Spot FX Day Trader's Thread

Amazingly the nikkei is holding ground at the moment. My sentiment is this flight to the euro, pound etc. is temporary. I'm trading with that in mind but I think it might be a tad early, especially with NFP later today it's quiet. Equities look in a general move south over the coming weeks, today was just a strange one.

S/P ASX 200 pretty flat ....+4.4

Small and quick pips so far today.

Short 1.5185 sl ~1.5200 keeping size small as based on intraday oscillations

1.52 is a strong test IMO

triple rejection on 1m now at 1.52 get down here!!

EDIT -25


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Short 1.5207 sl~1.5220 keeping small size

1.5220 is upper channel on Daily, I failed to pay attention to it in last trade

The reason I don't commit size to intraday trading is mainly to do with lack of reliability factor in electronic trading. Probability wise I do prefer longer term charts (daily), but do not dispute that intraday probability can be quite profitable as long as there are at least 3 factors present:

1. Low risk entries;
2. Reward to be maintained as a multiple of risk;
3. Risk reduced to an emergency stop which falls outside intraday 'noise' levels ie marked to a key Daily, Weekly or Monthly level.

I have been a member on quite a few trading boards & what I keep noticing is 1 bad habbit which is present in many traders. That is pulling a trigger on a open trade before it reaches favourable reward prior to a stop loss being triggered. IMO it is a bad habbit.

Firstly, all stops have to be outside extreme Hi/Lo levels of whatever time frame being traded. As anything within the range is noise, that is a statistical fact. Marking stops within range reduces probability drastically.

Secondly, there is a statistical & also a psychological issue involved in understanding that if a trade is stopped out at actual stop (outside noise) that it was not a mistake on our part, but because it was quite simply a wrong time to be in a trade which is beyond our control as we are not market makers, we simply do not have the scope to see order flow.

So as long as a trader can grasp above 3 points an account can be allowed to grow at a steady pace. Be ready to lose small & win big

Hope above helps some traders, always good to be a learner.

Hi Jsspmk and thanks for the article.I must say i am one of those who is guilty of closing a trade too soon but I also like many others here also trade more as a scalper than a longer term or swing trader. To each his own I suppose but I certainly appreciate your interest.Good trading to you.

I appreaciate that holding periods are different, though those 3 points are applicable to any time frame. Stops have to be outside noise, as new hi or lo is less likely than a re-test of any level within a range. If you go for high risk entries, for instance where your risk is 5 & potential reward is 2, would reduce probability. And if you allocate 2% risk to a 20 pip stop which is let's say 150 pips away from a key daily level & if your workstation crashes or internet goes down & broker doesn't answer phone in time at the time of a news shock, then you will potentially stand to lose more than 2% of your trading capital. See what I mean?

I never intentionally try to get less reward than risk but I will cut a trade short if it doesn't feel right..

I have put GJ in a dress.. he's trying to take it off but I'm determined to put him out on the street to make money for me..

I understand. But "feeling" is an emotion

I am Long ESU10 1,030.5 with a reverse stop @ 1,005.5 x2 size. Swing basis.

naaaaw.. When you enter a trade based on price action and equities make news lows, but spot doesn't go anywhere, it's time to bail out because the probability of getting further gains has been greatly reduced.. when that happens it's time to cover. That's a feeling, although I guess you could call it a calculation.

Personally I disagree, to me only a fact makes me get out of a trade, not perception of what may happen. But that's just my opinion.

Hell, I do it all the time. Sometimes it backfires and I miss out on further gains....sometimes I call the ball right on and cover against loss.

You can't fit every trader's peg into the same hole.

Of course methods vary. But math wise providing reward is a multiple of risk makes it more profitable in the long run to stick to a stop which is outside trading range & not close a trade in profit until a favourable reward has been reached. Of course if one has an edge, that may not be required.

There aren't many facts with which to work in scalping and daytrading with limit orders.. You can either watch equities and watch the price action on the 5m charts to see how it behaves around s/r or you can have 43 indicators open on your screen. I don't use any indicators at all. I just make note of the s/r for a pair and watch gold,oil,usd index, usd/jpy and the S&P 500 to see how they are arranged in terms of proximity their own important levels. I probably hold a trade an average of 45 minutes.

I don't mind cutting myself short because I can always just play the other end of the move when it gets there, but I can't stand seeing profitable trades snap back on me. In choppy markets I would never make any money instead of totally cleaning up. It allows you to continue to purchase the pair at a better price and continue increasing margin.

pipp.... the rsi has become one of my most useful tools.... i used to trade currencies without any indicators either but ive found the rsi can be quite helpful when trying to determine when certain moves have exhausted themselves.... im still bearish on gbp/usd but need the pair to start showing some weakness, if it does im going to add to my short position... seems like the high is in to me... keeping my stop tight now at just above the high 1.5225....who knows though

True.. divergences on RSI and MACD have proven to be useful. I'm at b/e on muy GJ short.. I'm not looking forward to holding it over the weekend.

I trade mainly off the m1 and m5 charts and the indicators used are RSI and Bollinger Bands plus Macd mainly for divergence confirmation with the RSI......I find I am using the BB's to be excellent.In fact have found to be able to trade for example G/J nicely by trading between the BB's for scalping although it requires close attention.I also have the U/CH up continually as I find I can monitor the market by it's reactions although this has been a bit clouded of late and not as accurate as it was .Am sure this is just temporary and it will revert to mean again soon.I have just 6 symbols on my platform and the correllation of them all is important and gives a good picture of the market.

Have a great weekend all ....note the US has another holiday weekend so enjoy guys.Man am just getting over the late nights watching the World cup and Wimbledon when I see the Tour de France starts next week so more late night tv gazing.