SATORI FX: Forex Mathematical Analysis Tools for Excel. The CARTESIAN PLANE.

SATORI FX: Forex Mathematical Analysis Tools for Excel. The CARTESIAN PLANE.

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good time and good space fellow traders  and welcome back for the third part   of this overview of the satori effects  for excel and in this chapter i'm about   to talk about the cartesian plane concept  okay so let's dive into it immediately and   what we are talking about it's a bit more complex  so bear with me till the very end and if there's   something you think is not clear please go back  and re-watch again because i will cover all the   necessary things to build by yourself by having a  set of data that you grab from somewhere i grabbed   them from metatrader4 so the necessary tools  for creating in this case the cartesian plane   so a bit of concept before it's  very important but let me just   put in evidence what we are talking about what  we are talking about is this weird thing here okay   what is this this is basically a representation  different from the other kind of representations   while the ufo market performance or  other representations are based on   the time on the x-axis and the price or variations  of price in the y-axis in this case we have   both in the x-axis and y-axis we have prices  and this can change completely the way you   look at the market but it's another kind  of reliable information thanks to cartesio that we can apply in order to have information  of the overall behavior of the market   through the day or as i showed you but let  me just do back again uh on multiple days   because if i switch for example and want to  have the situation of the market at five days   let's wait a second for the spreadsheets bank  we have a completely different information right   and we can observe here the different  currencies in real we have six currencies repres   clouds of points the canadian  dollar the swiss franc the gbp the   australian dollar the new zealand dollar and the  japanese yang always at five minutes and always   with a referral point that it's always stated  on the zero gmt universal time okay great so let's do a bit of uh introduction to the way  we want to calculate this thing and the moment   we understand how to calculate this thing this  will be much more easy and this will be easier   as well of course here i repeat again is not  an excel course so if you don't have the skills   for excel i suggest you to go on udemy and do  some course in order to some classes in order   to get some skills in excel because this is  the basic uh requirement in order to work with   a tool like excel okay so i am supposing you  know what i'm talking about but i'm releasing   the formulas or the way to achieve this kind of  result okay so as i told you in the my previews   detail we were talking about let's get rid  of this and let's put let's put this one here okay here i will need also some  drawing tools let's grab a pencil let's see how the pencil works do you  see that yes okay let me grab this yeah okay so the concept is that we are  using the x-axis let me just do a brief yeah more yeah okay we have the  x-axis and the y-axis right here let me just do that way  that's better and let me also   let me also erase what we don't  need okay sorry for this okay   so this is the x-axis the y-axis and the x-axis  the concept is that we want to use for as regard the data that we need for the x-axis we want  to use this data here so the euro the pardon   okay i will go and first i draw and then   i'll tell you this values will be the x-axis  and these values would be the y-axis okay what values always the percentage of  variation of them i remind you in order   to get the percentage of variation you need  to do something like t minus t minus one divided by t minus one of course then you can do  per 100 okay this is the percentage of variation okay so we need this data first and we need to organize this data because in this  case i told you we have the euro which is always   base and this is pretty fine pretty fine and  nice because data are already settled for that we have another case on the  x-axis so in the x-axis we put   us dollar values which are these ones  and in the y-axis we put the euro values okay so euro values are already ready to be used   the x-axis we have usd cad which is fine usd  is base usd is based also usd yang is base   but we need to solve this little issue which  is not an issue it's just the convention that   your broker provides you gbp usd and not usd gpp  right in which usd is quote in order to obtain uh on this particular stuff here  in order to obtain usd gbp usd roc and usd ncd they will be equal in as intuitively we can argue as minus  the gbp usd quotes we have the o z usd and the nzd usd okay so first we need  to convert in order to have usd as base   even for as regard the x-axis and then the work is  done it's very simple okay so let's dive into it and let's grab the main cartesian plane so what do we have here here i have reported the euro dollar  the euro chf all the data until the   new zealand dollar yen but in real i'm using only the information that it's here  first of all what are these data   okay if i want to know what this data is basically i need to go back and grab the data that are let me just grab it yeah here that are calculated here okay so these data that are calculated here in order  to obtain then the clustering and then the ufo   market performance are the same data that we  want to have them in our main cartesian plane see we have the euro dollar 0.096 0.0951 0.096 0.0951 these are the data that we need for  and if you want to know how to calculate this   watch the previous video and you will have  them okay oh one thing prior to continue   that i didn't mention my fault but i will  repair immediately here in the basic concepts   you can say yes marco but we have only six currencies here while in the  market performance we have eight   currencies of course we are missing  one of the most important crosses   that gives us the other two currencies that  we need the euro dollar okay euro dollar where   the euro dollar where the euro and the dollar  are in this kind of representation euro dollar is in the z-axis of course i told you we have an x-axis   a y-axis but these axes are related all  on us dollar base values and euro base values as we know from a simple  formula that let's say eurocad and usd cad by subtracting eurocad to  usd cad we obtain euro dollar but also by doing this with euro yen and usdn we get euro dollar right when we deal with gbp aussie or usd  against dollar we need to add not subtract   but the moment we have making we are making  this conversion we are also having that euro gbp minus usd gbp equals to euro dollar we always get back  euro dollar okay and this euro dollar is this third axis which we  represent ideally at 45 degrees   on this cartesian representation in  real we have the x and y and the z okay so it's like vertical it's like above  or below negative or positive but in a   two-dimensional representation we get and this is  something related to the cartesian math so even   in this case you need to have basics of cartesian  math but it's something very achievable you go to   wikipedia you go to any kind of math territory or  information and you grab this basic concept okay so we also have the information about euro  and about dollar by this representation   is just that we don't see them but we see  them as a relation and constant relation   between all the let me just  do for example here we have   the the i hope to make straight lines okay we  have the australian dollar here we have the these two values because this is a point  in the space and we have the usd oz coordinate which is the variation of price that i  was talking about and we have here the euro aussie   coordinate okay so this is related to the  y-axis and this is related to the x-axis here   and here and by doing this on each and every  point for each and every currency we have the   range of oscillation on a specific spot in the  space where oz exists all z in terms of euro and   in terms of dollar so we know that australian  dollar configured by these two elements of   information can exist only in the range of  euro dollar because of this relation where   euro in order to obtain euro dollar we have  euro oz minus usd aussie and then we get euro dollar okay so in order to create this plane uh cartesian plane we take out of the equation  euro dollar because is already inside the   information that we want to observe and it will  come out then and will be used for the analysis   okay wow it's taking a bit longer with the  with the explanation but it's important for   you to understand and you have it there for  your availability okay so let's go back here   remember we were saying that we need to create  this cartesian plane so we need the percentage   of variation that we obtained here and this is  in the pink color so you can easily is the only set of values that we are we have obtained  and that we use for multiple purposes that   was in the previous video  very well explained okay so   of all this information we only need  we only need let me just do this this information this data and for the calculation we have to place the data this way usd cad  and eurocad first we post we put the x-axis   because this is the way excel works and then we  put the y-axis so we have usd cad and eurocad   usd chf and euro chf usd gbp usd oz and usd new  zealand are something that must be calculated   by making the the minus of the variation okay  because there are these are the only three crosses   that the base which would like to be the usd  in real stays in the quote as we are receiving   them from the broker so we need to convert  them for the rest is fine and if you want to   create then a chart like this let's do step  by step okay and of course i want to grab here   a lot of data let's say i hope to get into the ac yeah that's fine anyway uh i will need that  to go to the insert uh you don't see that but   trust me is that is there insert and  then go to the recommended chart and   in the recommended chart we select the scatter  okay and in the scatter we select this one   of course colors are different  then you have to adjust the colors   and all the stuff blah blah blah but the result  is basically the same okay let me compare to you so this is a simple way to obtain the same   price distribution of course then i changed the  colors i arranged where the price is and i do i   did some extra calculations but basically if we  want to check the australian dollar here value australian dollar okay and the distribution over euro dollar so  the z-axis and i also want to grab the australian   dollar here the spike is a different color is  the same right so this is the way we calculate our cartesian plane then there's another story on   how to use it but this would be the topic  of further videos at this moment i'm just   showing you how to build these tools which is  very important because the moment you understand   how a tool is built and the mathematical formulas  or the constructions that are underlying this tool   then you know what the tool is saying to  you regarding to what crosses or currencies   and then you can have a right and  proper interpretation of that of course   you can do also other formulas that you  see here but this is not the case of our of our video which is already taking too long  and i need to go further okay then remember   so this is all about in order to calculate this  representation but we also have here a correlation   map process and the correlation map with crosses  x and y this one is an oversimplification of   this one that is based on euro dollar with the  x-axis and another cross on the y-axis in fact   if i place euro dollar on the x-axis and let's  say cut the n canadian dollar yen in the y-axis   i have this price distribution if i go and  check and select the canadian dollar yen here i'm sorry you're not seeing that  well but i will let me do this okay and let me do this in order to give it  more canadian dollar let's give it a marker you agree that it's the exact same price  distribution right okay so i'm not going   to explain this because this is an over  sophistication that is done by some skills   that you may have in excel and this is not my  my my intention this is has to be your intention   what i'm anyway about to explain to you is also  how to achieve which is the most important one this secondary cartesian representation  which we call it correlation map   which correlates the oscillation of euro  dollar that in this plane is the z-axis   in this representation becomes  the x-axis and in this case   i would have instead of representing  the canadian dollar yen i could have   used the australian dollar tree jpy why  because we have the extremes of this of this clustering of of points we have  the australian dollar and the japanese yen okay so australian dollar japanese yen and sorry not australian dollar japanese  yes australian dollar japanese yang   and australian dollar japanese  yen let's also here create a australian dollar japanese yen yeah see that is we have the same distribution exactly the same so when we have this   it's enough this is a something extra that  it's very important because i would like to   analyze a specific combination of two  crosses and i can do it here but this is the   source that i also get this information with  the same meaning okay and in order to do this we basically go for this so we create another kind  of graphical representation let me do it in a very   simple way the rest of the currencies that are  not uh represented here and not used for this um   cartesian representations are all the crosses  let's let's put them with a different color okay   so canadian dollar chf gbp canadian dollar all the  canadian and so on until the ncd jpy and of course   they have to be put in relation with  the representation of euro and dollar price variation of price information   so what can we do we have the euro dollar  which is the beginning of everything okay and we simple trace until we want whatever data of course we have zeros because we are  analyzing just one day with zero at zero gmt   and then we go to the insert button and then we  create another kind of chart that it's always   scattered and in this case it's not this one but  it's this one okay and by creating this we have a   graphical representation that then we can adjust   colors whatever of these values and then by  keeping the x-axis still we move and we select the points of the remaining crosses and  we obtain this chart representation that is this one apply copy okay of course different colors the point of the now that is changing but  this is a sophistication you work on the   chart and you adapt it the way you prefer but  if we grab let's say an example canadian dollar   canadian dollar not canadian dollar but aussie yen  we were saying here and ocn we're saying here just   to show you that is exactly the same process  see the price distribution is the same so by showing you this i have basically shown you the cartesian plane representation  formulas to calculate this and the concept   that stays behind this is an  extra but you can use this one   if you want to do this you don't need me and my  explanation but you need skills in excel okay   okay this will end the this part of the  video and in the next one even if we take   a little bit longer but it was necessary in  the next one we go through the oscillator   the currency's momentum oscillator okay so  let's stay tuned and thanks for watching

2022-02-03 02:03

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