trading a 5 sec chart?

Discussion in 'Strategy Development' started by mounafia, Oct 21, 2008.

  1. mounafia


    I am daytrading (on paper) for 2 years and for the last month I have been tryin a 5 sec strategy that seems to works quite well...

    I use the longer chart (30 sec, 1 min, 5 min and 15 min) to have a feeling of the direction and I use the 5 sec to enter in the market (in forex Eur/usd) with a stop of 7 pips in average.

    I have read some forum (oanda) where experienced trader were saying that trading in 5 sec were just a lost of may won some and get lucky but sooner or later, you are gonna lose and it is not a viable strategy.

    What do you think of that? Am I losing my time trying to learn a strategy that may work right now but that is not going to work in other times or is it strategy that some of you use during all time?

    Thanks in advance

    ps : sorry for the grammatical mistakes ...I am from France
  2. I don't trade Forex often but I trade full time in stocks, options, and futures.

    Also I dont trade based on 1 min or even 5 min charts like many do. I do scalp stocks so I do know how to get in and get out fast though.

    You most likely already know this but on the off chance you haven't given thought to the differences in paper trading vs. real trading you don't want to think that your fills will be as good with real trades.

    If I understand correctly you use longer charts to determine direction and use a very micro time to actually execute the entry. I can't think of a way to back test that off the top of my head but I would guess that you are able to time an entry with practice and good observational skills.

    It would not be unlike how scalpers grab small amounts from the order flow as buyers and sellers hit the market.

    It actually sounds like a good idea to try to work on methods to get the best entry you can. I would be very careful to try not to be fooled by a small sample size of entries in making up your mind if your actually getting a benefit on your current method.

    Best of trading to you

  3. I dont use the 5 sec but the tick. Usefull for entry point.
    If you want to play the 5 sec with confirmation from the 5 minutes, 10 minutes... you want to do that in periods of high volatility otherwise the spreads will eat you. Good for news.

    Au plaisir cousin.
  4. I use a 5/10 second chart to find my spots for entry. But its not necessary you can just look at the DOM.

    It does give you a good visual representation of what should be happening and whether or not micro levels are holding.

    Just to clarify, I only bring it up at a buy/sell zone which is determined from a higher time frame.
  5. aren't you going to get killed on the spread?
  6. As I said, not if there is a lot of volatility. Spread 2-9 and you expect a 60-100 pip move in 2-5 minutes gives you a good risk reward ratio.
  7. in reality what i seen work is

    1 min proofs
    15 min proofs
    60 min proofs
    5 minute the entry point ( which should also be proofed)

    strange as it is.
  8. Tums


    Have you tried Constant Volume Bar?
    It might be more readable than 5sec interval charts.
  9. sevensa


    I think you have already made up your mind and is going to continue asking the question until you get the answer you want. Some guy on Oanda say A, but because you wanted to hear B, you ask at another place hoping they will tell you B and then you will continue to do B.
  10. I use 5s.
    It's a trigger.
    Not for finding your 'game'; for squeezing off the shot.
    #10     Oct 22, 2008