Forex Strategies

[doctorj]

The last few days i've been having a crack at some different strategies with Forex to get a feel for it on the Oanda practice account.

So far, I've had good success trading breakouts from S/R lines on the 15min chart with a stock standard MACD below for confirmation and some basic candlestick analysis on the USD/JPY only. Anyone trade this (or similar) and have any comments? It seems to be keeping me out of the chop and getting enough of the quick movements to be interesting.

 

[It's Snake Pliskin]

The last few days i've been having a crack at some different strategies with Forex to get a feel for it on the Oanda practice account.

So far, I've had good success trading breakouts from S/R lines on the 15min chart with a stock standard MACD below for confirmation and some basic candlestick analysis on the USD/JPY only. Anyone trade this (or similar) and have any comments? It seems to be keeping me out of the chop and getting enough of the quick movements to be interesting.

Try pivot points and their support and resistance levels.
ADX
RSI
Have you tried these?

 

[doctorj]

Had a play with ADX, but perhaps on too short a time frame. Was quite noisy.

I'm really just having a play for the moment to get a feel for forex. So far the more simple I keep it the more success I seem to be having.

 

[It's Snake Pliskin]

Had a play with ADX, but perhaps on too short a time frame. Was quite noisy.

I'm really just having a play for the moment to get a feel for forex. So far the more simple I keep it the more success I seem to be having.

It is a different beast FOREX. I'm with OANDA and have the account set up just working out my mindset before I go in.
Have a look at this blog it may have something interesting for you.
Fibs do well in FOREX but need to be part of a system not just alone.
http://www.forexproject.com/tag/Fibonacci/

 

[Naif]

The last few days i've been having a crack at some different strategies with Forex to get a feel for it on the Oanda practice account.

So far, I've had good success trading breakouts from S/R lines on the 15min chart with a stock standard MACD below for confirmation and some basic candlestick analysis on the USD/JPY only. Anyone trade this (or similar) and have any comments? It seems to be keeping me out of the chop and getting enough of the quick movements to be interesting.

FOREX is a crazy market.. don`t ever follow strategies which are full of indicators, remember always that indicators follow the price not followed by the price.
try to make ur chart simple and identify the trend, supports and the resistance. if the trend is up wait for the suports to buy or any confirmed break for the resistance.. use trend lines cuz its really useful.
try to follow a pair or two and try to understand their movements so by the time you will be familiar with..

good luck

 

[money tree]

use non-lagging methods like fibb, trendlines, resistance, support.

NEVER use rsi, macd, moving averages, or any other indicator using a MA. you WILL get roasted.

use other pairs as leading indicators.

 

[doctorj]

use other pairs as leading indicators.

Thanks for your post.

Can you suggest which pairs lead which pairs?

 

[money tree]

nzd, aud, eur & gbp have high correlations as they are all short USD. USDCHF is the inverse of EURUSD, ie something like 99% correlation, yet you may see a breakout in USDCHF before a breakdown in EURUSD. Or you can use one to confirm the move in the other.

generally if I see eur & aud move, and gbp is sluggish, I will get on gbp.

gold chart often is a leader for aud.

nzd is illiquid so you often see a move here before the others.

 

[Naif]

and if you want to trade cad or jpy you should watch the oil prices..

 

[money tree]

I agree with oil vs CAD, but jpy?

 

[Naif]

well Japan is number two in the world in importing oil, japan import 5.3 ..
u might ask what about number one? united states? well united states number one in the world in importing oil 11.8 , but they are also number three in producing oil 8.69 ..
thats why the investors who expect the oil will hit 100$ they will buy CADJPY.
just see the cadjpy chart

 

[It's Snake Pliskin]

well Japan is number two in the world in importing oil, japan import 5.3 ..
u might ask what about number one? united states? well united states number one in the world in importing oil 11.8 , but they are also number three in producing oil 8.69 ..
thats why the investors who expect the oil will hit 100$ they will buy CADJPY.
just see the cadjpy chart

Good info Naif and M tree.

Watch the CAD and the oil price.

 

[money tree]

oanda doesnt have oil (yet) but they have gold

another strategy is to watch the yen pairs, theres AJ, CadJ, ChfJ, EJ, GJ, UJ and if your lucky NJ.

wait till theres a break on most of these and get on the one thats lagging

 

[money tree]

once you start playing for real $$$ I recommend the following.

start out with 100 lots, if you handle that well, move up to 1000 and so on.

dont be like 99% of people who put $1m on their first trade based on gut feel, then lose 80% on day one, only to fight the rest of the year with small lots to break even.


lets compile some info on various brokers spreads and interest rate spreads.

for carry trades, the interest rate spread is more important.

 

[Naif]

once you start playing for real $$$ I recommend the following.

start out with 100 lots, if you handle that well, move up to 1000 and so on.

dont be like 99% of people who put $1m on their first trade based on gut feel, then lose 80% on day one, only to fight the rest of the year with small lots to break even.


lets compile some info on various brokers spreads and interest rate spreads.

for carry trades, the interest rate spread is more important.

i agree with u..
before u start a real account you should learn how to mange your money, u have really to know alot about risk management

 

[It's Snake Pliskin]

i agree with u..
before u start a real account you should learn how to mange your money, u have really to know alot about risk management

..or acceptance of tradable risk that encapsulates risk and money management.
I don't agree with using dummy accounts because they don't challenge the emotions and lead one into a false sense of belief.

 

[Naif]

..or acceptance of tradable risk that encapsulates risk and money management.
I don't agree with using dummy accounts because they don't challenge the emotions and lead one into a false sense of belief.

yea you`re right.. you can`t say that you are a successful trader if you could make profits using dummy account , real account is completely different..

 

[x2rider]

Yeah for what it's worth, I also agree with MT.

I prefer to enter a position with a small amount first and then pyramid the position as it rises or falls. Although it would be good to be able to start with the whole amount the rise or fall can be hard to predict in scale. The more positions that I have on a particular trade the tighter my stop gets.
I find the charts easier to read also because of the lack of gapping. These can sometimes be filled and can place doubt in the mind after a large rise that might of occured in a share price. Also if something dramatic happens in the world exiting a position is immediate and there is no chasing a falling price like shares.

Cheers martin

 

[doctorj]

I appreciate what you all have said about dummy accounts. Its a well worn arguement (for both sides). As I paper traded before making my first stock trade, I have commenced paper trading forex.

I am using proper money management (</= 2% of capital at risk per trade) and will endeavour to keep it realistic. I have also begun posting trades live (or as close to live as reality permits) in my ASF journal, so you can follow and post abuse there.

 

[It's Snake Pliskin]

I appreciate what you all have said about dummy accounts. Its a well worn arguement (for both sides). As I paper traded before making my first stock trade, I have commenced paper trading forex.

I am using proper money management (</= 2% of capital at risk per trade) and will endeavour to keep it realistic. I have also begun posting trades live (or as close to live as reality permits) in my ASF journal, so you can follow and post abuse there.

Doctor,
Since you are with OANDA you will find that you can practise better money management and position sizing because they have units not just lots. Most brokers only allow 1 lot to be traded. At OANDA you cna trade anything you like below your leverage level.

For example, I can trade a $2,000 trade using leverage with only a small portion of that my own money for collateral.