I trade 4x every day. It is much more of a "trending market" - I'll elaborate if you want me to. Find a broker with no deal desk: I use MBTrading - small spreads - great execution. (Only complaint is the maintenance that happens twice a day so you have to call in a trade during that time). As far as accurate quotes, I have 2 sources of data - so they're good. I trade stocks, futures and options as well - but 4x is the largest, most liquid market in the world, with a lot of opportunities every week.
Really? That's frankly surprising. As for "how do I know my quotes are good?"; I trade with an ECN and can very closely monitor bids and offers and make them myself. It's a trip to see that you ARE the bid/offer in a given currency pair. Make no mistake, though, the forex market is a dog-eat-dog world. Given the absurd number of entities trading, it is incredibly difficult to find a market inefficiency, or an "edge" if you prefer, to consistently profit off of.
I don't, but I sell FX Trading Strategies and Educational material. Business is doing very well, thank you and I use the profits to trade futures.
I think you've got your facts mixed up on the first point. The more popular FCMs are currently operating as ECN's or finishing a migration to anon-dealing desk model (see: FXCM). As to your second point, it's true, CME futures are all what you say they are. I've traded both cash and CME, and I'd take cash anyday. Commissions/fees tend to be lower (for me, anyway), and liquidity during volatile markets provides tighter spreads. As for the regulation, you should read up on the stuff that the NFA has been up to. Any entity regulated by the CFTC/NFA gets my vote; their capital requirements really force the FCM to keep honest, and the NFA is also a formal entity with which to lodge complaints against your broker. As for the unregulated bunch: no way in hell would I trade with anyone regulated in Belize or something shady like that.
I'm sure there are some reputable firms out there and I have read up on the NFA. Member firms are covered by the CFTC requirements and I probably wouldn't have a problem with them (except some do still trade against you). I was MOL suggesting to the OP to be careful as there are a lot of unscrupulous firms still. Thanks.
It all comes down to personal preference. I do mostly forex but will occasionally trade ES, YM, GC and things of that nature when I see opportunities. Is any market "better" than the other? Obviously not, they're just different. You pick what you're good at and/or feel comfortable with. If someone makes profit off of sell-side research in FX and uses the profits to trade futures, then good for them. I for one don't see the advantage of trading futures over FX.
Look. I have never complained about quotes and fills on the forex market. Never. You know why? Because i don't trade the news! Simple as that. You can find tonnes of sites with 90% of the brokers rated as SCAMs by people who want to trade the news (how's that for a market inefficiency ) haha ). The MAIN advantage on the forex is that you can be capitalized to your pleasure, test out strategies with little (but real) money. And let me tell you, besides the gap trading strategies, everything else works. Stop running and hunting. It;s been 2 years since i got my strategies pinned down and i didn't complain about my stop getting hunted. Could it be a coincidence, or have they stopped hunting stops. Oh... and i use an ECN.
forex162: If your broker takes the other side of your trade.... well ... .it's simple! He will lose ! That is if you know when and what to do! Nobody can predict the market. And they can't do tricks on you because they are regulated and usually have a high profile. Nobody is going to mess with some wanker with a 100.000 USD position. Foget about it. When you are going with 7, 8 digits, then you will have to think about that problem.
Stop hunting is a real problem, I'm afraid. The hunters aren't after you specifically, whether you're a 100k wanker or playing for 8 digits: they spot a thin market, dump a few billion onto it, trigger stops and drop the price some more, then slowly buy their way back in. Very often in a thin market 100 million or so will be enough to plunge through all the major bidders and drop the price instantaneously by 20-30 pips. 'Swhy I don't use stops - achieve risk management in time-honoured ways like diversification. If I've got my bets spread around 7-8 positions with roughly equal amounts +/- on each currency, I don't mind so much if one of them goes wandering a hundred pips offside, and if a stop hunter does his thing I can just wait for it to recover. So the problem is manageable, and I don't see any other downsides to FX, provided you are using a reputable broker. I like IB, partly because FX is just a sideline for them: they have a rep to maintain. Have looked at futures. First impression: huge overnight gapping (e.g. on the 21st CAD USD opened 45 pips down - so if you had a stop in place, it didn't get hunted, it just got ignored.) So you have to day-trade and take the hit on the spread every day. Spreads are often horrendous, exactly at end of day when everyone is scrambling to close. All the reasons I got out of stocks and into spot forex, which runs nice and smooth 24 hours a day. A theoretical advantage to spot foerx: people buy & sell currencies not just for profit but because they need the stuff, so they often trade against their own interests. If you're a Canadian oil company, and you've just sold $1 billion of oil to the US, there you are with USD1 billion, which you'd love to hang on to because this is a lousy time to be buying loonies: but you have payrolls to meet and creditors to pay, so ya gotta. A