Andre (Sep 17, 2003 4:25:07 PM)
Today we're pleased to welcome Kathy Lien of Forex
Capital Markets to the Elite Trader Chat Room.
Andre (Sep 17, 2003 4:25:14 PM)
Kathy is responsible for providing research and analysis for DailyFX.
The DailyFX team publishes technical and fundamental research reports, market
commentaries and trading strategies.
Andre (Sep 17, 2003 4:25:27 PM)
A seasoned FX analyst and trader, Kathy was an Associate at JPMorgan Chase where she worked in Credit Derivatives, Cross Markets and Foreign Exchange Trading for over 3 years. Kathy has vast experience within the interbank market, trading both FX spot and options.
Andre (Sep 17, 2003 4:25:37 PM)
She also has experience trading a number of products outside of FX, including interest rate derivatives, bonds, equities, futures and leveraging movements between markets.
Andre (Sep 17, 2003 4:25:48 PM)
The 24 hour nature of online foreign exchange trading has made daytrading the foreign exchange market increasingly popular. Kathy's experience makes her a perfect guest to talk about specific daytrading strategies that can be used successfully in the FX market.
Andre (Sep 17, 2003 4:25:54 PM)
Kathy, thanks for joining us today.
FXCM_Kathy (Sep 17, 2003 4:26:01 PM)
thank you Andre
FXCM_Kathy (Sep 17, 2003 4:26:14 PM)
Before I start, I need to get some legalities out of the way.
FXCM_Kathy (Sep 17, 2003 4:26:25 PM)
That is, the following chat session is provided for informational purposes only and does not constitute investment advice or recommendations of any kind.
FXCM_Kathy (Sep 17, 2003 4:26:35 PM)
Forex Capital Markets (FXCM) shall not be held liable for any inaccurate or incomplete information
FXCM_Kathy (Sep 17, 2003 4:26:42 PM)
or for any improper or incorrect use of the information or for anyone's use of the information described and/or contained herein.
FXCM_Kathy (Sep 17, 2003 4:26:49 PM)
With over 100 years in combined interbank experience, FXCM and its research team has identified some interesting day trading opportunities. The first of which involves trading off of round numbers.
FXCM_Kathy (Sep 17, 2003 4:27:09 PM)
When trading intra-day, it is impossible to look for bounces off every support/resistance level and expect to be profitable.
FXCM_Kathy (Sep 17, 2003 4:27:21 PM)
The key to successful intra-day trading requires that we be more selective and only enter at those levels where a reaction is more likely.
FXCM_Kathy (Sep 17, 2003 4:27:32 PM)
Trading off round numbers is one good way of identifying such opportunities.
FXCM_Kathy (Sep 17, 2003 4:27:49 PM)
After noticing how many times a currency pair would bounce off of round number support/resistance levels intra-day despite the underlying trend,
FXCM_Kathy (Sep 17, 2003 4:27:58 PM)
we have noticed that the bounces are usually much bigger and more relevant that rallies off other areas.
FXCM_Kathy (Sep 17, 2003 4:28:08 PM)
This type of reaction is perfect for intra-day FX traders as it gives them the opportunity to make 50 pips while only rising 10-15 pips.
FXCM_Kathy (Sep 17, 2003 4:28:19 PM)
The reason why this strategy works is simple.
FXCM_Kathy (Sep 17, 2003 4:28:26 PM)
Market participants as a whole tend to put conditional take-profit orders at or right around even figures.
FXCM_Kathy (Sep 17, 2003 4:28:37 PM)
Combine this with the fact that conditional orders are used much more frequently in FX and you have levels that have a high probability for a contra-move.
FXCM_Kathy (Sep 17, 2003 4:28:48 PM)
This contra-move is often intensified by Inter-bank market players who with the proprietary order flow often enter positions ahead of large conditional orders.
FXCM_Kathy (Sep 17, 2003 4:28:56 PM)
We can compare this strategy to stepping in front of large orders or buying gaps.
FXCM_Kathy (Sep 17, 2003 4:29:04 PM)
Equity and future traders do it all the time.
FXCM_Kathy (Sep 17, 2003 4:29:16 PM)
The reason why this is a solid strategy is because it allows you to limit your initial risk for good upside profit potential.
FXCM_Kathy (Sep 17, 2003 4:29:35 PM)
Wed rollover trading is also another interesting trading strategy
FXCM_Kathy (Sep 17, 2003 4:29:43 PM)
A unique feature of the FX market is the opportunity to earn interest.
FXCM_Kathy (Sep 17, 2003 4:30:06 PM)
Interest is something that is earned or paid at 5pm EST.
FXCM_Kathy (Sep 17, 2003 4:30:14 PM)
On Wednesdays, there is triple rollover to account for trades that settle over the weekend.
FXCM_Kathy (Sep 17, 2003 4:30:24 PM)
An interesting trading strategy that we have identified is buying a high yielding currency pair such as the GBPUSD in the hour prior to
FXCM_Kathy (Sep 17, 2003 4:30:34 PM)
rollover (5pm) and selling it shortly before 5pm.
FXCM_Kathy (Sep 17, 2003 4:30:46 PM)
The reason why this works is because some traders will bid up high yielding currency
FXCM_Kathy (Sep 17, 2003 4:30:55 PM)
pairs before rollover and sell them immediately after to earn the interest differential.
FXCM_Kathy (Sep 17, 2003 4:31:09 PM)
This strategy is even
FXCM_Kathy (Sep 17, 2003 4:31:27 PM)
more popular on Wednesdays
FXCM_Kathy (Sep 17, 2003 4:31:45 PM)
Channel trading is another strategy that i want to touch upon
FXCM_Kathy (Sep 17, 2003 4:31:54 PM)
Channel trading is less exotic but nevertheless works very well with currencies
FXCM_Kathy (Sep 17, 2003 4:32:09 PM)
Reason being is that currencies rarely spend much time
FXCM_Kathy (Sep 17, 2003 4:32:18 PM)
in tight trading ranges and have the tendency to develop strong trends.
FXCM_Kathy (Sep 17, 2003 4:32:28 PM)
By just going through a few charts,
FXCM_Kathy (Sep 17, 2003 4:32:38 PM)
traders can see that channels can easily be identified and occur frequently.
FXCM_Kathy (Sep 17, 2003 4:32:53 PM)
A common scenario would be channel trading during
FXCM_Kathy (Sep 17, 2003 4:33:01 PM)
the Asian trading session and a
FXCM_Kathy (Sep 17, 2003 4:33:10 PM)
breakout in either the London or US session.
FXCM_Kathy (Sep 17, 2003 4:33:16 PM)
Based upon our experience
FXCM_Kathy (Sep 17, 2003 4:33:26 PM)
we have seen that economic releases are one of the most
FXCM_Kathy (Sep 17, 2003 4:33:36 PM)
common triggers for a break of the channel.
FXCM_Kathy (Sep 17, 2003 4:33:47 PM)
Therefore it is imperative that traders keep on top of economic releases.
Andre (Sep 17, 2003 4:33:56 PM)
Kathy?
FXCM_Kathy (Sep 17, 2003 4:34:02 PM)
If a channel has formed and a big US number
FXCM_Kathy (Sep 17, 2003 4:34:14 PM)
yes?
Andre (Sep 17, 2003 4:34:17 PM)
Excuse my ignornace if this is a basic question...
FXCM_Kathy (Sep 17, 2003 4:34:20 PM)
sure
Andre (Sep 17, 2003 4:34:38 PM)
But which currency are you watching for a channel, or do you look for overlaps?
FXCM_Kathy (Sep 17, 2003 4:35:03 PM)
channel trading is a technical trend formation that can become prevalent in any currency pair
FXCM_Kathy (Sep 17, 2003 4:35:11 PM)
charts are available on all currency pairs
FXCM_Kathy (Sep 17, 2003 4:35:21 PM)
unfortunately i can not insert image
FXCM_Kathy (Sep 17, 2003 4:35:23 PM)
images
FXCM_Kathy (Sep 17, 2003 4:35:35 PM)
but if anyone is interested
FXCM_Kathy (Sep 17, 2003 4:35:39 PM)
i can email
FXCM_Kathy (Sep 17, 2003 4:35:46 PM)
an example of a channel later on
FXCM_Kathy (Sep 17, 2003 4:36:12 PM)
so anyhow
FXCM_Kathy (Sep 17, 2003 4:36:30 PM)
if a channel has formed before a big number
FXCM_Kathy (Sep 17, 2003 4:36:44 PM)
a big US number (per say) is expected to be released, and the currency pair is at the top of a channel,
FXCM_Kathy (Sep 17, 2003 4:37:07 PM)
the probability of a break is high, so traders should be looking to buy the break out, not fade it.
FXCM_Kathy (Sep 17, 2003 4:37:30 PM)
So, round figures
FXCM_Kathy (Sep 17, 2003 4:37:39 PM)
Wednesday rollover and channels
FXCM_Kathy (Sep 17, 2003 4:37:52 PM)
are some of the few ways that day traders
FXCM_Kathy (Sep 17, 2003 4:38:06 PM)
can profit in the FX market.
FXCM_Kathy (Sep 17, 2003 4:38:21 PM)
Traditionally, self-traders have not had access into the foreign exchange market.
FXCM_Kathy (Sep 17, 2003 4:38:32 PM)
However, in recent years, firms such as FXCM (Forex Capital Markets) have opened up the FX market to retail traders,
FXCM_Kathy (Sep 17, 2003 4:38:38 PM)
providing leveraged trading as well as free execution platforms, charts
FXCM_Kathy (Sep 17, 2003 4:38:44 PM)
and real time news.
FXCM_Kathy (Sep 17, 2003 4:38:51 PM)
However, with $1.5 trillion in daily turnover, it is the largest market in
FXCM_Kathy (Sep 17, 2003 4:38:58 PM)
the world, something that traders can no longer ignore.
FXCM_Kathy (Sep 17, 2003 4:39:09 PM)
Unlike the equity markets, where liquidity is dispersed across
FXCM_Kathy (Sep 17, 2003 4:39:15 PM)
many different stocks, the $1.5 trillion in liquidity is
FXCM_Kathy (Sep 17, 2003 4:39:25 PM)
concentrated in 4 major currency pairs,
FXCM_Kathy (Sep 17, 2003 4:39:29 PM)
making them very liquid
FXCM_Kathy (Sep 17, 2003 4:39:37 PM)
This means that traders can easily get in and out, executing over $100 million
FXCM_Kathy (Sep 17, 2003 4:39:42 PM)
without significantly moving the markets.
FXCM_Kathy (Sep 17, 2003 4:39:51 PM)
Aside from liquidity allowing for fast execution and tight spreads,
FXCM_Kathy (Sep 17, 2003 4:39:56 PM)
the 24-hour nature of
FXCM_Kathy (Sep 17, 2003 4:40:03 PM)
the FX market allows positions
FXCM_Kathy (Sep 17, 2003 4:40:12 PM)
to be liquidated at any time and stops/limits filled without slippage.
FXCM_Kathy (Sep 17, 2003 4:40:20 PM)
On a side note,
FXCM_Kathy (Sep 17, 2003 4:40:27 PM)
, I also want to mention that there is an upcoming prop trading seminar
FXCM_Kathy (Sep 17, 2003 4:40:40 PM)
that provides qualified traders with the opportunity to trade proprietary capital.
FXCM_Kathy (Sep 17, 2003 4:40:47 PM)
This seminar is by invite only, therefore I can not disclose too much details on it.
FXCM_Kathy (Sep 17, 2003 4:40:57 PM)
Interested parties need to send their resume and trading records to aspanton@fxcm.com
Andre (Sep 17, 2003 4:41:39 PM)
Som if you're interested, ask some good questions!
Andre (Sep 17, 2003 4:41:59 PM)
Kathy, thanks so much for going over those strategies.
FXCM_Kathy (Sep 17, 2003 4:42:04 PM)
my pleasure
FXCM_Kathy (Sep 17, 2003 4:42:31 PM)
Feel free to ask questions about these specific strategies or the FX market in general
Andre (Sep 17, 2003 4:42:38 PM)
As always, Kathy is here to delve deeper on any strategy, or on general questions on trading the FX or on FXCM.
Andre (Sep 17, 2003 4:43:00 PM)
And here they come... so let's get to it.
cibio (Sep 17, 2003 4:43:09 PM)
Kathy why is scalping in forex discouraged?
FXCM_Kathy (Sep 17, 2003 4:43:10 PM)
great
FXCM_Kathy (Sep 17, 2003 4:43:21 PM)
good question
FXCM_Kathy (Sep 17, 2003 4:43:40 PM)
the reason
FXCM_Kathy (Sep 17, 2003 4:43:47 PM)
why many firms discourage scalping is because
FXCM_Kathy (Sep 17, 2003 4:44:06 PM)
most fx market makers do not charge commission
FXCM_Kathy (Sep 17, 2003 4:44:13 PM)
and make money purely from the spread
FXCM_Kathy (Sep 17, 2003 4:44:25 PM)
scalpers tend to take advantage of the spread and
FXCM_Kathy (Sep 17, 2003 4:44:40 PM)
which makes it very difficult for market makers to provide equitable prices
FXCM_Kathy (Sep 17, 2003 4:44:52 PM)
and grow as a firm
FXCM_Kathy (Sep 17, 2003 4:44:53 PM)
however
FXCM_Kathy (Sep 17, 2003 4:45:01 PM)
many firms such as FXCM do recognize
FXCM_Kathy (Sep 17, 2003 4:45:14 PM)
that some traders use scalping strategies
FXCM_Kathy (Sep 17, 2003 4:45:27 PM)
therefore specific platforms are typically offerred for traders
FXCM_Kathy (Sep 17, 2003 4:45:33 PM)
using such strategics
FXCM_Kathy (Sep 17, 2003 4:45:38 PM)
strategies
cibio (Sep 17, 2003 4:46:49 PM)
so how many times can u trade the same currency in 1 trading day and yes i know FXCM has a scalpers platform. I love the FXCM demo its great
FXCM_Kathy (Sep 17, 2003 4:46:57 PM)
thanks
FXCM_Kathy (Sep 17, 2003 4:47:07 PM)
there is no limit on how many times you can trade in a currency as
FXCM_Kathy (Sep 17, 2003 4:47:12 PM)
long as you have sufficient funds
FXCM_Kathy (Sep 17, 2003 4:47:36 PM)
the fx market is a 24 hour market so trading is available anytime of the day
FXCM_Kathy (Sep 17, 2003 4:47:43 PM)
once you close your positions
FXCM_Kathy (Sep 17, 2003 4:47:53 PM)
those funds automatically go back into your usable margin
FXCM_Kathy (Sep 17, 2003 4:47:54 PM)
cibio (Sep 17, 2003 4:48:02 PM)
thank u
eatnrun (Sep 17, 2003 4:48:46 PM)
If I have 15 hours per day to trade, which time periods are the most active associated with which currency pair? Would appreciate if you can specify the time zone in Eastern time.
FXCM_Kathy (Sep 17, 2003 4:48:53 PM)
sure
FXCM_Kathy (Sep 17, 2003 4:49:27 PM)
The most trading activity tends to take place when markets overlap
FXCM_Kathy (Sep 17, 2003 4:49:50 PM)
in EST they are during the following overlaps
FXCM_Kathy (Sep 17, 2003 4:49:51 PM)
Asia and Europe (12:00 AM to approximately 2:00 AM), Europe and the US (8:00 AM to approximately 11:00 AM) and US and Asia (5:00 PM to 9:00 PM).
FXCM_Kathy (Sep 17, 2003 4:50:07 PM)
During New York and London hours all the currency pairs trade actively.
FXCM_Kathy (Sep 17, 2003 4:50:15 PM)
During the Asia hours, however, the trading activity for pairs such as EUR/JPY and AUD/JPY peak
FXCM_Kathy (Sep 17, 2003 4:50:23 PM)
and are less widely traded during New York and London hours.
FXCM_Kathy (Sep 17, 2003 4:50:39 PM)
daanackerman (Sep 17, 2003 4:51:44 PM)
Kathy for the channel trading what timescale is the best to use?
FXCM_Kathy (Sep 17, 2003 4:52:32 PM)
typically channel trading works best on longer time frames
FXCM_Kathy (Sep 17, 2003 4:52:41 PM)
hourly works okay and can be used successfully
FXCM_Kathy (Sep 17, 2003 4:52:55 PM)
however breaks of channels on the daily charts
FXCM_Kathy (Sep 17, 2003 4:52:59 PM)
are more significant
FXCM_Kathy (Sep 17, 2003 4:53:10 PM)
and then of course breaks on the weekly charts are EVEN more significant
FXCM_Kathy (Sep 17, 2003 4:53:33 PM)
Andre (Sep 17, 2003 4:53:50 PM)
Keep those questions coming, folks.
yunlin (Sep 17, 2003 4:54:36 PM)
Are moving averages important??and where can you get intraday charts with indicators??
FXCM_Kathy (Sep 17, 2003 4:54:49 PM)
moving averages are very important when trading currencies
FXCM_Kathy (Sep 17, 2003 4:54:55 PM)
we typically monitor
FXCM_Kathy (Sep 17, 2003 4:55:16 PM)
the 10, 20, 50, 100 and 200 day moving averages
FXCM_Kathy (Sep 17, 2003 4:55:22 PM)
you can find intraday charts at
FXCM_Kathy (Sep 17, 2003 4:55:42 PM)
http://www.dailyfx.com/sa/sa_charts.html
FXCM_Kathy (Sep 17, 2003 4:55:54
PM)
in fact
FXCM_Kathy (Sep 17, 2003 4:56:04 PM)
if you are familiar with moving averages
FXCM_Kathy (Sep 17, 2003 4:56:29 PM)
you already have one of the key tactics to trading the fx market down
FXCM_Kathy (Sep 17, 2003 4:56:50 PM)
eatnrun (Sep 17, 2003 4:57:09 PM)
Kathy, which main indicators have you been successful with in trading forex??
FXCM_Kathy (Sep 17, 2003 4:57:26 PM)
the best ones to use
FXCM_Kathy (Sep 17, 2003 4:57:32 PM)
and the ones that we monitor
FXCM_Kathy (Sep 17, 2003 4:57:33 PM)
are RSI
FXCM_Kathy (Sep 17, 2003 4:57:37 PM)
fibonacci
FXCM_Kathy (Sep 17, 2003 4:57:43 PM)
moving averages
FXCM_Kathy (Sep 17, 2003 4:57:46 PM)
bollinger band
FXCM_Kathy (Sep 17, 2003 4:58:06 PM)
and of course candlestick formations
FXCM_Kathy (Sep 17, 2003 4:58:08 PM)
ccoon (Sep 17, 2003 4:59:19 PM)
Any MACD divergences?
FXCM_Kathy (Sep 17, 2003 4:59:54 PM)
typically we look at RSI and stochastic divergences
FXCM_Kathy (Sep 17, 2003 5:00:16 PM)
MACD divergences give pretty much the same signal
FXCM_Kathy (Sep 17, 2003 5:00:29 PM)
so they are pretty much a redundant analysis
FXCM_Kathy (Sep 17, 2003 5:00:42 PM)
yunlin (Sep 17, 2003 5:00:49 PM)
intraday divergence indicators(5min)??
FXCM_Kathy (Sep 17, 2003 5:01:19 PM)
it depends on your trading strategy and holding pattern
FXCM_Kathy (Sep 17, 2003 5:01:30 PM)
of course
FXCM_Kathy (Sep 17, 2003 5:01:43 PM)
the longer your time frames, the more reliable
FXCM_Kathy (Sep 17, 2003 5:01:46 PM)
the divergence
FXCM_Kathy (Sep 17, 2003 5:02:01 PM)
therefore if you use the 5 minute time frame, divergences may occur more frequently
FXCM_Kathy (Sep 17, 2003 5:02:09 PM)
but are also therefore a lot less reliable
FXCM_Kathy (Sep 17, 2003 5:02:20 PM)
resulting in a higher number of unprofitable trades
FXCM_Kathy (Sep 17, 2003 5:02:34 PM)
however, intraday traders who are looking for
FXCM_Kathy (Sep 17, 2003 5:02:41 PM)
divergences on the 5-10 min time frames
FXCM_Kathy (Sep 17, 2003 5:02:50 PM)
are hoping that the profitable trades will
FXCM_Kathy (Sep 17, 2003 5:03:06 PM)
offset the higher number of unprofitable ones
FXCM_Kathy (Sep 17, 2003 5:03:13 PM)
and when working with shorter time frames,
FXCM_Kathy (Sep 17, 2003 5:03:22 PM)
stops need to be placed closer as well
FXCM_Kathy (Sep 17, 2003 5:03:33 PM)
therefore the general rule of thumb is if you are using divergences
FXCM_Kathy (Sep 17, 2003 5:03:52 PM)
is to opt for a longer time frame because it increases the reliability of the indicator
FXCM_Kathy (Sep 17, 2003 5:03:53 PM)
yunlin (Sep 17, 2003 5:04:03 PM)
need shorter timeframe for good entry price mainly
PuffyGums (Sep 17, 2003 5:04:25 PM)
When you trade off of critical levels, how much heat do you usually take (how much do you let the trade go against you) before you get out?
FXCM_Kathy (Sep 17, 2003 5:04:58 PM)
this is dependent on where you intend to take profit
FXCM_Kathy (Sep 17, 2003 5:05:06 PM)
we encourage at least a 2:1 risk reward ratio
FXCM_Kathy (Sep 17, 2003 5:06:24 PM)
your holding period will also impact the view
FXCM_Kathy (Sep 17, 2003 5:07:03 PM)
so the longer your holding period, the more you are able to risk
FXCM_Kathy (Sep 17, 2003 5:07:05 PM)
eatnrun (Sep 17, 2003 5:07:45 PM)
Kathy, I plan to concentrate on no more than 2 currency pairs for now. EUR/USD is one, what others do you favor most???
FXCM_Kathy (Sep 17, 2003 5:08:13 PM)
USDJPY
FXCM_Kathy (Sep 17, 2003 5:08:26 PM)
EURUSD and USDJPY are the most liquid currency pairs
FXCM_Kathy (Sep 17, 2003 5:08:40 PM)
however i also like GBPUSD and USDCHF
FXCM_Kathy (Sep 17, 2003 5:09:10 PM)
cibio (Sep 17, 2003 5:09:31 PM)
Kathy i heard USD/CHF was good to trade for teh novice trader? is this true
FXCM_Kathy (Sep 17, 2003 5:10:23 PM)
I'd be careful with that one
FXCM_Kathy (Sep 17, 2003 5:10:32 PM)
USDCHF has very wide trading ranges
FXCM_Kathy (Sep 17, 2003 5:10:39 PM)
and excessive moves
FXCM_Kathy (Sep 17, 2003 5:10:48 PM)
EURUSD is the best for a novice trader
cibio (Sep 17, 2003 5:11:11 PM)
ok thank u will do
FXCM_Kathy (Sep 17, 2003 5:11:32 PM)
because it allows you
FXCM_Kathy (Sep 17, 2003 5:11:40 PM)
to participate in the market without being
FXCM_Kathy (Sep 17, 2003 5:11:50 PM)
victimized by excess volatility
FXCM_Kathy (Sep 17, 2003 5:12:00 PM)
EURUSD trends very well
FXCM_Kathy (Sep 17, 2003 5:12:09 PM)
so if you've got to pick one to trade
FXCM_Kathy (Sep 17, 2003 5:12:17 PM)
i would certainly recommend that
FXCM_Kathy (Sep 17, 2003 5:12:18 PM)
cibio (Sep 17, 2003 5:12:25 PM)
great thanks again
Nana Trader (Sep 17, 2003 5:12:56 PM)
Does News has stronger impact on FX market cpmpare to equity? and if affect on that currency is longer comparing to news that affect equity market and taking quick profit otherwise we are late to the Move?
FXCM_Kathy (Sep 17, 2003 5:13:36 PM)
news and rumors definitely move currencies
FXCM_Kathy (Sep 17, 2003 5:13:52 PM)
professional FX traders will never be late to the move because
FXCM_Kathy (Sep 17, 2003 5:14:01 PM)
everyone has access to real time news
FXCM_Kathy (Sep 17, 2003 5:14:06 PM)
even our clients
FXCM_Kathy (Sep 17, 2003 5:14:13 PM)
(we offer it free)
FXCM_Kathy (Sep 17, 2003 5:14:48 PM)
economic releases and macro news probably has more of an impact on currencies
FXCM_Kathy (Sep 17, 2003 5:15:02 PM)
than equities because equities
FXCM_Kathy (Sep 17, 2003 5:15:31 PM)
may only react to news that is specific to one currency
FXCM_Kathy (Sep 17, 2003 5:15:38 PM)
i meant company
FXCM_Kathy (Sep 17, 2003 5:16:00 PM)
currencies will react to news that affects both equity and bond markets
FXCM_Kathy (Sep 17, 2003 5:16:31 PM)
for example,
FXCM_Kathy (Sep 17, 2003 5:16:34 PM)
in the Eurozone
FXCM_Kathy (Sep 17, 2003 5:16:42 PM)
European government officials
FXCM_Kathy (Sep 17, 2003 5:16:55 PM)
consistently make comments on the growth prospects and
FXCM_Kathy (Sep 17, 2003 5:17:18 PM)
current conditions
FXCM_Kathy (Sep 17, 2003 5:17:22 PM)
as well as interest rates
FXCM_Kathy (Sep 17, 2003 5:17:32 PM)
rarely do you see blips in the Dax
FXCM_Kathy (Sep 17, 2003 5:17:40 PM)
based upon these comments
FXCM_Kathy (Sep 17, 2003 5:17:52 PM)
however, the EURUSD will
FXCM_Kathy (Sep 17, 2003 5:18:04 PM)
react significantly on that news
FXCM_Kathy (Sep 17, 2003 5:18:09 PM)
Andre (Sep 17, 2003 5:18:16 PM)
Interesting, Kathy.
FXCM_Kathy (Sep 17, 2003 5:18:42 PM)
this same case occurs in
FXCM_Kathy (Sep 17, 2003 5:18:44 PM)
Japan
Andre (Sep 17, 2003 5:18:44 PM)
We've actually got several questions here asking about what kind of indicators do currencies respond to.
FXCM_Kathy (Sep 17, 2003 5:18:48 PM)
sure
FXCM_Kathy (Sep 17, 2003 5:18:54 PM)
Nana Trader (Sep 17, 2003 5:19:00 PM)
Can you recommand some of best sources for top economic releases that covers realtime for all currencies?
eatnrun (Sep 17, 2003 5:19:11 PM)
Kathy, which top economic/fundamental indicators do you favor and follow most with trading the eur/usd and usd/jpy?
FXCM_Kathy (Sep 17, 2003 5:19:34 PM)
most free resources do not provide realtime economic releases
FXCM_Kathy (Sep 17, 2003 5:20:15 PM)
the resource that our clients use is our news plugin
FXCM_Kathy (Sep 17, 2003 5:20:27 PM)
it lists all of the upcoming economic releases and updates
FXCM_Kathy (Sep 17, 2003 5:20:35 PM)
them as soon as the release hits the wires
FXCM_Kathy (Sep 17, 2003 5:20:46 PM)
its free
FXCM_Kathy (Sep 17, 2003 5:20:51 PM)
but requires a download process
FXCM_Kathy (Sep 17, 2003 5:21:21 PM)
in terms of my favorite economic releases
FXCM_Kathy (Sep 17, 2003 5:21:38 PM)
for the us; the last fomc statement tells us exactly what the fed is watching
FXCM_Kathy (Sep 17, 2003 5:21:46 PM)
which is gdp, the labor market,
FXCM_Kathy (Sep 17, 2003 5:22:10 PM)
productivity, consumer spending
FXCM_Kathy (Sep 17, 2003 5:22:23 PM)
CPI,PPI
FXCM_Kathy (Sep 17, 2003 5:22:52 PM)
for the eurozone
FXCM_Kathy (Sep 17, 2003 5:23:17 PM)
gdp is the obvious one
FXCM_Kathy (Sep 17, 2003 5:23:23 PM)
also the ZEW survey,
FXCM_Kathy (Sep 17, 2003 5:23:29 PM)
IFO Survey
FXCM_Kathy (Sep 17, 2003 5:23:34 PM)
HCIP
FXCM_Kathy (Sep 17, 2003 5:23:43 PM)
which is the Harmonized Index of Consumer Prices
FXCM_Kathy (Sep 17, 2003 5:23:47 PM)
German Unemployment
FXCM_Kathy (Sep 17, 2003 5:23:52 PM)
German Industrial Production
FXCM_Kathy (Sep 17, 2003 5:23:56 PM)
for Japan
FXCM_Kathy (Sep 17, 2003 5:24:02 PM)
we follow the Tankan survey
FXCM_Kathy (Sep 17, 2003 5:24:18 PM)
current account surplus
FXCM_Kathy (Sep 17, 2003 5:24:22 PM)
employment
FXCM_Kathy (Sep 17, 2003 5:24:26 PM)
industrial production
FXCM_Kathy (Sep 17, 2003 5:24:29 PM)
business spending
FXCM_Kathy (Sep 17, 2003 5:24:38 PM)
and of course gdp
FXCM_Kathy (Sep 17, 2003 5:24:45
PM)
Andre (Sep 17, 2003 5:24:52 PM)
Kathy, we've got plenty of questions for you, but let's take a few specifically on Forex Capital Markets.
FXCM_Kathy (Sep 17, 2003 5:25:07 PM)
no problem
izeickl (Sep 17, 2003 5:25:10 PM)
Are FXCM planning on updating the software at all? I.e trailing s/l, OCO. Also any chance on offering other currency pairs?
FXCM_Kathy (Sep 17, 2003 5:25:39 PM)
we do not offer trailing stops at this time,
FXCM_Kathy (Sep 17, 2003 5:26:23 PM)
we do offer OCO orders in the form of stop and limit orders that can placed along with an open position
FXCM_Kathy (Sep 17, 2003 5:26:37 PM)
and cancelled once the first is triggered
FXCM_Kathy (Sep 17, 2003 5:27:21 PM)
we are always taking a look at expanding the line of currency pairs that we offered
FXCM_Kathy (Sep 17, 2003 5:27:36 PM)
we recently launched AUD./NZD
FXCM_Kathy (Sep 17, 2003 5:27:37 PM)
Nana Trader (Sep 17, 2003 5:27:56 PM)
Do you have mobile "wireless trading" offered in future?
FXCM_Kathy (Sep 17, 2003 5:28:15 PM)
definitely something we are looking at but not at the moment
FXCM_Kathy (Sep 17, 2003 5:28:27 PM)
the problem with wireless trading is the unreliability of networks
FXCM_Kathy (Sep 17, 2003 5:28:38 PM)
we do not want to compromise our speed of execution
FXCM_Kathy (Sep 17, 2003 5:28:51 PM)
most wireless trading are request a quote
FXCM_Kathy (Sep 17, 2003 5:28:57 PM)
we offer automatic execution
FXCM_Kathy (Sep 17, 2003 5:29:07 PM)
and thats something we pride ourselves on
FXCM_Kathy (Sep 17, 2003 5:29:20 PM)
so if we do offer a wireless platform
FXCM_Kathy (Sep 17, 2003 5:29:33 PM)
we want to ensure that we can offer the same quality of execution on that as well
FXCM_Kathy (Sep 17, 2003 5:29:55 PM)
therefore at this point, it is still something that we are looking into
FXCM_Kathy (Sep 17, 2003 5:29:56 PM)
eatnrun (Sep 17, 2003 5:30:03 PM)
Kathy, I aware of FXCM's partnership with Refco, any additional advantages you offer over Refco???
FXCM_Kathy (Sep 17, 2003 5:30:32 PM)
both companies are different and are their independent market makers
FXCM_Kathy (Sep 17, 2003 5:31:02 PM)
the advantage of fxcm is the personal touch and superior
FXCM_Kathy (Sep 17, 2003 5:31:06 PM)
customer service
FXCM_Kathy (Sep 17, 2003 5:31:49 PM)
we also offer an expanded line of option products
FXCM_Kathy (Sep 17, 2003 5:31:50 PM)
Andre (Sep 17, 2003 5:32:03 PM)
And where would they get in touch with that fabulous customer service? Can they contact you? Or is there a help desk or Email address for further questions on FXCM?
FXCM_Kathy (Sep 17, 2003 5:32:26 PM)
we have a 24 hour/ 7 day a week staff
cibio (Sep 17, 2003 5:32:47 PM)
thanks Kathy yes i will be trading the mini with FXCM
FXCM_Kathy (Sep 17, 2003 5:32:56 PM)
that can be reached at 1-888-50-FOREX or via email at sales@fxcm.com or
FXCM_Kathy (Sep 17, 2003 5:33:10 PM)
we have an online chat feature that can be accessed at www.fxcm.com
FXCM_Kathy (Sep 17, 2003 5:33:21 PM)
we also offer something called the Gold Service
FXCM_Kathy (Sep 17, 2003 5:33:29 PM)
for larger account sizes that
FXCM_Kathy (Sep 17, 2003 5:33:34 PM)
gives those clients
FXCM_Kathy (Sep 17, 2003 5:33:49 PM)
a personal representative
FXCM_Kathy (Sep 17, 2003 5:33:54 PM)
to chat about the markets
FXCM_Kathy (Sep 17, 2003 5:33:59 PM)
expediate account processing
FXCM_Kathy (Sep 17, 2003 5:34:07 PM)
and customized currency research reports
FXCM_Kathy (Sep 17, 2003 5:34:12 PM)
Andre (Sep 17, 2003 5:34:22 PM)
Good to know, Kathy.
Andre (Sep 17, 2003 5:34:41 PM)
We've got a few more questions... can you stick around?
FXCM_Kathy (Sep 17, 2003 5:34:54 PM)
yep
izeickl (Sep 17, 2003 5:34:58 PM)
What constitutes a "larger account"?
Andre (Sep 17, 2003 5:35:10 PM)
Great.
FXCM_Kathy (Sep 17, 2003 5:35:16 PM)
greater than $25k
eatnrun (Sep 17, 2003 5:35:27 PM)
Kathy, a few of your competitors offer 2-3 pips spread on the major currency pairs. Will FXCM's pip spread become more competitive in the near future????
FXCM_Kathy (Sep 17, 2003 5:35:49 PM)
yes, there are definitely firms who offer tighter spread
FXCM_Kathy (Sep 17, 2003 5:36:03 PM)
Many of the firms promoting 3 pip spreads actually receive spreads that are much wider than those they offer to their clients.
FXCM_Kathy (Sep 17, 2003 5:36:22 PM)
Spreads of 3 pips in the major currency pairs are common in the interbank market.
FXCM_Kathy (Sep 17, 2003 5:36:33 PM)
However, many of those firms
FXCM_Kathy (Sep 17, 2003 5:36:38 PM)
are too small to have primary access to the interbank market.
FXCM_Kathy (Sep 17, 2003 5:36:49 PM)
As in every major business, there are large firms that have primary access to major suppliers
FXCM_Kathy (Sep 17, 2003 5:36:56 PM)
and smaller ones that have to go through intermediaries at greater cost
FXCM_Kathy (Sep 17, 2003 5:37:01 PM)
These firms generally clear with firms like Refco or us.
FXCM_Kathy (Sep 17, 2003 5:37:06 PM)
If these firms provided 3 Pip spreads, they would be out of business within a couple weeks
FXCM_Kathy (Sep 17, 2003 5:37:14 PM)
Rather these firms do not honor their 3 Pip spreads (re-quote) or engage in ethically questionable execution practices (excessive slippage, manipulating prices).
FXCM_Kathy (Sep 17, 2003 5:37:19 PM)
Generally their prices will only be good if you are on the wrong side of the market move
FXCM_Kathy (Sep 17, 2003 5:37:24 PM)
On the right side of the market they will not honor their price.
FXCM_Kathy (Sep 17, 2003 5:37:32 PM)
Some firms simply gray out their prices or will not execute during fast moving markets, precisely when good executions matter the most.
FXCM_Kathy (Sep 17, 2003 5:37:37 PM)
FXCM’s prices are always good regardless of which side of the market you are on.
FXCM_Kathy (Sep 17, 2003 5:37:46 PM)
FXCM offers instantaneous fills in all market conditions regardless market conditions or the size of the order
Andre (Sep 17, 2003 5:38:09 PM)
You know,I got this question in:
trader3 (Sep 17, 2003 5:38:20 PM)
I came late, so forgive me if this is a silly question, but I was under the impression that in FX trading a trader could not buy the bid or sell the ask. If this is the case, how can a scalper take advantage of the spread?
Andre (Sep 17, 2003 5:38:28 PM)
BUt I think you just answered it.
Andre (Sep 17, 2003 5:38:32 PM)
Can you add to it?
FXCM_Kathy (Sep 17, 2003 5:39:03 PM)
the platform that we offer for scalpers does allow traders to place entry orders between the spread
FXCM_Kathy (Sep 17, 2003 5:39:10 PM)
minihane (Sep 17, 2003 5:39:36 PM)
Hi Kathy one thing I've noticed with USD/JPY is intervention from the Bank of Japan, which causes surges in the market. I guess it doesn't happen on a regular basis, but how often does this happen?
FXCM_Kathy (Sep 17, 2003 5:40:10 PM)
recently its been happening alot because of the current trading price of USDJPY (nearing what is the supposed break even level of exporters - 115)
FXCM_Kathy (Sep 17, 2003 5:40:30 PM)
Japanese fundamentals are improving significantly after 10 years of stagnation
FXCM_Kathy (Sep 17, 2003 5:40:38 PM)
capital is pouring into Japan
FXCM_Kathy (Sep 17, 2003 5:40:55 PM)
creating severe upward pressure on the Yen and corresponding downward pressure on USDJPY
FXCM_Kathy (Sep 17, 2003 5:41:11 PM)
the bank of japan is committed to keeping the JPY capped
FXCM_Kathy (Sep 17, 2003 5:41:25 PM)
so intervention will continue
FXCM_Kathy (Sep 17, 2003 5:41:36 PM)
they already spent 9trln yen
FXCM_Kathy (Sep 17, 2003 5:41:41 PM)
or $77bln
FXCM_Kathy (Sep 17, 2003 5:41:48 PM)
they aren't going to back off yet
FXCM_Kathy (Sep 17, 2003 5:42:12 PM)
we are seeing a lull ahead of G7, i expect it to pick up with fierce shortly after G7 (which is this weekend)
FXCM_Kathy (Sep 17, 2003 5:42:24 PM)
however, if usdjpy breaks
FXCM_Kathy (Sep 17, 2003 5:42:25 PM)
115...
FXCM_Kathy (Sep 17, 2003 5:42:33 PM)
it could be a freefall in my opinion
FXCM_Kathy (Sep 17, 2003 5:42:35 PM)
mark2002 (Sep 17, 2003 5:42:58 PM)
how do you define a choppy day or non trending if you want to daytrade ?
FXCM_Kathy (Sep 17, 2003 5:43:24 PM)
extreme volatility
FXCM_Kathy (Sep 17, 2003 5:43:30 PM)
for example the euro
FXCM_Kathy (Sep 17, 2003 5:43:46 PM)
was in a consistent uptrend today, so daytrading was fairly easy
FXCM_Kathy (Sep 17, 2003 5:43:49 PM)
however,
FXCM_Kathy (Sep 17, 2003 5:44:32 PM)
this is not always the case
FXCM_Kathy (Sep 17, 2003 5:44:54 PM)
a choppy day may be a downtrend in usdjpy
FXCM_Kathy (Sep 17, 2003 5:45:03 PM)
followed by BoJ intervention
FXCM_Kathy (Sep 17, 2003 5:45:06 PM)
mark2002 (Sep 17, 2003 5:45:29 PM)
you measure volatility based on which timeframe ?
FXCM_Kathy (Sep 17, 2003 5:45:45 PM)
we usually use the 3 month volatility as a barometer
FXCM_Kathy (Sep 17, 2003 5:45:52 PM)
however,
FXCM_Kathy (Sep 17, 2003 5:46:24 PM)
in reference to the earlier question, choppy trading for an intraday trader
FXCM_Kathy (Sep 17, 2003 5:46:37 PM)
would be based upon a 30min-1 hour time frame
FXCM_Kathy (Sep 17, 2003 5:46:39 PM)
mark2002 (Sep 17, 2003 5:46:55 PM)
historical vol , no implied one ?
mark2002 (Sep 17, 2003 5:47:26 PM)
so it is better to do position trading ?
FXCM_Kathy (Sep 17, 2003 5:47:27 PM)
actual vol
FXCM_Kathy (Sep 17, 2003 5:47:39 PM)
historical vol that is
FXCM_Kathy (Sep 17, 2003 5:47:52 PM)
profits are made in both short term day trading and position trading
FXCM_Kathy (Sep 17, 2003 5:48:04 PM)
i can't tell you whats best, it depends on your style
FXCM_Kathy (Sep 17, 2003 5:48:19 PM)
Andre (Sep 17, 2003 5:48:39 PM)
Well, folks I think we're about done. However, before we Let Kathy go, does
anyone have any questions for her on the Prop Seminar the FXCM will be sponsoring?
Andre (Sep 17, 2003 5:49:13 PM)
Anyone?
eatnrun (Sep 17, 2003 5:49:20 PM)
Kathy, if accepted , what is the initial buying power you offer??
FXCM_Kathy (Sep 17, 2003 5:50:19 PM)
no money is put up by the trader
FXCM_Kathy (Sep 17, 2003 5:50:29 PM)
the firm provides all the funds
FXCM_Kathy (Sep 17, 2003 5:50:55 PM)
and the limit is 2 lots at any point in time in the beginning
FXCM_Kathy (Sep 17, 2003 5:51:07 PM)
which is approx 200,000 in notional
FXCM_Kathy (Sep 17, 2003 5:51:10 PM)
eatnrun (Sep 17, 2003 5:51:20 PM)
And what will the profit split percentage between the trader and fxcm be?
FXCM_Kathy (Sep 17, 2003 5:52:10 PM)
50:50 with 10% bonus after $250,000 gross on 1 year anniversary and
FXCM_Kathy (Sep 17, 2003 5:52:18 PM)
20% bonus on a million gross
FXCM_Kathy (Sep 17, 2003 5:52:24 PM)
tlcap (Sep 17, 2003 5:52:41 PM)
do you need an FX track record to perticipate in the seminar?
FXCM_Kathy (Sep 17, 2003 5:52:48 PM)
definitely
FXCM_Kathy (Sep 17, 2003 5:53:25 PM)
you need to have technical analysis
FXCM_Kathy (Sep 17, 2003 5:53:27 PM)
skills
FXCM_Kathy (Sep 17, 2003 5:53:33 PM)
so a track record or trading experience
FXCM_Kathy (Sep 17, 2003 5:53:43 PM)
is required
FXCM_Kathy (Sep 17, 2003 5:53:44 PM)
Andre (Sep 17, 2003 5:53:46 PM)
Trading style? A certain number of profitable months?
FXCM_Kathy (Sep 17, 2003 5:54:19 PM)
technical analysis with understanding of economics....the company will provide some training
Andre (Sep 17, 2003 5:54:38 PM)
Kathy, can you provide that Email address again?
FXCM_Kathy (Sep 17, 2003 5:54:42 PM)
aspanton@fxcm.com
FXCM_Kathy (Sep 17, 2003 5:55:01 PM)
there is no specific track record period
FXCM_Kathy (Sep 17, 2003 5:55:08 PM)
depends upon the experience of the trader
FXCM_Kathy (Sep 17, 2003 5:55:12 PM)
more experience,
FXCM_Kathy (Sep 17, 2003 5:55:21 PM)
less track record needed
mark2002 (Sep 17, 2003 5:55:22 PM)
where is the training provided ?
FXCM_Kathy (Sep 17, 2003 5:55:22 PM)
FXCM_Kathy (Sep 17, 2003 5:56:20 PM)
more information on training will be disclosed
FXCM_Kathy (Sep 17, 2003 5:56:30 PM)
once an invitation is extended
FXCM_Kathy (Sep 17, 2003 5:56:52 PM)
but it will be in ny most likely
FXCM_Kathy (Sep 17, 2003 5:56:59 PM)
Andre (Sep 17, 2003 5:57:00 PM)
Ok, Kathy... thanks.
Andre (Sep 17, 2003 5:57:16 PM)
And with that...
Andre (Sep 17, 2003 5:57:32 PM)
I think we'll call this done.
FXCM_Kathy (Sep 17, 2003 5:57:39 PM)
thanks alot folks
Andre (Sep 17, 2003 5:57:40 PM)
Kathy... thanks so much for joining us today!
FXCM_Kathy (Sep 17, 2003 5:57:50 PM)
its always a pleasure
eatnrun (Sep 17, 2003 5:57:54 PM)
Thank you so much Kathy
cibio (Sep 17, 2003 5:57:58 PM)
Thanks a million Kathy
FXCM_Kathy (Sep 17, 2003 5:58:01 PM)
more questions can be sent to klien@fxcm.com
Andre (Sep 17, 2003 5:58:14 PM)
And you can find more about Forex Capital Markets at: http://www.fxcm.com
minihane (Sep 17, 2003 5:58:21 PM)
very good-thanks to all!
FXCM_Kathy (Sep 17, 2003 5:58:29 PM)
track records and resumes for the prop seminar should be sent to aspanton@fxcm.com
Andre (Sep 17, 2003 5:58:36 PM)
We will have a log posted soon at: http://www.elitetrader.com/ch/index.cfm
Andre (Sep 17, 2003 5:58:44 PM)
And while this chat session may have ended, the discussion doesn't have to. For additional questions and comments, please see the following thread on our message board: http://www.elitetrader.com/vb/showthread.php?threadid=22335
bobcathy1 (Sep 17, 2003 5:58:54 PM)
thank you very much for this chat.
virgin (Sep 17, 2003 5:59:20 PM)
it was nice to have a real lady on this board !
cibio (Sep 17, 2003 5:59:21 PM)
thanks nite all great chat
eatnrun (Sep 17, 2003 5:59:23 PM)
and Thank you Andre for hosting this informative session
Nana Trader (Sep 17, 2003 5:59:43 PM)
Thanks to ET and Fxcm
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