Starting to trade CFDs

[Timmy]

Re: Starting to trade CFD's

TH, you have been on this track of "the MM CFD providers do not manipulate price to take out stops" for a while now. I must admit a wariness of MM CFD providers because it is my belief they do target stops ... but you have been calling for quite some time for anyone to provide an example of where this has happened - a real example, backed up with charts etc. From my observations of your calling for examples (or at least an example) I have not seen one provided ... which I must say has shaken my belief. I would appreciate anyone showing an example of this happening so I can snuggle back into my belief ... 'cause it is getting shaken very badly ...

This assumption has profound effects on your trading and I warn anyone not to listen to this stuff. When you get stopped out and you put it down to manipulation by your broker what is that saying about your approach, mindset, entries, stops AND most importantly responsibility for your OWN actions and ability to learn.

This comment, should be required reading and understanding before anyone trades anything. This comment is really valuable. I would add that if anyone does have evidence of a MM CFD provider targetting his or her stops then the solution is very simple, change your account to a DMA CFD provider - that way there is no dispute about MM manipulation and the party responsible for your stop being hit will be revealed with clarity.

Thanks TH.

 

[Trembling Hand]

Re: Starting to trade CFD's

Timmy I have been on and on about this because it is very important for a traders development. I'm not trying to make an **** of myself(although I probably have) or anyone else but it is really very very very very important to shift the focus from,

the game is rigged & and my brokers stealing from me,​

To

that trade didn't work what really went wrong?​

If you answer that question from the point that the prices you are getting are manipulated then you have no hope. Why try? But if you realize that the prices are real market prices you can then just maybe set about learning to trade with good entries & stops.

Don't get me wrong MM are crooks in the silly leverage they give you and the spreads & turning off your account when you make money etc etc. BUT in all the times I have been fluffing around with CFD & Futures & Forex I have never seen a price "drift" from the underlying market. If I did I would load up big time. BIG TIME.

 

[Timmy]

Re: Starting to trade CFD's

Hat's off to you TH ... really great stuff.

 

[Uncle Festivus]

Re: Starting to trade CFD's

Well I have had a win with IG closing me out with a stop. I couldn't see that the stop had been hit but was closed out. Gave them a ring and after a few minutes of behind the scenes silence they admitted they got it wrong and reversed the stop. Luckily it was spot gold at 863 so a lesson to all to question some of these things and you never know, you may be surprised.

He still didn't explain why it happened though, mumbled something about fractions or some such.

 

[Spineli]

Re: Starting to trade CFD's

Timmy I have been on and on about this because it is very important for a traders development. I'm not trying to make an **** of myself(although I probably have) or anyone else but it is really very very very very important to shift the focus from,

the game is rigged & and my brokers stealing from me,​

To

that trade didn't work what really went wrong?​

If you answer that question from the point that the prices you are getting are manipulated then you have no hope. Why try? But if you realize that the prices are real market prices you can then just maybe set about learning to trade with good entries & stops.

Don't get me wrong MM are crooks in the silly leverage they give you and the spreads & turning off your account when you make money etc etc. BUT in all the times I have been fluffing around with CFD & Futures & Forex I have never seen a price "drift" from the underlying market. If I did I would load up big time. BIG TIME.

I'm not a fan of the MM model at all for that very concern. The Direct Market Access (DMA) model guarantees the underlying prices on the ASX so you will never find yourself loading up BIG TIME! If you trade at a loss, then you can only blame one person, yourself!

 

[Trembling Hand]

Re: Starting to trade CFD's

If you trade at a loss, then you can only blame one person, yourself!

I'm not sure what your point is here??

 

[Spineli]

Re: Starting to trade CFD's

I'm not sure what your point is here??

Just following up from your point re: Market Makers and how a trader should behave if they have made a loss on a trade.

i.e. with DMA, since the price of the contract traded is guaranteed to be the same as that in the underlying market, if you make a loss on your trade, you really can't blame your broker/provider...alternatively with the MM model, it is possible for the MM to adjust spreads such that they deviate from market spreads (although it rarely would happen) such that if you occasion a loss on a particular trade, then you could place partial blame on the MM...

 

[Trembling Hand]

Re: Starting to trade CFD's

Yep fair enough spreads are wider in the MM model. thats true.

 

[MoneyNeverSleeps]

Re: Starting to trade CFD's

If you need to trade CFDs throw away their data and watch the REAL market that its linked to the cfd to see what is really going on!!!!!

I can certainly see where this advice would be would be invaluable for day trades however I gather that this does not really apply to scalp trades where you are in and out based purely on what Market Maker etc are showing?

 

[peter2]

Re: Starting to trade CFD's

TH has already mentioned this.
It is extremely difficult to scalp 2,3 tics if the MM spread is 2,3 tics.
It is slightly easier to scalp 2,3 tics if the real market spread is 1,2 tics.

When you trade against MM spreads you must aim for bigger moves, at least 5x the spread.

 

[>Apocalypto<]

Re: Starting to trade CFD's

TH has already mentioned this.
It is extremely difficult to scalp 2,3 tics if the MM spread is 2,3 tics.
It is slightly easier to scalp 2,3 tics if the real market spread is 1,2 tics.

When you trade against MM spreads you must aim for bigger moves, at least 5x the spread.

so true peter.

like TH has said, sure u can use a two point spread and day trade but each time u lose u add two. that aspect makes it really hard almost impossible. I had a shot at it did well in picking them but my losers just ate away my wins!

I was trading IG Australia 200 cash 2 min and 3 min. I agree totally with u i did much better when trading higher time frames.