The Active Forex Traders Discussion

[Maxjohan]

I'm thinking about starting a hedge fund. Just a one time shot. Focused on long term bet on EUR. I know how I should marketing this. There's no doubt in my mind that there will be a crash in the US soon.

I actually regged bigbetonusa.com on August 3. I was going to try to get investors to invest in the USD against the SEK. But I've figured out now that the EUR/USD is the next opportunity and I may act on that.

1 USD on August 3: 6.8625 SEK.
1 USD now: 7.4433 SEK.

It's not too hard to trade long term. But I admit I am quite a sucky day trader. Lost all but $5000 on my demo account. I think I made 4-5 trades in a day. Every one of them was a loss. From like $27,000 down to $5,000. Then I stopped trading.

Nah, I am only trading long term from now on. At least a few months. I am too emotional for daytrading.

But anyhow I did like 50:1 trades and 100:1 trades. If I get investor money now.

I would go no higher than 5:1.

 

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[Guest3722A]

I am too emotional for daytrading

to eliminate the emotion, try this: Find something that almost always seems to occur technically, something that seems more often than not to put the odds in your favor, and then build a system around that. A system where you can comfortably say that the chances of taking x number of ticks seems to always be greater than losing x number of ticks when this technical thing happens. From there, you'll be able to build your stop into this system as well as your target. If you are just paper trading you can forward test and adjust. the closer you get to a 1:1 risk reward ratio the better but sometime a profit factor is so outstanding that it's easier to take on a 2:1.

 

[Maxjohan]

to eliminate the emotion, try this: Find something that almost always seems to occur technically, something that seems more often than not to put the odds in your favor, and then build a system around that. A system where you can comfortably say that the chances of taking x number of ticks seems to always be greater than losing x number of ticks when this technical thing happens. From there, you'll be able to build your stop into this system as well as your target. If you are just paper trading you can forward test and adjust. the closer you get to a 1:1 risk reward ratio the better but sometime a profit factor is so outstanding that it's easier to take on a 2:1.

Yeah. That's kind of how I think too. But when you look at a chart for a hour or so. I kind of start to see things which are not there. I start to over-analyze things I think. With trading long term. You just look at a 10 year chart. And see how the market looks like compared to the other years. And then you know it will probably not get higher or lower than the lowest point on that chart. And if it does. It probably will not get much lower than the lower point. I just think it's much easier. Sure, you probably make more money if you are a good daytrader. But it's just not for me. I can't change who I am and get rid of my emotions.

Edit: Or maybe I don't know what to look for on a daily/hourly/30 min chart or so? It just seems unpredictable to me.

Besides that. If you trade long term. It's not so much work. Check the market and you are like done for the day. 5-10 min max daily.

 

[Guest3722A]

What's nice about what I just explained is that it can be applied to any timeframe. And once you find something that works, you can plug the parameters into an automated trading system that will trade exactly how you have set it up. I had done this for a while and became so comfortable with my system that I even went in for a surgery and left my computer trading REAL money. Something else that you might like is that trade setups don't occur every day. Sometimes they don't even happen every week. This is why this type of trading has worked for me because I didn't need to force anything. And what really took the emotion away was the computer doing all the work. I never had to worry about should I wait another tick, what if something unseen happens, etc. When a signal happened, I was in a trade.

Another thing that also has helped with controlling emotion is that there are opposing instruments that many times move just slightly before the contract you are trading. For example, you mentioned the Euro USD, most of the time the USD leads, and the Euro reacts. But to even go deeper, in futures trading there is something called a footprint which basically shows the exact trading volume for any given timeframe whether it be a minute, or 5, or hour, or maybe broken down in ticks, (so tick time frames and not time based). But what's nice about footprint charting is this volume shows the exact amount of buying to selling ratios on each footprint and there is a lot of information that is seen by this. There are other trading instruments out there as well but, this is a lot of information already.

 

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[P3HSB]

I am too emotional for daytrading.

There is a strategy called "Set and forget". This will pretty much solve your emotional problems with trading. Once you spot a good entry, enter it, set your stops and limits and let the market do its thing. Turn the computer off and check back within a few hours or a day.

Going to start my live account very soon. I'm excited!

 

[Maxjohan]

But to even go deeper, in futures trading there is something called a footprint which basically shows the exact trading volume for any given timeframe whether it be a minute, or 5, or hour, or maybe broken down in ticks, (so tick time frames and not time based). But what's nice about footprint charting is this volume shows the exact amount of buying to selling ratios on each footprint and there is a lot of information that is seen by this. There are other trading instruments out there as well but, this is a lot of information already.

That's what I am talking about. Sharing some secrets.

There is a strategy called "Set and forget". This will pretty much solve your emotional problems with trading. Once you spot a good entry, enter it, set your stops and limits and let the market do its thing. Turn the computer off and check back within a few hours or a day.

Going to start my live account very soon. I'm excited!

Yeah. You are right. I got stuck to the chart that time. Should had made my trade and been done. And checked back later.

By the way. How many pips are you two doing. Especially "topherea" as you seem to have it figured out. Kind of. I like to know. To compare it to my long term trade. The one I had been doing around August 3 if I had just taking some real action. And been hungry.

Mind sharing? You can PM me if you want.

 

[P3HSB]

By the way. How many pips are you two doing. Especially "topherea" as you seem to have it figured out. Kind of. I like to know. To compare it to my long term trade. The one I had been doing around August 3 if I had just taking some real action. And been hungry.

Mind sharing? You can PM me if you want.

Also how many trades do you guys do daily? Weekly? Monthly? And so on?

I try to go for 15-25 pips per trade. I usually trade 1-3 times per week. I never leave any trades open longer than a day. My favorite pairs to trade are EUR/USD, GPB/USD, USD/JPY.

My strategy is real simple. I just use price action w/ support and resistance or trend lines. For indicators, I like the Fibonacci retracement, Bollinger bands and stochastic oscillator.

 

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[Guest3722A]

How many pips are you two doing

I trade futures. My system initially picks up one contract and depending on what the market does at around that entry point it'll pick up additional contracts if/as they are triggered onto the position. With this system, it also trades on the short side and the long side, and with the type of system it is, it doesn't matter what the direction of the long or short-term trend is. Ever. Not sure if that's easy to fathom, but it is possible. The system obviously does have losses though, and it needs to have an additional algorithm programmed to reduce this even greater, but the profit factor is up there in the 90s % range, so it wins one heck of a lot more than it loses.

As far as the "secret" goes, the only secret is that I've been watching this stuff for almost 20 years day in and day out from different time frames and tickframes etc. and after so long, the same things repeat over and over and over.

Here's something that might help you though - whatever it is that you're watching, have your main trading chart, like maybe an hour timeframe, but then surround it with a daily, a weekly, a half-hour, a 15 minute, a 10 minute, 5,1...a 4 hour..?? throw various tick charts up too. When doing this you will see setups forming in advance.

 

[Maxjohan]

I try to go for 15-25 pips per trade. I usually trade 1-3 times per week. I never leave any trades open longer than a day. My favorite pairs to trade are EUR/USD, GPB/USD, USD/JPY.

My strategy is real simple. I just use price action w/ support and resistance or trend lines. For indicators, I like the Fibonacci retracement, Bollinger bands and stochastic oscillator.

Thanks. For your comment. I just calculated that if I had made the trade. I would have made 5354.79 pips.

I would be happy with that for a roughly 3 month and 3 week period. Unless topherea has some amazing results that beat my own long-term trading strategy. I don't see then why I should stop trading my way.

I've searched for this now. And I found one comment on a forum that stated he had a 8 year trading experience. And averaged 500-2000 pips a month.

 

[Maxjohan]

Here's something that might help you though - whatever it is that you're watching, have your main trading chart, like maybe an hour timeframe, but then surround it with a daily, a weekly, a half-hour, a 15 minute, a 10 minute, 5,1...a 4 hour..?? throw various tick charts up too. When doing this you will see setups forming in advance.

Okay. Funny. I just looked in to futures today. But I am not completely sure how it works. Are you loz lawn by the way?

I did kind of like this once. The DKK were doing moves before the SEK. But I don't know how often this happens. Both scandinavian countries by the way.

 

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[Guest3722A]

@Maxjohan here's something you might appreciate that's in reference to footprint AND the market flash crash from 4 years ago:

There's a lot to learn from this video. If I remember correctly, I was fortunately 100% cash at the time this happened.

Unless topherea has some amazing results that beat my own long-term trading strategy

Do your own thing, broseph!

I just looked in to futures today. But I am not completely sure how it works

The thing I like about futures is that there is an actual person on the other end of the trade called a specialist. So, with a specialist comes humanity which in my opinion is something that can be averaged. Others seem to have the same opinion as well because besides footprint, there is another technical indicator known as market profile. And market profile does just that. It "averages" the price ranges that the specialist likes to hangout at. THIS form of charting is a whole new world though, but truly makes a lot of sense.

Futures trading is also a first in first out system, meaning, if the specialist only has 50 contracts to sell at a set price, and you are in line at 51, you are going to have to wait.

Something else about futures too is that say if you wanted to trade the eur/usd but don't want to take the risk of a full sized contract, contracts get broken down into mini and even micro sized. Full size, half size, 1/10 size.

I did kind of like this once. The DKK were doing moves before the SEK. But I don't know how often this happens

Here's a list of several to watch:

inversely correlated forex and some futures pairs.

They have a Rank Correlation of daily return over the last 10 years of at least -90%.

Sorry about the format as this is a cut n paste
________________________________________

Name Name Linear CorrRank CorrelPair Stabil
Danish Krones per 1 U.S. Dollar-#690(59) U.S. Dollars per 1 Euro-#591(60) -99.1_% -99.2_% 1.6
U.K. Sterling per 1 Australian $-#171(37)Australian Dollars per 1 U.K. Sterlin-99.2_% -99.0_% 1.5
Euroyen-3Mth-SGX (SIMEX) Singapore Dollars per 1 U.S. Dollar-#-97.8_% -98.9_% 1.5
Euroyen LIBOR 3 Mth-(SIMEX)-SGX Singapore Dollars per 1 U.S. Dollar-#-97.8_% -98.9_% 1.5
New Zealand Bank Bills(90 Day)-(NZFE)-SFEAustralian Dollars per 1 U.S. Dollar--99.4_% -98.9_% 1.6
Australian Bank Bills(90 Day)-(Floor+ElecAustralian Dollars per 1 U.S. Dollar--99.3_% -98.8_% 1.4
Danish Krones per 1 U.K. Sterling-#590(41U.K. Sterling per 1 Euro-#591(55) -98.5_% -98.7_% 1.8
Hong Kong Dollars per 1 Australian$-#171(Australian Dollars per 1 U.S. Dollar--99.1_% -98.7_% 1.7
Danish Krones per 1 U.S. Dollar-#690(59) Hong Kong Dollars per 1 Euro-#591(44)-98.3_% -98.7_% 1.6
Australian Govt Bond 6%(10Yr)-(Floor+ElecAustralian Dollars per 1 U.S. Dollar--99.2_% -98.6_% 1.3
New Zealand Govt Stock(3 Yr)-(NZFE)-SFE Australian Dollars per 1 U.S. Dollar--99.2_% -98.6_% 1.2
Australian Govt Bond 6%(3Yr)-SFE Australian Dollars per 1 U.S. Dollar--99.2_% -98.5_% 1.3
Australian Govt Bond 6%(3Yr)-(Floor+ElectAustralian Dollars per 1 U.S. Dollar--99.1_% -98.5_% 1.3
SIBOR-3 Mth-(SIMEX)-SGX Singapore Dollars per 1 U.S. Dollar-#-97.3_% -98.1_% 1.7
EURIBOR-3 Mth-EUREX Danish Krones per 1 U.S. Dollar-#690(-98.0_% -98.1_% 1.6
Euro German Schatz-EUREX Danish Krones per 1 U.S. Dollar-#690(-97.3_% -97.2_% 1.4
Euro German Schatz(Last Trade in Close FiDanish Krones per 1 U.S. Dollar-#690(-97.2_% -97.2_% 1.3
Eurodollar(3Mth)-SGX(SIMEX) Singapore Dollars per 1 U.S. Dollar-#-96.5_% -97.1_% 1.5
ICE US Dollar Index at US ICE Euro(Floor Trading Only)-CME -96.4_% -96.1_% 1.3
ICE US Dollar Index at US ICE Euro Currency EUR/USD at CME -96.4_% -96.1_% 1.3
Euro(Floor Trading Only)-CME U.S. Dollar Index(Floor+Electronic Co-96.4_% -96.1_% 1.3
Euro Currency EUR/USD at CME U.S. Dollar Index(Floor+Electronic Co-96.4_% -96.1_% 1.3
ICE US Dollar Index at US ICE Euro E-mini-CME -95.8_% -95.6_% 1.3
Euro E-mini-CME U.S. Dollar Index(Floor+Electronic Co-95.8_% -95.6_% 1.3
Swiss Franc-CME(Floor Trading Only) Swiss Francs per 1 U.S. Dollar-#390(5-95.8_% -94.9_% 1.3
Swiss Franc at CME Swiss Francs per 1 U.S. Dollar-#390(5-95.8_% -94.8_% 1.3
Euro/British Pound-FINEX Danish Krones per 1 U.K. Sterling-#59-95.1_% -94.8_% 1.3
South African Rand-FINEX SA Rand-CME(Floor+ Electronic Combine-95.2_% -94.6_% 1.7
South African Rand-FINEX South African Rand-CME -94.3_% -94.5_% 1.7
Euro(Floor Trading Only)-CME Danish Krones per 1 U.S. Dollar-#690(-94.8_% -94.4_% 1.3
Euro Currency EUR/USD at CME Danish Krones per 1 U.S. Dollar-#690(-94.8_% -94.4_% 1.3
Euro E-mini-CME Danish Krones per 1 U.S. Dollar-#690(-94.2_% -93.9_% 1.4
Japanese Yen-CME(Floor Trading Only) Japanese Yen per 1 U.S. Dollar-#390(4-94.2_% -93.6_% 1.5
Jap Yen Currency JPY/USD at CME Japanese Yen per 1 U.S. Dollar-#390(4-94.2_% -93.6_% 1.5
Euro/British Pound-CME Danish Krones per 1 U.K. Sterling-#59-93.7_% -93.4_% 1.4
ICE US Dollar Index at US ICE U.S. Dollars per 1 Euro-#591(60) -93.2_% -92.9_% 1.3
U.S. Dollar Index(Floor+Electronic CombinU.S. Dollars per 1 Euro-#591(60) -93.2_% -92.9_% 1.3
Euro German Bobl-EUREX Danish Krones per 1 U.S. Dollar-#690(-93.4_% -92.9_% 1.3
Euro German Bobl(Last Trade in Close FielDanish Krones per 1 U.S. Dollar-#690(-93.4_% -92.9_% 1.3
Japanese Yen E-mini-CME Japanese Yen per 1 U.S. Dollar-#390(4-92.9_% -92.5_% 1.6
ICE US Dollar Index at US ICE Hong Kong Dollars per 1 Euro-#591(44)-92.3_% -92.4_% 1.3
U.S. Dollar Index(Floor+Electronic CombinHong Kong Dollars per 1 Euro-#591(44)-92.3_% -92.4_% 1.3
Australian Dollar-FINEX Australian Dollars per 1 U.S. Dollar--91.8_% -92.2_% 1.4
ICE US Dollar Index at US ICE EURIBOR-3 Mth-EUREX -92.2_% -92.0_% 1.3
EURIBOR-3 Mth-EUREX U.S. Dollar Index(Floor+Electronic Co-92.2_% -92.0_% 1.3
Canadian Dollar-CME(Floor Trading Only) Canadian Dollars per 1 U.S. Dollar-#3-92.5_% -91.9_% 1.3
Canadian Dollar at CME Canadian Dollars per 1 U.S. Dollar-#3-92.5_% -91.9_% 1.3
ICE US Dollar Index at US ICE Euro German Schatz-EUREX -91.7_% -91.5_% 1.3
Euro German Schatz-EUREX U.S. Dollar Index(Floor+Electronic Co-91.7_% -91.5_% 1.3
ICE US Dollar Index at US ICE Euro German Schatz(Last Trade in Clos-91.6_% -91.5_% 1.3
Euro German Schatz(Last Trade in Close FiU.S. Dollar Index(Floor+Electronic Co-91.6_% -91.5_% 1.3
Australian Dollar at CME Australian Dollars per 1 U.S. Dollar--89.7_% -91.4_% 1.4
Australian Dollar-CME(Floor Trading Only)Australian Dollars per 1 U.S. Dollar--89.7_% -91.4_% 1.4
New Zealand Dollar-FINEX New Zealand Dollars per 1 U.S. Dollar-89.5_% -90.5_% 1.5
Singapore Dollars per 1 Australian$-#171(Australian Dollars per 1 U.S. Dollar--93.7_% -90.4_% 1.2

 

[Maxjohan]

here's something you might appreciate that's in reference to footprint AND the market flash crash from 4 years ago:

That video was cool. Almost like an auction.

So, you are not loz lawn, I guess?

 

[Guest3722A]

So, you are not loz lawn, I guess?

May I ask what your point is?

 

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[Maxjohan]

May I ask what your point is?

Nah. I don't know. Was just wondering.

 

[CarrieW]

hey everyone!

I was finally able to get my full raw data from my ibfx account. the entire history. I am wondering if anyone here can help me

I have the data in raw form. I do not have the knowledge to be able to easily take this data and extract what I want to know from it. I was hoping someone here would be able to help me.

I am trying to find out exactly what my pip count/score whatever you want to call it is. at some point a year or 2 ago I was even in pips. I was even in the green for a bit, then I started losing trades and went into the negative again. I am trying to find out exactly where I stood when they closed my account. (exactly how many pips up or down over the entire history)

I have gained alot of pips in my new account and I am trying to figure out where I stand

if you can help me figure this out please let me know and I will figure out how to get the raw data to you

thanks!

 

[Maxjohan]

Just so you guys know. My prediction I made is not set in stone. Reading this stuff. It seems like we are going to a long term stronger USD: http://www.economist.com/node/21549968

Remember. This was in March 2012.

Maybe back to the old time hights of 9-10 SEK for a USD. It's now at 7.84 SEK for 1 USD. What do you guys think? I may have been completely wrong with my prediction that the EUR would get stronger. As I saw it as more of a cycle by the years before. Anyhow. Invest with caution.

Also, it's only been like 6-7 years since the 2008 market crash.

Any suggestions/ideas?

 

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[Threenuc]

Is Forex even Fastlane? It's pretty much an uncontrolled gamble, too.

 

[Maxjohan]

Is Forex even Fastlane? It's pretty much an uncontrolled gamble, too.

Of course it's fastlane. If you know what you are doing. But that's just what I think. You can trade 100:1 leverage on Forex. So you can lose and earn quite a bit of money.

But I am just interested in long term trades. Not daily or several trades per day.

 

[HighestVantage]

Apologies for not having read this whole thread before responding. I have some limited experience and knowledge of the currency markets, and a few trading platforms. I would be happy to talk more about it.

 

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[HighestVantage]

Oh wow, just realized this thread started in 2007. Okay.

Well let me share what I have learned from reading and playing around with forex. I'll probably no doubt cover things already discussed...

Common questions that are asked about Forex:
But first, about Forex. Forex stands for Foreign Exchange, you may hear or see it called Forex, FX or The Currency Market. Forex supports the exchange of floating currencies. This just means any country that has a floating currency does not base their currencies value on something valuable, like gold. The Gold Standard has an interesting history and used to create a sort of cyclical import/export effect between countries. Anyhow, The forex market is actually the biggest market in the world, and thus the most liquid, trading around $2-Trillion daily.

How does it work?
You can trade US Dollars for Canadian Dollars, or US Dollars for Euros, or vice versa. These are called Currency Pairs. A currency pair is basically the equivalent of a stock. Forex is to currency pairs as Stock Market is to stocks. There are many pairs that you can work with, but a handful are very popular and have the most activity. Other markets focus mostly on immediate to mid-term events, while the forex market is focused solely on global long-term events.

Can you actually make money?
Of course you can. But like any financial market you can lose some too. Here is my favorite story of making money in Forex.
http://www.investopedia.com/ask/answers/08/george-soros-bank-of-england.asp

How much do you need to start?
You can start with almost nothing. Unlike other financial markets, with the Forex market you can start with sometimes $25 or $50. Since you usually will be offered leverage anywhere from 100x to 1000x your initial investment. This is also the only way you can make any money since Day-to-Day a currency pair probably moves a cent or two in price. You use massive leverage, and you trade to fractional cents. Usually Pips or Basis Points. (refer below)

Benefits of using Forex.
-Due to the size of the market liquidity won't really change if you're trading with $100 or $10 Billion.
-Since it is a HUGE global market most events are seen as small. Did your country has a bad winter, or a "major" catastrophe? Big deal, at this level it all averages out.
-They are always open. You can trade at 1pm or 1am, doesn't matter to a global market. You can have your money working more hours of the day.

Like anywhere you can find Experts, the stock market and the currency markets all have their own lingo. Some things you might run into that I initially found confusing.
Basis Point: 1% change = 100 basis points, and 0.01% = 1 basis point.
Pip: the smallest move a currency pair can make is $0.0001, or one basis point.
Currency Pair: These are all pairs USD/CAD, EUR/USD, AUD/USD or USD/AUD, Etc.

 

[Guest3722A]

Any suggestions/ideas?

Yes

 

[Maxjohan]

Yes

Yes, what?

 

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[Guest3722A]

Yes, what?

yes I have suggestions and ideas

 

[Maxjohan]

yes I have suggestions and ideas

Okay. I got it. I think.

 

[Guest3722A]

Okay. I got it. I think.

Let me ask you something - how much technical research did you put into the DXY

 

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[Maxjohan]

Let me ask you something - how much technical research did you put into the DXY

I haven't put any analysis in to that. All I know is when the federal reserve have cut the bond buying people started after a while to put trust in the USD again. And USD have become stronger and stronger.

So, I guess, I am more of a fundamental analysis guy.

 

[Guest3722A]

I haven't put any analysis in to that. All I know is when the federal government have cut the bond buying people started after a while to put trust in the USD again. And USD have become stronger and stronger.

So, I guess, I am more of a fundamental analysis guy.

I'm going to ask you a couple questions to just get you thinking. Cool?

I myself am more on the technical side of things as that's what better satisfies my tolerance for risk and I do take into account fundamentals but more so how the market reacts to fundamentals and fundamental announcements. Reactions to these things create the charts and the averages. Its my opinion that in these averages you see when the trading begins to waver and become inconsistent. Does this always create winning trades? No. Does this win more than it loses? Yes.

Right now I have a few accounts open, but I don't have any positions because my focus is completely on building a business that is positioned perfectly to become something (very) fastlane, and I put most of my energy into putting that puzzle together while dancing around the current issues life has dealt me. Go time is very close now, and when it is go time, that is where all of my investment money will be. But, I watch the charts every day/night as I always have for 18 years now.

 

[Maxjohan]

Go time is very close now, and when it is go time, that is where all of my investment money will be. But, I watch the charts every day/night as I always have for 18 years now.

What do you mean, go time is very close? What is your prediction of the market then? Or do you mean something else?

Just wondering.

 

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[P3HSB]

Just opened and funded a live account with $2000. Excited but at the same time nervous.

 

[CarrieW]

There are threads that discuss if forex is fast lane or not. This thread is for active traders not those who liken it to gambling