The Trader's Academy - by Traders for Traders | Page 44 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

Are you a trend trader or a counter-trend trader? 29 replies

Baby pips style academy for other financial markets? 6 replies

from retail trader to full-time trader 17 replies

Discipline Trader and Voice Trader EA/IND 16 replies

IkonFX Viking Trader or Pfgbest Viking Trader? 2 replies

Attachments: The Trader's Academy - by Traders for Traders
Exit Attachments

The Trader's Academy - by Traders for Traders

  • #861
  • Feb 18, 2016 6:55am Feb 18, 2016 6:55am
Quoting strongtrader
{quote} Not confusing, Medici gave the correct and precise answer; it depends on brokers not on platform
Yes, this is what I thought. I asked the original question because on non 24 hour feed, that which shows only the market open data, many of the indicators are unusable when the markets open becise of the after hours gap, for example, the moving averages are a nonsense until the price has had time to build them again. This is something to consider for those whose data is not 24 hour. that's all.
  • #862
  • Feb 18, 2016 6:58am Feb 18, 2016 6:58am
Quoting Coreiscore
{quote} Right thought! Than what is your entry criteria? Ok, you deal with yourself about first hour rule - "cut losers in the first hour". At the same time you know a price could hold in a flat for some time. In that situation your business will be close and open your orders again all the time while a flat. And how big drawdown you can accept? My thought determine the entry point, SL (not depending on time) and TP according to analyze
If the trade is not going anywhere, and an hour has passed( I trade on the hourly timeframe a lot of the time), I get out. There has been lost interest. That means that to regain interest the MM's are going to have to move price against me until they find a new level of disagreement.

My position sizing accounts for the knowledge that I might have periods of several small losses. I risk 0.5% over say, 400 pips. So after I have accumulated 400 pips in losses on the day, I would be down 0.5% of my total account. That's a wrap, then, for the day. Every currency has a different metric of risk, but the percent risked remains static.
If you are good at something, never do it for free--Joker
  • #863
  • Feb 18, 2016 7:01am Feb 18, 2016 7:01am
Quoting pulke
{quote} you mean data on the weekends when there is no trading for private traders? than yes- mt4 doesn't display data in those times. Is prorealtime good?


It's the only software I've ever used, so I can't compare it with anything else I'm afraid, though I've always been happy with it. Perhaps someone else here can answer.
  • #864
  • Feb 18, 2016 7:07am Feb 18, 2016 7:07am
Quoting cat
{quote}[/b] It's the only software I've ever used, so I can't compare it with anything else I'm afraid, though I've always been happy with it. Perhaps someone else here can answer.
The best platform in the world at this moment in time is Ninja Trader for it allows to do almost everything; the counter face of the coin is that it is not easy at all to understand and you have to build your own indicators because you do not find any already done; so it is very good for those who already have a good knowledge.
MT4 has many limitations but you can find tons of indicators for free.
Anyway, what makes the difference is the quality of data feed and this depends on the broker you have.
  • #865
  • Feb 18, 2016 7:30am Feb 18, 2016 7:30am
Quoting pulke
Is prorealtime good?
It depends, of course, on your requirements.

First thing to consider is that charting packages are linked to brokers - that is, depending on what assets you want to trade, and your choice of broker, the selection of charting packages has already been restricted for you.

You can find out about ProRealTime by signing up for a free trial at https://www.prorealtime.com/en/ With PRT you have two brokers to choose from if you want to trade off the charts.

If you're out shopping for charting packages, other popular retail packages are MultiCharts and NinjaTrader. The advantage of those is that they are more capable for algo trading, and their performance (in terms of CPU usage) is better. Not as nice visually as PRT though, I think, with the exception of range candles and Renko charts, which aren't very good in PRT.
  • #866
  • Feb 18, 2016 7:53am Feb 18, 2016 7:53am
Quoting strongtrader
{quote} The best platform in the world at this moment in time is Ninja Trader
That's a debatable statement. No need to restrict people's perspective, I think. There are several worthy contenders beside NT, depending on what you are looking for. But, yes, NT is probably one of the most widely used. Which doesn't make it best.
  • #867
  • Feb 18, 2016 8:34am Feb 18, 2016 8:34am
Quoting medici
{quote} That's a debatable statement. No need to restrict people's perspective, I think. There are several worthy contenders beside NT, depending on what you are looking for. But, yes, NT is probably one of the most widely used. Which doesn't make it best.
Agree, however the topic is so wide that an orientation to begin can be useful
  • #868
  • Feb 18, 2016 10:18am Feb 18, 2016 10:18am
Hello traders,

If I have a account balance on for an example $1000 and want to risk 2-3% per trade. How big lots should I trade with?

If you know a good information site about this please let me know.
  • #869
  • Feb 18, 2016 10:33am Feb 18, 2016 10:33am
Quoting swetrader
Hello traders, If I have a account balance on for an example $1000 and want to risk 2-3% per trade. How big lots should I trade with? If you know a good information site about this please let me know.
A bit of simple maths is required - so 2% of 1000 = 20. So with a stop loss of 20, you can afford to trade i lot, and a stop loss of 10, you can afford to trade 2 lots.

I'm assuming you've already traded a demo account successfully and you are now ready to risk money with a live account?
  • #870
  • Edited 2:45pm Feb 18, 2016 10:39am | Edited 2:45pm
Quoting swetrader
Hello traders, If I have a account balance on for an example $1000 and want to risk 2-3% per trade. How big lots should I trade with? If you know a good information site about this please let me know.
As an example, if your stop is 10 pips, and you're trading EUR/USD, then you want 10 pips to equal $20 (2%). Than means $2 per pip, which means a $20k trade size, i.e. 0.2 standard retail lots of $100k.

In a formula: P * r / SL / 10 standard lots, where P is your capital, r is your risk expressed fractionally (e.g. 0.02 in the example), SL your stop loss distance in pips, and 10 corresponds to the number of usd per pip for a lot of currency bought/sold with/for USD.
  • #871
  • Feb 18, 2016 12:20pm Feb 18, 2016 12:20pm
Quoting cat
{quote} A bit of simple maths is required - so 2% of 1000 = 20. So with a stop loss of 20, you can afford to trade i lot, and a stop loss of 10, you can afford to trade 2 lots. I'm assuming you've already traded a demo account successfully and you are now ready to risk money with a live account?
Thank you. Exactly, I'm thinking of open a live account.
  • #872
  • Feb 18, 2016 12:21pm Feb 18, 2016 12:21pm
Quoting medici
{quote} As an example, if your stop is 10 pips, and you're trading EUR/USD, then you want 10 pips to equal $20 (2%). Than means $2 per pip, which means a $20k trade size, i.e. 0.2 standard retail lots of $100k. In a formula: P * r / SL / 100000 standard lots, where P is your capital, r is your risk expressed fractionally (e.g. 0.02 in the example), SL your stop loss distance in pips, and 100000 corresponds to the $100k in a lot of currency bought/sold with/for USD.
Thank you. This means if I open a $1000 account I need very tight SL right?
  • #873
  • Feb 18, 2016 1:44pm Feb 18, 2016 1:44pm
Quoting swetrader
Hello traders, If I have a account balance on for an example $1000 and want to risk 2-3% per trade. How big lots should I trade with? If you know a good information site about this please let me know.
I want to add one more point to what medici and cat said. In addition to calculating lot size based on your stop loss and the amount you want to risk, you should pay attention to the difference between currency rates and your account currency and difference of that. for example if you have 1000 USD in your account and want to risk 1% of it on a EUR/USD with a stop loss of 20 pips your position size is 5000 units or 0.05 lots. But if you want to do the same with USD/CAD your position size would be 6867 or 0.069 lots. It is not as simple as calculating with an excel sheet. However, don't worry you can use the following indicator or some websites like this:
http://www.myfxbook.com/forex-calculators/position-size

Attached File(s)
File Type: ex4 LotCalculator v1.ex4   4 KB | 258 downloads
  • #874
  • Feb 18, 2016 2:51pm Feb 18, 2016 2:51pm
Quoting swetrader
{quote} Thank you. This means if I open a $1000 account I need very tight SL right?
Not quite. The SL depends on your strategy and on the volatility of the asset you are trading.

If instead you are setting your SL based on how much risk you can tolerate, you are setting yourself up for a lot of stop-out losses due to market noise rather than anything wrong with your strategy. In other words, you are increasing your risk, not decreasing it.

The only viable option is to reduce your trade size in line with required SL level.

My own SLs are based on the setups and entry triggers i use, and then adjusted for volatility which varies. So I start with the SL, say 12 points, and then look at how much I want to risk in $ terms, which then is divided by 12 to get to the number of contracts to trade, as per above.

PS: I was a bit quick in typing the formula above. The factor to divide by should be 10 not 100000, as originally stated. Updated in the original post.
  • #875
  • Feb 18, 2016 6:28pm Feb 18, 2016 6:28pm
Quoting swetrader
Hello traders, If I have a account balance on for an example $1000 and want to risk 2-3% per trade. How big lots should I trade with? If you know a good information site about this please let me know.
Take a look at this mt4 script by sangmane, it does all the math calculation for you.
http://www.forexfactory.com/showthre...59#post8547559

Note that setting sl and determine risk per trade are independent variables, each of them goes through separate decision making process. Once both these variables are determined only then are they brought together to proceed with the math calculations which is defined by the lot size and $amount.

There are many ways to relate this sl and risk with assets or current market volatily. Sangmane's script does the basics but does not take into account volatility and flexibility to choose is limited.
  • #876
  • Edited 10:21pm Feb 18, 2016 8:07pm | Edited 10:21pm
Thanks! cat & medici.
If you don't mind post more of those screenshots
...
  • #877
  • Feb 18, 2016 8:23pm Feb 18, 2016 8:23pm
Quoting cat
Attached is an hourly chart, which I hope will give some idea of how I read where the main S&R levels are likely to be, and how I read where the main momentum lies and when we are due for a directional change. I've numbered the key areas, so I'll go through them one by one. 1/ Both the 100sma (dark blue dotted ) and the 200ema ( thick purple ) are above the price, which tells me that the overall momentum is down. The strong rally up to the 100sma I won't deal with as it is a counter-trend move, but certainly this is something that can and should...
Nicely done cat ! Concentrate attention to trade at 3b which carries the lowest risk with low swing point 2 as sl and high swing point 1 as immediate tp1. On 1mTF you will find lots of such setups.

*For sl variation, it can also be set at 8400 and the risk is set at half of 4x of the original. This approach will suit those who prefer a higher win/loss ratio with a lower RR.
  • #878
  • Feb 18, 2016 10:17pm Feb 18, 2016 10:17pm
Quoting skyway
{quote} Nicely done cat ! Concentrate attention to trade at 3b which carries the lowest risk with low swing point 2 as sl and high swing point 1 as immediate tp1. On 1mTF you will find lots of such setups. *For sl variation, it can also be set at 8400 and the risk is set at half of 4x of the original. This approach will suit those who prefer a higher win/loss ratio with a lower RR.
3b?
...
  • #879
  • Feb 18, 2016 10:20pm Feb 18, 2016 10:20pm
Quoting medici
Another instructional piece while waiting for the action to start, this time on range vs trend. The chart below is the DAX index from Tuesday this week. When a downtrend stalls it is easy to ask whether the trend is over now, and to start looking for reversal entries. Generally it is unwise to take trend-type entries in a range, and you may find yourself whipsawed for a while before the trend continues instead of reversing. Cat mentioned the EMA200 as one way to keep track of this. The downside of this is that a 200 period MA is a tad slow to react...
I found that 2B works better in a ranging market (accumulation or distribution phase) or for tops in an uptrend just after a sharp rise.
...
  • #880
  • Feb 19, 2016 1:17am Feb 19, 2016 1:17am
Quoting Piquant
Thanks! cat & medici. If you don't mind post more of those screenshots
I have an old thread 'Cat's whiskers ', with quite a few screenshots you may like to check out.
2 traders viewing now