In short the answer for me is YES.
I am a retail trader. I trade my own money and have been trading forex for over two years now. I can confidently say that my efforts are now profitable and getting more profitable as I learn more and time progresses. I still consider myself a newbie and not professional - yet. I have been through a few brokers (and I think that’s important - to experience the difference). I would say that I’m a chartist with a bit of fundamentals thrown in, but I am a discretionary trader. I trade what I call a market view – my opinion of what the market is doing. Of course, I’m not always right.
At the moment I am using MT4 on an Alpari data feed for my charting. As a UK resident, now they are licensed for retail, I am seriously considering using them as my broker of choice for trading, but I haven’t made that decision yet.
The data feed does not reset at 17:00 EST, but the daily, weekly and monthly pivots all seem to work well and the daily is accurate to the pip most days. There are some days though when this isn’t the case and the market doesn’t seem to act in the way that I have it mapped out. Recognizing those days and staying out is important for capital preservation. I shall use an example – last Thursday 14th February 2008.
GBP/USD is not my favourite currency to trade but I like to keep and eye on it (maybe it’s the Brit in me that wants to keep bullish about the pound). On my charts, I have the usual 15, 20, 50, 100, and 200 SMAs. There had been institutional buying during the two days prior – Tuesday and Wednesday. The price had cut through the 20&15SMAs and was holding just above the 15SMA (which was above the 20SMA). I had expected the price to push a flexible resistance level and advance to the 50SMA, which is not too far away, meet resistance and return to the 15&20 which were fairly close together. All day long, I couldn’t figure out why the price was just hanging around, not going anywhere. Where were the institutional buyers from the previous two days? There was no adverse GBP news and USD had not gained in strength, so why wasn’t it still moving? Apart from a flexible resistance level, what had changed to make people stop buying?
Since I had decided not to trade, I had time to look at other things. I keep a number of different data feeds (which is a good idea) and I was looking at one from another broker who has an obscure server time and has Sundays as a separate day which really messes up Mondays pivot points (pivot traders will know what I mean) so I don’t use it for charting. However, I noticed that on this feed the price had already reached the 50SMA. If other traders and institutions were seeing this 50SMA as well, as the other resistance level, that could explain why prices had stayed where they were. On this chart (not my Alpari chart) the price had already reached the 50SMA and the drop in prices on Friday could be explained as a retraction from the 50SMA resistance (sell resistance).
This isn’t the first time that I have noticed these differences, sometimes it works the other way around. The important thing, as far as price is concerned, is; what do institutional traders see? Because they move the market and will trade according to what they see.
It’s at this point that we arrive at the very nature, the soul of our chosen market. Different institutions look at the market differently depending how involved they are in the market. Certainly it makes sense to start everything at 17:00EST, but many institutions that trade forex only do so because of their involvement in other markets. Their forex desk is secondary. Their involvement in other markets means that their server time and working hours vary and their reset times vary. This means that a number of indicators will vary and that will affect the way they see the market.
There is also the matter of volume. I have a data feed on which the volume has obviously been smoothed to take out the excessive volume days (institutional involvement giveaway). When other data feeds (even if different in number) have obvious blowout days which change price direction, this one is just showing similar to the previous day and the next. I even have a data feed with no volume. What better way to hide what the institutions are doing?
For me, I need a data feed that I know I can trust to be telling me the truth (that’s why I have a number of feeds), but more important than that is a system that makes money using the data that I get. The only way to do that with consistency is to have a plan.
I am a retail trader. I trade my own money and have been trading forex for over two years now. I can confidently say that my efforts are now profitable and getting more profitable as I learn more and time progresses. I still consider myself a newbie and not professional - yet. I have been through a few brokers (and I think that’s important - to experience the difference). I would say that I’m a chartist with a bit of fundamentals thrown in, but I am a discretionary trader. I trade what I call a market view – my opinion of what the market is doing. Of course, I’m not always right.
At the moment I am using MT4 on an Alpari data feed for my charting. As a UK resident, now they are licensed for retail, I am seriously considering using them as my broker of choice for trading, but I haven’t made that decision yet.
The data feed does not reset at 17:00 EST, but the daily, weekly and monthly pivots all seem to work well and the daily is accurate to the pip most days. There are some days though when this isn’t the case and the market doesn’t seem to act in the way that I have it mapped out. Recognizing those days and staying out is important for capital preservation. I shall use an example – last Thursday 14th February 2008.
GBP/USD is not my favourite currency to trade but I like to keep and eye on it (maybe it’s the Brit in me that wants to keep bullish about the pound). On my charts, I have the usual 15, 20, 50, 100, and 200 SMAs. There had been institutional buying during the two days prior – Tuesday and Wednesday. The price had cut through the 20&15SMAs and was holding just above the 15SMA (which was above the 20SMA). I had expected the price to push a flexible resistance level and advance to the 50SMA, which is not too far away, meet resistance and return to the 15&20 which were fairly close together. All day long, I couldn’t figure out why the price was just hanging around, not going anywhere. Where were the institutional buyers from the previous two days? There was no adverse GBP news and USD had not gained in strength, so why wasn’t it still moving? Apart from a flexible resistance level, what had changed to make people stop buying?
Since I had decided not to trade, I had time to look at other things. I keep a number of different data feeds (which is a good idea) and I was looking at one from another broker who has an obscure server time and has Sundays as a separate day which really messes up Mondays pivot points (pivot traders will know what I mean) so I don’t use it for charting. However, I noticed that on this feed the price had already reached the 50SMA. If other traders and institutions were seeing this 50SMA as well, as the other resistance level, that could explain why prices had stayed where they were. On this chart (not my Alpari chart) the price had already reached the 50SMA and the drop in prices on Friday could be explained as a retraction from the 50SMA resistance (sell resistance).
This isn’t the first time that I have noticed these differences, sometimes it works the other way around. The important thing, as far as price is concerned, is; what do institutional traders see? Because they move the market and will trade according to what they see.
It’s at this point that we arrive at the very nature, the soul of our chosen market. Different institutions look at the market differently depending how involved they are in the market. Certainly it makes sense to start everything at 17:00EST, but many institutions that trade forex only do so because of their involvement in other markets. Their forex desk is secondary. Their involvement in other markets means that their server time and working hours vary and their reset times vary. This means that a number of indicators will vary and that will affect the way they see the market.
There is also the matter of volume. I have a data feed on which the volume has obviously been smoothed to take out the excessive volume days (institutional involvement giveaway). When other data feeds (even if different in number) have obvious blowout days which change price direction, this one is just showing similar to the previous day and the next. I even have a data feed with no volume. What better way to hide what the institutions are doing?
For me, I need a data feed that I know I can trust to be telling me the truth (that’s why I have a number of feeds), but more important than that is a system that makes money using the data that I get. The only way to do that with consistency is to have a plan.
Follow the money. Follow the money. Follow the money.
