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Trading with $1000 per pip?

  • #21
  • Apr 26, 2009 7:45am Apr 26, 2009 7:45am
Quoting altrader

But I just wonder how much a 10 million unit order could move the market anyway, say the EUR/USD? e.g. $1000/pip

Those guys in that thread say break the order down for better execution so that you don't move the market.
A trade that size wouldn't even come close to moving the spot market.
  • #22
  • Apr 26, 2009 8:50am Apr 26, 2009 8:50am
Quoting gammase1
A trade that size wouldn't even come close to moving the spot market.
how many units would it take to move the market on say the EUR/USD during the London session?--by just a pip or two.
  • #23
  • Apr 26, 2009 12:32pm Apr 26, 2009 12:32pm
Quoting altrader
how many units would it take to move the market on say the EUR/USD during the London session?--by just a pip or two.
It's difficult to give an exact answer to this question. However, when I was working for large bank, the spot desk on a busy day could absord a $100m ticket, in that they'd deal immediately and would not need to work the oda gradually through the market.

Please forget the idea you have of scalping 2-3 pips on larger trade tickets, friend, as this is the quickest way to lose your account. As someone has already said, you will need a much higher ratio of winners to losers, given that your s/l will be 8-10 pips away.

Also, you are also leaving yourself open to slippages in price, which will never be in your favour, meaning that even with a s/l of 8-10 pips your broker may filll you at 15 pips or more.
  • #24
  • Apr 26, 2009 9:31pm Apr 26, 2009 9:31pm
Quoting gammase1
It's difficult to give an exact answer to this question. However, when I was working for large bank, the spot desk on a busy day could absord a $100m ticket, in that they'd deal immediately and would not need to work the oda gradually through the market.

Please forget the idea you have of scalping 2-3 pips on larger trade tickets, friend, as this is the quickest way to lose your account. As someone has already said, you will need a much higher ratio of winners to losers, given that your s/l will be 8-10 pips away.

Also, you are also leaving...
Thanks again gammase1 And yeah, I'm still developing a system. I've been looking at longer term and shorter term strategies.

From what I've experienced so far, I must agree with you regarding the 2-3pip strategy being a poor one.
  • #25
  • Apr 28, 2009 5:21am Apr 28, 2009 5:21am
100 lots could easily move the market a few pips.
  • #26
  • Apr 28, 2009 6:49am Apr 28, 2009 6:49am
Quoting blazespinnaker
100 lots could easily move the market a few pips.
That's very, very unlikely, especially during London hours.

Seriously, I can tell you for certain that a $10m ticket size on eurusd wouldn't register on the richter scale in the interbank market, certainly not in the London session. Foreign exchange transactions totalling in excess of trillions (approx $3 trillion) of dollars are settled every single day.

Now, compare that $10m ticket (100 standard lots) to the total size of this gigantic market, of which eurusd is by far the biggest pair, the one with the deepest liquidity, accounting for almost 30% of settled foreign exchange transactions.
  • #27
  • Apr 28, 2009 1:13pm Apr 28, 2009 1:13pm
What sense does it make to trade with 1000$ per pip, no matter what broker will be used?

I mean lets assume that you buy EUR/USD at 1.3100. What will u do when the price goes to 1.3090? Then you are 10'000 (tenthousend) Dollar in the red! Not to mention what happens if the price go any lower. It's just crazy.
Forex is a losers game.
  • #28
  • Apr 28, 2009 1:44pm Apr 28, 2009 1:44pm
Sure but what happens when the price goes in your favor? It may sound crazy to you but it is not crazy. If you have the mentality that you must place a trade and place a set TP and set SL on a higher time frame then yes this is pretty crazy. Scalping this is not so crazy.
  • #29
  • Apr 28, 2009 2:10pm Apr 28, 2009 2:10pm
Quoting sccz97
true, this is little counterparty risk but you're exposing yourself to serious liquidity risk. 12 months ago, if you wanted to trade 100 lots during eu or us session you could most likely get that done on the inside bid/offer but in these mkts, prepare to take on board some slippage. As has always been the case in fx and most likely for the forseable future, spot fx is the deeper mkt and where you'll get the better avg price. I dont want to get into a useless spot/futures argument cos if you want to even consider thinking about trading in clips...

Just a little info. Large traders trading 300 lots or significantly more are big swing/position traders and know what to expect regarding slippage, no surprises there. I trade both spot and fx futures. I like both very much. Spot has actually gotten better than it used to be. A lot of newer spot fx traders think Fx futures are a dinky little market with a lack of liquidity. There are position accountability levels of 10,000 contracts set be the CME. There are firms and a few individuals trading at this size, most scale into and out of those positions.
  • #30
  • Apr 28, 2009 5:29pm Apr 28, 2009 5:29pm
Quoting fxRichard
Sure but what happens when the price goes in your favor? It may sound crazy to you but it is not crazy. If you have the mentality that you must place a trade and place a set TP and set SL on a higher time frame then yes this is pretty crazy. Scalping this is not so crazy.
How is scalping going these days? What kind of indicators do you use in order to time these small moves?
  • #31
  • Apr 28, 2009 6:04pm Apr 28, 2009 6:04pm
It's going great, for the most part no indicators, I have a setup with some visual aids that show price action and that is pretty much it. I don't trade like some where entry is based on x crossing y and z is above 80 level etc lol. Straight up price action on a tick chart
  • #32
  • Apr 28, 2009 8:33pm Apr 28, 2009 8:33pm
Quoting fxRichard
It's going great, for the most part no indicators, I have a setup with some visual aids that show price action and that is pretty much it. I don't trade like some where entry is based on x crossing y and z is above 80 level etc lol. Straight up price action on a tick chart

Nice.

Btw, when did you decide to switch to scalping? I am asking all these questions since there aren't many scalpers who survive. I'd like to heard from somebody who can cut the mustard.
  • #33
  • Apr 28, 2009 9:13pm Apr 28, 2009 9:13pm
Not a problem, in my opinion and this is strictly my opinion I don't see how people can trade longer time frames, it just does not make sense to me but that's ok scalping doesn't make sense to others. I started off on a 3min chart back in 07 with a simple system I came up with, no indicators except maybe an ema or wma at the time just to help visualize what was going on. I then switched over to basically a tick chart in early 08 and never looked back. One advantage I had was that I am self employed and could put as much time into it as I deemed necessary thus I spent nearly 16 hours a day EVERY day staring at the tick chart until it just made sense, so that's my story
  • #34
  • Apr 28, 2009 11:05pm Apr 28, 2009 11:05pm
Quoting fxRichard
Not a problem, in my opinion and this is strictly my opinion I don't see how people can trade longer time frames, it just does not make sense to me but that's ok scalping doesn't make sense to others. I started off on a 3min chart back in 07 with a simple system I came up with, no indicators except maybe an ema or wma at the time just to help visualize what was going on. I then switched over to basically a tick chart in early 08 and never looked back. One advantage I had was that I am self employed and could put as much time into it as I deemed...
16 hours! Wow. Well, in order to master scalping it probably would take that kind of focus. So how long do you spend in front of the monitor(s) per day? Do you have to wait for setups or can you predict direction at any given time? Interesting stuff!
  • #35
  • Apr 29, 2009 7:07am Apr 29, 2009 7:07am
Quoting fxterrapin
16 hours! Wow. Well, in order to master scalping it probably would take that kind of focus. So how long do you spend in front of the monitor(s) per day? Do you have to wait for setups or can you predict direction at any given time? Interesting stuff!
I only spend 1-2 hours actually trading now not all day like most people think scalpers do. Direction is fairly easy to see, but I still wait for my setups because you never know for sure how far it will go , the same setup may net 2 pips or 20 pips so it's best to get in at your entry and not in the middle of a move etc.
  • #36
  • May 5, 2009 5:06pm May 5, 2009 5:06pm
Quoting fxRichard
I only spend 1-2 hours actually trading now not all day like most people think scalpers do. Direction is fairly easy to see, but I still wait for my setups because you never know for sure how far it will go , the same setup may net 2 pips or 20 pips so it's best to get in at your entry and not in the middle of a move etc.

Btw, I'm curious as to why you dumped Dukascopy as your broker. Anything wrong with them?
  • #37
  • Last Post: May 5, 2009 6:40pm May 5, 2009 6:40pm
No problems at all, no reason just using Cnx now.
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