The thing to remember about trading is its almost 100% discretional. So if you are trading mechanically, you are going to malfunction (like a robot).
It becomes an instinct, if the price is making lower highs around a resistance duh its going to go down. Its not "oh two lines crossed, time to sell"..
I am not going to say that people who trade the line crosses are wrong, infact with good money management and a long term out look you can do well with bells and whistles, but most people trading said systems are looking for the get rich quick fix. Which is possible, but not using those types of systems, because the win:loss does not get you very far ahead of break even.
So you need to trade the same way as the other noise makers (myself included) rather than trying to beat them, because you won't. There is a reason they are labelled professionals, and thats generally because they are the best. I am far from them, I know that, maybe in a few years I will be able to compete. But I know how they trade, the idea is to follow them.
There is another major issue about trading. That is that online, you do not get direct market access (even through said ECN's that have such a great reputation). The job of the broker is to market make, so THEY have the direct access, you get nothing.
I can tell you now that a 100k order (1k leveraged) can move the market during a thin period. I have seen it first hand. So the Q is why don't my orders online move the market? I know they don't, and they are more than 1K leveraged.
Thats because the 2-3 pip spread, that the market makers offer, does not cover cost. If you had 200 mill, it might.. But 2-3 pips on a 100$ order is going to cost a broker money.
Only if you are on the interbank will you get spreads below 2 pts, and thats if the trading desk likes you, or is in a position to give it. If you are doing a 1:1 leveraged trade before 7am Aus time, you will get charged 90-100 pts on a 200 mill transaction in spread. And hedge funds are HAPPY with this at that time, because no one else will execute it (has to be executed on shore).
So bascially, online trading is like betting. You just have to hope you are better than the bookie, and if they start to not pay up, leave them whilst you can.
It becomes an instinct, if the price is making lower highs around a resistance duh its going to go down. Its not "oh two lines crossed, time to sell"..
I am not going to say that people who trade the line crosses are wrong, infact with good money management and a long term out look you can do well with bells and whistles, but most people trading said systems are looking for the get rich quick fix. Which is possible, but not using those types of systems, because the win:loss does not get you very far ahead of break even.
So you need to trade the same way as the other noise makers (myself included) rather than trying to beat them, because you won't. There is a reason they are labelled professionals, and thats generally because they are the best. I am far from them, I know that, maybe in a few years I will be able to compete. But I know how they trade, the idea is to follow them.
There is another major issue about trading. That is that online, you do not get direct market access (even through said ECN's that have such a great reputation). The job of the broker is to market make, so THEY have the direct access, you get nothing.
I can tell you now that a 100k order (1k leveraged) can move the market during a thin period. I have seen it first hand. So the Q is why don't my orders online move the market? I know they don't, and they are more than 1K leveraged.
Thats because the 2-3 pip spread, that the market makers offer, does not cover cost. If you had 200 mill, it might.. But 2-3 pips on a 100$ order is going to cost a broker money.
Only if you are on the interbank will you get spreads below 2 pts, and thats if the trading desk likes you, or is in a position to give it. If you are doing a 1:1 leveraged trade before 7am Aus time, you will get charged 90-100 pts on a 200 mill transaction in spread. And hedge funds are HAPPY with this at that time, because no one else will execute it (has to be executed on shore).
So bascially, online trading is like betting. You just have to hope you are better than the bookie, and if they start to not pay up, leave them whilst you can.