I agree if you are scalping. Also I have concern as to counterparty risk. As I mentioned in previous posts, I used to trade forex regularly, but I worked with the Bundesbank exclusively. This goes back nearly 20 years. I never had a problem (I did not scalp) and on more than one occasion I was able to execute both sides of each transaction over the phone directly with the bank. If I understand correctly, forex brokers can (if they want to or have to) simply step away from the transaction, or "requote" to minimize risk on their side. I couldn't do business that way. Best Regards, Steve46
I would be intested in hearing in detail how one scalps the cash FX market. Please explain and use some nice charts.
Mike..... If you're over twelve I think you might want to rethink your harshness on the moderators here. I believe they are completely unpaid and they can't be alert and aware of everything that goes on here 24/7. Oh, don't get me wrong, I disagree with some of their judgements, also. But there's always that fine line between freedom of expression and censorship. I strongly disagree with your assessment that they are fucking morons. Quite to the contrary, I believe most of the time, they are trying to keep ET cleaned up to a reasonable extent. Regards, BSAM (I know. Off topic here, but the Mike Brown comment was totally out of line.)
BSAM: This thread opened up recently. I am glad you are here to do the job, and I dont expect you to be on top of every little detail. I appreciate your help. Best Regards, Steve46
Sam is really active with this, but I have no idea exactly how he does it. Personally, I could never beat a spread like they have in forex. I take rather large trades, 40 to 50 pips. Maybe Sam can share some techniques? Jay
ehk ehk ehk... OK, enough of Dr. Seuss. Wanna know some techniques ol' Sammy boy uses, eh? heh heh heh.. OK, first lemme clear up a few things the other Sam asked. "Did two trades and realized $17. Not bad for a beginner scalper! However I still feel there was a lot of exposure as I had no idea what I should do if the market continued to go adversely, and frankly i used 100K in one and 50K in the other, which doesn't make sound risk management if I am scalping I suppose." May want to keep an eye on size, dude. Number 1 reason traders bite it is due to size. In a real account unless you have the pockets of Donald Trump (read lots of credit) those 100Kers can show a few $1000 negative in your PL indicator in a heartbeat in forex. You may not have the wherewithal to withstand such a drawdown or trade your way out of it. "So how do I anticipate the waves?" How does one anticipate anything in life. Adapting is a key to trading success. Study the concepts of Bruce Lee. "And how do I limit my losses if the market goes against me?" This may be one of the very first questions primative man asked, only, he may have replaced the word "market" with "mistress." "Tight stop/losses I think are out of the window for they will do much more damage." SLs may infer that you don't know enough about the market or instrument you trade. Relying on a SL to do your thinking and homework for you is similar to relying on your hand when clicking through porn on the Internet, instead of, say, a vaccuum cleaner nozzle. *cough* "Also, I still didn't get what you said about a 100 pip drop that can happen in seconds in the USD/JPY?" Oh, OK, well... if you set up a 30 minute chart and/or a 5 minute or 3 hour chart and track the spike on USD/JPY that started around Febuary 17th, you'll see later big spike downs. If you had been trading like I was during a few of them you'd know that this pair has a habit of giving up 25, 50, 100 points in a few seconds time. Techniques. I know, I know, everyone says it's suicide to trade without stops, well... perhaps for 99% of traders. However, it is said that only 1% of traders survive. This would indicate that the 99% who eventually get vaporized may follow similar trading tactics. I am pursuaded that if I should ever join the ranks of successful traders who make millions trading I am going to have to think. I am going to have to work harder than the 99% of traders who lose. Speaking of losing.... I focus more of my time on how to win and how to avoid losing than making losing such a structural component of my trading that it interferes with the other dyamics that must be present in order to win every trade. Perhaps a better way to trade than using a stop loss to limit damages is to not make a trade when it is more probable that you will lose rather than win. Therefore, I don't trade unless the proper setting is present. Also, when I do make a trade I try to have alternate routes OUT of the trade should it go against me. So far... and we are talking a massive amount of market time here - little over a month live trading - I have not gotten a margin call. I have closed trades while in negative P/L but only by using already gained profit to replace the amount of money it took away from me in order to release that position. Like running a business, at times you may not be able to escape incurring "operating costs" on a trade - but hopefully, if the overall game plan of the trade(s) goes somewhat according to your strategy(ies) - you'll walk away from it with more than it cost you to slug it out while your trading was in progress. For example. This USD/JPY pair. I could have looked at it as a single trade (which I did, actually, in the beginning) - however once I committed to that first trade and the mutha went against me - WAY BACK on Feb, what, 17th?? (first short trade made under 106.67) I stuck with it, and it turns out I made quite a few errors, in that, had I been able to do the trade over again I would have probably rather just sought to marry a rich Princess of a Saudi sheikh out of the middle east. I'm still involved in the trade even as I write - WAIT I GOTTA CLOSE A TRADE!!!!! whew that was a close one... - so where was I - oh yeah, so once I finally find the perfect princess on the Internet by searching "naked teen girl vagina woman princess" on Google Images... I am sure someday I will hook up and I am not talking about just to my vacuum cleaner nozzle. We, as traders, place ourselves at the forefront of risk each time we open a trade. Winning is easy. How to not lose while trading is the complex part. Though I have found that loudly muttering, "UHKA BUKA! UHKA BUKA! UHKA BUKA!" when you have a trade on may influence the price to go in your favor. Best regards, Sam
Ok Thanks, Jayford must have been referring to you. I appreciate you telling us you have only been trading live for a month or so; I guess you are the same Sam who also uses alias Overload. Why two names on the one forum? Anyway your post does make sense. I put no stops on a Yen trade on monday and made $800 so am feeling a bit chuffed.