# FOREX newbie questions



## funnybunny (3 May 2018)

I was thinking about investing in forex for a few months now - had a few questions which I couldnt find from forex books - mostly was reading about technical analysis not specifically related to australia

1) I was wondering are there any forex brokers in australia (or provide service to australia) that have guaranteed stop losses or in the effect of preventing negative balances i.e. wont be too worried if I lose my investment but not any more

2) If there are any brokers that provide GSLOs - how much are the prices - what brokers do ppl reccommend - I was going for Pepperstone but realise they dont provide GSLOs.

3) I assume if I deposited $1000 AUD, then to buy CHF/AUD, EUR/AUD etc would be straightforward  - but what about EUR/US..would I need to first exchange from AUD to USD - would the forex broker do this for me at a reasonable price then buy EUR with US? What would the costs be approximately?

I understand I have a long way to go but had these initial questions for australians taking on forex markets

Thanks!


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## peter2 (3 May 2018)

1) IG Markets have guaranteed stop losses on FX currencies. (see pic)




2) The costs vary with the currency pairs (AUDUSD ~0.8pt, GBPUSD ~2pt) 

3) The broking platform will automatically calculate the margin and your P&L in the account currency.
The costs are in the spread every time you need to cross it. 

It's up to you to ensure that your account has enough for the margin requirement for every trade and enough to cover any loss from the trade. If you make a "fat finger" mistake or overlook a decimal pt in your trade calculations you can lose your entire account. It won't be the brokers fault if you make this mistake. GSLOs won't prevent these mistakes from happening. 

Good luck and practice until you know what you're doing.


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## funnybunny (3 May 2018)

peter2 said:


> 1) IG Markets have guaranteed stop losses on FX currencies. (see pic)
> 
> View attachment 87219
> 
> ...




Hi Peter
Thanks for that info. i was going to look at IG markets as well.

Say if i had $1000AUD and buy EUR/AUD, it would be straight forward.  How do i go about buying EUR/USD...who would i only be able to buy in AUD as a base currency?


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## peter2 (3 May 2018)

You can buy or sell any pair to start a trade. 
The trading platform will do all the calculations and notify you of your margin requirements in AUD before you start the trade. 

Get a demo account and see what happens.


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## funnybunny (3 May 2018)

Thanks for the replies
Also with IG markets- the do do guaranteed stop losses- so i guess this would safeguard me against slippage but does it guard against gaps as well? (is that the same thing)


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## peter2 (4 May 2018)

The price of the GSLO is the exit price of your trades. There will be no slippage and no gaps. 
Your paying for that service.

Gaps and slippage are not the same thing. Gaps in the price feed happen when prices move fast or happen over the weekend between the close at the EOW and next week's open. The gap would be in response to something that occured while the markets were closed.

Slippage occurs when prices move after you've placed a market order. You try to buy at 0.7500 but as soon as you enter your market order the price changes either up or down and you get filled at a slightly different price, ie 0.75002 or 0.74999.


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## cynic (4 May 2018)

A couple of further comments on the gaps and slippage question. 

Depending upon one's trading methodology, the GSLO might not be the only exit trigger for the trade.

One might wish to exit upon achieving a predertemined profit target, in which case gaps and/or slippage can potentially impact the exit price.

Intraday gaps can also occur when liquidity dries up in advance of high impact news reports, or during sudden shocks to the market.


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## Wysiwyg (4 May 2018)

funnybunny said:


> Thanks for the replies
> Also with IG markets- the do do guaranteed stop losses- so i guess this would safeguard me against slippage but does it guard against gaps as well? (is that the same thing)



Keep an eye out for the GPT (guaranteed price target) offer.


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## cynic (4 May 2018)

Wysiwyg said:


> Keep an eye out for the GPT (guaranteed price target) offer.



Is this your way of hinting at the availability of limit orders?


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## Wysiwyg (4 May 2018)

cynic said:


> Is this your way of hinting at the availability of limit orders?



No, just joking.


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## aus_trader (5 May 2018)

My only suggestion is go slow and learn from mistakes as you do. Currency markets can be very frustrating to trade based on my experience and try to stick to longer time frames such as Daily and 4H. 1H may be as low as I would go since it starts to look like noise when you go further down in my opinion. 

Also as* peter2* mentioned earlier with aud/usd at 0.8pips example, the cost of the trade is also important so I reckon stick to the majors such as aud/usd, eur/usd and gbp/usd as they offer lower costs. Best of luck and do post your progress...


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## Stratagist (6 May 2018)

Definitely suggest you open a Demo account and practice trades to get a handle on the market
FXCM offers a Demo account using the Trading Station Platform which can be downloaded to PC also mobile to monitor during the day.The platform allows 24 hour trading from Australian market into the US market overnight. Bear in mind there is a cost carrying a trade over to the next day https://www.fxcm.com/au/ Download their EBOOK.pdf, Trading Station user guide.pdf
$1000 is a small amount to play with as does not give you much leverage ie if currency pair goes in opposite direction to what you anticipated you can lose the lot in a blink of the eye
The platform allows you to place a trade either buy or sell at the price you deem is value.
Always place a stop/limit order to cover losses in excess of what you can afford or what you concider is a good profit - do not get greedy as you will loose big time
Forex market is very volatile but practice makes perfect
Research and homework is your friend. Use chart indicators to find market direction, many are available.
I use MACD (12-26-9), Chaikin Oscillator (monitors money flow in and out of market), Directional Real Volume (Histogram), Bollinger Bands, SMA (simple moving average)
Have a look at these links, they will give you a handle on the market
https://www.tradingview.com
https://au.investing.com/currencies/streaming-forex-rates-majors
https://www.dailyfx.com/market-news
https://www.investopedia.com/ask/an...dlines&utm_source=rss_www&utm_medium=referral

Good luck but remember until you are confident with the practice account DO NOT PLAY


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## Stratagist (6 May 2018)

An example of my setup 30m chart
In this case would trade the Bolinger bands top and bottom ie going short or long
For a more precise price movement re volume switch to 5m/15m charts
Be careful entering a trade too early wait for a change in the market direction
Real volume histogram gives a good indication of buy/sell volume for each 30m peroid


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## Stratagist (9 May 2018)




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## Stratagist (9 May 2018)




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## funnybunny (9 May 2018)

Hey guys
thanks for the replies- very useful!
Also i have been reading about how brokers can be dogy like the following link 
how  often do you feel that this occurs? is it comomn? how do people then actually make any money?  also what are ecn accouts?  
thanks


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## peter2 (10 May 2018)

Unfortunately this happens quite commonly when trading cfds on thinly traded markets with almost all cfd providers. On this occasion the trade was left open as the underlying market (or cfd market) closed for the day. The market reopened at a random(?) price triggering the stop order. 

I had this happen to one of my trades a few days ago, triggering 17pips of "slippage". 

The only course of action is to make a polite inquiry with the cfd provider. They will probably say that their spreads can get a little wide when their markets reopen. If they don't offer to fix the trade, there is nothing you can do about it. Their product disclosure states that they can do anything they want with their prices and we have to accept the consequences.

These "unfortunate" spread issues don't happen in the real underlying futures markets. 

Profitable traders fully understand the trading conditions of every market they trade and fully understand how their brokers execute their orders. They also have an edge or understand how to create one with disciplined and consistent management of risk. 

ECN accounts - google is your friend.


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## cynic (10 May 2018)

funnybunny said:


> Hey guys
> thanks for the replies- very useful!
> Also i have been reading about how brokers can be dogy like the following link
> how  often do you feel that this occurs? is it comomn? how do people then actually make any money?  also what are ecn accouts?
> thanks




As I have never traded with Pepperstone I make no comments, (explicit, implicit or otherwise) about the quality of their service offering/s.

ECN stands for Exchange Consolidated Network. Normally comprised of a number of liquidity providers (ofttimes major banks amongst them). From amongst the bids and offers across that network, the most favourable of the bids is selected and coupled with the most favourable of the offers and then used as the basis for the price quoted by the broker/s using that ECN.

Based upon my past experience with many other OTC derivatives providers, and conversations with other traders like myself, the seemingly mysterious triggering of stop orders with precision, has been an all too common experience.

As far as I can discern, the terms of the product disclosure statements of OTC derivatives providers, typically allow ample scope for discretionary price setting and profitting from clients' losses.

I recommend that anyone contemplating use of OTC products, rather than risk the free donation of one's trading capital to the broker's coffers with stop order placement, instead monitor positions continuously and exit at market, or find an alternative method of risk mitigation.


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## minwa (10 May 2018)

If you've ever seen a major USD pair spreads increase from 1ish to 7+, during major market hours, with no major news/announcements, while other majors stayed same, while a exotic pair of the currency you're trading has even tighter spreads than the USD cross, while also paying commision for supposed institutional grade spreads, after you enter the trade - you will likely stay far away from CFD brokers. 

Ignore the marketing buzzword ECN. No true ECN exists in retail OTC brokers that I know of. 

I do know of people profitable using these types of brokers though. Just an uphill battle in my opinion.


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## Stratagist (10 May 2018)

My suggestion is go for a broker that trades 24\7

Some AU brokers create thier own boards only trading on a day to day basis - in my opinion manipulation is too easy hedging against your buys etc. On joining you are assigned a so called portfolio manager who will hound you on the phone to make trades suggesting various strategies. These guys work on commission - stay away. Some notable brokers have been pulled up by ACIC (Google Search)
Trading NZD/USD long today 
Entry 0.69231 100k
Backup entry 0.69108 100k
Watching trading volume


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## Ken from Hantec Australia (10 May 2018)

1) I was wondering are there any forex brokers in australia (or provide service to australia) that have guaranteed stop losses or in the effect of preventing negative balances i.e. wont be too worried if I lose my investment but not any more

*Depands on what you really want, normally, if you trade with MM(market maker) you probably will have GSLOs, cuz your broker is MM, in the other hands means they are the ppl to take your trade and decide whether put your trade onto market.
For DMA and ECN, normally it is impossible to have GSLOs, cuz the market volatility can be really crazy.
However, some of the broker (such like easy Markets, however I don't know whether they are MM or DMA), they do offer some kind of GSLOs, by using some kind of binary options (which of course extra charge).*

2) If there are any brokers that provide GSLOs - how much are the prices - what brokers do ppl reccommend - I was going for Pepperstone but realise they dont provide GSLOs.

*As your question 1: GSLOs
you might find some broker they do have it. but the problem is whether they will trade against with you. The other things you might want to know is the slippage usually happen to ECN and DMA brokers, doesn't matter how good their server is, and if your broker says they are MM and they still have slippage - then be careful with them - they might (just might) do taking advantage on you.*

3) I assume if I deposited $1000 AUD, then to buy CHF/AUD, EUR/AUD etc would be straightforward  - but what about EUR/US..would I need to first exchange from AUD to USD - would the forex broker do this for me at a reasonable price then buy EUR with US? What would the costs be approximately?

*The computer will do the math for you no worries. *

I understand I have a long way to go but had these initial questions for australians taking on forex markets

Thanks![/QUOTE]


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## Stratagist (11 May 2018)

A long days trade
Used margin $550 200k at average of 0.69198 opened 11.30/2.15 
Cassic example of having a margin to play with was $350 down a one stage. Must admit did pull the 0.69108 entry which would've been the cream on the cake but thats the Forex jitters.
15m 2 day chart used 30m chart to get entry/exit. 
Paid close attention to Real Volume Histogram. High volume even on red candles you new the bears were working. The consoladation between 2.15pm and 8.30pm indicated the upside was evident.
Days profit $1049


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## peter2 (11 May 2018)

@Stratagist  I enjoy your contributions and I would like to see more of them. Please consider starting your own thread so we can follow your trades as they progress. 

Your current posts are much too advanced for this forex newbie questions thread.


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## Value Collector (11 May 2018)




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## Stratagist (11 May 2018)

Too advanced????
funnybunny seemed to be dipping his/her toe into the water unsure whether to get wet. A bird does not know it can fly until it takes its first leap.
Remember the Forex market is not like trading stocks where you hold for a peroid of time.
I have stated open a demo account, you do not have to deposit initial funds to operate other than go through the registration process. When you are confident you can deposit funds and operate a real account. If the broker you select asks for a deposit find a broker that does not. Preferably one that trades 24/7 and does not run their own trading board only trading on a daily basis.
And practice before entering the real market.
Replicating my trades with a demo account, I would hope, educate any newbie as to how the market can be used to thier advantage.
Any newbie needs an education as to how to set up thier trading strategies with indicators that can be used to thier advantage. I post mine as they work for me, others may have different ideas.
Like a child beginning to read one needs a starting point as the whole concept of trading the Forex markets can be very confusing and if one intends dabbling they need guidance as a path to education.
I might mention 15m 1day, 2day, 30m 2day 5day charts. Go to the demo account account and have a look. Redraw my entry/exit points and how they coincide with the Bollinger Bands top and bottom over a period. I only day trade, rarely more than two days.
Fiddle about with the trading platform right click to create entry/exit/limit points whether you intend going short or long. A window will pop up where you can see your profit or loss margins, cost per pip etc. If you are happy with the results submit the order.
Do not expect to win on every trade, I don’t but I run tight stop losses. 
And remember the demo account gives you a substantial amount to play with. Do not get carried away with large orders as they will not translate to the real world. If you intend starting with a small investment trade within that investment ie 20k/50k lots. Remember small fish are sweat fish.  
I pick one currency pair to trade for the day that I consider will turn me a profit by going through all the charts of an evening. Some days I do not trade as none catch my eye.
I also subscribe to the Trading Central daily newsletter which sends an email each morning which can give you a guidance as to the expected market action It is free to join.
On top of that research is important.
I have previously suggested a few sites to have a look at.
funnybunny I hope this little incite will encourage you to take the leap.
Remember a little profit averaging out at say $50/$100 per day adds up over a twelve month period. 
Any questions ask.


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## cynic (11 May 2018)

Stratagist said:


> A long days trade
> Used margin $550 200k at average of 0.69198 opened 11.30/2.15
> Cassic example of having a margin to play with was $350 down a one stage. Must admit did pull the 0.69108 entry which would've been the cream on the cake but thats the Forex jitters.
> 15m 2 day chart used 30m chart to get entry/exit.
> ...



I believe that it is posts of this nature that could be considered so advanced as to be beyond the grasp of those yet to commence their foray into the forex maeket.
Your willingness to share your analysis is most welcome to this forum, it just seems better suited to one of the more advanced threads, or perhaps a thread of your very own - one opened specifically for journalling the progress of your trades.


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## Stratagist (11 May 2018)

Se ya!!!!!


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## cynic (11 May 2018)

Stratagist said:


> Se ya!!!!!



I fear there may have been somme misunderstanding here.

Please,please, please, do not go!

I am sure that I am not alone in saying that I consider your participation to be most welcome within the ASF community.


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## funnybunny (11 May 2018)

Thanks everyone,  i find it very useful so far on the demo- have just played with the indicators etc, MACD seems to be good to me.
With some of these brokers been dodgy- how do pros have actuallly make money ?, Is it a stratgey to just close your trade before the end of the day in that case? 
For some who say to email them- is it a good idea to keep like another account open to follow the actual prices- can it be just the demo account or does it need to be a live account from the same broker or a different broker?  

cheers


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## grah33 (16 May 2018)

funnybunny said:


> I understand I have a long way to go but had these initial questions for australians taking on forex markets
> 
> Thanks!



I had a good crack at forex in the recent past and I didn't succeed at it so took time off.  Although what I did learn is on other forums there are people out there who are experts compared to me, know way more than me, yet still aren't profitable.  So I reckon it might be hard to make money.  Maybe try gold or the SP or something else.  And test  out your ideas first .  You might be profitable after e.g. 30 trades, but when you get to 90 you find out your stuff doesn't really work.  That aside one can see why it's so attractive.  Little margin to get going, great liquidity, but the crashes are terrible.


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## aus_trader (22 May 2018)

It's fairly hard to find out if a broker is running your stops if you are trading on the very small time frames because the stop loss may be placed very close to price action. Then it's hard to say whether your say 7pip stop was hit due to actual market movements or broker increasing it from a 5pip market move against you with a 2pip widening of the spread by the broker i.e. 5+2=7 so your stop his hit so precisely it feels like a curse. Anyway that's how I felt when I tried to scalp a few pips out of the smaller time frames in my early/newbie days.

Nowadays I don't trade very actively in the Forex markets on the smaller time frames but may take a trade every now and then on the Daily or the 4hour charts with much larger stop loss. It would be very hard for the brokers to scam a few pips from me because my stop loss is probably 50 or 70 pips away. If they close my trade by widening the slippage or spread by 50pips, I will take action such as ASIC reporting, legal etc. It hasn't happened and I think no decent/reputable broker will take such a risk because it's so obvious that even a newbie can spot such a huge price anomaly by checking against freely available currency charts to confirm the market didn't go anywhere near their stop loss.

Sorry for the lengthy explanation but I just want to protect fellow traders from Forex brokers.


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## funnybunny (22 May 2018)

Hi 
Thanks for the advice- I agree with your plan- i feel that small pips are easily missed but placing the stop loss greater than say 40 pips should be sufficent,, anyone else use this way and found that they did not have any issues?
thanks, again this is prob the most useful info i have found so far ...


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## grah33 (24 May 2018)

funnybunny said:


> Hi
> Thanks for the advice- I agree with your plan- i feel that small pips are easily missed but placing the stop loss greater than say 40 pips should be sufficent,, anyone else use this way and found that they did not have any issues?
> thanks, again this is prob the most useful info i have found so far ...



you're probably gonna do discretionary trading right?  you should get FX tester and test out your system.  get 30 trades down, then up to 60 and if it looks good take it to 100 to really see.  it's hard work, but it save you time.  I don't know if anyone is really profitable with e.g. 40 pip stop losses on this forum...maybe they got it going with futures, but currency i don't know


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## willoneau (4 November 2018)

I have been using Pepperstone awhile now and find depositing and withdrawing funds not a problem . As for the platform i have noticed times when the spread can expand quite alot but not sure if when expected news is coming out as i don't follow that at moment .Might look at tracking new release times though . Also the price can move extremely far and quickly at times causing large slippage but all part of trading. Good thing is you can trade with very low risk capital and keep blowing up untill you either find something that works for you or you give up.


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## willoneau (4 November 2018)

I use ctrader which i like as a platform and just started looking at getting into cbots with it maybe.


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