I admit i know jack squat about forex trading, nothing, nada, zilch, so please i dont need comments saying get out while you can or train for a year before you do any trading etc etc. I am here asking for help for the very basics My first and formost question is if I buy something how long can I hold that position? For example if I buy a share of Wal-mart I can hold onto it forever. But if I buy an option or commodity, eventually it has a time line. Does forex have a time line?? Now I just started with a 50000 dollar fake account with FXCM and within 24 hours i made 700 dollars profit. My equity never hit below 48000, so am I assuming I never used more than 2000 buying power? Again I apologize but I am eager to learn and will learn and plan on trading in the very near future once I learn more. Lastly if there is no time line (I already know what people are going to say, but I have done it in the stock market with great results, I just want to speed things up and since over 3 trillion dollars a day is traded in this market it seems prime for me to try it) I like to average down, cont. to buy if it drops and get my average price down until I can make a small profit and then sell. I have been 100 percent successful in the stock market so far, but again it is extremly slow and I wonder has anyone else done this with success or lost their ass to this system. Thanks in advance Note"up 800 dollars now lol"
There is no time line, you can hold positions for as long as you want. Do some reading on the "carry trade"... essentially an arbitrage between two different currency interest rates. It's not prevalent right now because rates are low everywhere, but when Japan was implementing ZIRP and countries like the UK, Australia, etc. had high interest rates it was a very popular long-term trade. Large countries and institutions were holding positions for close to a decade. Buying power is tricky with currencies mostly because brokers treat it differently. Most (like FXCM) are what are referred to "bucket shops". Ideally, trade with IB or MBTrading. I have accounts with both. If you like Metatrader platform I highly recommend MBTrading. They have by far the tightest spreads albeit a commission per trade. But do the math and it saves you boat loads of cash. For example, I trade mostly GBP/JPY. MB's spread is rarely more than 4 pips and I pay something like $4.00 to trade 100k. At about $10/pip I'm essentially in hole $44.00 once I put on the trade as I need it to move 4 pips before I could get out at break even and then the comission. At most other brokers the spread is much larger... usually at least 7 pips and sometimes 9+. While they don't charge a comission, I'm essentially in the hole $70-90+ (depending on the broker) when initiating a trade. IB is just as good, they just don't have Metatrader. So go ahead and learn but be smart and shop around when you do decide to play for real. Long-term positions can be ok, but if you can master trading in and out of a "long-term" trade you can make much more money. I generally have large targets but hop in and out of the entire move several times. When you get a feel for the market you'll be able to do the same. Best of luck.
I trade forex and please don't lose the fact that your not on the same playing field as the big banks so the Trillion dollar amount is just marketing. LOL There is no rollover of positions ala futures market. I would not confuse an early win of 800.00 to be shooting fish in a barrell. I'd go to sites like babypips.com to get basic knowledge also the forex trading for dummies and idoit's guide are decent books to read. Good Trading!
Thanks to your replys and I will take both of your advices seriously. I lost 6000 dollars and called out on a margin call (overextended myself lol). Now since then I have been taking baby profits of 1 dollar to 100 dollars per trade and have since gone back up and I am now down only 5000 dollars. Alot to learn I guess. but averaging down seems to work very well in this market
you can definitely average down as long as you don't over leverage yourself and keep the major trend in mind. When you're wrong, you need to recognize it and not be stubborn. Those are the toughest two things to conquer.
Thank You I think you are right, it is hard to let go and I will have to learn to do that to be successful. I have been trading the last hour roughly and I am up 75 dollars getting small profits from the wild swings. You would not happen to know off the top of your head (I can research it) what the biggest drop was in this market ever was would you? and on a very bad day (like black monday in 87) how many pips can you expect a currency to drop?. This will help me to decide how far to average down and when to get out. Thanks if you can Any traders in dallas/fort worth Texas area you may know I might learn from? I would be willing to pay to watch someone do this live and learn from them?
It's hard to put numbers on how many pips something can drop. GBP/JPY dropped thousands of pips during the months when the real estate bottom was falling out. Averaging down there would have blown your account. Soros made over a billion dollars shorting the Pound back in the day. So drops can be huge. My advice is to start with slower moving pairs like EUR/USD, AUD/USD, USD/JPY, etc. Once you can trade those successfully and if you crave even more volatility try your hand at GBP/USD. If you get bored with that, move to GBP/JPY (what I trade 90% of the time). It's hard to get bored with that one. Just look at some historical charts and take a look at some big drops (or rises). Things can get CRAZY. Also, some news events have potential to really move currencies. NFP used to be the big one then it was rate decisions. Now it's NFP again but not as volatile as it used to be. Since rates are so low everywhere there's much less importance on these until countries start raising again. It's good to be aware of what news events are "hot" and the big market movers. I'm in San Francisco so can't be much help in terms of showing live trading.
thanks once again, like i said i have alot to learn and right now today i am up 200 dollars (only 4800 more to break even). I tend to favor the US dollar since it is the most traded currency and I will try the others when i feel more confident. Thanks again wishing you profitable trading db
I would check the terms and conditions of the trading platform you are using for how long you can hold any trading positions. I know one of the guys on here think it's an infinite stretch but actually depends on how long the trading app will let you keep it really. I found out about this recently as like you I started on the markets.com trading app with a practice amount of $10K back in September 2015 while on holiday - I thought I would try it as I had some spare time. I built it up to $1.5m over 3 months. I was 'practise' trading while doing my day job as an IT contractor. It took up a lot of my time as I was constantly eyeing the markets and my share prices and basically spent almost as much time on it as my day job. I initially thought it was a scam and that there is no way in hell I can make that kind of money trading for real. I made around $800K on one trade (a reverse stock split which came in at 10 to 1 basically as the share price shot up and I cashed in my position straight away). Anyway, I grew more and more sceptical about the app and kind of stopped using it once I was up to $1.5m. Recently I lost my iPhone and bought a new phone and saw that it had the app was still backed up - so I opened it up and saw my balance was up to $1.7m - I think it was earning interest while I had been away. SO...I bought around 6 new positions and in 2 or 3 days have made $140K ($80k on Bitcoin, $48K on Arcelor Mittal and $32K on Air France being my high earners...in 2 or 3 days!!! lost some money on Ethereum and Litecoin but only around $30K). Anyway, I think I am ready to trade for real now, I have created a 'strategy' for myself and know what kind of trader I am now after 2 years. I think thats the important thing for anyone looking to trade for real, have a strategy and know what type of investment game you are good at playing (long, mid or short term trading). I had some open positions on markets.com when I gave up the app the first time and they were closed out when I recently logged back in again, hence why I mentioned check the t's and c's