Valuationtool

٢٨ أغسطس

Valuation tools, updated version for every asset (vs futures price / vs gold / vs bounds)

قبل ٤ أيام

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💰 What “Valuation” Means in Trading

Valuation in trading measures whether a market or asset is currently overvalued or undervalued compared to a reference benchmark — for example, a futures contract, an index, or another correlated instrument like the DXY for USD-based pairs.

When a market is overvalued, it means price has risen significantly above its fair or relative value compared to the benchmark — suggesting potential exhaustion or correction.
When it is undervalued, it means price is trading below its fair value — which can indicate a potential buying opportunity if market conditions align.

A valuation indicator helps visualize these relationships directly on the chart by comparing real-time price behavior to a baseline (e.g., DXY, futures, or another pair).
This allows traders to:

Spot imbalances between spot and futures prices.

Identify when an asset becomes statistically expensive or cheap.

Combine it with supply/demand or price action signals for high-probability entries.

In short, valuation tools provide a quantitative edge — helping traders see when markets deviate too far from equilibrium, so they can anticipate potential reversions or continuations with greater confidence.

قبل ٤ أيام

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Updated