# Getting started in Forex



## nizar

Hi everyone,

Im looking at getting started in trading forex, can anybody recommend me some good books?

Though Im more interested in mechanical systems trading, even some basic ones will do for a start.

And also some questions,
*Which pairs have the tightest spreads?
*Which pairs have the biggest trading range?

I have no idea about forex as all of my (limited) background is in stocks. But I see Fx as a much bigger pond with UNBELIEVABLE opportunity.

Any opinions or discussion would be much appreciated.

Nizar.


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## MS+Tradesim

Hey Nizar,

I'm trying to figure out the same stuff. Maybe we can work on it together?

I'm probably going to open a Tradestation account and use their linked brokerage GAIN Capital. Doesn't seem to be the best broker but will at least be a starting point. Tradestation allows for fully automated mechanical trading. It has its own system development and testing tools but apparently it can export test trade data into a format Tradesim can use -  which is a nice bonus. The forex guys around here seem to be tight-lipped. Can't get too many answers from 'em.


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## stargazer

Hi Nizar

I am also looking into the FOREX side of things and have found a few sites.

Google:
Trader Mastermind (Education) Some Books recommended
Forex Killer is more a software that you plug in nos.  (Mechanical)
Top Dog Trader (Education)

Cheers
SG


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## prawn_86

I know Oanda has a free account in which you get $100k trial $. 

Not sure about the mechanical side though


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## ithatheekret

nizar said:


> Hi everyone,
> 
> Im looking at getting started in trading forex, can anybody recommend me some good books?
> 
> Though Im more interested in mechanical systems trading, even some basic ones will do for a start.
> 
> And also some questions,
> *Which pairs have the tightest spreads?
> *Which pairs have the biggest trading range?
> 
> I have no idea about forex as all of my (limited) background is in stocks. But I see Fx as a much bigger pond with UNBELIEVABLE opportunity.
> 
> Any opinions or discussion would be much appreciated.
> 
> Nizar.




The best pip spread I have seen is from AMC ( Swiss Mob ) , they can do better though and that entails a $50K minimum account . putting that aside though , they have the best spreads I have seen ........... and they are an accreditted brokerage . Not sure about the algorythmic trading though , but a simple email would soon sort that out .

If anyone knows of one better please let me know !

The big swingers in Forex IMHO is the Euro it has the most heavily traded crosses on earth . ie. EUR/JPY is a boomer .


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## connelkp

I just started researching Forex myself...

I have been reading this website, very good (if not very basic) information.

http://www.babypips.com/school/


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## ithatheekret

Read everything you can get your hands on if it affects the market your in .

The first and foremost thing you must first decide , is what type of speculator are you .

Understand your own personality and style first !

A schwing trader will usually have a short time frame planned in their trades .

If you are a position trader you may only make 10 or so trades a year if that .

A daytrader , may limit themselves to just a couple of trades a day or may make upto say 10 a day . the timeline leaning more to in and out on the day .

Then you have as was mentioned , the automated trading systems . But even these require input measured to the style of trading that suits the operator .


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## soso

nizar said:


> *Which pairs have the tightest spreads?
> *Which pairs have the biggest trading range?
> 
> I have no idea about forex as all of my (limited) background is in stocks. But I see Fx as a much bigger pond with UNBELIEVABLE opportunity.
> Nizar.




Hi Nizar,

1st Q: The tightest spread is usually provided for EURUSD as it is the most popular and liquid pair. The crosses have the biggest spreads, usually.

2nd Q: GBPJPY has the biggest trading range (at least out of the pairs I watch). GBPUSD is also known for its wide range.

And one Q from me: Why do you think it has UNBELIEVABLE opportunity? I ask cause I know it is heavily advertised but I think is no better than other markets and is as dangerous as any market. 

Cheers,
-soso


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## macca

Hi Nizar,

Plenty of forums, just like stocks, I have found this forum to be good

http://www.forexfactory.com/

Their news calendar is good as well.

I might mention that when trading FX be very careful of the news, it does create huge spikes and will stop you out, time after time.

good luck


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## nizar

soso said:


> And one Q from me: Why do you think it has UNBELIEVABLE opportunity? I ask cause I know it is heavily advertised but I think is no better than other markets and is as dangerous as any market.




Hi Soso,

Yes I think there is GREAT potential in the forex markets.
24 hour trading brings about amazing opportunity.

You have all the benefits of short term trading such as:
*Increased opportunity
*Decreased market exposure (short average trade lengths = decreased open equity drawdowns).
*Smooth equity curve due to fast trade turnover 

And couple this with forex advantages:
*24 hours a day, 5 days a week trading
*50-100x leverage easily available
*No brokerage fees (except the spread)
*High liquidity.

I actually beg to differ and think that its TOTALLY different from any other market because of the extremely high liquidity and that it trades 24 hours a day.

Thank you everyone for your thoughts, and yes, I have found Forex Factory to be a really top forum, hundreds of pages of info on trading systems and everything to do with forex.


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## wayneL

nizar said:


> Hi Soso,
> 
> Yes I think there is GREAT potential in the forex markets.
> 24 hour trading brings about amazing opportunity.
> 
> You have all the benefits of short term trading such as:
> *Increased opportunity
> *Decreased market exposure (short average trade lengths = decreased open equity drawdowns).
> *Smooth equity curve due to fast trade turnover
> 
> And couple this with forex advantages:
> *24 hours a day, 5 days a week trading
> *50-100x leverage easily available
> *No brokerage fees (except the spread)
> *High liquidity.
> 
> I actually beg to differ and think that its TOTALLY different from any other market because of the extremely high liquidity and that it trades 24 hours a day.
> 
> Thank you everyone for your thoughts, and yes, I have found Forex Factory to be a really top forum, hundreds of pages of info on trading systems and everything to do with forex.



Don't bother trading it, get a job marketing it.


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## wayneL

OK I trade currency futures, but let ne play devils advocate



nizar said:


> Hi Soso,
> 
> Yes I think there is GREAT potential in the forex markets.
> 24 hour trading brings about amazing opportunity. Really? Why? You can only trade it when you're trading.
> 
> You have all the benefits of short term trading such as:
> *Increased opportunity How?
> *Decreased market exposure (short average trade lengths = decreased open equity drawdowns). One can achieve this in any market
> *Smooth equity curve due to fast trade turnover One can achieve this in any market
> 
> And couple this with forex advantages:
> *24 hours a day, 5 days a week trading As above
> *50-100x leverage easily available Only a mug would use that much leverage
> *No brokerage fees (except the spread) Nonsense, the spread *is* the brokerage. In fact it's more expensive than brokerage in most cases
> *High liquidity. How does that help you over and above other instruments unless trading a billion dollar a/c?
> 
> I actually beg to differ and think that its TOTALLY different from any other market because of the extremely high liquidity and that it trades 24 hours a day. Nonsense, gold, oil, and several other commodities trade 24 hours as well
> 
> Thank you everyone for your thoughts, and yes, I have found Forex Factory to be a really top forum, hundreds of pages of info on trading systems and everything to do with forex.




I don't want to put anyone off XXXX, it's an good market to trade, but lets cut through the marketing crap.

Cheers


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## nizar

I love you too, Wayne


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## wayneL

nizar said:


> I love you too, Wayne



I'm here to serve.


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## Temjin

Here are my comments too. 



wayneL said:


> OK I trade currency futures, but let ne play devils advocate
> 
> Originally Posted by nizar
> Hi Soso,
> 
> Yes I think there is GREAT potential in the forex markets.
> 24 hour trading brings about amazing opportunity. Really? Why? You can only trade it when you're trading. True, one is still limited by physical trading. Nizar knows what I'm talking about through our private email. heheh I wouldn't say any further in this regards.
> 
> You have all the benefits of short term trading such as:
> *Increased opportunity How? true, physically impossible, unless...(as above) hah
> *Decreased market exposure (short average trade lengths = decreased open equity drawdowns). One can achieve this in any market That's true, forex is just another market to trade, simple as that.
> *Smooth equity curve due to fast trade turnover One can achieve this in any market True again, high opportunity trading system produce smooth equity curve, regardless of markets
> 
> And couple this with forex advantages:
> *24 hours a day, 5 days a week trading As above lol as way above too
> *50-100x leverage easily available Only a mug would use that much leverage Only a person who does not understand risk management will get burnt using leverage. As I have said it many times, the higher the leverage, the less capital I need to fully utilise my position sizing strategies. There are 0.01 lots for trade out there, one can trade a 1% fixed size using only $1000 as starting capital.
> *No brokerage fees (except the spread) Nonsense, the spread is the brokerage. In fact it's more expensive than brokerage in most cases As the account equity get larger, this becomes extremely true. The shorter the timeframe you are trading, the more expensive each trade become. One pip spread make a hell lot of differences when your stop are only set in the single digit or low 10s pips away. As the trade become longer term, that is stop are set at a much higher pip, spread fee become less expensive in relative term
> *High liquidity. How does that help you over and above other instruments unless trading a billion dollar a/c?True again, a small account (like less than a few hundred thousands) make no differences.
> 
> I actually beg to differ and think that its TOTALLY different from any other market because of the extremely high liquidity and that it trades 24 hours a day. Nonsense, gold, oil, and several other commodities trade 24 hours as wellthat's true too.
> 
> Thank you everyone for your thoughts, and yes, I have found Forex Factory to be a really top forum, hundreds of pages of info on trading systems and everything to do with forex.  I would strongly advise you not to spend too much time in such a forum. Everyone there only focuses on their ENTRY STRATEGIES, and not position sizing, exit, etc, etc. EVeryone there are looking for a high accuracy, holy grail trading system. It's a waste of time trying to test out their systems. Develop your own instead. There is a page in "Ways of the Turtle" that mention about these online forums, and I so agree with him hahah
> 
> I don't want to put anyone off XXXX, it's an good market to trade, but lets cut through the marketing crap.
> 
> Cheers




Sorry, I don't have any specific books on the forex market itself. I forgot how I learn my from, a while ago.  

However, it does not hurt you to read those sites you just mentioned as long as you are aware of the "general psychology" and how bad it is for you to follow them. You can also try www.fxfisherman.com and www.strategybuilderfx.com too.

Good luck man.


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## Kauri

If you want a good general book as an introduction to FX markets and the way they work, what drives them, their basic mechanics etc,(not strategies or holy gales), then FX Trading by Alex Douglas... an Australian guide to trading FX... is a very good place to start. 
Cheers
.........Kauri


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## Kauri

The spreads of the pairs I concentrate on...
Cheers
.........Kauri


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## professor_frink

> Yes I think there is GREAT potential in the forex markets.
> 24 hour trading brings about amazing opportunity. Really? Why? You can only trade it when you're trading. True, one is still limited by physical trading. Nizar knows what I'm talking about through our private email. heheh I wouldn't say any further in this regards.




Hi Temjin,

I can only venture a guess that you are talking about full automation of the strategy,order entry included, as you have previously alluded to in other posts.

If I'm right, may I ask how you've managed to deal with things like broker isssues, lengthy blackouts, internet problems etc? What happens if your broker's platform goes down  just before a major announcement comes out and you're asleep with a position on?? Have you had these kinds of problems before, and if you have, how do you deal with them?


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## nizar

Kauri said:


> If you want a good general book as an introduction to FX markets and the way they work, what drives them, their basic mechanics etc,(not strategies or holy gales), then FX Trading by Alex Douglas... an Australian guide to trading FX... is a very good place to start.
> Cheers
> .........Kauri




Yes I have bought this the other day as an introduction based on somebody's recommendation. Thanks.

Temjin,

Yes I know that entry isnt the most important thing, blah blah.
Strategy builder looks like its exactly what Im looking for.

Well I beg to differ from Curtis Faith. I've learnt a hell of a lot through internet forums. Alot of the posters (in every forum) are newbies or amateurs or bullmarket champions. But the are a few people who really know their stuff and are willing to share their knowledge and for me that makes the time Iv spent through these forums very much worth it.


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## tayser

FX Trading by Alex Douglas is about the only book you'll need to buy.

It will give you a primer, and the rest is up to you and your google skills - the beauty of FX is that there are so many more people who are open to sharing different systems - like Temjin says however, you need to apply a good personal bull****-o-meter, but there are some goldmines out there.  Take a look at Trend Follower in the Trading Systems sub-forum on Forex Factory.    

Don't be fooled by 'no commissions all you pay is the spread' that is just bucketshop market makers luring you in.  Woop ee doo if there's no commission, you will pay for their antics however (eh, they're the ones on the other side of the trade, who's to know what the hell they'll do - ECNs only act like a stock broker and route your orders to a bank and for that you pay a commission - you have a spread but eh, who's complaining about 1 pip spreads of EUR/USD or EUR/JPY and non-fixed spreads of every pair? not I).

You'll then need to decide on a trading strategy - I personally chose scalping because it suits my timeframe (short: i personally couldnt think of anything worse than sitting in front of a PC day trading equities or currencies for that matter) and it's one of the purest forms of trading - or at least the method I'm using is (see the LinuxTroll thread if you're interested or go to LT's new home: http://www.cyrox.com/forum/).

Just remember this: all you need is 10 pips a day and you will live a very comfortable life.


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## Temjin

professor_frink said:


> Hi Temjin,
> 
> I can only venture a guess that you are talking about full automation of the strategy,order entry included, as you have previously alluded to in other posts.
> 
> If I'm right, may I ask how you've managed to deal with things like broker isssues, lengthy blackouts, internet problems etc? What happens if your broker's platform goes down  just before a major announcement comes out and you're asleep with a position on?? Have you had these kinds of problems before, and if you have, how do you deal with them?




Great questions there frink. 

If you referred to my other posts, I am still in the development stages. 

You are right that those are very legitimate risks and I have developed, or rather, have thought of strategies to mitigate them.

*broker isssues* - This remain one of my biggest risk. I am essentially relying on their uptime and connectivity reliability to execute my system properly. This is mitigated by regularly monitoring of the system, set maximum portfolio risk (no more than 10 positions at once, or no more than 5 long/short, etc) and reduce reliance on trading system's rule to liquidate trade. (i.e. have trailing stop / profit targets already set on broker's server) 

Another major concern is how the broker manage their client's fund. What do they do with the funds? How risky is it? Do they have plans to shield themselve from the current or future credit crisis? etc, etc.

*lengthy blackouts, internet problems* - This is less of a problem as I will be using a virtual dedicated (or shared as minimum) server hosted by a professional company with connections located near my broker's own routing servers. I will rather pay for the cost for the service of having advanced hardware security, reliable backup power source, minimum internet access downtime and regular data backup than using my own home desktop computer with unreliable power supply and internet. I would be able to access my hired server through remote access from my home computer/laptop.

*just before a major announcement comes out * - As I will be desiging intraday trading system with no overnight positions, and that the markets I am trading in is highly liquid, major annoucement that produce major price shock should not present a major problem to me. (in theory anyway, who knows what will happen in the future) I would further mitigate it by the same max portfolio heat strategy and having a balance of long/short.

I am fully aware of the fact that alot of quantitative hedge funds recently had experienced major drawdown when both of their LONG and SHORT positions went against them all at the same time. I don't know if, or how this would happen to me, but the best defense against it would be to limit my positions opened and total % of equity risked. 

That's how I would deal with them. I'm sure most of the more "professional" quantitative hedge funds have better strategies to deal with these. 



			
				nizar said:
			
		

> Well I beg to differ from Curtis Faith. I've learnt a hell of a lot through internet forums. Alot of the posters (in every forum) are newbies or amateurs or bullmarket champions. But the are a few people who really know their stuff and are willing to share their knowledge and for me that makes the time Iv spent through these forums very much worth it.




Maybe it's my biases toward these forums, there would be alot more newbies and losing traders than winning traders. If I was a winning trader who have been making profit consistently over the past several years, I would NOT even consider making posts in those forum because I already have my own trusted system.  

But it's still a good idea to learn what strategies other are using. I stilll believe that some people could potentially develop a great entry strategy but doesn't have other elements in place to make a profitable system. (i.e. exit strategy, position sizing, discipline etc) So yeah, steal their ideas (as long as you are confident in using it) and make them yours.


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## nizar

Temjin said:


> Maybe it's my biases toward these forums, there would be alot more newbies and losing traders than winning traders. If I was a winning trader who have been making profit consistently over the past several years, I would NOT even consider making posts in those forum because I already have my own trusted system.




I don't know why you wouldn't post on forums just because you have a trusted system  

Well Im glad most people don't think of you because Iv learnt immensely from guys like tech/a and Stevo (those that have great systems yet they still care to post on forums and help others). Why do they waste their time? Because they too may learn something 

I believe in continuous improvement in quality of performance (and NO, i don't mean to destroy a decent system by trying to make it perfect), and the ultimate pinnacle in trading is to have several systems with low correlation so you can have confidence in being profitable xx% of performance evaluation periods.

I think one way of continually learning is by talking to others with different experiences and working together with them, and you find such people through posting on forums.



			
				Temjin said:
			
		

> But it's still a good idea to learn what strategies other are using. I stilll believe that some people could potentially develop a great entry strategy but doesn't have other elements in place to make a profitable system. (i.e. exit strategy, position sizing, discipline etc) So yeah, steal their ideas (as long as you are confident in using it) and make them yours.




I know about how a system works, at least the basics of it.
You need an exit(s), and entry and money management to begin with.

I see entry is dismissed by many people and as traders develop it goes from being severely overvalued to severly undervalued, when actually it should be somewhere in the middle and treated as an important part of the system.

Actually the importance of the entry depends on the sort of edge the system is trying to exploit and the timeframe in which it works. 

For those that trade intraday mean reversion systems off 5-minute bars with average trade length of 2 hours, then the entry is paramount especially for those relying on a high win percentage.

For those that trade long term trend following systems, entry is not so important, especially in the stockmarket with an upwards bias, and because of the long average holding time of several months.

I really don't think you should dismiss forums. There are some really smart people around. Even Curtis Faith says this in his YouTube interview.

Have you read this stuff by Acrary?

Maybe even you can learn something 

All the best.


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## >Apocalypto<

Don't know how the system would have faired tonight and over the last few day's

Nizar I really advise you spend a lot of screen time getting to know the pair and what it can do, one trick I use when i place a fx trade is work out both road maps in acouchs words. what i see could happen long and short, regardless of the direction I think it's going to move. 

Nizar what time frame u plan to run your system on? 

Good luck mate

over 150 pips in 4hours on 3 pairs what a way to end the week.  yeh all markets are the same!! whatever! tonight is one of the main reasons I only trade fx now...

Attached find, a one min chart of the EUR/JPY check out those 5 pip ranges....


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## >Apocalypto<

Temjin said:


> Great questions there frink.
> 
> If you referred to my other posts, I am still in the development stages.
> 
> You are right that those are very legitimate risks and I have developed, or rather, have thought of strategies to mitigate them.
> 
> *broker isssues* - This remain one of my biggest risk. I am essentially relying on their uptime and connectivity reliability to execute my system properly. This is mitigated by regularly monitoring of the system, set maximum portfolio risk (no more than 10 positions at once, or no more than 5 long/short, etc) and reduce reliance on trading system's rule to liquidate trade. (i.e. have trailing stop / profit targets already set on broker's server)
> 
> Another major concern is how the broker manage their client's fund. What do they do with the funds? How risky is it? Do they have plans to shield themselve from the current or future credit crisis? etc, etc.
> 
> *lengthy blackouts, internet problems* - This is less of a problem as I will be using a virtual dedicated (or shared as minimum) server hosted by a professional company with connections located near my broker's own routing servers. I will rather pay for the cost for the service of having advanced hardware security, reliable backup power source, minimum internet access downtime and regular data backup than using my own home desktop computer with unreliable power supply and internet. I would be able to access my hired server through remote access from my home computer/laptop.
> 
> *just before a major announcement comes out * - As I will be desiging intraday trading system with no overnight positions, and that the markets I am trading in is highly liquid, major annoucement that produce major price shock should not present a major problem to me. (in theory anyway, who knows what will happen in the future) I would further mitigate it by the same max portfolio heat strategy and having a balance of long/short.
> 
> I am fully aware of the fact that alot of quantitative hedge funds recently had experienced major drawdown when both of their LONG and SHORT positions went against them all at the same time. I don't know if, or how this would happen to me, but the best defense against it would be to limit my positions opened and total % of equity risked.
> 
> That's how I would deal with them. I'm sure most of the more "professional" quantitative hedge funds have better strategies to deal with these.
> 
> 
> 
> Maybe it's my biases toward these forums, there would be alot more newbies and losing traders than winning traders. If I was a winning trader who have been making profit consistently over the past several years, I would NOT even consider making posts in those forum because I already have my own trusted system.
> 
> But it's still a good idea to learn what strategies other are using. I stilll believe that some people could potentially develop a great entry strategy but doesn't have other elements in place to make a profitable system. (i.e. exit strategy, position sizing, discipline etc) So yeah, steal their ideas (as long as you are confident in using it) and make them yours.




Temjin,

maybe if u spent as much time trading as u do posting about it, u may have a perfect system by now..........


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## nizar

Trade_It said:


> Don't know how the system would have faired tonight and over the last few day's
> 
> Nizar I really advise you spend a lot of screen time getting to know the pair and what it can do, one trick I use when i place a fx trade is work out both road maps in acouchs words. what i see could happen long and short, regardless of the direction I think it's going to move.
> 
> Nizar what time frame u plan to run your system on?
> 
> Good luck mate
> 
> over 150 pip's in 4hours on 3 pairs what a way to end the week.  yeh all markets are the same!! whatever! tonight is one of the main reasons I only trade fx now...
> 
> Attached find, a one min chart of the EUR/JPY check out those 5 pip ranges....




Thanks for the chart.
150pips in 4hours, thats nice! 
Keep up the good work.

How long have you traded forex for and which pairs do you trade?

Im not sure about timeframe, like you said, I just need to spend alot of screen time and try to educate myself about this market. Im in no rush so ill spend as long as it takes until i feel comfortable. But im thinking maybe 1minute, or 5minute??

What timeframe do you trade?

Do you trade discretionary or following a (backtested) mechanical system?


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## >Apocalypto<

nizar said:


> Thanks for the chart.
> 150pips in 4hours, thats nice!
> Keep up the good work.
> 
> Hi nizar,
> tonight was a real treat, it was news related.
> 
> How long have you traded forex for and which pairs do you trade?
> 
> Started trading the aud/usd spot last year in September, while trading indexes and shares on cfd's. from November i have been mostly trading fx. 98% I trade: EUR/USD AUD/USD USD/CHF and EUR/JPY on one min but mostly demo trades to pass the time while I wait or am holding a trade.
> 
> 
> Im not sure about timeframe, like you said, I just need to spend alot of screen time and try to educate myself about this market. Im in no rush so ill spend as long as it takes until i feel comfortable. But im thinking maybe 1minute, or 5minute??
> 
> the lower the time frame the faster it moves.Yen crosses are all nuts but they all can move when they want to. get to know one pair and what makes it move. the hard part about news is the market expectation part, last CPI really shows that. you need to plan for the best and worst at the same time. be objective as possible! just cuz we got a rate cut does not mean the usd will drop and the euro will rise against it. example last friday I was long on the eur/usd NFP was coming out. everything was fine i was up all of a sudden the US$ buyers came out big time it slipped then i was 30 pips down very close to stop. this is just after the release. I thought i was toast, then it came back to a 38 pip profit. my point fx can do some wild ****! u have to be aware of that. USD/CHF is another mind bender at times!
> 
> What timeframe do you trade?
> 
> I trade on a 4 hour chart also look at 1 hour to fine tune entry's, I gave scalping a shot on demo on a 5 sec chart. it did my head in so fast it really boggles the mind.
> 
> Do you trade discretionary or following a (backtested) mechanical system?
> 
> I trade a discretionary system i picked up in ForexFactory, Philip Nells 4 hour MACD system with Mclarean teachings. that's all i use for fx.
> 
> I use Metatrader4 with Apari data, but I do all my trades with IG, I am still looking at all the fx brokers. It's a toss up between Efx and IB not sure who yet.




I have read no Fx books yet, if u can trade off a RIO chart u can trade off a aud/usd chart. u just need to learn and understand how the FORex moves and how it moves around certain times of the day/night. that is critical!

One book that has done wonders for me is Emotion free trading by Larry Levin. Best part it was free! if u want a copy let me know it's a ebook I can email it to u.

All the best in FX Nizar, I love it, do your work and u will succeed, just get to know your pair and what makes it tick, what time it's active. 

I will leave it there as it's to late now!


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## wayneL

Trade_It said:


> over 150 pips in 4hours on 3 pairs what a way to end the week.  yeh all markets are the same!! whatever! tonight is one of the main reasons I only trade fx now...
> 
> Attached find, a one min chart of the EUR/JPY check out those 5 pip ranges....




LOL. That's not bad! But Oil gave away up to 500 ticks on Wednesday.  

XXXX/Currency Futs are good, but so are other commods, Nasdaq stocks etc.


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## caribean

I don't know anything about system trading, but i think you might find some inspiration reading about a trader called Malcolm Morley from Victoria.
He has made some posts on the Oanda forums under the name: chaffcombe
Good luck with what you are trying to do.


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## Temjin

nizar said:


> I don't know why you wouldn't post on forums just because you have a trusted system




Well, I guess I don't post on those forums because I really don't have much to add and I don't want to talk about my system just yet. Though I do read them a lot. 



> Well Im glad most people don't think of you because Iv learnt immensely from guys like tech/a and Stevo (those that have great systems yet they still care to post on forums and help others). Why do they waste their time? Because they too may learn something




That's true too, we all did learn a lot from them.



> I believe in continuous improvement in quality of performance (and NO, i don't mean to destroy a decent system by trying to make it perfect), and the ultimate pinnacle in trading is to have several systems with low correlation so you can have confidence in being profitable xx% of performance evaluation periods.
> 
> I think one way of continually learning is by talking to others with different experiences and working together with them, and you find such people through posting on forums.




I believe in continous improvement over everything as well, so you are right. That's why I'm talking with others here about different experiences.  But not necessary the really "technical" parts. (yet)




> I really don't think you should dismiss forums. There are some really smart people around. Even Curtis Faith says this in his YouTube interview.
> 
> Have you read this stuff by Acrary?
> 
> Maybe even you can learn something
> 
> All the best.




Not really dismissing them, I do read them occassionally but am always fully aware of the trap of trying out different systems to get the perfect "setup".

Woo, that's a really long thread, will definitely take some time to read them. Thanks!



			
				Trade_It said:
			
		

> Temjin,
> 
> maybe if u spent as much time trading as u do posting about it, u may have a perfect system by now..........




Hahah Too true there!  It's not easy when I have a full time job and a busy social life that I'm not willing to sacrifice. (yeah yeah excuse!) I would also avoid full on trading until I have the system ready.


----------



## >Apocalypto<

wayneL said:


> LOL. That's not bad! But Oil gave away up to 500 ticks on Wednesday.
> 
> XXXX/Currency Futs are good, but so are other commods, Nasdaq stocks etc.




500 ticks! ok WayneL I think u win this round! 

I agree with u on futures Waynel, I have seen some amazing movement in the grains, that will match FX. Grains is another area that really interests me. but keeping it with Fx for now.

hope u caught a good part of that mate!


----------



## nizar

From what I gather from their website, TradeStation seems to now be a subscription service (not outright like other software) and they seem to offer a strategy design and backtesting platform, historical data, and also execution (acting as a broker) all in one?

Software and intraday data I would have thought are significant costs but these guys just give it away??

Does anybody use Tradestation here and what are your thoughts?


----------



## >Apocalypto<

nizar said:


> From what I gather from their website, TradeStation seems to now be a subscription service (not outright like other software) and they seem to offer a strategy design and backtesting platform, historical data, and also execution (acting as a broker) all in one?
> 
> Software and intraday data I would have thought are significant costs but these guys just give it away??
> 
> Does anybody use Tradestation here and what are your thoughts?




not sure about tradestation NIza,

I use Metatrader4 that has a program function in it, i am sure u can write and create trading programs as well

www.metatrader4.com


----------



## Timmy

nizar said:


> From what I gather from their website, TradeStation seems to now be a subscription service (not outright like other software) and they seem to offer a strategy design and backtesting platform, historical data, and also execution (acting as a broker) all in one?
> 
> Software and intraday data I would have thought are significant costs but these guys just give it away??
> 
> Does anybody use Tradestation here and what are your thoughts?




Hi Nizar - I don't use it but it is one of the most widely used and popular softwares globally.  I gather from your postings you are heavily into system design and testing and systematic trading.  My understanding is TS is ideal for this style of trading.  A lot of futures guys in the states use it, it is a subscription service and if you do a certain number of round-turn trades per month with their brokerage service the software/data costs are waived (I think the number of round-turn trades required is 10 per month - I don't know anything about the quality of their brokerage service).


----------



## nizar

Wow, what do you guys think of this? 



> Brokers can deceive you about there being no commissions. $30 minimum/round turn (called the spread) is in reality a commission that eats up your capital at an astonishing rate. Even winning traders lose money and end up with negative results because of this outlandish overhead. Trading futures, you should never have to pay a broker more than $10/round turn, and usually quite a bit less than that.
> 
> Guaranteed fills. True but… The only way a broker can guarantee fills is for the broker to become the buyer or seller of last resort. That means the broker is running a bucket shop. All forex brokers are the buyer and seller of last resort.
> 
> Brokers do not all tell the truth about volume. They show the volume for all forex trading, which doesn't even come close to the volume they truly have at their own brokerage, which is where you are trading. Volume in currency futures is considerably higher than the volume traded at any single forex broker, often greater by a factor of ten.
> 
> Leaning. Brokers say they are charging you a 3 pip spread to trade the popular currency pairs. But in reality a broker may be making as much or more than 10 pips on your trades. He does this by skewing prices. Since you are not trading at an exchange, the broker can feed you any price he wants to feed you. He can buy at the bank for perhaps 7 pips less than he sells to you. He then charges you 3 pips for the privilege of being ripped off for a total of 10 pips.
> 
> Unregulated. Forex may sound like an exchange but it isn't. It exists entirely in cyberspace with every broker and every bank having different prices for any particular currency. There is little or no regulation, even for brokers who register with the CFTC and the NFA. Forex brokers do not have to mark to market each day as do futures brokers. If your forex broker files for bankruptcy or absconds with your money you have zero recourse.
> 
> No guarantee. If a forex broker does go out of business, you could lose all your money. There are no guarantees and no one standing behind it. Futures brokers are required to mark to market at the end of every session every day. They have to put up cash to cover every open trade on their books. Futures brokers have gone broke, but no futures customer has ever lost one cent of the money in his trading account because of a failed broker. Nor have they had to wait for their money. It is immediately available.
> 
> You can get exactly the same action in the euro fx futures as you get in the "Euro" forex. Commissions are as low as one tenth per round turn depending on volume, through a regulated broker, trading electronically at an exchange where you know the true price of the currency.
> 
> What is the true price? A forex broker can only give you the price of a currency as quoted to him by the bank through which he trades. Banks have differing prices for a currency. You never know what the real price is because there is no central exchange through which all prices flow. Besides not knowing the true price from the bank, you can also be deceived by "leaning" or "skewing" of the real price at the bank. Forex brokers commonly lean the prices.
> 
> Forex brokers are not necessarily truthful. They lure people in with hype and false advertising: "No commissions!" "Guaranteed fills." "24 hour trading:" Who in their right mind is going to trade in the middle of the night unless they have a special need. While it is true that total forex volume is greater than in the futures, futures, volume at the exchange is greater than the volume at your broker for the most popularly traded currencies. The only place where the liquidity differential matters is in currencies like the Mexican peso, the Brazilian real, and somebody's drachma. Those thinly traded currencies may be more liquid in forex. But if you trade anything but the few most liquid and popular currencies, you are going to be paying at least 5 pips, and often more. Unless you have a particular commercial need to deal in Polish zlotys, Indian rupees, or some other thinly traded currency, you don't need forex.
> 
> You are told by forex brokers that there is little or no stop running. This is one of their biggest and boldest fabrications. The truth is there is far more stop running in forex than in futures, and possibly as much stop running as in the stock market. I have friends who work in forex as well as many traders who of necessity have to trade forex. One of my students is a market maker in forex. These are people who should know, but in case you don't want to believe me or them, simple observation of forex trading will reveal the vast amount of stop running that takes place there. Who is it that runs the stops? Why it is your friendly forex broker. The broker has a vested interest in seeing to it that your orders are filled. Stop running is nothing more than order filling. The broker sees to it that everybody's order gets filled.
> 
> Probably you have heard that if you are winning regularly in forex, you may be barred from trading. Is this true? Yes it is. The fact that it is true is just another proof that when you trade forex you are trading at a bucket shop. In the book, "Reminiscences of a Stock Operator," we are told that Jesse Livermore was banned from trading at certain stock brokers because they couldn't stand him beating the house. The same thing is true with many forex brokers. Since they are the ones guaranteeing you a fill, they are in effect the buyer and seller of last resort. The truth is that most forex brokers have precious little liquidity at their firms. In order to give you the impression that there is liquidity, it is the broker who gives you your fill. It is the broker who does the stop running that supposedly doesn't exist in forex. But if you are regularly beating the socks off the broker, he will ban you from trading at his firm.
> 
> Now you know the truth about forex. I challenge any and all forex brokers to prove that I am wrong. I will change or remove anything proven to be untrue in what I stated above.




Taken from here


----------



## Timmy

nizar said:


> Wow, what do you guys think of this?




I'm sure someone will come along to quibble with a minor point or two but essentially it is all true.

The key to understanding retail FX is that it is basically unregulated.  There is no exchange.  FX brokers in Australia are subject to Australian law; so you may have the law to fall back on in a dispute with an Australian broker, so hire yourself a good QC/SC and away you go.  But dealing with an offshore broker (I hear there are many wonderful FX brokers in Eastern Europe and Russia...). well good luck.

So, the most important point is retail FX is unregulated.  It is the Wild West out there.


----------



## Timmy

By the way, doesn't mean you should not trade in it, but have your wits about you and understand the potential pitfalls.  If you do want to deal in speculative FX find a reputable broker with access to good liquidity.


----------



## nizar

Yeh good point about finding an Aussie broker.

Does anybody know an Aussie forex broker that will allow you to autotrade using metatrader 4 platform?

Also, does anybody know any websites where I can look at some Forex charts in any timeframe that i want. Sort of like a bigcharts equivalent?


----------



## ithatheekret

Tried your local Aussie bank ?


----------



## tayser

I'll save you the trouble.

Australia blows for Foreign Exchange.  Full stop.  Unless you're uber cashed up and are able to open an insto level account with Maq bank or some such.

If you're happy with going with a local CFD provider look at Pacific Trader (they white label Saxo bank's platform - it's very nice and fully integrated with CFDs/Equities, get their demo: http://www.pacifictrader.com.au/), IG or CMC.

If you look at international brokers, stick with North American especially if execution is going to be an issue.  Specifically a broker who has a data centre somewhere on the west coast (California etc).  There may be more European brokers (remember FX HQ is London, not New York!) but they're further away from us (as our net is routed via North America to get to Europe) so Swiss brokers (MIG are siwss and are one of the biggest MT4 providers) are likely to have poorer execution performance (MIG I can say from demoing their MT4 platform are very poor, and when you get requoted as you do with market-makers it blows it out even more - keep that in mind) compared with US-based brokers.

Moving money to the US is pretty simple, most brokers will offer AUD account denomination, and the timezones work pretty well... depending on your bank here, usually the close off time for international payments is 6pm (well it is with ANZ who I bank with), so they do their processing and load the batches up and send off around 9pm which in many cases is going to hit the US banks around midnight (9am their time on the day we've just closed), transferring money to Europe can take longer because by 9pm our time it's midday there so you're likely to miss their business open of the same day.

I don't think there are any Australian-based MT4 brokers, and yes MT4 is a nice little package, but just remember that if you decide to use a faster / scalping-like strategy, you're likely to get the ars3 from any MT4 broker as they're all market makers.

And explore different trading styles / strategies and don't make an assessment on them til you've tried them.  I harp on about scalping and how it requires little work - don't take my word for it, explore it all.

I started on the same path as you 6+ months ago and am yet to go fully* live, so you've got a fair bit of work ahead of you 

*I have a real account with oanda (and regret opening it), but it's not going anywhere nor do I intend to take it anywhere!.

cheers.


----------



## Kauri

If you go the Norht Am. route make sure it will see the distance..




> The NFA is raising the minimum requirements to $5m and has suggested that in 2008 it will raise the minimum to $20M
> The president of the NFA in testimony to congress advocated the need to raise MINIMUM capital requirements further to $20m. the transcript can be found on the NFA website. With all the problems with small FX firms going out of business in the past year the NFA has been actively campaigning in congress to clamp down on this issue.


----------



## nizar

Thanks for your post Tayser, i really appreciate it.



tayser said:


> I don't think there are any Australian-based MT4 brokers, and yes MT4 is a nice little package, *but just remember that if you decide to use a faster / scalping-like strategy, you're likely to get the ars3 from any MT4 broker as they're all market makers.*




But what did you mean by this?


----------



## tayser

market-makers take the other end of your trade, and when you scalp you're only in the market for seconds, so the broker doesn't have much time to trade against you - i.e you're going to win more than they do, therefore most market-makers discourage scalping.  

ECN brokers are merely agents for banks and route your orders to them - like a stock broker routes your order to the ASX and as they don't take the other end of your trade (the bank does), the broker doesn't give two shizzles what type of trading strategy you use because they get a commission.  

You invariably pay commissions to ECNs (because they're more a service provider) whereas you pay nothing to market makers (although some do charge commish!) because you pay wider, fixed spreads which have a higher degree of broker intervention (ECN = real banks providing the spreads are a trude ECN also allows you to trade between other people on their network - just like a crossed trade through an ASX broker).

Only market maker that openly allows it is Oanda as far as I know.


----------



## Timmy

Great info Tayser, will you be going down the route of an ECN broker?


----------



## tayser

For execution - yep, starting with EFX - their commissions are among the highest ($50USD per every 100,000USD traded) but it's one of the only options we small traders have.

When account balance permits I'll probably keep EFX open, but also open account somewhere with a broker who offers the Currenex platform (commission ranges a bit some can be as cheap as $25USD per every 1,000,000 traded).  I'm nowhere near this stage so haven't done much research into it, but the same principle applies to equities: when you make it big, you dont just keep all your eggs in one basket.


----------



## nizar

tayser said:


> For execution - yep, starting with EFX - their commissions are among the highest ($50USD per every 100,000USD traded) but it's one of the only options we small traders have.
> 
> When account balance permits I'll probably keep EFX open, but also open account somewhere with a broker who offers the Currenex platform (commission ranges a bit some can be as cheap as $25USD per every 1,000,000 traded).  I'm nowhere near this stage so haven't done much research into it, but the same principle applies to equities: when you make it big, you dont just keep all your eggs in one basket.




Tayser,

What Aussie based ECN brokers are out there?
I tried a google search but didn't find much.

Most forex brokers it seems are market makers.
Im not liking the idea of ECN brokers so far, exuberant fees plus the spread, and no link up to MT4, Hmmm....


----------



## nizar

Has anybody here had experience with Alpari?

Their website seems very professional.



> Regulation
> Alpari (UK) Limited is authorised and regulated by the Financial Services Authority (United Kingdom).
> For more details you may refer to the FSA website, using the following firm reference number: 448002, or firm name: Alpari (UK) Ltd.
> All firms regulated by the FSA are required to meet strict financial standards, including capital adequacy requirements. On a regular basis, firms are required to submit financial reports to the regulator. These standards are enforced by the FSA, which has the right to fine firms and/or terminate a firm's regulatory status for violations.
> 
> Among other things the regulations require that our firm:
> Maintain sufficient liquid capital in excess of the amount required to cover all client deposits, potential fluctuations in the firm’s currency positions and outstanding expenses;
> Does not include any debt outstanding to the firm as part of this capital;
> Undergo scrutinizing annual audit performed by an independent financial auditor. Our annual financial reports are audited by a leading financial auditor in the United Kingdom - Smith & Williamson.
> Furthermore, Alpari (UK) Limited holds all deposits with only highly reputable financial institutions.


----------



## MS+Tradesim

tayser said:


> For execution - yep, starting with EFX - their commissions are among the highest ($50USD per every 100,000USD traded) but it's one of the only options we small traders have.




Tayser,

EFX is US$5 per US$100,000. You have $50 there.

http://www.efxgroup.com/commissions.php


----------



## tayser

doh sorry 

nizar: see my earlier comment about Australia sucking when it comes to FX


----------



## Flying Fish

great thread


----------



## Timmy

MS+Tradesim said:


> Tayser,
> 
> EFX is US$5 per US$100,000. You have $50 there.
> 
> http://www.efxgroup.com/commissions.php




Tayser - I will join in those thanking you for the great information, it is really helpful to anyone wanting to trade FX.  

And thanks for nearly sending me falling off my chair when i saw $50 / $100,000 - dirty rotten scoundrels I thought, they should be Australian CFD brokers with prices like that!


----------



## nizar

Timmy said:


> Tayser - I will join in those thanking you for the great information, it is really helpful to anyone wanting to trade FX.
> 
> And thanks for nearly sending me falling off my chair when i saw $50 / $100,000 - dirty rotten scoundrels I thought, they should be Australian CFD brokers with prices like that!




Haha, yeh i thought the same thing.

Tayser, now I see what you were saying with the scalping and how market makers hate it. Was having a geez at some other forums, and yeh apparently they could place you on manual execution if they disagree with your trading style, so much so that your profitable strategy becomes unprofitable  

And thanks for all the great info brother, its appreciated.


----------



## nizar

nizar said:


> Also, does anybody know any websites where I can look at some Forex charts in any timeframe that i want. Sort of like a bigcharts equivalent?




Any suggestions guys?


----------



## prawn_86

Oanda perhaps??


----------



## tayser

nizar said:


> Any suggestions guys?




NinjaTrader 6.5 using EFX's data will do.  I only just got myself setup with Ninja after reading about another scalper on LinuxTRolls forum.

www.ninjatrader.com

just get the free licensed version.  Make sure you download the 6.5 beta.  Download EFX's latest Navigator (sign up for their demo then follow the links to download the software). www.efxgroup.com







^ ninja chart.

Syafi - a member on the Cyrox (LinuxTroll) forum shows you how to set it up here: http://www.cyrox.com/forum/index.php?topic=8.0

The best thing about Metatrader is the amount of free systems people have out there that you can grab yourself and play with - I still dabble with one (Trend Follower) - I just execute the trades on EFX's demo rather than in the MT4 interface.  I still have MT4 up and running in the background when scalping too.


----------



## Timmy

nizar said:


> Also, does anybody know any websites where I can look at some Forex charts in any timeframe that i want. Sort of like a bigcharts equivalent?




Try this : http://www.dailyfx.com/charts/

choice of 5 different live charts


----------



## >Apocalypto<

nizar said:


> Any suggestions guys?




this is the best of the best Nizar

http://www.netdania.com/ChartApplet.asp


----------



## MS+Tradesim

OK, here's an ECN who charge US$3 per US$100,000 lot. They also allow you to put in your own bid/ask, in other words you don't have to take what's offered! One downside is minimum deal size of 100,000 units of base currency so no use for mini traders.

http://eu.hotspotfx.com/why-hotspot-fx/what-is-ecn/
http://eu.hotspotfx.com/trading-fx/trading-terms/

Limited to 21 pairs currently:
http://eu.hotspotfx.com/trading-fx/currencies/

However, can be funded in AUD:
http://eu.hotspotfx.com/open-an-account/funding-an-account/

Looking good. Anyone have experience with them?


----------



## pangea

Hi,
I am starting out in FOREX and looking for a good system. Can anyone recommend a good trading platform and tipping service for AUD-based account?

Thanks,
Pangea


----------



## nizar

MS+Tradesim said:


> OK, here's an ECN who charge US$3 per US$100,000 lot. They also allow you to put in your own bid/ask, in other words you don't have to take what's offered! One downside is minimum deal size of 100,000 units of base currency so no use for mini traders.
> 
> http://eu.hotspotfx.com/why-hotspot-fx/what-is-ecn/
> http://eu.hotspotfx.com/trading-fx/trading-terms/
> 
> Limited to 21 pairs currently:
> http://eu.hotspotfx.com/trading-fx/currencies/
> 
> However, can be funded in AUD:
> http://eu.hotspotfx.com/open-an-account/funding-an-account/
> 
> Looking good. Anyone have experience with them?




Form their website it looks the goods, but i wonder how their spreads are.


----------



## MS+Tradesim

Spreads are great, I've seen them as low as 0.5 a pip. And as I pointed out....you can offer your own bid/ask! You don't have to accept what's on offer. You can put a bid/ask *inside* the quoted spread. Why? Because you are dealing directly into the real currency market instead of being shafted by a MM.

Their platform is really basic, but I don't care. I'll only need it for quotes and execution. Analysis will be done elsewhere.


----------



## nizar

MS+Tradesim said:


> One downside is minimum deal size of 100,000 units of base currency so no use for mini traders.




Just one question about this.
If i buy a standard lot of AUD/USD at say 0.8600, that will cost me AU$86,000, and 1 pip is worth US$10.

Is this correct?

If so, if i buy a standard lot of GBP/JPY at say 225.00, that will cost me 225,000 pounds?? and 1 pip is worth 10 yen??

Surely that cant be right??
Or??

(Im a very much beginner in this market, so please be easy on me)


----------



## tayser

You need your account's equivalent of the currency on the left hand side of the pair you're trading and your profit will be in the currency on the right hand side of the pair.

100,000 GBP/USD @ 1.9925 = 100,000 Sterling buys 199,250 Greenback

So if you're denominated in AUD, you need:

GBP/AUD = 2.3199

231,990 AUD to buy 100,000 GBP/USD

yep, 1 pip will be $10USD

so if you make 10 pips, your profit will be:

AUD/USD = 0.8588 (1/.8588 = 1.1644)
$100 USD * 1.1644 = *116.44AUD*.


----------



## disarray

they build the leveraging into the transaction. so you place an order for 100,000 units and you front $3000 or so then make $10 / pip but you are exposed to a higher amount (depending on leveraging). start an oanda fx game to get the feel of it.

a picture is worth a thousand words so ......


----------



## nizar

Thanks disarray and Tayser.
But could you please answer the question in my previous post more directly?

Isnt 10yen useless? lol.

Would this be a reason this pair isnt popular to trade with AUD?


----------



## tayser

The value of the pip (therefore your profit/loss) is always in currency on the right hand side of the pair - therefore, if it's not AUD, you have to run it through that currency's AUD exchange rate to get back into your account denomination (if you're denominated in AUD).

for Yen crosses (most popular scalping pairs) let's compare:

10 pips on AUD/JPY (97.10) and GBP/JPY (225.15)  

_your margin requirement is in italics & (brackets)_

*AUD/JPY*

AUD/JPY 97.10

*Using 1:100 leverage with AUD account denomination*

BUY 100,000 _(1000)_ aussie* 97.10 = 9,710,000 yen

Value of position when 10 pips in profit (when you exit by doing the opposite order: sell): 

SELL 100,000 _(1000)_ aussie * 97.20 = 9,7*2*0,000 yen

1 pip = ¥1000 or ¥10,000 profit

10 pips profit = ¥10,000 * (1/97.10) = $102*AUD*


*GBP/JPY*

GBP/JPY = 225.15
GBP/AUD = 2.3199
AUD/JPY = 97.10

*Using 1:100 leverage with AUD account denomination*

_100,000 sterling = 231,990 / 100 = *$2319.90AUD* _

BUY 100,000 _(2319.90)_ sterling * 225.15 = 22,515,000 yen.

Value of position when 10 pips in profit (when you exit by doing the opposite order: sell): 

SELL 100,000 _(2319.90*)_ sterling * 225.25 = 22,5*2*5,000

1 pip = ¥1,000 or ¥10,000 profit

10 pips profit = ¥10,000 * (1/97.10) = $102*AUD*

_*remember the GBP/AUD will move whilst you're in a GBP/JPY position so your margin requirements for GBP/JPY may rise/fall as the GBP/AUD exchange rate moves_

So with the two examples you come up with the same amount of profit - except when you trade GBP/JPY you're required to have 2.3 times the margin requirement (because to buy Sterling with Aussie - which the broker will do the transaction internally - you need 2.32 dollars to buy one pound which in turn is then use to buy 225.15 yen (multiply by the lot size: 100,000))

But this doesn't mean you should trade AUD/JPY instead of GBP/JPY - you next have to compare liquidity and volatility (how much it will move)... and sterling/yen moves like no tomorrow.


----------



## nizar

tayser said:


> and sterling/yen moves like no tomorrow.




Tend to agree.
GBP/USD moves a fair bit as well.

Thanks for the example, i think i understand it now.


----------



## MS+Tradesim

I sent an email to Hotspot, the ECN I linked to earlier. I specifically asked about any extra fees for data or API integration etc and the guy said only fee is the trading comm.

They can feed data into Metastock and have a program so buy/sell signals in Metastock can initiate trades automatically. They also have a test environment.

My objectives now....

1) Buy Metastock Pro (has the advantage of also being usable for intraday stock trading analysis - means I have no program development learning curve as I already use MS EOD)
2) Hook in to datafeed.
3) Develop back-tested strategy using Tradesim
4) Demo live trade
5) refine
6) Live trade small
7) refine
8) Live trade big
9) repeat 3-8

BTW, Tayser thanks for your response to nizar. I found it helpful too.

It would be great to do this openly like tech/a did with his system development.


----------



## tayser

Just with your overall strategy above, be careful when you start 'live trading small' - different ECNs have different levels of liquidity and if liquidity is poor you'll possibly find that when you start trading small lots (i.e minis: note I haven't done much research into HotSpot so don't know what they offer) you won't get filled as fast compared to if you were trading a few standard lots.

I'm just downloading their platform and it's taking ages - not a good sign when execution is one of my paramount concerns.  It's being downloaded from Europe.

cheers.


----------



## nizar

MS+Tradesim said:


> They can feed data into Metastock and have a program so buy/sell signals in Metastock can initiate trades automatically.




Are you sure you can autotrade through MS?
I thought only MT4 or TradeStation can do this?

And do you know where you can get intraday forex data?

Anyway, keep us posted on your progress.


----------



## tayser

Most MT4 broker's demos' data will go back a fair way (just looking at the MT4 demo I have: AUDJPY goes back as far as 1983 - when we floated!) - and when markets are open you'll be able to get down to 1 minute charts.  It will suffice while you're still learning.


----------



## nizar

Does anybody know of an ECN which offers Mt4 ?


----------



## tayser

MT4 is a market-making/deal-desk platform.

FF's EFX thread: http://www.forexfactory.com/showthread.php?t=10002  Jlebang is a customer management rep so he's obviously got a vested interest in spruiking his brokerage, but throughout the thread he discusses these types of questions - if you read the thread from beginning to end you'll pick up on an ECN + MT4 discussion.


----------



## ithatheekret

And which forex sites were in hybernation , on the 25Th when Tokyo was open , seeing new set ups in the charts  ?

Many were closed and your postions unless hedged , could have suffer major damage .

The market session times are extremely important , as each international opening , has a direct impact on certain currencies and the crosses related to it .

For a market maker , I take my hat off to OANDA , they are there everyday !

The pips spread variations and the minor slippages are something one would have to put up with , with the multiple market convenience being the benefit outweighing .

Are there any other operators known by members that allow all markets participation , especially in the end of year slowdown , where thin markets are more volatile . ?


----------



## nizar

tayser said:


> MT4 is a market-making/deal-desk platform.
> 
> FF's EFX thread: http://www.forexfactory.com/showthread.php?t=10002  Jlebang is a customer management rep so he's obviously got a vested interest in spruiking his brokerage, but throughout the thread he discusses these types of questions - if you read the thread from beginning to end you'll pick up on an ECN + MT4 discussion.




Im working my way through that thread slowly.

Just got a question for you, what is the ECN equivalent of MT4?
What Im specifically looking for is fully automated trading.
How do ECNs offer this?

Iv heard the term API get used? What exactly does this mean and how does it work?

Thanks.


----------



## MS+Tradesim

Nizar,

I'm still in software research phase as my original idea of MSPro and Tradesim got panned. Tradesim won't handle timeframes smaller than 1day.

Metastock Pro can handle realtime forex and using an API middleman like Tradebullet of Ninjatrader etc, to connect to an ECN like Hotspot (they've confirmed they have their own middle-party plugin) can be setup to be fully automated but backtesting is limited to its inbuilt tester which as you would know is dodgy at best.

Tradestation (which is not cheap for us forex beginners) can handle real-time stocks and forex, and strategies can be automated through either their sponsored brokers or through your choice of broker (but you pay a higher monthly fee for platform access). Tradestation can backtest and optimise over one instrument at a time but I can't see that it can do true portfolio testing like Tradesim, which as a systems trader I consider essential.

I've just been talking to Jose Silva and he thinks Amibroker might do the trick for backtesting. I've downloaded the Amibroker trial and several years of free EOD forex data and I'll let you know if it does the trick....but I have to learn its development language first. Don't know if this will ultimately be able to be automated but I now have reservations about fully automating a strategy UNLESS I am prepared to sit there while it trades. There are just too many things that can go wrong along the production chain to feel confident about turning it on and going to bed.

EDIT: Hotspot confirmed their real-time data-feed will plug into MS Pro and automated strategies can be developed within their test environment before going live.


----------



## Timmy

MS+Tradesim and Nizar - just following along your conversation here re system testing etc; would Wealthlab do the trick for what you want?  I have no experience with it but know a few FX systems-type traders who use it.


----------



## julius

nizar,

The API allows two programs to interface with one another - this can facilitate a data feed, order execution, etc.

Generally there are a number of different broker API plug-ins to accommodate different ( trading ) platforms - IB has one for Excel , Amibroker, C++.

I've played around with them a bit but gave up on accounting for all the possible contingencies - not really where I'm at atm but happy to help where I can.

Howard B and Kaveman (sp?) prob know much more.


----------



## nizar

MS+TradeSim,

Looks like we are both on the same road here.

I spoke to David some time ago about TradeSim and intraday testing and he told me the same thing. TradeSim cannot handle the timestamp on periodicities smaller the daily.

TradeStation with forex i dont mind one currency pair testing at a time, as its much less of a hassle than 1 stock! But from what Iv heard, i just cant see myself trading with these market maker types. I would only go ECN. The thing is, it seems that at the moment its only through the market makers where you can do fully automated trading through MT4.

Im sure the ECN brokers will offer some sort of equivalent to facilitate automated trading in the near future. This type of trading is still very much in its infancy going by what Iv heard and read.

AmiBroker the features and speed I heard is excellent, but its the lack of monte carlo analysis which is a let down as the integration with TradeSim is far from seamless. But it can be done -- Im sure Stevo would be happy to help here. As for the programming, for me to learn a complex language with no programming background would be tough. I would rather pay a programmer to do it (try Grahame/Kaveman)

I have talked to somebody who has a wide array of software at his disposal and he told me for intraday -- Wealthlab or Amibroker are the best.

But this was when I was looking at intraday CFDs and before I had considered forex. Still applicable I suppose.

Julius, thanks for your post. I appreciate it.


----------



## nizar

tayser said:


> if you read the thread from beginning to end you'll pick up on an ECN + MT4 discussion.




Finally got to this point, page 52 of that thread!



> You asked; “Which automatic trading software can work with your platform?”
> 
> I’m sure we work with many I don’t even know about, but here is a few I do know of for certain;
> NeoTicker – www.neoticker.com
> TradeBullet – www.tradebullet.com


----------



## LetItRide

Hey All!!!!


Well I haven't been on this site in ages since I converted to forex but it's exciting to see some of the traders here showing an interest. 

I'm far from an experienced trader but I would like to suggest to anyone who is seriously interested in parting with their money in the forex game please do your research. It's a highly unregulated market and unless you're willing to put in the hours to understand the market's structure you might as well be gambling. 

Also this is a business so treat it like one. Think of things like;

*Capital - Would you start a business with a couple of hundred bucks?

*Money management - How many % are you going to risk on each trade?
                             - Have you got enough capital to withstand a string of    losses?(Even with the old coin flip of 50% probability, there's a definite possibility of 10 heads or tails in row)

*Realistic Goals- Making 5%-10% is month is realistic while 100-200% a month isn't.

*Risk- What's your risk tolerance? 

*Plan- Would you go into business without a plan? (Think of things like, what happens after you enter a trade and price goes up? down? or sideways?


When looking for a system make sure you find one that works for you personally, not one that's been hand fed to you by a friend or a trading guru. 
I'm a swing trader who likes to keep an ear to the ground listening  to the fundamentals but thats my personal choice and what I'm comfortable with. 

There's no holy grail to trading but being disciplined and well planned will certainly put you in the right direction of reaching your goals.

Ok I could go on and on but hopefully you get the picture

good luck and happy trading

p.s. here's a link of some articles which you may find helpful

http://www.forexfactory.com/showthread.php?t=39892


----------



## nizar

LetItRide said:


> *Realistic Goals- *Making 5%-10% is month is realistic *while 100-200% a month isn't.




Making 5-10% per month is realistic?  
You must be a bloody champion 
Keep up the good work brother.


----------



## professor_frink

nizar said:


> Making 5-10% per month is realistic?
> You must be a bloody champion
> Keep up the good work brother.




It's not that unreasonable for intraday trading, depending on the leverage used.



nizar said:


> I have talked to somebody who has a wide array of software at his disposal and he told me for intraday -- Wealthlab or Amibroker are the best.




Ninja trader could be another option for you to look at too.


----------



## tayser

100% per month is not unrealistic if you scalp.

With EFX 60 pips gross per week (10 pips net a day) on AUD/JPY @ 80-100% account balance utilisation will easily give you 100% return in a month (in fact about 200%).

Remember a swing trader works with much slower timeframes and will have stops as wide as the Tasman, whereas a scalper works with incredibly fast timeframes (tick or under 30 seconds) and has (mental) stops only a few pips above/below where they entered and a disaster recovery stop set about 20 pips away from where they got in.  You minimise risk further when scalping by  only being in the market for seconds when scalping, not minutes/hours when you employ a swing trading strategy and focus on more conventional risk / money management techniques like the 2% rule & trailing stops etc etc.

You need to distinguish between trading styles/strategies when looking at ROI and with scalping you practice til you can't practice anymore on getting ten pips net consistently then you let compounding take over.

examples:

AUD/JPY 1:100 (acc denomination is AUD, lots are naturally in AUD)

Balance start of week, Week #, Lot size, Account balance utilisation (for single trade/scalp).
$500 	Week 1	40000	80%
$720 	Week 2	57600	80%
$1,037 	Week 3	82800	80%
$1,492 	Week 4	119280	80%

...snip...

$56,980 	Week 14	4550400	80%
$82,012 	Week 15	6549440	80%
$118,041 	Week 16	9443280	80%
$169,990 	Week 17	13599200	80%

I'll attach an updated pip plan when I get home (see the LinuxTroll thread for an older version).


----------



## MS+Tradesim

Well, I've decided I'm going to focus on the linuxtroll method from Tayser's thread for the time being and take my time setting up a longer term system. If my stock systems are anything to go by it'll take probably 6mths for me to build a decent longer-term strategy anyway. So after new year I'm going to spend about a month on a pair or two just scalping in a demo and see how it goes.


----------



## tayser

you need a solid 2 months of 2-3 hours (no more) per day screentime recognising patterns and then a good 2-3 months of profitably trading in a demo before committing real money when scalping too.


----------



## MS+Tradesim

Alright. I agree.

Do you use multiple screens? In equities I'm longer term and thus accurate execution is not paramount. However, I have oanda and hotspot open in front of me, each taking up half the screen and it just doesn't work for me on such tight timeframes with execution being, IMO,  so important.


----------



## Timmy

MS+Tradesim said:


> Alright. I agree.
> 
> Do you use multiple screens? In equities I'm longer term and thus accurate execution is not paramount. However, I have oanda and hotspot open in front of me, each taking up half the screen and it just doesn't work for me on such tight timeframes with execution being, IMO,  so important.




MS+TS, good thread from SevenFX on setting up multiple screens:
How to Run Multiple Monitors....


----------



## tayser

MS+Tradesim said:


> Alright. I agree.
> 
> Do you use multiple screens? In equities I'm longer term and thus accurate execution is not paramount. However, I have oanda and hotspot open in front of me, each taking up half the screen and it just doesn't work for me on such tight timeframes with execution being, IMO,  so important.




I only have a single 22" Widescreen at the moment - I want to get another one.

But realistically all you need is one if the platform your executing on can have its panels docked (never used hotspot).  I just have my chart in the background with the platform's panels around the edge.

I only want the other screen so I can do other stuff!


----------



## nizar

professor_frink said:


> It's not that unreasonable for intraday trading, depending on the leverage used.
> 
> Ninja trader could be another option for you to look at too.




Thanks Prof.
I think NeoTicker is right up my alley as well.

Anybody here have any experience with NeoTicker?


----------



## ithatheekret

tayser said:


> I only have a single 22" Widescreen at the moment - I want to get another one.
> 
> But realistically all you need is one if the platform your executing on can have its panels docked (never used hotspot).  I just have my chart in the background with the platform's panels around the edge.
> 
> I only want the other screen so I can do other stuff!




I trade off the charts [directly] most of the time , takes a little getting use to , but one click is also good , on a back platform . My page is the chart , the rest of the platfrom is really just for renavigating and hedging etc.

The only time I have had difficulty in this style , is when I start trading off a chart I've done workings on and my workings gets in the way .

You should see it when one needs to get in sync , I'll have 4 charts up on one screen and sometimes charts on a second , but the CPU makes a blinking racket when we push that pedal .


----------



## nizar

Excuse the amateur question, but How exactly do you short pairs?

I understand that if you buy USD/JPY for example you are "selling" yen, but how do you short pairs and try to profit off downtrends?

Thanks guys.


----------



## LetItRide

nizar said:


> Excuse the amateur question, but How exactly do you short pairs?
> 
> I understand that if you buy USD/JPY for example you are "selling" yen, but how do you short pairs and try to profit off downtrends?
> 
> Thanks guys.





Each currency pair has one currency pegged against another. So in your example of the USD/JPY pair, when looking at a chart you are seeing the US dollar pegged against the JPY. Therefore if there is an uptrend and you see an entry you would buy the US/JPY pair speculating the US dollar will rise against the yen. It's the same when shorting, if the US/JPY pair is in a downtrend on your chart and you see an entry you would then sell the pair speculating the US dollar is going to weaken against the Yen.

Hope that helps(and makes sense hehe).


----------



## nizar

LetItRide said:


> Each currency pair has one currency pegged against another. So in your example of the USD/JPY pair, when looking at a chart you are seeing the US dollar pegged against the JPY. Therefore if there is an uptrend and you see an entry you would buy the US/JPY pair speculating the US dollar will rise against the yen. It's the same when shorting, if the US/JPY pair is in a downtrend on your chart and you see an entry you would then sell the pair speculating the US dollar is going to weaken against the Yen.
> 
> Hope that helps(and makes sense hehe).




Oh so selling is as easy as buying.
Thanks for that.


----------



## tayser

When you buy AUDUSD, you are holding AUD.  When you sell AUDUSD, you are holding USD.

When you buy EURJPY, you are holding EUR.  When you sell EURJPY, you are holding JPY.


----------



## nizar

Tayser,

Using EFX, what are the usual spreads on the 4 major spreads?
Is it closer to 1 pip or 2 pips ?

Total round cost for a position would be 5 pips or 3 pips?


----------



## tayser

The contents of my own FX board:










We've actually got really good liquidity tonight (well compared to the past month). 

From European open, usually:

AUDJPY 2-3
EURJPY 1-2
GBPJPY 3-4
EURUSD usually spends the whole day at 1
GBPUSD 1-2
AUDUSD 1-2
USDCAD 2-3 (better after NY open naturally)

roundtrip commission on AUDJPY (only pair I reguarly scalp) is 1 pip (actually less than a pip when the rate is less than 100 yen like now).


----------



## nizar

tayser said:


> The contents of my own FX board:
> 
> 
> 
> 
> 
> 
> 
> 
> 
> We've actually got really good liquidity tonight (well compared to the past month).
> 
> From European open, usually:
> 
> AUDJPY 2-3
> EURJPY 1-2
> GBPJPY 3-4
> EURUSD usually spends the whole day at 1
> GBPUSD 1-2
> AUDUSD 1-2
> USDCAD 2-3 (better after NY open naturally)
> 
> roundtrip commission on AUDJPY (only pair I reguarly scalp) is 1 pip (actually less than a pip when the rate is less than 100 yen like now).




Thanks Tayser.

Yeh the past few weeks has been holiday season, that may explain it.


----------



## nizar

GBP/JPY is such a beast...  
The range is so massive.
If only those spreads could get down a bit lower...


----------



## tayser

Spread is less of a concern on GBP/JPY because as you just highlighted it moves all over the place.

Capture 20 pips on it for the day and you're done for the day...


----------



## KamiCrazy

Alright, first time posting in these forums, so here we go...

This thread seems the place to be for forex newbs so this is what I have learnt over the last month of research. I'm sharing it so that if I have anything incorrect hopefully someone will correct me!

*Brokers*

In the retail forex sector (low cap traders) there are only two kinds of brokers, bucketshops and ECNs. ECNs are better. Period.
There are only 3-4 retail ECN brokers around, IB, hotspot and MBT/EFX (they are  the same company).

I didn't look into hotspot, not interested in them as they do not do mini's.
IB has a $10k USD opening balance requirement (unless you are under 21, then its $3k). As I do not have close to that amount of money I couldn't use them but I would prefer them for data reasons (everyone's program seems to be able to hook into their datafeed). 
MBT/EFX has a small opening balance requirement and allows you to trade in mini's. They are pretty much the broker of choice for poor bastards like me. Only problem I have is that there aren't many good programs which can hook into their data and they don't supply backfill either. 

*Datafeeds*

Once I was done looking for a broker I went and looked at datafeeds. I'm a long time user of Metastock EOD for trading ASX. So I searched for compatible feeds for Metastock Pro. The more I looked the more I realised this slight conundrum.

You either have two choices. Use a 3rd party datafeed or use your brokers datafeed.
There are many quirks which go along with either choice. The first one I realised is that if you choose the 3rd party feed it isn't going to match your brokers feed. What your broker says is happening in the forex market is not neccessarily what is happening on your 3rd party feed. This is a real problem as these differences large and small can have a bad impact on your trading.
Choosing your brokers datafeed can leave you with insufficient data. Basically MBT doesn't provide backfill, so even though I have intraday data with them and there is no issue of not having the "correct" data, having no backfill well sucks.
Choosing your brokers datafeed can also limit the programs you can use. Unless of course your broker is IB, which practically everyone hooks into (big reason to use IB!).
At the moment I am using MBT's datafeed with backfill provided by tickquest (through FXCM).

*Charting/backtesting/automation*

When it comes to intraday forex data, there isn't much choice for metastock pro, so I decided that I basically had to drop it for another charting program. This was the longest part of my quest to get started and I am still treading this. I have been through a lot of product websites, read heaps of user comments on products and tried to ascertain which product would suit me. I've only investigated charting at the moment. I haven't even begun on which backtesting app will suit. Although I have automation largely figured out with tradebullet.

On the charting side I'm comparing 3 products atm.
Amibroker, I would probably like to settle on this, but I am having issues with datafeed as it does not hook into MBT's feed at the moment. The current plan if I go with amibroker is to subscribe to dtniqfeed and just put up with any tick differences.
Neoticker, I am currently demoing this. It hooks into MBT fine and backfill is provided by their own backfill server (which gets its data from FXCM). Integration with MBT is really good as well. I don't really like neotickers interface however and its charting doesn't seem to be up to scratch.
Sierracharts. Again needs to hook into dtniqfeed. Relatively inexpensive charting program, haven't tried it out yet but I want to.

Thats all I have figured out atm.


----------



## tayser

ahhhh you and I have headed down the same path 

Chart backfill isn't really a big issue for me, I only need a general look at the market so I just have a standard MT4 demo up and running on a M1 chart before I start for the day.

Be careful with EFX & Minis - on their thread on forexfactory, they said they can't guarantee fills for orders < 10,000.  i.e if you order under 10,000 or a number like 134,567, you could be waiting a while for a fill!  Justin LeBang (rep on FF) did say that you shouldn't have problems with multiples of 10,000 (which is a mini contract, however some people were trying to go even lower).


----------



## KamiCrazy

I never planned to trade in strange lot sizes.

10k is 1 lot at EFX and on their leverage of 100:1 it seems to be the perfect lot size to me. I think that sort of risk is acceptable.

Have you given neoticker a spin yet? Their backfill for MBT is very good.

I'm also looking at openquant as well. However I need a decent charting package to go along with it if I decide to go down the openquant path. Finding it difficult to find a clean looking charting package which works with forex as well.


----------



## >Apocalypto<

KamiCrazy said:


> I never planned to trade in strange lot sizes.
> 
> 10k is 1 lot at EFX and on their leverage of 100:1 it seems to be the perfect lot size to me. I think that sort of risk is acceptable.
> 
> Have you given neoticker a spin yet? Their backfill for MBT is very good.
> 
> I'm also looking at openquant as well. However I need a decent charting package to go along with it if I decide to go down the openquant path. Finding it difficult to find a clean looking charting package which works with forex as well.




if you are trading single lot sizes with EFX 10 000$ don't get upset if on some occasions your order sits there waiting for a little while. you have to think that how many players in the interbank market are buying/selling minis!

Tayser,

have u seen this happen?


----------



## tayser

Not in their demo.  I'm yet to go live (still no word on AUD accounts?).


----------



## KamiCrazy

I spent earlier today playing with amibroker again to get a feel for how it works in a forex environment. There are a lot of settings which need to be customised for it.
Been playing around with it mostly on my laptop but when I went home and tried it on my desktop (1920x1200 res). I don't like its window management on such a bigger screen.

Tonight tried out neoticker again. Its interface is seriously not intuitive but there are a lot of nice forex stuff that it does (the forex board is primo). And its window management being everything is undocked suits bigger/multiscreens more.
However all comments I've read about it being sluggish has been true, its definitely not a snappy program. Its almost starting to annoy me greatly.


----------



## nizar

KamiCrazy said:


> Alright, first time posting in these forums, so here we go...
> 
> This thread seems the place to be for forex newbs so this is what I have learnt over the last month of research. I'm sharing it so that if I have anything incorrect hopefully someone will correct me!
> 
> *Brokers*
> 
> In the retail forex sector (low cap traders) there are only two kinds of brokers, bucketshops and ECNs. ECNs are better. Period.
> There are only 3-4 retail ECN brokers around, IB, hotspot and MBT/EFX (they are  the same company).
> 
> I didn't look into hotspot, not interested in them as they do not do mini's.
> IB has a $10k USD opening balance requirement (unless you are under 21, then its $3k). As I do not have close to that amount of money I couldn't use them but I would prefer them for data reasons (everyone's program seems to be able to hook into their datafeed).
> MBT/EFX has a small opening balance requirement and allows you to trade in mini's. They are pretty much the broker of choice for poor bastards like me. Only problem I have is that there aren't many good programs which can hook into their data and they don't supply backfill either.
> 
> *Datafeeds*
> 
> Once I was done looking for a broker I went and looked at datafeeds. I'm a long time user of Metastock EOD for trading ASX. So I searched for compatible feeds for Metastock Pro. The more I looked the more I realised this slight conundrum.
> 
> You either have two choices. Use a 3rd party datafeed or use your brokers datafeed.
> There are many quirks which go along with either choice. The first one I realised is that if you choose the 3rd party feed it isn't going to match your brokers feed. What your broker says is happening in the forex market is not neccessarily what is happening on your 3rd party feed. This is a real problem as these differences large and small can have a bad impact on your trading.
> Choosing your brokers datafeed can leave you with insufficient data. Basically MBT doesn't provide backfill, so even though I have intraday data with them and there is no issue of not having the "correct" data, having no backfill well sucks.
> Choosing your brokers datafeed can also limit the programs you can use. Unless of course your broker is IB, which practically everyone hooks into (big reason to use IB!).
> At the moment I am using MBT's datafeed with backfill provided by tickquest (through FXCM).
> 
> *Charting/backtesting/automation*
> 
> When it comes to intraday forex data, there isn't much choice for metastock pro, so I decided that I basically had to drop it for another charting program. This was the longest part of my quest to get started and I am still treading this. I have been through a lot of product websites, read heaps of user comments on products and tried to ascertain which product would suit me. I've only investigated charting at the moment. I haven't even begun on which backtesting app will suit. Although I have automation largely figured out with tradebullet.
> 
> On the charting side I'm comparing 3 products atm.
> Amibroker, I would probably like to settle on this, but I am having issues with datafeed as it does not hook into MBT's feed at the moment. The current plan if I go with amibroker is to subscribe to dtniqfeed and just put up with any tick differences.
> Neoticker, I am currently demoing this. It hooks into MBT fine and backfill is provided by their own backfill server (which gets its data from FXCM). Integration with MBT is really good as well. I don't really like neotickers interface however and its charting doesn't seem to be up to scratch.
> Sierracharts. Again needs to hook into dtniqfeed. Relatively inexpensive charting program, haven't tried it out yet but I want to.
> 
> Thats all I have figured out atm.




Great post brother.
Welcome to the thread.
I've only just started looking at forex as well.

I have been looking at neoticker and I appreciate your feedback. It seems to be exactly what I need.
Im looking towards automated trading and Neoticker/EFX seems to be a good way of doing it. The neoticker forum has alot of discussion about this.

Openquant Ive heard is mostly designed for hardcore programmers, whilst neoticker is more trader friendly. That said, openquant can do some things that neoticker cannot.

What does backfill mean exactly?
It it like very recent data?

Where do you get like a few months of intraday data for neoticker?

Thanks.


----------



## MS+Tradesim

So I've now got eSignal real-time data plugged into Metastock Pro. Anyone else doing this as I've got questions??

EDIT: Nope, doesn't matter anymore - I've figured it out.


----------



## nizar

Im just wondering, what does scalping actually mean?
Is it short holding time or small profits or both?

If I have a system that trade using 5-minute bars, with average nett profit per trade of 3pips (after spread and commission), and average holding time of 20-minutes, am I scalping?
Or am I trading intraday?


----------



## tayser

yes, you're scalping - you're only looking for small gains on short timeframes - you're not waiting and looking for a big move which will net you 50+ pips etc.

Scalping is far more effective at faster timeframes however... i.e tick charts or 5sec (Oanda offers 5 sec).  In saying that, if you've caught a big move - why would you get out? why wouldn't you stay in for 50 pips?  

It's more a mindset - i.e. I only want this much and I only want to do it in this amount of time, whereas swing trading is I'm happy to wait for this much and I'll sit here all day if I need to. etc

A lot can happen in 5 minutes!  Look at faster timeframes for entry/exit and confirm it with slower timeframes.


----------



## nizar

tayser said:


> yes, you're scalping - you're only looking for small gains on short timeframes - you're not waiting and looking for a big move which will net you 50+ pips etc.
> 
> Scalping is far more effective at faster timeframes however... i.e tick charts or 5sec (Oanda offers 5 sec).  In saying that, if you've caught a big move - why would you get out? why wouldn't you stay in for 50 pips?




Because of the trailing stop (which trails very close to the price action), Some of the winners in my testing so far have netted me 50 pips or even more. I get maybe 1-2 of these everyday.

In fact about 20% of all trades make a nett profit of more than 20 pips.

But its the losses which bring down the average. Heaps of losses around the 5 pip mark. Hit rate is still about 50%.

So far the testing has been positive, the system does between 50-80 trades per day, with a nett of profit of 3 pips per trade, thats 150-200 pips per day.

The discretionary backtesting I've been doing has only been over a few days, so the results are *far from * conclusive, but to be honest with you I'd be happy with half of that (75-100 pips nett per day).

The system is trend-following in its nature, and because of its structure, it will never miss a big trend. Its these big trends that bring home the bacon.

A fellow trader I have spoken to once said he traded a very similar system for some time very profitable. But he said once the market entered a volatile state, with no clean trends, he just got whipsawed to pieces (the system trades long/short). So maybe a filter based on a longer timeframe is a good idea??

The system is designed to be autotraded server-side by EFX. There's nothing better than making money while you sleep 

But still a long way to go...


----------



## KamiCrazy

After testing out neoticker and sort of working around its flaws I have decided to go ahead and get a full licence for it.

In the end I just wasn't impressed enough with amibroker's offering plus I like the free data setup I have going with neoticker.

On the subject of AUD accounts I asked them if they would do that for forex and their reply was no.
I would in the future like to pursue a non-usd account to insulate myself from some exchange rate movements lowering my profits (bit weird aye? hedging a forex account with... forex?).

Now comes the hard part... learning c# haha!


----------



## nizar

KamiCrazy said:


> After testing out neoticker and sort of working around its flaws I have decided to go ahead and get a full licence for it.
> 
> In the end I just wasn't impressed enough with amibroker's offering plus I like the free data setup I have going with neoticker.
> 
> On the subject of AUD accounts I asked them if they would do that for forex and their reply was no.
> I would in the future like to pursue a non-usd account to insulate myself from some exchange rate movements lowering my profits (bit weird aye? hedging a forex account with... forex?).
> 
> Now comes the hard part... learning c# haha!




Thankyou for your feedback.
I have heard good things about neoticker as well.
Its what the real professionals use including some hedge funds.

Where are you getting your data to feed into neoticker?
Esignal?


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## KamiCrazy

MBT+tickquest

There is no backfill delay either because I only deal with forex instruments.

The best is esignal but I am unwilling to absorb the cost at the moment.


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## nizar

An interview with a very experienced trader who trades automated forex systems.

Well worth the read IMO.


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## Temjin

Excellent thread going on here guys, keep it up! 

Looks like my original plan of MT4 -> TB -> ECN/STN brokers, then Amibroker -> TB -> IB is still quite feasible.  

Damn real life..I mean social life, is definitely getting into my way at the moment. In the middle of a career crisis (ok, not really a crisis!) as well, so time to tune up my time management skills. 

You got my last email Nizar? Sorry about the lateness in reply.


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## nizar

Temjin said:


> Excellent thread going on here guys, keep it up!
> 
> Looks like my original plan of MT4 -> TB -> ECN/STN brokers, then Amibroker -> TB -> IB is still quite feasible.
> 
> Damn real life..I mean social life, is definitely getting into my way at the moment. In the middle of a career crisis (ok, not really a crisis!) as well, so time to tune up my time management skills.
> 
> You got my last email Nizar? Sorry about the lateness in reply.




Hi Temjin,

What is TB?

Yes i got your email.


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## Temjin

Nizar said:
			
		

> Hi Temjin,
> 
> What is TB?
> 
> Yes i got your email.




http://www.tradebullet.com/

Basically, you can use Metatrader 4 or Amibroker or Wealthlab, or almost any custom applications to connect to ECN brokers like EFX or MBT through tradebullet conversion/routing program. (or whatever they call it)

While I don't like the idea of the dependance on another third party program, I guess this is the only effective way currently available for small retail automated traders. 

The more professional future managed fund managers tend to have their own custom application connected to IB without the need for third party softwares.


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## KamiCrazy

Well today was the first day i started practicing what I've learnt and try it out. With real money that is. It's more fun when you have hard cash riding on it 

http://dump.justwipeit.com/Pics/firsttrade.JPG
EDIT: I originally attached a picture but now I've linked it cause its too big for the website.
The blue box on the chart basically shows where my trade went.

Anyways I was sitting at my desk, saw the breakout and entered in at 1.4851. I entered with 1 lot and watched it goto 1.4865 then retrace back to 1.4860. It then meandered there for like I dunno ages... I was considering exiting but the support seemed to be there and so I stayed.

Then there was another breakout and so I quickly added to my position at 1.4871 with another lot. It spiked to 1.4883 and then quickly retraced back hitting my stop at 1.4873.

So I'm pretty happy at the results. Although I think I need to tighten my stops a little more, 10 pip trailing seems too much.


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## nizar

KamiCrazy said:


> Well today was the first day i started practicing what I've learnt and try it out. With real money that is. It's more fun when you have hard cash riding on it
> 
> http://dump.justwipeit.com/Pics/firsttrade.JPG
> EDIT: I originally attached a picture but now I've linked it cause its too big for the website.
> The blue box on the chart basically shows where my trade went.
> 
> Anyways I was sitting at my desk, saw the breakout and entered in at 1.4851. I entered with 1 lot and watched it goto 1.4865 then retrace back to 1.4860. It then meandered there for like I dunno ages... I was considering exiting but the support seemed to be there and so I stayed.
> 
> Then there was another breakout and so I quickly added to my position at 1.4871 with another lot. It spiked to 1.4883 and then quickly retraced back hitting my stop at 1.4873.
> 
> So I'm pretty happy at the results. Although I think I need to tighten my stops a little more, 10 pip trailing seems too much.




Good stuff, and a great start.
Its always good to start in the green.

22 pips and 2 pips on your first two trades is nothing to scoff at.

What broker are you using?

With the stop, why don't you try trailing it very tightly, putting it 1-tick under the low of the previous bar?


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## KamiCrazy

Sorry haven't been on for ages, busy with work... not been paying any attention to my trading development. Bad yeah I know, need to regain focus in march.

Anyways to answer your question I use MBT/EFX.

And for the trailing stops question. I'm not sure... I think its just a case of trading style. I like giving the trade a bit of breathing space. I could be very wrong in this matter, but I simply need more experience to get the trailing stop size just right. I don't think a 1 pip trailing stop is very useful. You just get whipsawed.


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## Wysiwyg

My recent first time experience in the foreign exchange, commodities etc. gives me the impression the dealer pulls the strings.Another game where the house has the advantage.Or maybe every decision i make is wrong.Nuh.


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## Wysiwyg

Hi. I`m having trouble holding longer term. For example i enter and hold a good profit position with a belief there is more downside/upside only to see the profits wittled away and price go past the entry 
	

		
			
		

		
	



	

		
			
		

		
	
.This happened to me a fair bit over the last week and i was wondering if it* is not* the go to hold for very long.Anyone takers?

p.s. it`s probably a case of adjusting to the constant price changes hey.


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## disarray

regardless of the time frame you are trading it sounds like you are doing badly because you keep buggerising around with the trade. once you have a profit, set a stop then profit is assured. only ever adjust the stop up (profit wise) and that will solve that problem


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## Stormin_Norman

Wysiwyg said:


> Hi. I`m having trouble holding longer term. For example i enter and hold a good profit position with a belief there is more downside/upside only to see the profits wittled away and price go past the entry
> 
> 
> 
> 
> 
> 
> 
> 
> 
> 
> 
> 
> 
> 
> 
> 
> 
> 
> 
> .This happened to me a fair bit over the last week and i was wondering if it* is not* the go to hold for very long.Anyone takers?




If you are scalping on a narrow (<20 pips) stop loss you should take your profit i think.

+1R I move my stop loss up from -1R to 0R.

at +2R I move my stop loss up from 0R to +1R

etc.

But I will exit on discretion too.

I set my take profit to +3R or higher depending on discretion. But as above I will exit on discretion too if the market starts to go down.


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## tayser

If you're _scalping_ you should never let a 20 pip stop loss get hit... that's suicide.

In fact: Wysiwyg what sort of trading strategy are you using?


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## Trembling Hand

tayser said:


> If you're _scalping_ you should never let a 20 pip stop loss get hit... that's suicide.




yeah scalping is looking for less than 10 pips. More like 5 avg with the occasional bigger win.


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## Stormin_Norman

Trembling Hand said:


> yeah scalping is looking for less than 10 pips. More like 5 avg with the occasional bigger win.




obviously im not very knowledgeable in scalping. (Really short term trades technically isn't scalping either. Scalping is arbitrage gains between currencies. - but that's besides the point)

because im a fundamental trader; i am looking to 'ignore' what the scalpers are looking for. ie short term jumps. so my R = 20 pips.


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## Wysiwyg

tayser said:


> If you're _scalping_ you should never let a 20 pip stop loss get hit... that's suicide.
> 
> In fact: Wysiwyg what sort of trading strategy are you using?



Hi tayser,

Well i started off with a go long/short and hold with entries at pre-determined levels.I suppose i don`t really have a hard and fast rule for closure except for a safety stop loss.I rather monitor the movement and determine the closure with discretion.Most here seem to use trailing stops which is a good idea.(except when they are tipped and reverse )

I`m also learning how the currencies,futures in real life trading works and with the constant movement i have decided it is mainly a short term trading situation that i have to adapt to.Sometimes very short if it feels wrong.


thanks too norman.


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## nizar

tayser said:


> If you're _scalping_ you should never let a 20 pip stop loss get hit... that's suicide.
> 
> In fact: Wysiwyg what sort of trading strategy are you using?




You are correct in principle.
But you should expect even correctly placed stop losses to be hit at some point.

*If your stop loss gets hit and you are "dead" (suicide), then you are obviously risking too much per trade.* Regardless of the strategy.

Obviously how often your stop gets hit depends on your win% which is part of your overall system.

This post probably makes no sense at all, lol.


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## julius

nizar - the stop loss is a worse case scenerio, ie. price spike, computer crash, unfavourable news.  not the same as the predetermined risk level when trading other instruments.

the real stop is mental because it needs adjustment according to the particular set up & the market conditions, but i'd suggest R/R is probably around 1:1


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## prawn_86

nizar said:


> You are correct in principle.
> But you should expect even correctly placed stop losses to be hit at some point.
> 
> *If your stop loss gets hit and you are "dead" (suicide), then you are obviously risking too much per trade.* Regardless of the strategy.
> 
> Obviously how often your stop gets hit depends on your win% which is part of your overall system.
> 
> This post probably makes no sense at all, lol.




I havnt read all of this thread admittedly, but scalping involes a lot of discretion.

I would doubt you could set up a system that works on short term scalping, but i could be wrong.

Also with scalping, trailing stops would probably see you with less profits if they got hit, because the exit is usually at the scalpers discretion rather than relying on a stop being hit.

my 

EDIT - my R:R is also generally 1:1 to 1:1.5 as the supports are usually at all the .1, .2 etc marks


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## Stormin_Norman

tayser said:


> If you're _scalping_ you should never let a 20 pip stop loss get hit... that's suicide.




only if youre 1% leveraged and risking 20% equity it would be.

otherwise it's just a 1R loss. Id have at least a 25% stop loss hit rate.

i also dont like trailing my stops too close, cause like someone mentioned; they get stopped out on a rebound before continuing in the initial direction. that really pisses me off when that happens.

or when the market moves dramatically while your away and the take profit gets hit before it can be moved out  although by this time if it's got to 3R i should be bloody happy anyway!


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## Wysiwyg

Stormin_Norman said:


> only if youre 1% leveraged and risking 20% equity it would be.
> 
> otherwise it's just a 1R loss. Id have at least a 25% stop loss hit rate.
> 
> i also dont like trailing my stops too close, cause like someone mentioned; they get stopped out on a rebound before continuing in the initial direction. that really pisses me off when that happens.
> 
> or when the market moves dramatically while your away and the take profit gets hit before it can be moved out  although by this time if it's got to 3R i should be bloody happy anyway!




Completely agree about the downside of trailers being hit.Though there is many times the trailer would save on a sharp change of trend.

I suppose to guarantee profit the trailer is the only way but to maximise profit, well is there a surer way than to stay with the trend (time frame related) until it turns.This determining of trend change (within our time frame) is an education in itself because the maximising of profit is bought into the equation.

Not a problem if percentage,  indicator or contentment  targets are met and executed.


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## nizar

*In reply to prawn86*

I havnt read all of this thread admittedly, but scalping involes a lot of discretion.

*LOL Really?*

I would doubt you could set up a system that works on short term scalping, but i could be wrong.

*Im setting one up now, I doubt im the first.*

Also with scalping, trailing stops would probably see you with less profits if they got hit, because the exit is usually at the scalpers discretion rather than relying on a stop being hit.

*With a mechanical system, no discretion will be used at all.*

my 

EDIT - my R:R is also generally 1:1 to 1:1.5 as the supports are usually at all the .1, .2 etc marks

*I hope you take enough trades to make such a poor expectancy system worth trading.*


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## Trembling Hand

prawn_86 said:


> EDIT - my R:R is also generally 1:1 to 1:1.5 as the supports are usually at all the .1, .2 etc marks




until you go live and trade at least 100 times you probably don't know what your R:R is.

It all changes when there is real $ on the table over a long period.


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## Trembling Hand

nizar said:


> *I hope you take enough trades to make such a poor expectancy system worth trading.*




Nizar my system with the poorest expectancy is the most consistently profitable. Its not FX but its a scalping "system" on the HSI. Point is its not really one aspect that is the be all and end all but combination of many. What make this system profitable is the 300 odd trades it produces each day!!

Which maybe what you were getting at?

Have a look at the two charts below. Two days of scalping the HSI. One very good one not so good but still very profitable. I do the same with all my trading FX & Futures none have a high expectancy. Points is the expectancy is razor thin but very profitable over 50,000 trades per year per instrument!!


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## Stormin_Norman

Trembling Hand said:


> Nizar my system with the poorest expectancy is the most consistently profitable.
> 
> Point is its not really one aspect that is the be all and end all but combination of many.
> 
> What make this system profitable is the 300 odd trades it produces each day!!
> 
> Which maybe what you were getting at?
> 
> Have a look at the two charts below.




good graphs to exemplify what you mean.

i found more regular smaller trades were a much more stable way of trading. sure, making a 60% return in one trade is good. but i think people concentrate on the wrong side of the equation.

rather then worrying about how to get returns, i found it was more important to limit risk. 

my expected return is R0.66. (risk/return ration of 1.66). about 25% of my trades hit -1R. another 40% hit my 0R adjusted break even point (or are heading at great speed for it so I take a small profit).

only about 1/3 of my trades are profitable. but they are quite profitable. the average is probably at least 2.5R for my successful trades.


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## nizar

Trembling Hand said:


> Nizar my system with the poorest expectancy is the most consistently profitable. Its not FX but its a scalping "system" on the HSI. Point is its not really one aspect that is the be all and end all but combination of many. *What make this system profitable is the 300 odd trades it produces each day!!*
> 
> Which maybe what you were getting at?




TH.

I did say i hope you take enough trades.
And you do!!!

Good work by the way, Im a big fan of high frequency systems, especially if you can automate them. Its the fastest way to compound your account.


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## wayneL

nizar said:


> Good work by the way, Im a big fan of high frequency systems, especially if you can automate them. Its the fastest way to compound your account.



Have you had experience with this Niz?


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## prawn_86

So let me get this straight Nizar.

You are looking at setting up a scalping system, which will generally have a low expectancy (due to the nature of scalping), and yet it is still ok for you to have a go at discretionary traders who use a similar method?

Just because you use mechanical systems does not mean they are the be all and end all, like you so often like to make out.


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## julius

nizar i'll be very interested to see the results of your scalping system _net of transaction costs_. please elaborate.

systems with low expectancy generally have smoother equity curves...ie lower risk... hugely important when trading leveraged instruments.


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## Stormin_Norman

prawn_86 said:


> So let me get this straight Nizar.
> 
> You are looking at setting up a scalping system, which will generally have a low expectancy (due to the nature of scalping), and yet it is still ok for you to have a go at discretionary traders who use a similar method?




i didnt read it like that.


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## nizar

wayneL said:


> Have you had experience with this Niz?




Wayne.
Im working on something right now, the system has been coded, we just need to find historical tick data that goes back at least a year that doesn't cost an arm and a leg.

Prawn86.
Im not having a go at anybody.

Julius.
I might be setting up a thread on it, but if I don't, PM me your email address and I will send the results your way in due course.

I agree smooth equity curves is a big plus of high frequency trading systems.


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## julius

nizar I'm looking foward to it.

I guess I'm skeptical because I spent a while researching scalping systems last year, trawled through academic journals, found heaps & developed a few myself that killed the market gross profit, but once transaction costs were considered weren't generating a significant return.

Overcoming the spread, imo, is by far the most difficult obstacle to overcome.


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## Trembling Hand

julius said:


> Overcoming the spread, imo, is by far the most difficult obstacle to overcome.




That's where you need the finesse of a trader executing the trades. :


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## Stormin_Norman

nizar said:


> Wayne.
> Im working on something right now, the system has been coded,




what platform and coding language are you using?


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## nizar

Stormin_Norman said:


> what platform and coding language are you using?




OpenQuant is the platform.

As to the language I havent got a clue, as i got a professional to do the coding for me.


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## angel

Hi forex lovers,

I know forex market is open 24/7. 

But when is the official opening time (I guess it's more important than closing time) for each market. I would like to follow US/Canada, UK, Europe, Tokyo markets.

and how about Stock Exchange market times? are they the same?

I'm in Sydney.

thanks all
ak


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## tayser

8am in each local timezone except Tokyo which is 9am (8am Hong Kong/Singapore time).

AEST:

Auckland 6am 
Sydney 8am
Tokyo / Hong Kong / Singapore 10am
Paris / Frankfurt 4pm
London 5pm
New York 10pm

AEDT:

Auckland 6am
Sydney 8am
Tokyo / Hong Kong / Singapore 11am
Paris / Frankfurt 6pm
London 7pm
New York Midnight.

When in AEDT NY Close overlaps Sydney open by an hour, in AEST NY Close is one hour before Sydney open.

Most liquid time in the market: from Paris open til London close (depending on northern hemisphere DST, you get the last hour or two of Asian trade, all of the European trade and the first half of North American trade).
Most illiquid time in the market: in AEDT from NY Close to Sydney open (1 hour - Auckland is the only place with banks officially open during this period).


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## tayser

Sorry, the above are FX opens, no idea bout exchanges - I don't pay much attention to them


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## angel

Thanks for a quick response, tayser. it will be a good reference for everyone here.

I assume AEDT is Daily light saving time, so now we are in AEST, right?

are each market open for 8-10 hours? if you don't mind, when London and Paris are closed exactly? 

am I correct if our dollar mostly traded after 10am (when Tokyo opened) as AUD is pretty much depends on carry trade?

thanks again
ak



tayser said:


> Most liquid time in the market: from Paris open til London close (depending on northern hemisphere DST, you get the last hour or two of Asian trade, all of the European trade and the first half of North American trade).
> 
> Most illiquid time in the market: in AEDT from NY Close to Sydney open (1 hour - Auckland is the only place with banks officially open during this period).


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## nizar

Hi,

Im looking for historical tick data for some forex pairs for testing and system design purposes.

I've tried e-signal, does anybody here have experience (and feedback) on other data providers?

Has anybody tried these guys?
http://www.forextickdata.com/

Thanks.
Nizar.


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## Largesse

i've noticed some people have been able to set up their ninjatrader software such that it automatically has vertical lines with a label stating what event is occuring.

How is this done? the 'help' file isn't providing much help.

Ideally i want to be able to see on my chart when events such as FX market open's and close's occur.
I also noticed on a chart that someone posted on a seperate thread they had a line for when news was released. if anyone knows how this is set up i'd be very appreciative


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## Page

Before you can get started with Forex trading, there are so many questions to answer. Should I use a demo account? How do I choose a broker? What do I need to know before making my first trade?
Here is your answer in short-
1. Choose a broker
2. Open a Demo Account
3. Learn About Leverage
4. Practice Reading Charts
5. Making the first live trade


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