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Ramblings of a Forex Junkie

  • #161
  • Jan 20, 2013 11:06am Jan 20, 2013 11:06am
Quoting Seneca pilot
Ok I know its a lot of indicators but here's my chart set-up.

Junky, indicator laden charts will only increase indecision. Most people go down the indicator road. I certainly did. I still waste an hour or so a week adding one checking it out and then deleting it after a little testing. They all lag and they all will give you conflicting info. If you really want to confuse yourself throw up a bunch of indicators and then use multiple timeframes.

Everything you need to know to trade is on the chart I am posting. If the...
I agree with this statement, however in time I was able to make this work, as we are all different. I think it helped that I am instrument rated for flying and if you can develope a good scan and know what you are looking for, it works, but for 95% of the population, it will only confuse you......
The More You Learn, The More You Earn.....
  • #162
  • Jan 20, 2013 11:12am Jan 20, 2013 11:12am
Quoting Seneca pilot
I got my multiengine commercial licence three months before the September eleven attacks. Ruined my career path so I just fly recreationally now.

On Mondays and sometimes Tuesdays The bulls and bears are deciding whether the week will be up or down. The decision points are the two lines on the chart I posted. It isn't the purpose of this thread to go into trade strategy but I will trade around this area all week. I will use these prices for targets and entries.

Price is everything. Price at certain times is gold. This will lead into truth...
That's wild , I was instrument rated the week before the attacks. I was afraid to go up during that next month, even though that was the only pilots that they would let fly, instrument rated pilots.......
The More You Learn, The More You Earn.....
  • #163
  • Jan 20, 2013 11:15am Jan 20, 2013 11:15am
Quoting Agro
The market would be relatively slow to react. Unconfirmed reports would come through and people would react, but market participants would receive this info at different times and would have different interpretations. Then more confirmed reports would come through and people would react accordingly at different times according to when they receive the info. This may take seconds, minutes or hours and unless you have a large stop loss and are not monitoring the market at the time then there would be time to get out. Point being, black swan is...
It doesn't take confirmed news to move the market, rumors move it in large chunks every day. We live in a time of instant news. If Russia invaded Germany tonite at 10PM it would be on tv at 10:05PM. If you think the market can't move two to five hundred pips in a few seconds leaving your stop in the dust you are kidding yourself. If you think brokers won't pull their liquidity and requote you until they can get solid bids and offers from their liquidity providers you're kidding yourself. Flash crashes occur. Fat finger trades that move markets in big handles occur. The markets are traded by people and their fears will often cause moves that are blindingly fast. If you think you can click your mouse and get out of a trade before the news bots that are trading in milliseconds you are kidding yourself

Just my opinion.
  • #164
  • Jan 20, 2013 11:26am Jan 20, 2013 11:26am
Quoting forexalien
That's wild , I was instrument rated the week before the attacks. I was afraid to go up during that next month, even though that was the only pilots that they would let fly, instrument rated pilots.......
I was working that morning. Had actually gone home to have lunch and watched the second plane hit on the news. Sad day.

The guy I was flying with at the time and I had an aircraft scheduled for that afternoon. I'm sure you remember that all the airspace was shut down to non commercial traffic for days. All I could do was go to the airport every day and check weather hoping that was the day they opened the airspace back up.

About three weeks before the attacks I had completed building enough experience to get hired and had begun sending out resumes. The flying business has never recovered. Of all the friends I have who were new pilots at that time only one has been able to have a career without furloughs and layoffs. He is stuck as a captain at a regional though with no real prospects of moving up any time soon. The job is not stable, the retirements are not safe, the equipment is aging and maintenance is lax. Its probably the last career I would consider going into debt to pursue these days. I love flying though and private air travel is certainly the best way to move around the country.
  • #165
  • Jan 20, 2013 11:52am Jan 20, 2013 11:52am
Quoting Seneca pilot
It doesn't take confirmed news to move the market, rumors move it in large chunks every day. We live in a time of instant news. If Russia invaded Germany tonite at 10PM it would be on tv at 10:05PM. If you think the market can't move two to five hundred pips in a few seconds leaving your stop in the dust you are kidding yourself. If you think brokers won't pull their liquidity and requote you until they can get solid bids and offers from their liquidity providers you're kidding yourself. Flash crashes occur. Fat finger trades that move markets in...
Unscheduled news is not instant and traders reactions are not instant. There are many corporations reporting news at different times and many different traders receiving this reporting at different times. Seconds matter in forex and anyone can react in seconds. The market DOES NOT move in large chunks every day IF you consider seconds as part of the equation. The stops that we place act in milliseconds. I have been trading for 10 years plus making many trades a day and I am yet to observe or get caught in an instant gap of more than a few pips and I am next to certain that it will never happen unless I am in the market during major news announcements. Yeah, the market can move fast, but not in large gaps where a stop will be triggered in a reasonable distance or a manual exit is not possible. If you have evidence against this claim, please present as I am seriously interested in being proven wrong on this matter and would change my risk parameters accordingly if so. I guess "fat fingers" are my major concern but I figure traders with the amount of funds necessary to trade these amounts have the proper safeguards in place to avoid this type of error because otherwise I am sure I would have seen it happen by now due to the time I spend in front of the screen. PLEASE PRESENT THE EVIDENCE IF I AM WRONG.
  • #166
  • Jan 20, 2013 12:00pm Jan 20, 2013 12:00pm
Quoting Agro
Unscheduled news is not instant and traders reactions are not instant. There are many corporations reporting news at different times and many different traders receiving this reporting at different times. Seconds matter in forex and anyone can react in seconds. The market DOES NOT move in large chunks every day IF you consider seconds as part of the equation. The stops that we place act in milliseconds. I have been trading for 10 years plus making many trades a day and I am yet to observe or get caught in an instant gap of more than a few pips...
I don't think Seneca pilot is looking to pick a fight here. While I tend to agree with your perspective (mostly because I trade tiny amounts and the market is more than liquid enough to execute my stops precisely) it could be expressed in a less aggressive manner.
  • #167
  • Jan 20, 2013 12:43pm Jan 20, 2013 12:43pm
Quoting Kanzler
I don't think Seneca pilot is looking to pick a fight here. While I tend to agree with your perspective (mostly because I trade tiny amounts and the market is more than liquid enough to execute my stops precisely) it could be expressed in a less aggressive manner.
I am not trying to pick a fight either. I am simply presenting the facts. I am trying to say that limiting your profit potential based on a hugely unlikely senario will ultimately kill any potential profit. If you are a scalper and you adjust your risk according to the fact that you may incur a 500 pip slip that has never happened outside of major news announcements then you are seriously reducing your profit potential. Sure, it could happen, anything can, but trading is about risk management and if you start factoring in huge outliers that may or may not ever happen then you will never make more than peanuts in this game. Every time we trade we take on risk but the smart trader takes on calculated risk and including a huge outlier in our risk parameters that hasn't happened and probably will never happen seriously limits our profit potential. I am not saying don't account for a large slip, but setting your risk parameters around a 500 pip slip, that is not likely to ever happen, when you are going for a few pips per trade limits your profit potential to the point that there is no point trading unless you have huge amounts of capital and are not looking to grow.
  • #168
  • Jan 20, 2013 12:50pm Jan 20, 2013 12:50pm
Quoting Agro
Unscheduled news is not instant and traders reactions are not instant. There are many corporations reporting news at different times and many different traders receiving this reporting at different times. Seconds matter in forex and anyone can react in seconds. The market DOES NOT move in large chunks every day IF you consider seconds as part of the equation. The stops that we place act in milliseconds. I have been trading for 10 years plus making many trades a day and I am yet to observe or get caught in an instant gap of more than a few pips...
http://www.dailyfinance.com/2012/12/...ading-dangers/

http://www.thestreet.com/story/11788...h-crashes.html

http://www.businessinsider.com/there...-india-2012-10

http://www.cnbc.com/id/49104814/Flas...y_Time_Analyst

http://news.sharpspixley.com/article...unnit-/145195/

http://www.futuresmag.com/2012/10/31...market-moments

http://timesofindia.indiatimes.com/b...w/16683675.cms

Sadly, people lost lots of money over these. Yes they are rare, and you could trade for decades without having a problem. I am sure you have a good plan for containing your losses. I am not trying to be combative I am just putting out information. Right or wrong I am of the opinion that we can never know what comes in the future and should prepare as well as we can. Anyting is possible especially in a OTC market such as forex where we have few of the controls and protections that these stock markets enjoy.
  • #169
  • Jan 20, 2013 12:53pm Jan 20, 2013 12:53pm
Quoting Agro
I am not trying to pick a fight either. I am simply presenting the facts. I am trying to say that limiting your profit potential based on a hugely unlikely senario will ultimately kill any potential profit. If you are a scalper and you adjust your risk according to the fact that you may incur a 500 pip slip that has never happened outside of major news announcements then you are seriously reducing your profit potential. Sure, it could happen, anything can, but trading is about risk management and if you start factoring in huge outliers that...
I don't factor a 500 pip slip either when trading intraday that was not the point I was trying to make. I was saying that having a trade open over the weekend when brokers and banks are closed and liquidity is dry exposes you to these types of nonscheduled news events. I was explaining why I have troubles with holding trades for long periods.
  • #170
  • Jan 20, 2013 1:46pm Jan 20, 2013 1:46pm
Quoting Seneca pilot
Ok my confession:

This is how I really trade.

:nerd:
That's about what I would exspect from a Pilot, your not alone, mine is the lower of the two..........I did the same m15 gbp to compare.....It all comes down to what you understand and what works for you.......You know were to look, to get the information you need, to make that next trade decision or to sit on your hands and not trade......I know when not to trade, trends, trend starts, trend endings, reversals, ranging etc., with my information, I also team this up with multiple TF's to know when to get in or stay out......You need to make the system yours, and learn it, and own it, no matter what it looks like.....as long as you understand it.......as long as you understand it......as long as you understand it.........

http://www.forexfactory.com/attachme...1&d=1358123499
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The More You Learn, The More You Earn.....
  • #171
  • Jan 20, 2013 1:52pm Jan 20, 2013 1:52pm
[quote=Seneca pilot;6361415]
Quoting billytt

Joke.
You Bad ! ..............
The More You Learn, The More You Earn.....
  • #172
  • Jan 20, 2013 2:01pm Jan 20, 2013 2:01pm
Quoting forexalien
That's about what I would exspect from a Pilot, your not alone, mine is the lower of the two..........I did the same m15 gbp to compare.....It all comes down to what you understand and what works for you.......You know were to look, to get the information you need, to make that next trade decision or to sit on your hands and not trade......I know when not to trade, trends, trend starts, trend endings, reversals, ranging etc., with my information, I also team this up with multiple TF's to know when to get in or stay out......You need to make the...
You seem like a nice enough guy but I still have no clue how you trade with that mess on your screen.
  • #173
  • Jan 20, 2013 2:11pm Jan 20, 2013 2:11pm
Quoting Atreides
Seneca, I completely agree with your assessment of those other posters, especially 3-4 of them that I have also read every post of. However, most of them merely talked about their experience/lessons in the industry, never really giving concrete example of how they trade. I also was never able to completely integrate their ideas into my own because they clashed somehow.

You, however, actually show some charts and give some examples to back up your thoughts, and it does seem to click with what I think. Seeing your charts and posts is the first...
The forum is best used to look at how different ideas are used, and for readers to take the best parts of different ideas or systems, that fit their personality and make a trading system to fit themselves .....
The More You Learn, The More You Earn.....
  • #174
  • Jan 20, 2013 2:26pm Jan 20, 2013 2:26pm
Quoting Seneca pilot
I spoke earlier about why levels hold. I would like to expand on that if I may. In the chart below you will note that the price was below the weekly open most of monday and then during late NY and Asia it sort of raced up to that price level again. Millions of traders bought up there. There was perhaps hundreds of millions if not billions traded long at that level. Now Big institutional traders sold into all that buying. That is why the level held. Since most of the buying that took place there was retail and uninformed many of those people are...
Retail traders are only 2% of the total market IMO, it's the big boys or whole countries moving large amounts of money. They will put only so much cash into their trade and then the market stops at that level. If the level holds after a period of time, then there is the chance to add to their position and continue the move upward further. Example : 800 pip run. Or the level continues back down for a retest. Price has to hold in an area to consolidate to take on, or off positions and let the price stabilize so the world buisness traders can use the current price for manufacturing buisness decisions....IMO
The More You Learn, The More You Earn.....
  • #175
  • Jan 20, 2013 2:30pm Jan 20, 2013 2:30pm
Quoting PiptheRipper
There is one point I have to disagree with you regarding backtesting. I don't think it's useless if you use software that allow to re-trade the past. Especially in the shorter term trading, there is no way you could remember what happened on a specific day, so it's like trading it for the first time. I know there is a lot of factors that doesn't make it close to the real thing, like the psychological aspect, no real money and being able to fast forward time, but for me it's excellent to quickly test new ideas.

I fully agree that testing with...
Back testing is a must, most people won't take the time to do it. Back testing has to be done manually, or you will never learn anything from it.
If an automated back testing EA does it for you, you will learn less from that king of back testing.
The More You Learn, The More You Earn.....
  • #176
  • Jan 20, 2013 2:31pm Jan 20, 2013 2:31pm
Quoting Seneca pilot
If Russia invaded Germany tonite at 10PM it would be on tv at 10:05PM.
While I agree with you SP about the risks of assuming your SL is guaranteed to be transacted even close to your chosen level in unusual market conditions (you've all seen it in the small print that there are no guarantees over stops) I would love to pick you up on this Russia invades Germany scenario. I've seen a few docus over here in UK on the guys in the US who refuse to pay what you call 'Federal taxes'? because they think your gov is in some sort of alliance with the UN and Russia to invade the US? It was something like that, and I'm just wondering if it's a common perception over there that Russia could invade Germany or any other major EU country?

I would be interested in how that perception came about and is perpetuated because to Europeans (and I'll speak for all of us there) it seems as likely as Canada invading the US.
  • #177
  • Edited 2:49pm Jan 20, 2013 2:34pm | Edited 2:49pm
You've seen it a million times. You have been trading for years and it always happens. You open a trade and place your stop and target. Slowly, agonizingly the price dances closer and closer until, gasp, it hits your stop. The market continues moving the same way for a few minutes and as you are patting yourself on the back for containing your losses and managing your risk it happens. It's slow at first then faster. Back through your stop, back past your original entry, and into what would have been profit had you just held. You are furious, You yell at the market, you yell at those crooks at your broker, you yell obscenities about stop sweeps.

You start going over all your past trades. Hey you think this happens all the time. There must be some way to stop losing on all those trades and turn them into winners. You don't want to have your stops hit all the time and then watch the market recover. Then it hits you. I'll just pull the stop, wait for it to turn up then add more. Hey if I double the position all it has to do is move a third of the way back and I'll kill it at breakeven. You try it on the next trade. Sure enough you add and it recovers and you get out at BE.

But wait the market kept going. You watch in horror as the market rips and the position you just closed at BE would have made you a handsome profit. You curse that you closed it so soon and you think, next time I will maybe get some of that profit. Next few trades go as planned. You are trading without a stop but hey I'm right here looking at the screen anyway. You enter the next trade and as usual you have a little draw down. You get a tasty little pin bar so you enter your double lot on the break. The market goes up even approaches breakeven then goes positive for a second or two but you vowed to make these profitable so you hold. The trade goes negative again. You tell yourself its just the normal market ebb and flow so you hang on. It keeps going though. The bottom of the pin bar breaks and now you're sweating.

The market moves against you for another few minutes then prints an engulfing in your direction. That is what I needed you say to yourself as you double down again. This time I am getting out at breakeven. You watch in horror as the market breaks the engulfing by five pips and then turns and races against you again. Now what. You have a position that is several times your normal exposure. You have no more margin left. What do you do. You beg and plead with the market. You curse at the market. You can't believe anyone is stupid enough to (buy sell) this market. You swear that if you get out of this you'll never get here again.

What happens next? Well that depends on your leverage, your account size, your position size, and your broker's policies. Since most retail traders trade with too much leverage, with accounts that are too small, and with positions that are too large if the trade doesn't turn in your favor you'll likely get a margin call. My broker will automatically kill your position at a certain margin level. Of course that could be viewed as a stoploss but losing half your funds is a pretty steep stoploss. This is the way accounts get killed.

The truth:

If your method isn't working with the stops and targets you have in place get a new method. Averaging down and hoping is a guarranteed way to lose all your money. I know, I did it seven years ago.

What if you sold here? The market didn't return to this price for four months. Can your account withstand 890 pips draw down when leveraged to the max.
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  • #178
  • Jan 20, 2013 2:37pm Jan 20, 2013 2:37pm
Quoting forexalien
Retail traders are only 2% of the total market IMO,
That may be correct, but you can't really put an 'only' in there without qualification. 2% of a multi trillion pound market is actually quite a significant ammount of cash/potential liquidity.
  • #179
  • Jan 20, 2013 2:38pm Jan 20, 2013 2:38pm
Quoting stevexyg
While I agree with you SP about the risks of assuming your SL is guaranteed to be transacted even close to your chosen level in unusual market conditions (you've all seen it in the small print that there are no guarantees over stops) I would love to pick you up on this Russia invades Germany scenario. I've seen a few docus over here in UK on the guys in the US who refuse to pay what you call 'Federal taxes'? because they think your gov is in some sort of alliance with the UN and Russia to invade the US? It was something like that, and I'm just wondering...
It was just an example, nothing to read into it. I could just as easily have used the example of China invading Taiwan which is probably far more likely.
  • #180
  • Jan 20, 2013 2:39pm Jan 20, 2013 2:39pm
Quoting stevexyg
While I agree with you SP about the risks of assuming your SL is guaranteed to be transacted even close to your chosen level in unusual market conditions (you've all seen it in the small print that there are no guarantees over stops) I would love to pick you up on this Russia invades Germany scenario. I've seen a few docus over here in UK on the guys in the US who refuse to pay what you call 'Federal taxes'? because they think your gov is in some sort of alliance with the UN and Russia to invade the US? It was something like that, and I'm just wondering...
You're probably talking about "sovereign citizens". And no, I think the last time that was even a remotely common idea was at the end of the cold war. There are baseless conspiracy theories in every society.
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