules formulated in Slovakia and the Czech Republic fail to meet the expected function, i. The research outcome demon- strated that the defined public debt rules in the V4 countries helped avoid negative outcomes for economic growth. Meanwhile, regarding total general government expenditure in millions of euros basic research , its positive correlation with the standardised fiscal rules index was recorded in three countries.
The only exception was Hungary, where the relationships are insignificant. The third category of factors tested in the model involves correlations between standardised fiscal rules and social development indicators. In this matter, we arrive at relationships that confirm diverse outcomes for socio-economic development of respective Visegrad Group countries.
Such abresult indicates that the fiscal rules used have ab diverse impact on income stratification.
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In this article, we will look at how forex correlation is determined and calculated, how it affects trades and trading systems, and what tools can be used to track currency correlations. Get tight spreads, no hidden fees and access to 11, instruments.
A foreign exchange correlation is the connection between two currency pairs. There is a positive correlation when two pairs move in the same direction, a negative correlation when they move in opposite directions, and no correlation if the pairs move randomly with no detectable relationship. A negative correlation can also be called an inverse correlation. As an example, assume that a trader buys two different currency pairs that are negatively correlated.
The gains in one may be offset by losses in the other, which is often used as a hedging strategy. Meanwhile, buying two correlated pairs may double the risk and profit potential, since both trades will result in a loss or profit. They are not fully independent since the pairs move in the same direction.
A correlation coefficient represents how strong or weak a correlation is between two forex pairs. Correlation coefficients are expressed in values and can range from to , or -1 to 1, with the decimal representing the coefficient. Anything in the negative range of means that the pairs move nearly identically but in opposite directions, whereas, if it is above , it means that the pairs move nearly identically in the same direction.
For example, one pair may move up pips percentages in point while another moves down 70 pips. Both pairs may have a very high inverse correlation, even though the size of the movement is different. If a reading is below and above 70, it is considered to have strong correlation, as the movements of one are largely reflected in movements of the other. Readings anywhere between and 70, on the other hand, mean that the pairs are less correlated. With forex correlation coefficients near the zero mark, both pairs are showing little or no detectable relationship with one another.
While this formula looks complicated, the general concept is that it is taking data points from two pairs, x and y, and then comparing them to average readings within these pairs. For example, think of the data points as closing prices for each day or hour. The closing price of x and y is compared to the average closing price of x and y , so a trader can enter closing and averaged values into the formula to extract how the pairs move together.
Once multiple closing prices have been recorded, an average can be determined, which is continually updated as new prices come in. This is plugged into the formula along with new values for x. You can compare each currency on the y-axis to those on the x-axis to see how they are correlated to one another. Monitoring currency correlations is important because, even in this small table of currency pairs, there are several strong correlations.
However, because the pairs have a high negative correlation, they are known to move in opposite directions. Therefore, the trader will likely end up winning or losing on both, as they are not fully independent trades. Correlation allows traders to hedge positions by taking a second trade that moves in the opposite direction to the first position.
A currency hedge is achieved when gains from one pair are offset by losses from another, or vice versa. Therefore, buying or selling both creates a hedge. For someone trading gold and holding positions in other currency pairs, this type of analysis is important. This is because both Canada and Japan are major oil importers. Commodities can hedge or be hedged by currencies when there is a strong correlation present in the same way that currencies hedge each other.
A commodity may move much more in percentage terms than a currency, so gains or losses in one may not be fully offset by the other. Read our commodity guides on oil trading and gold trading. A pairs trade involves looking for two currency pairs that share a strong historical correlation, such as 80 or higher, and taking both long and short positions on the assets. A trader can buy the currency that is moving down and sell the currency pair that is moving up.
The idea of this is that they will eventually start moving together again, given their long history of a high correlation. If this occurs, a profit may be realised. Therefore, some traders may place a stop-loss order on each position to control the loss.
Ideally, the bought pair would move up and the sold position move down as the pairs mean-revert , which could result in a profit on both trades. When using any currency correlation strategy, and any strategy, position sizing is a key component to risk management.
Based on where the stop loss is placed, many traders opt to risk a small percentage of their account, for example, if the stop loss is reached. This way, the risk on the trade and risk to the account is controlled. Currency pairs are non-correlated when they move independent of each other.
This can happen when the currencies involved in each pair are different, or when the currencies involved have different economies. Therefore, they tend to move together in the same direction, although this is not always the case, as we will see further on in the article. Therefore, the correlation between these pairs tends to be lower.
To start spread betting or trading CFDs on our correlation pairs, all you need to do is the follow the below steps:. Place your trade. Decide whether to buy or sell and determine entry and exit points. While a number of currency correlation strategies have been discussed in this article, using them on a trading system means defining exact entry and exit points, both for winning and losing trades.
On our platform, any currency can be dragged from the product list onto an existing chart of any currency pair to show both currency pairs on the same chart. These pairs typically move together, but in this example, they moved in opposite directions. This set up is a potential mean-reversion trade.
Use our Profit Calculator to calculate your expected profit or loss in money and pips based on your entry and exit prices, lot size and trade direction. Widżet open trades forex pokazuje bieżące otwarte transakcje i zamówienia na koncie. Open trades widget. Custom widget. Ten widget forex można w pełni. Korelacja procesów doskonalenia instrumentów ostrożnościowych systemu finansowego i antykryzysowej polityki społeczno-gospodarczej w Polsce To read the full-.