FX Volume Info

I never see volume displayed at the bottom
of any posted charts. Isn't it of any use?
Maybe to see if trading is at a decent level?

Just wondering.

FXS

From what I understand most volume indicators only take in account for the broker you use and not the whole market. I'm sure there has to be some out there that do account for most of the market. But I know on mine, most pairs have so little volume I can't even see it except on the lower time frame charts.

volume is of no use in these kind of bucket shops

actually Volume in MT4 is "tick volumes", meaning, how many ticks a bar moved.

That's really helpful!
Number of ticks per bar, is that right?
Seems like it could help gauge trading activity.


FXS

FXS

http://img183.imageshack.us/img183/5479/captureko8.jpg

I look at volume on the futures exchange with my forex platform. Pretty darn efficient.

From what I know, the volume data you get from your broker is the trading volume inside of their brokerage and not the whole forex volume, as a result the data is inaccurate. FX futures only represents a small portion of the forex market, but I think you can use that data in a semi accurate way.

If you give FX Futures a try instead of the spot market, volume is not only available, but very helpful in decision making. I'll never go back to the spot market again.

Hi BinB!
Seems like you feel pretty strongly about futures vs. spot!
Could you please list a few pros and cons of futures and spot
for a newbie and others who may benefit from your experience?

How about you, Mr. Doodi?

Thanks!

FXS

For one thing, on the futures market the transaction cost is very low compared to forex. GBP/USD for example, I pay $2.20 per trade plus 1 tick spread.

So thats $4.40 plus 2 ticks for a round turn trade. In dollar figures thats $24.40 for 1 lot or 2.4 pips in forex terms. A lot of people would agree that that is extreamly cheap compared to forex.

What broker or system do you use for forex futures?

I second this; I'm very curious....

Hi Surfer-Dude:
Hope I can help.

For starters, there's no such thing as a bucket shop in the Currency Futures exchange. Prices for all brokers are the same, quoted from a central source (the CME).

Here's a screen-shot of what my Yen chart looks like. Note the volume chart at the bottom.
http://img61.imageshack.us/img61/9296/chartlj7.png

Check out the price ladder, which gives Depth of Market information at 5 different levels, and a cumulative at the top/bottom of each side. This means I can tell how many contracts (lots) are waiting to be bought at each price level -- pretty valuable information. It lets me know how much traders want to buy or sell when the market reaches that price, so I can sort of figure what's ahead for price action.

http://img507.imageshack.us/img507/5324/domya2.png

Also, there is a time and sales window, so I can see how much is being bought off of the Bid or off of the Ask. Watching the time and sales in conjunction with the price ladder lets me see if the number of level 1 Bid or Ask contracts are being depleted, indicating a price move in that directions.

http://img232.imageshack.us/img232/7388/tsqy7.png

Also note that there is only one pip (tick) difference between the Bid and Ask. None of this 3-5 pip spread nonsense. And if I get in on a limit order, instead of a market order, I don't even have to pay the 1-pip spread. Yes, you have to pay a commission instead, but it's only $5.73 USD round trip.

I haven't been able to find any information like this on the spot Forex charts.

Ever heard of slippage? No one that trades the FX futures has -- it doesn't exist. Of course, using market orders on ANY market, including the spot, does not garuntee a fill at your price unless you use limit orders. Market orders will get you filled real quick, but you get a better price with limits.

Your money is a lot safer in a future's broker, as it is regulated, and marked to market each night. No broker can abscond with your funds, or declare bankruptcy, and leaving you holding the bag. I believe your funds are actually put in a segregated account (check on this -- hell, treat the whole post as a lie, and check on all of it!!).

One final note. While the price action is very close for Futures and spot charts, remember that FX Futures do not trade in pairs. You buy or sell the future of that single currency, denominated in USD.

Hope this helps.

Thanks BinB!
Lower cost is one thing(thanks much Mr. D!).
But, you can't help but wonder if the apparent
lack of transparency compared to futures isn't
perhaps by design.

Anyone care to defend the Motherland?

Why do I get the feeling that rather than defend
it, I'll simply be told to "love it or leave it".
In other words, to take a hike.
Probably just the conspiracy theorist that I mentioned
coming out again.

Thanks Again BinB!

FXS