Hello fellow traders. This is a pretty cool forum, lots of info to learn.
Anyways.
I have been trading equities for 2 years now. My track record is not so great but I feel I am at the threshold of creating consistant returns. (Swing trading, position trading)
Because I do not have $25,000 (I have 6000) I chose to look into FOREX because of it's high leverage, and day trading capabilities. Also its pretty cool that it's open 24/7.
Over the past week I have been analyzing forex, and making paper trades (I have an account with IB)
I have designed a system where I find pairs that are trading in tight trading ranges. Then I look for bullish chart signs like ascending triangles. I always buy at the bottom resistance and place a maximum 7 pip stop loss. I chose not to look at any flashy indicators, I feel comfortable just by trading the chart.
I have been analyzing the EUR/USD and feel comfortable with it.
Now my questions:
1. How much leverage do you use? For example I have chosen to start out with roughly 6-1, I have 5600 and I will be trading with $30,000. (very tight stop losses)
2. Does IB charge interest rates for holding leveraged positions? I dont understand how this works. If I close all of my positions at the end of the day, am I still charged interest?
3. It appears there are huge differences between stocks and forex. However It still seems I can apply technicals to the charts and day trade these things similar to stocks. Does anyone agree? Disagree?
4. Lets pretend 100 percent of my portfolio is in an equity which I am swing trading. Do the leverage rules still apply? Or Can I only be leveraged to the amount of free cash I have?
5. I have set a hot key that is called "Reverse Position" (to those of you using IB) Does this mean that my long EUR/USD will instantly be sold and bought long USD/EUR at the bid and ask?? I just want to make sure before I try this.
6. I plan on making 1% returns daily.
Do you think it is beneficial or harmful to set goals such as this?
Thanks...
Anyways.
I have been trading equities for 2 years now. My track record is not so great but I feel I am at the threshold of creating consistant returns. (Swing trading, position trading)
Because I do not have $25,000 (I have 6000) I chose to look into FOREX because of it's high leverage, and day trading capabilities. Also its pretty cool that it's open 24/7.
Over the past week I have been analyzing forex, and making paper trades (I have an account with IB)
I have designed a system where I find pairs that are trading in tight trading ranges. Then I look for bullish chart signs like ascending triangles. I always buy at the bottom resistance and place a maximum 7 pip stop loss. I chose not to look at any flashy indicators, I feel comfortable just by trading the chart.
I have been analyzing the EUR/USD and feel comfortable with it.
Now my questions:
1. How much leverage do you use? For example I have chosen to start out with roughly 6-1, I have 5600 and I will be trading with $30,000. (very tight stop losses)
2. Does IB charge interest rates for holding leveraged positions? I dont understand how this works. If I close all of my positions at the end of the day, am I still charged interest?
3. It appears there are huge differences between stocks and forex. However It still seems I can apply technicals to the charts and day trade these things similar to stocks. Does anyone agree? Disagree?
4. Lets pretend 100 percent of my portfolio is in an equity which I am swing trading. Do the leverage rules still apply? Or Can I only be leveraged to the amount of free cash I have?
5. I have set a hot key that is called "Reverse Position" (to those of you using IB) Does this mean that my long EUR/USD will instantly be sold and bought long USD/EUR at the bid and ask?? I just want to make sure before I try this.
6. I plan on making 1% returns daily.
Do you think it is beneficial or harmful to set goals such as this?
Thanks...
