Fading Thomson

Discussion in 'Forex' started by ForexPro, Mar 9, 2006.

  1. I look at the news plug-in of FXCM software and look at the trades which thomson financial make, with regards to fx trading.
    I can see the rationale in their trades, such as breakouts, fibonacci, clouds, moving averages etc. However, they seem to get stopped out more often than not, and i dont see them realling making any headway.
    Would it be a good strategy to do the reverse of what they do?
  2. Most recent trade by Thomson on USD/CAD:

    After booking a 49-pt profit on our long trade after prices neared the next
    major historical hurdle at 1.1615, we have gone long again with the rise
    beyond that resistance. We are using a tight stop below yesterday"s 1.1585
    high which is also an hourly low today. Daily studies remain bullish although
    hourlies are have reached overbought readings. Target 1.1800.

    I think I will oppose that trade and short at 1.1623 tp 1.1570 SL 1.165. I'll see how it works out.
  3. Let's start with the premise that you've identifed what you believe to be a non-trivial negative expectancy strategy. In order to fade it successfully over time, you'll still face the considerable challenges of 1) not missing any entries, and 2) setting your own stop and target levels.

    Not missing any entries implies (besides the logistics of a 24/6 market)... what exactly do you do when you happen to agree with their trade? Fade it as usual; fade it with adjustments (e.g., smaller size than normal); stand aside and do nothing; go along with it (the anti-fade); flip the coin; or -- it depends, i.e., decide on a discretionary basis?

    Setting your own SL and TP... you are not going with TP 1.1585 and SL 1.1800 for your short. Why not?... Then you're combining the fade with a good dose of discretion.
  4. I quite like the Thomson stuff for its views and levels.

    Never do their trade though. Their biggest flaw is their stops are so wide for my style. Also they seem a bit wooly about when are stopped out and take profit. Would make it impossible to fade, if you were being serious!