NITRO Scalping for serious traders

This is my motto

I did an FF search for the FX Fish indy and I'm not sure I found the same one you guys are using but if it is not repanting it sure is giving interesting signals!

Never mind .. it repaints like crazy!

Probably repaints too.....interesting signals also......

Whilst everyone is off fishing I continue to earn the grocery money. Usd/Jpy was an oddball at the London strike but that is often the case.

London was about a -ve 20 pip drawdown before it turned, about 45 mins before t/p. +7 on each eur/jpy trade

Lou, sorry for the delayed response. I think this answers your question. If it doesn't, let me know.

Patience has it's own reward - +7 pips on eur/jpy

Nice Dave, I also just made +13 on EY, got it on a pullback so got a few extra pips.
Not fishing anymore, the fish keep changing colors.

Hey Dave,
Could you tell me what the MI indicator is that you have below each chart?

TpTrading.

The MI indicator on my charts is attached here for you. Settings 2,10,2,3

Hi 4xStar.

I am noticing that even though I am making my regular 7 pips the price usually pulls back about 10 or so the minute I hit the button. Have to look at it a little closer as we progress, waiting for the pullback would increase the t/p but how many runaway trades would we lose out on??

Thanks Dave.

I'm using the 5 bar renko to decide whether to wait for a pb or not .. in this case the 10 bar was moving up and down but the 5 bar had already formed a down bar so based on the mom indy and overall trend I got in just as 5 pip bar was trying to form another down bar. It didn't succeed, but even if it had, unless there was sudden strong downward momentum, I was already committed to going long & that bar gave me the pb I wanted.
As to how many you miss waiting for a pb .. I would guess you would miss out ... but .. then you would be able to get in on strong upward momentum. If the EY had not pulled back there, it would have 'broken out' above it's daily high & that would be another reason to enter a trade, following momentum.

Hope that was clear...

My original plan was to trade the Nitro strategy on a demo account until I was consistently profitable and then switch to a live account and trade mini lots until it proved itself to be as profitable. Having made the move to an existing live account, I want to make some observations that directly affect scalping and use of the Nitro strategy.

First some live feed info:
Broker 1 - Demo Account (Dealing Desk)
Data feed seems to be unfiltered as tick chart shows significant activity during normal trading hours for all currency pairs.

EURJPY - normally 1 to 2 pips. Have seen as low as -1 pip and as high as +12 pips during news.
GBPJPY - normally 5 to 6 pips. Have seen as low as 3 pips and as high as +15 pips during news.

Broker 1 - Live Account (Dealing Desk)
Data feed seems to be filtered as tick chart shows significantly less activity during normal trading hours for all currency pairs than the demo account.

EURJPY - normally 3 pips. Have never seen it lower than 3 pips and have seen it as high as +35 pips during news.
GBPJPY - normally 7 pips. Have never seen it lower than 7 pips and have seen it as high as +70 pips during news.

Broker #2 - Demo Account (ECN)
Data feed seems to be unfiltered as tick chart shows significant activity during normal trading hours for all currency pairs.

EURJPY - normally 1 to 2 pips. Have seen as low as .1 pip and as high as +35 pips during news.
GBPJPY - normally 3 to 4.5 pips. Have seen as low as .6 pips and as high as +35 pips during news.

Broker #3 - Demo Account (Pass-through to ECN)
Data feed seems to be unfiltered as tick chart shows significant activity during normal trading hours for all currency pairs.

EURJPY - normally 3 to 4 pips. Have seen as low as 1.1 pip and as high as +27 pips during news.
GBPJPY - normally 6 to 9 pips. Have seen as low as 5 pips and as high as +65 pips during news.

Broker #3 - Live Account (Pass-through to ECN)
Data feed seems to be unfiltered as tick chart shows significant activity during normal trading hours for all currency pairs.

EURJPY - normally 3 to 4 pips. Have seen as low as 1.1 pip and as high as +27 pips during news. (Same as Demo Account)
GBPJPY - normally 6 to 17 pips. Have seen as low as 5 pips and as high as +65 pips during news. (Same as Demo Account)

Broker #4 - Demo Account (ECN)
Data feed seems to be unfiltered as tick chart shows significant activity during normal trading hours for all currency pairs. However, as an ECN, the tick activity was significantly less than broker #2 above indicating that their access to the market may be significantly limited by the banking/financial entity they are aligned with. During off European session, this broker's tick activity was almost non-existant with extremely high spreads (GJ averaging 20+ pips) especially during the Asian session.

EURJPY - normally 2.6 to 4.5 pips. Have seen as low as 2.1 pip and as high as +46 pips during news.
GBPJPY - normally 4.8 to 6.9 pips. Have seen as low as 3 pips and as high as +70 pips during news.

How I tested this:
Computer #1 was setup to receive Demo account feed (demo account logged in).
Computer #2 was setup to receive Live account feed (live account logged in).
Both computers had identical MT4 Profile, templates, and indicators. Renko bars was setup with 10 pip bricks.
Readings were made throughout the day including NYC, European, and Asian sessions over a period of a week.


How does this affect you?
If you are scalping, you need adequate price activity to be able to enter trades with confidence. If price activity is limited by the broker to what they want you to see, you may not have significant enough information to successfully enter trades.

If spreads are prohibitive, you may not be able to trade pairs you prefer.

Of over 2 dozen demo accounts I have tested, brokers with direct market (ECN) access generally have the best price activity. However, I am not making any recommendations here, only suggesting that you do you own due diligence and "Test" your broker's demo and live accounts against each other and against other brokers. Be aware that just because a broker is an IB for another broker that this does not necessarily mean that you get worse data feeds or higher spreads than the originating broker.

The bottom line is that not all brokers are keen on scalpers and will make environmental "adjustments" which directly affect your profitability. If you don't believe me, set up both a demo and live account on two seperate computers and trade the same signals. What you will find out is that demo accounts are usually much more profitable than the live accounts.

Thanks for these tests...i'm trying an ECN demo account too...but in demo i can't see big differences between ecn and non-ecn (except for the commission on every trade)...but i think in live account we can have really troubles if we don't have a fast and reliable broker...

Chris,
I agree that a fast and reliable broker is paramount to profitable trading. We probably could start a thread just on this issue but unfortunately as I have found out, live accounts generally don't perform the same as demo accounts. The best advice is read the broker reviews online and thoroughly test your demo account. Open a live account with the broker(s) you feel will provide the best service and again test the live trading against their demo trading.

ECN brokers and Dealing Desk brokers are two seperate animals and have distinctly different behavior. Be sure to research the differences as well because they can be significant.

Brokers who look down on scalping are typically doing things away from the "norm" imho. In the case of scalping, you want to be aligned with the broker that has no problem with scalping whatsoever and typically that would be an ECN broker that also charges commission - you bring them more business and commissions since scalping naturally requires many trades. Dealing desk may not at first look down on you at scalping since they dont know if you'll be profitable long term and trade against you, hunt down your stops if they are tight,etc... With spreads progressively getting more competitive across the board - i think its imperative to be aligned with broker that has your best interests in mind. just my 2pips.thx.

Ok, this is an issue of paramount importance.

Why don't we open a thread where we can compare live brokers -normal and ECN-, so we can find the best alternative for our (profitable) trading?
We can also point out web reviews, wtc.

I believe if we do it here we'll be diverting from the original intention of the thread

Regards
Mandel

BTW,
If you have been a victim of stop hunting with a US broker and you have valid proof, pm me as I know someone who is seriously looking into this issue.

i've experienced it few times with a broker who kept getting these sudden spikes quite often but they are also one of the worst imo to have a micro account with. solution is simple, go to good broker that has your interests in mind and is on same page as you. i'll leave the invistigations to nfa and such, i dont have time to waste.I think it would be difficult to prove they are doing anything extremely wrong and it might not happen as frequently as people complain, imho [easy to blame broker for loss], but let alone force any type of action since these types of brokers are MarketMakers and they do also provide a service to small retail traders with small accounts - they provide added liquidity - these trades dont go to interbank they stay within the market makers who are a business and operate as such - to generate profits for their business and by also taking statistical advantage that many newly opened accounts opened by inexperienced traders will be losers...you see what i'm saying.