FX Club

[Ciscodarkie]

Well over a month, no posts , where is sensei FxJalarupa, we need your insight after Brexit.
Hope everyone is well.

 

[Thor]

He should come post on platimum so much threads that can benefit by insight

 

[Papsak]

I must say I did learn a lot from FxJalarupa - even if some of it went above me. But I am trading from demand to supply and having reasonable success. Will be running though this thread again to try and understand what I missed the first time.

 

[Ciscodarkie]

How do the Brokers & Market Makers alike handle different account sizes.

I read that trade execution is often overlooked when choosing a broker especially novice traders starting out, often on charts they'll go Long at price X, then it appears to be filled, meanwhile behind the scenes it only gets filled few seconds later, how true is this ?

I also read about FX brokers handle accounts differently, micro, mini ect
Positions executed from micro-accounts don't even get sent to interbanks, it roams around until they (brokers) based on their profits targets will intentionally make you lose, how true is this ?

This really upset me i mean If i commit 10000 hours into learning Forex, Risk Analysis, Strategies & hours backtesting only to be snubbed
by a dishonest broker

 

[Pho3nix]

How do the Brokers & Market Makers alike handle different account sizes.

I read that trade execution is often overlooked when choosing a broker especially novice traders starting out, often on charts they'll go Long at price X, then it appears to be filled, meanwhile behind the scenes it only gets filled few seconds later, how true is this ?

I also read about FX brokers handle accounts differently, micro, mini ect
Positions executed from micro-accounts don't even get sent to interbanks, it roams around until they (brokers) based on their profits targets will intentionally make you lose, how true is this ?

This really upset me i mean If i commit 10000 hours into learning Forex, Risk Analysis, Strategies & hours backtesting only to be snubbed
by a dishonest broker

Do your research. Using XM.com at the moment, with a micro account and a 1:100 leverage.
Lost all my money twice but part of the learning process.

Demo accounts help but you won't learn actual risk mitigation and money management + the emotional portion that comes with losing your own money.

Hopefully FxJalarupa returns, while I didn't post often I did like his posts and found them very informative

 

[Pho3nix]

A note on RISK...

You can gear your position size to max risk ONLY by reinvesting gains (profit) treat your trading business like a real business to leverage your profit...

This gets done via the mechanism of STOP LOSS Size...

If you increase your STOP LOSS SIZE then you are decreasing your position size... if you decrease lot size then you are increasing position size...

If you trade 1 lot and you make 100 pips... You now have 100 pips at 1 lot worth of risk...

If you wanted to gear this position, it can be quiet simply done by doubling your lot size and halving your profit... Now you are trading 2 lots for a 50 pip stop... or 4 lots for a 25 pip stop...

We are literally taking money made and creating a multiplier effect from it... In other words, we remove attachment and fear of loss by reinvesting and gearing other peoples' money...

at 4 lots at 100 pip gain you now have 4 times the reward for the same amount of risk...

Think of the charts as a chess board... each tile is a piece of the battle ground either lost or gained... your lot size determines the size of the tile relative to your whole regiment (account size) if you gain 3 tiles then you have three tiles that can be placed behind your next position to protect you from an attackers onslaught...

Cutting lot size mid trade increases the size of the tiles so if I were trading 3 lots at 3 tiles risk... and I halve my position I then give myself another 3 tiles... so now I have 6 tiles for the same risk amount...

Trading is 90% position sizing... getting this right creates all the difference...

When one starts out, one should BUILD profit and inject this profit into your trades for a greater multiplier effect... This keeps risk relative...

So we risk 1.5% on a trade @ an account of $1000

0.015 x 1000 = $15

$15 @ 30 pips 15/30 = 0.5 Lots

So if you gain 30 pips you gain 1 tile on the chess board... 60 pips gives you 2 tiles... 90 pips gives you 3 tiles...

30 pips = $15
60 pips = $30
90 pips = $45

Should you take 90 pips from the market you have now created $45 of other peoples money...

Should you want to place that $45 of other peoples money to work...

Then you can just repeat the above equation...

$45/30 pips = 1.5 Lots

30 pips = $45
60 pips = $90
90 pips = $135

IF you make another 90 Pips you have now made $135 + $45 = $180 (all for risking an initial amount of $15)

If your Stop gets hit you go back to risking 1.5% of your account and reinvesting that money...

OR if you made $180 you can readjust your risk to 1.5% of $1180 = $17.7 / 30 = 0.6 Lots and start again trying to grow your profit of Other peoples money and letting their losses compound your gains...

This is a very simplified form of the current money management strategy that I employ to leverage gains to great effect...

Some rules with regards to this...

NEVER ADD TO A LOSING POSITION
NEVER TAKE A FULL LOSS (Scale out of a position / or terminate before your full loss can get realized)
CONSERVE YOUR PROFIT (talks to the rule above)

A lesson learnt too late for me

 

[Papsak]

Also with xm.com on a micro account - fill is pretty much instantaneous. You do use a different chart for normal/micro so I guess there must be a difference in the spread - as I almost always trade 2 lots at a time I figured it might be worth switching to a normal account - then my 2 lot would be the same as 0.02 - so checked and opened both charts for the same pair - personally, I could not see a difference at the time with the spread.

 

[FrankieK]

At the moment I'm Long USDZAR @14.65

Are you watching GBPUSD?

 

[FxJalarupa]

I am still around... Feel free to start your own thread snoop, I've been busy building / adding to my office and servers, waiting on a massive software update and just gearing myself up for northern hemisphere winter... I don't trade much during the north's summer season... For me it's a time to take stock, read, reflect and build...

I'll be back when everything is up and running... Got a lot of back testing to do on a few fronts regarding my money management system and some new information on charting patterns that had been keeping me up at night...

Thanks to those who have enjoyed this thread, I hope to be able to direct my children to it one day... So I'll be back in time...

Peace

 

[Pho3nix]

Also with xm.com on a micro account - fill is pretty much instantaneous. You do use a different chart for normal/micro so I guess there must be a difference in the spread - as I almost always trade 2 lots at a time I figured it might be worth switching to a normal account - then my 2 lot would be the same as 0.02 - so checked and opened both charts for the same pair - personally, I could not see a difference at the time with the spread.

Something I am still investigating..
Happy with my micro account. Just need to test out the withdrawal process now.

 

[Xflint]

Has anybody been making money. I started more than 3 years ago. Lost tens of thousands of rands. Tried ea trading, manual, reverse ea, totally random trades, zulutrade and came out of pocket.

Only seen recently that I got a small balance on one of the accounts. Want to give this 1 last try. Any suggestions of a system or ea

 

[Pho3nix]

Has anybody been making money. I started more than 3 years ago. Lost tens of thousands of rands. Tried ea trading, manual, reverse ea, totally random trades, zulutrade and came out of pocket.

Only seen recently that I got a small balance on one of the accounts. Want to give this 1 last try. Any suggestions of a system or ea

Start with a demo account. Practice, read, practice. Watch YouTube vids about patterns and practice more.

Month 3 and this is the first month I'm making a decent profit, albeit after learning risk management. Lost a couple K before that.

Oh and watch the graphs.. Love the graphs. Also focus on 1 or 2 pairs.

 

[FxJalarupa]

Has anybody been making money. I started more than 3 years ago. Lost tens of thousands of rands. Tried ea trading, manual, reverse ea, totally random trades, zulutrade and came out of pocket.

Only seen recently that I got a small balance on one of the accounts. Want to give this 1 last try. Any suggestions of a system or ea

Systematic trading is a flawed approach as the markets do not lend themselves well enough to any one particular system...

Trading is a game of odds... Win or Lose... That is your only possible outcome...

Now you need to ensure that if and when you lose, your losses actually cause you little damage... And you need to ensure that when you win you win big...

How do we create an advantage over others in a market place that is designed to extract money from us?

Simply put

You make it as difficult as possible for them to take your money... You place your stop in areas where many fear to tread... And if your stop placement is good enough then you can start to leverage that stop to greater gains in the future...

Trading is a game of strategy, strategy takes time... Far too often we give away choice positions because we are so excited that we in profit that we blow our wad early and then we say..."If only I still had that short on at such and attach a price..."

Leveraging gains is probably one of the most powerful aspects to this business... But brokers don't want you to do this... They want you to trade in and out in and out in and out and then... Poof... Your account is blown...

So try this... It's really quiet simple...

Find a price that you feel the market is incapable of moving to... Then size your position from this price...

Enter in the direction of momentum and then...

Sit on your hands and do nothing!

It would be even more advantageous to you if your trade is able to collect a positive carry (overnight swop) then you can earn while doing nothing... And when the opportunity presents itself... Enter into a new trade on that same pair and in doing so bringing your average price closer to current price and grow your account by exploiting the anchor that you have created...

Example...

The image above (marked up from my phone so excuse the sloppiness) represents an idea... The long line is a multi year low (very hard for price to reach again)

If you placed a long anywhere between the long and short lines with your stop below the long line you would be doing something a little more interesting than trying to buy each time the 5SMA crosses the 20SMA on bullish MACD DIVERGENCE... You would be giving yourself staying power... Making it difficult to give up your position to the quant, algo and pit traders out there... Screw those guys! If they want your position they must try and take it from you, and if you have done your job correctly then they will try and they will fail... You can then create wonderful options for yourself to exploit the strength of your positron, either through a geared short or additional long position at a later stage...

The benefits of trading like this are many, but the one that should be most obvious to you is the fact that you won't over trade and you won't do stupid ****... You then in theory should not blow another account... EVER...

You're welcome

 

[Pho3nix]

Systematic trading is a flawed approach as the markets do not lend themselves well enough to any one particular system...

Trading is a game of odds... Win or Lose... That is your only possible outcome...

Now you need to ensure that if and when you lose, your losses actually cause you little damage... And you need to ensure that when you win you win big...

How do we create an advantage over others in a market place that is designed to extract money from us?

Simply put

You make it as difficult as possible for them to take your money... You place your stop in areas where many fear to tread... And if your stop placement is good enough then you can start to leverage that stop to greater gains in the future...

Trading is a game of strategy, strategy takes time... Far too often we give away choice positions because we are so excited that we in profit that we blow our wad early and then we say..."If only I still had that short on at such and attach a price..."

Leveraging gains is probably one of the most powerful aspects to this business... But brokers don't want you to do this... They want you to trade in and out in and out in and out and then... Poof... Your account is blown...

So try this... It's really quiet simple...

Find a price that you feel the market is incapable of moving to... Then size your position from this price...

Enter in the direction of momentum and then...

Sit on your hands and do nothing!

It would be even more advantageous to you if your trade is able to collect a positive carry (overnight swop) then you can earn while doing nothing... And when the opportunity presents itself... Enter into a new trade on that same pair and in doing so bringing your average price closer to current price and grow your account by exploiting the anchor that you have created...

Example...

The image above (marked up from my phone so excuse the sloppiness) represents an idea... The long line is a multi year low (very hard for price to reach again)

If you placed a long anywhere between the long and short lines with your stop below the long line you would be doing something a little more interesting than trying to buy each time the 5SMA crosses the 20SMA on bullish MACD DIVERGENCE... You would be giving yourself staying power... Making it difficult to give up your position to the quant, algo and pit traders out there... Screw those guys! If they want your position they must try and take it from you, and if you have done your job correctly then they will try and they will fail... You can then create wonderful options for yourself to exploit the strength of your positron, either through a geared short or additional long position at a later stage...

The benefits of trading like this are many, but the one that should be most obvious to you is the fact that you won't over trade and you won't do stupid ****... You then in theory should not blow another account... EVER...

You're welcome

Same strat as not using SL's. Started doing this myself when gold tried to screw me. Sat on my hands until I was in profit. Took 3 days and most of my margin but it was worth it not to have the loss.

 

[FxJalarupa]

I'm pretty sure that what I said above and trading without a stop that brings you within a few inches of a margin call is NOT the same thing...

I'm advocating using a stop and sizing yourself from that stop so that you are risking no more than 1%-2% risk initially... That way if your stop gets hit, then you aren't down by more than 2%

When you profit from a position, then you can reinvest that profit, along with your initial MAX 2% risk to increase your lot size but still not make you lose more than 2% relative to your initial account size...

I hope this makes sense...?

 

[splicelife]

Thank you FxJalarupa your advice has helped alot!

 

[Pho3nix]

I'm pretty sure that what I said above and trading without a stop that brings you within a few inches of a margin call is NOT the same thing...

I'm advocating using a stop and sizing yourself from that stop so that you are risking no more than 1%-2% risk initially... That way if your stop gets hit, then you aren't down by more than 2%

When you profit from a position, then you can reinvest that profit, along with your initial MAX 2% risk to increase your lot size but still not make you lose more than 2% relative to your initial account size...

I hope this makes sense...?

true true

 

[Bluebat]

Does this stuff work Forex trading ,do any of you guys mirror trade .
What platform do you use .
How do you know it legit .

 

[FxJalarupa]

Hey,

My Forex Broker TickMill
My Multi-Trading Platform FX SYNERGY

FX Synergy does mirror trading, advanced money management, trade and alert management... its pretty much your own customization robot for all things Forex related.

You can use it to build scalping strategies, hedging strategies, scaling strategies... it pretty much does everything...

In terms of whether or not something is "legit" you need to look for a well regulated forex broker... Preferably one who charges low spreads, low commissions, low slippage and pays when you want to get paid...

I like TickMill because they offer USDZAR, GBPZAR, EURZAR, and soon they will also offer trading on the ALSI Top40...

 

[FxJalarupa]

Quick re-cap on how to spot opportunities on a longer term time frame...

USDJPY

Daily Chart... Can you see the confluence...?

We find Momentum...

We then plot direction... Price moves between an upward trend and a downward trend...

We then Establish when we are WRONG...

MOVE DOWN TOWARD A LOWER TIME FRAME and Plot Entry...

Sizing this position looks like this...

IF i have 105 pips until my (I screwed up and chose the wrong direction line "Pink Line") and I want to use that line as my stop...

If trading 1% on $10 000 = $100 RISK Capital...

I now inject that $100 into 105 Pips (or less if I decide to enter higher up inside the "box" if I do this i effectively GEAR my position)

So 100 / 105 = 0.95 lots or 95 000 units

*** What to do if things do not go my way immediately but I still believe my initial thesis?? ***

You can half your position size to 0.47 lots or 47 000 units and double your left over space in the box...

In other words if I'm taking heat to the tune of 35 pips I now have 105 - 35 = 70 pips remaining...

So 35 x 0.47 = 16.45 (Risk Capital Lost)

Then 105 - 35 = 70 x 2 (because I have halved my position size I double my position space)

So I now have to lose another 140 pips from price where I halved in order to have lost my initial risk of $100

Which effectively given me 175 pips of space wherein to be WRONG in time...

THIS IS HOW IT IS DONE GUYS!!!

Good Luck!

**Edit** In order to see the charts better, right click and open in a new tab
_____________________________________________________________
My Forex Broker TickMill
My Multi-Trading Platform FX SYNERGY
_____________________________________________________________