Forex rebates on every trade - win or lose!

Lovely ride on cable this afternoon. Didn't get it all, but that's why a good day on Fx beats scalping stocks - for me anyway.

Thank you, Dazzler. My head's a bit sore this morning.

Sign on, sign on.

:o))))))))

06:47 GMT, May 01 2008 | Posted by Mark Mitchell from London
Well did they or didn't they ?


With Europe off merrily enjoying their May day celebrations and most probably making a long weekend of it, don't expect too much activity this morning. The main question that everyone is asking this morning, is did the Fed signal a pause or didn't they ? In my opinion they did neither like a good central bank should. They are as much a hostage of data as us commentators and traders are and if we see data deteriorating further in the eight weeks before the next meeting they will cut further, but if the figures don't they will stand pat. So in my mind it's time to move on to the next items, which are today's US ISM and tomorrow's Non Farm Payroll data. Eur/usd seems content to stay within a 1.5600/50 band for now, with a lot of chatter talking about a retracement back up to the 1.57 handle after failing to pierce 1.5510 yesterday.

Priscilla,

If you're lurking, this might help with your report.

07:33 GMT, May 01 2008 | Posted by Mark Mitchell from London
A sign of things to come ?



It may not be the largest of the Eurozone economies, but the PMI from Ireland does make for interesting reading. We have already seen falls in the flash estimates for the French, German and Eurozone indices, but we will have to wait until tomorrow for most of the weaker peripheral economies to report.

The Irish Manufacturing PMI fell to 44.7 in April from 46.0 in March. This is it's lowest level in the ten year history of the report. The details look even worse with the sharpest fall in new export orders for almost 5 years. The weakness was attributed to the weakening of global economic conditions, increased competition and the strength of the Euro against Sterling. This should give everyone a heads up for weak numbers tomorrow as we get the reports from Italy and Spain. The peripheral economies are in freefall and the ECB doesn't seem to care. Eur/usd selling by a Swiss and US name has pushed Eur/usd easily back down to 1.5566 and just like that 1.5510 looks more likely than 1.5700.

Hils, is that a subscription site, because they're right on the money? I was short EUR/USD this morning and closed off well before the current bottom, again should have held on for a bit more but haven't got all my indicators properly set up at work yet.

Mkt looking for large sell stops below 1.5500 on Eur/$ before US Open. I mention this as there may be a good opportunity to reverse and catch the rebound. JT

I'll mail you a link later, Seymour.

I could be talked into taking up FOREX. The broader picture seems to suit my style these days and I find this thread very useful. Thanks again, Hils.

OK Hils

There's talk of a large fiber option struck at 1.5500 in the market. Either for a $20m or 20m payout if the price is above 1.5500 at expiry. To add further to the confusion, there's uncertainty as to whether expiry is 3pm London or 3pm NY.

If it was 3pm London,it expired worthless. If it's 3pm NY, it ain't gonna rally today.

:o)

Times Shadow MPC sees split on rate cuts as recession bites

Trailing stops have always struck me as a tricky issue.

Parabolic SAR's are OK, but they have a habit of accelerating into the back of the price as it pauses after a strong move. There are times when this suits me and I'm happy to come out of the market, but that isn't always the case. The other problem with them is that they reverse as soon as they're triggered whilst the other indicators don't say the same thing. Anyone trading on SAR's alone will get whipsawed to hell and back.

This last week or so, I stumbled across something called ATR (Average True Range) developed by J Welles Wilder. The range is derived from a formula to do with highs and lows, etc during the period. You then multiply the range by a factor (typically between 2 and 5 from what I can gather) and use that to set the trailing stop. It also uses the close price of the bar to decide whether to trigger the stop, thereby eradicating the major issue with Para SAR's.

There are various derivatives of ATR Stops such as Chandelier Stop and Volty Channel Stops all available as custom indicators for MT4 and they're also available as MTF's.

This is today's 5-minute cable chart.



The stops are shown by the stepped magenta and aqua lines. The indicator is a MTF stop using a 15-minute period. I've played about with the settings to get something that looks like it might be workable.

I wonder if anybody else uses ATR Stops and, if so, what their experience of them is.

07:41 GMT, May 05 2008 | Posted by Mark Mitchell from London
Former MPC member warns of mortgage rationing

Stephen Nickell a former member of the Bank of England's monetary policy committee and now an adviser to the beleaguered PM Gordon Brown, has warned that the main lenders are now rationing their mortgages and that good borrowers are finding it difficult to obtain mortgage lending. Both Eur/Gbp and Cable are flat-lining at the moment as the UK holiday drains the life out of the FX markets this morning. Cable currently at 1.9780 and Eur/Gbp at 0.7820.

07:52 GMT, May 05 2008 | Posted by Mark Mitchell from London
Greenspan refuses to retire quietly


Former Fed President is now giving us his prognosis on the US economy more often than when he was in office. He has said that the US is in an "awfully pale recession" and that the economy may remain stagnant for the rest of the year. Eur/Usd has enjoyed a steady grind higher since the Far east open to stand at 1.5455. With London and Tokyo off on holiday a couple of option expiries due at the NY cut are capturing market attention at 1.5500 and 1.5525.

Nevertheless, Mr Wilder wears a cat for a hat - or is it a pug for a rug?



And he comes from the planet Delta.
Tom H's mentor, dontcha know.
But his indicators are certainly worlds apart from his prognostications :o)

I thought Winston was the cat with the hat, Chocopops.

:o)

Indeedy ma p'tite cerise - along with you, my son was one of the 5389.
But then, living where he was for a short time in leafy Brixton - he had to pump some muscle fast ;)

I am thinking of taking a couple of weeks off in the next month or so and playing with Forex !

I had a little dabble with fx a couple of years ago without much success.

I tend to trade stocks based in trend, support and resistance which works OK for me but OK means I havnt made a loss for a couple of years but I havnt made much profit either (I have made about 7%PA including in the last 12 months).

So would anyone like to share their basic trading strategy with FX? also how do you trade fx? when I did it a couple of years ago i was spreadbetting but thats probably not the best way!

Hi Spaceman,

Welcome to the FX thread. I've dabbled with FX trading for a couple of years now, but only recently decided to focus on it in a more professional, virtually full-time capacity, so I'm still learning all the time but managing to be pretty successful nonetheless.

I attempt to get the 1 or 2 main trends of the day in a currency pair and ride them for maximum profit. There is a discretionary element to my trading style which I am trying to cut out as I want to make it more automated and objective so I don't have to sit in front of the screen all the time. It bores me !!

In fact, only this week I have opened an account with Tradestation (as well as ODL Markets -spreadbets) which have very extensive automated trading strategies which you can develop and program yourself. I'm hoping to program a strategy that I can just leave running in the background making me pips. That's the theory anyway. At the very least I'll enjoy the challenge as I love programming (use to be an IT Consultant in a past life!) and developing my own indicators/strategies.

Just got to come up with some good rules that make money .... easy :-)

Others on this thread, trade on smaller timeframes than me and trade each time a trade is signalled by their indicator settings, but not managed to find any that work consisting for me yet. I keep studying and learning ... at least until I can program the Holy Grail !!

FreemanFox, thanks for that, when I dabbled a couple of years ago what kept catching me out was my stop loss strategy, I was trying to set fairly wide stop losses but they kept getting taken out by spikes, probably ignoring them would have been a better strategy but I was using SL's to try and limit my risk, it meant I didnt make much or lose much but I want to do better than that.

Your pattern for the day strategy sounds interesting. I am also a IT person although I dont like programming !

On question on Tradestation, can you trade dircetly from it? if so how is that done? do dealers provide tradestaion as an add on?