Can we really WIN?

If you wish trade the news, you will have to go with a non-dealing desk broker that uses STP (straight-through processing) and trades directly on an ECN (electronic communications network) with interbanks.

The reason brokers widen spreads or lock platform during times of news is to protect themselves. Since most brokers offer fixed spreads, during news, they’re unable to guarantee those spreads, so they lock platforms. Other brokers because they take the opposite side of your trade will widen spreads or manipulate price (rarely done these days in G8 countries due to tougher regulatory oversight) to make sure they don’t lose money.

what really facinates me is this thing called “Stop hunting”. it really fustrates many traders. there are so many threads talking about it. and one recommentation was that people just stop putting stop losses:eek: . that goes against everything most traders are tought. ALWAYS ALWAYS PROTECT YOURSELF!!! but then again its these brokerage firms that host alot of these seminars and tutorials to begin with. its only natural for them and the big guys to get in the game and use it against us. i thought stop hunting was just totally scadelouse but when you look closely its the amateurs that get caught up in it by puting their stoplosses in obviouse areas that can easily be targeted. the truth of the matter is, if you cant beat 'em, join 'em. instread of being hunted try targeting areas that are being hunted. so no one should be crying about stop hunting if no one is stopping your from playing the game. also you much watch out for TP orders. it seems that these areas are targets too. rather then trip these areas, they actually get missed and the market retraces just shy of these areas. lol

Honeb,

After reading your first post it seems that you are quite panic striken about trading now. I want to try and encourage you or cheer you up a little.

First and foremost, DON’t PANIC. When you trade, it needs to feel easy and relatively free of panic. If all of your above reasons are going to lead you to feel fear and panic with every single trade, then it implies that there is some internal conflict with trading or with the methodology you wish to pursue.

If i understood your post correctly, you are looking to scalp and news trade. These are some of the toughest trading methodologies to successfully execute. This is precisely when spreads widen and stops are hunted. Please forgive me if i am stating the obvious but when scalping, the spread is what kills you anyway. If you are scalping 5 pips on GBP/USD, then it means you must make 9 pips to close the trade with net 5 pips, because you are starting off at a loss because of spread. On the losing side, however, if you have a 10 pip stop, then you really only have to lose 6 before your trade closes (again because of spread). This is very demanding. I’m not suggesting it’s impossible, i’m just saying it is very difficult to manage a healthy risk:reward ratio when doing it and it is the very thing traders are doing when they are 90% right but still end up losing. My old trading partner practically lost 40K trying to scalp. He didn’t have a losing trade in months taking measly 4-5 pip gains after news releases but gave it all back in 2 hours with one trade he couldn’t close.

News trading is not meant to be easy. It is when the most volatility exists and most newbie traders think they can make a killing and treat reports like slot machines. If you insist on trading news, trade it after a certain time has elapsed after the release is out. News trading is full of profit potential, but the fact is there is nothing more risky for your account if it is not managed with precise timing and execution. And even then it’s very hard. Brokers hate people who straddle the news and that is just the reality. We can either continuously be upset about it or just accept the rules and find a way to deal with it. You said it right, we need brokers. Brokers may be sneaky but they don’t care about sabotaging our tiny accounts. Stop hunting, in my opinion is really a non-issue if you place your stops properly, outside of the market noise.

All this to say, why must you trade the news or scalp trade? Those seem to be the quick way to riches but nothing could be further from the truth. If it seems quick and easy, then it is very likely the least effective route to take. It seems unscientific, but to be honest it is the very reason i started to stay away from news and scalping and day trading in general.

I hope you are not considering quitting. At the very least consider some other style of trading that triggers less panic or stress. Why not consider swing trading, or trend following or something a little longer-term? The stress levels are much lower and you are not subjecting yourself to the same broker tactics you outline in your post.

Don’t fear trading or brokers honeb. I think if you were to scrutinize every single unsuccessful trader’s trades, i’m 100% sure you would not find broker tactics to be the focal point of his/her failure.

Keep your head up and stop thinking about brokers. They may not be the boy scouts we want them to be but i also don’t beleive they are out to sabotage us. Only we do that. We just have to accept certain truths and work around them.

dont worry im not going to quit trading. if i sound paniced its because i just fell hard from a place where i was so excited and eager to get in the market. IMO these emotions can be dangerouse. im right now at a place where im more realistic and im going to take my time getting back into the market. i do focus on the bad where people give details about what is actually wrong (the fair negatives). the postives are easy to find and they mostly all you see. but you are definately right about the fact that a trader who fails is not because his broker is messing with them. if your bad, your bad, its just that with what i was talking about before you get taken out easier and faster.

anyways, im not a scapler or news trader. you are right. these are the most riskiest trading styles and everything that ive been talking about, compounds the risks. im just surprised that these are still viable methods of trading and i am very curiouse how the successful traders manage to trade like this and what they have to say about everything i brought forward. i was actually studying how to be a news trader but with all the noise i cant see how it would be possible for me. ill just stick with trading technicals for now. im a swing trader and maybe i might consider long term trading w/carry trading in the mix. that seems to be safest bet for me.

thanks for being the voice of reason though. you brought my confidence up a few notches.

How I agree with Pipbull. One broker commented to me that if you are going to try and straddle the news, you might as well go to the casino and put your money on black. Those in the know also tell me that scalpers are unpopular with brokers and are liable to be ‘flagged’ and encounter all sorts of problems with their accounts. Far better to profit from the RESULTS of the news which in my experience is much safer!

HAPPY NEW YEAR

Well put. There are safer methods to trade the news, not requiring to trade on the spike. Guys like forexbastards, the Rob guy, see orders through the main feed, so this obviously does not affect them. True- brokers are out to stop scalp traders.

For me, I just watch and wait on the sideline during major economic news release. It’s too risky.

Pipbull I am curious to know what methodology do you use to properly place your stops outside of the market noise. How many pips have you seen broker’s platform can spike the price just hit your stop loss? Is it really that hard to regulate brokers platform to avoid this type of hunting?

alright, can you name some “true-brokers” please. thanks

I think you are smart for waiting on the sidelines during economic releases. At the very least, if you have a position open and it is in profit, you should either cash out or lock in some profit before the release.

Since i am swing trading, the stops i place are a safe distance away from the previous swing high or low, where support and resistance can be expected to hold. The other technique you can use to safely avoid random market noise is the ATR*3 (Average True Range). Look at the ATR of whatever time frame you’re in over the last 14 periods, take the average of that, and multiply that by 3. This will place you with a wider stop, but it is considered by many to be the best way to stay away from the noise. I don’t use that technique so i might be getting the exact calculation wrong, but that is the jist of it. You can read about it anywhere and everywhere. Just make sure your risk:reward remains favorable.

Cheers

thanks pipbull great info.

How Is ATR Stop Calculated?

Basically the ATR trailing stop uses the Average True Range for it’s calculation (see Average True Range for the description of it). Once this figure is calculated the figure is then multiplied by a factor (usually 2 0r 3) and then taken away from the close. The following is an example of how a 3 x ATR Trailing Stop may be calculated on any given day:

ATR Figure = $0.08
Last Close = $6.78

3 x ATR Stop = $6.78 - ($0.08 x 3)
= $6.78 - $0.24
= $6.54

The trailing stop in this case would be set at $6.54

true-broker? :eek: I’ll let you know once I find one

lol, fair enough:p

I experienced 3 minute fills and today, “slippage” of 75 pips with GFT. Sometimes brokers are totally slimy. I’ll try MBT as soon as my account is ok’d, but I’ll keep just enough in my account to use gft’s charts which I like. MBT is a non-dealing desk, so it’ll be different…I exploit the stophunting that DDs use (not primarily, but I’ve taken some $$ from them) so that won’t be doable…

Its really gonna come down to your trade style and who you like…some hate this broker others love this broker…but 3 minute fills and 75 pips of slippage - those are the signs of crooks.

That is completely ridiculous, and exactly the reason I have primarily traded with Oanda for years. I don’t have to worry about fills. My stops and limit orders are executed right on the number.

In terms of the general discussion, I don’t honestly believe there’s a lot of broker manipulation of prices to run stops. If they did that intentionally, they’d be out of business pretty quick one way or another. This strikes me as being more an excuse offered up by frustrated traders who basically had their stops too close to the market.

3 minute fills? 75 pips slippage?

That’s hard to believe that happened from a large broker such as GFT??

Where you trading during a news releases?

My opinion…
OandA is best and safest broker…50/1 leverage…very small trades are OK
If you are afraid to lose money…dont trade forex
learning to trade…at least a year…took me 3 years
I lose half my trades…smaller losses…larger wins
trading a news event up front is called gambling
get a real good news/event calendar,4Cast has one,also ForexFactory
sometimes I do gamble a news event, but thats not trading

Oanda still the best? I dunno about that. I think Felix’s people just started making too much with this news trading…kinda pissed Oanda off.

The question is do you want to win? If the answer is “yes”, than you will.

I understand how you feel about stop hunting. I’ve been stopped out to often by 1 pip. No mater how deep I place my stop. My wife says I take it too personal. I’ve been trying a new strategy that will scare most traders. I go with a strong trend. Go the opposite direction 10 pips and put a buy or sell limit and take profit at 30 pips. That takes care of the spread and gives a good profit. No stops. If you look at most pairs, they rise and fall an average of 45 pips each way. If you put a deep stop of 50 pip, its the same thing. The trade usually closes before morning. Also, learn patience. I have gotten out of loosing trades at a loss. After checking a few of these trades, I found that had I held them untill 23:00 they would have been winners.

Dear Traders,
Iam a full time forex trader for the last one and half years. I first started off with FXCM and when DBFX came in to the scene I moved my account there about 4 months ago…
When ever I read any forex forum on the net I always get a feeling that I’m the only customer FXCM had. Because every one else thinks FXCM is the biggest enemy of retail forex trader. When I first started trading my main concern was security of my funds and thats why I chosed FXCM and never realy bothered about other brokers.
I grew my account over 400% (this is after withdrawing money for my personel expences) in the last year with FXCM. One main reason for my success was, I realy didnt go to any forex forums on the web until a month ago. Therefor I realy didnt know how bad or good FXCM or DBFX was. All I knew was about a year ago when I tried to straddle the news my account manager from FXCM called on my phone and said Iam not allowed to straddle during the news and after he convinced me why I shouldnt straddle , I never did since then. I never executed a new trade 15 mins before or after a news release for the last 12-14 months. apart from I cannot trade the news I never had a problem what so ever with FXCM . One of main reason I went to DBFX was my account manager moved to DBFX from FXCM and he told me that DBFX is using their white label system and also have outsourced the dealing and CS staff to FXCM. Iam currently happy with DBFX and no major issues at all(No news trading) . Just two months ago I bought My self a Nice house and a BMW (partly Mortaged) from the trading profits.
Iam only doing day trading and I follow my own system. I dont call my self a proffessional trader because I dont draw any lines on my charts :slight_smile: I used to be a door to door salesman before I started trading and I didnt know jack **** about trading untill one of my work mates just mentioned about it. Just like everyone else I lost more money than I could afford in the begining but I learned from my mistakes. I started with a uSD 50000 loan and my account balnce today over USD 2700000 after paying off for my loans and expences…

When I went to U.S last December DBFX guys invited me to NY and spent over $2000 on me taking me to nice restaurents and my hotel bill. (also visited few strip clubs with my account manger sponsered by DBFX :wink: )

When my account hit the 1/2 million mark I will move it to a currenex broker and hoping to trade with big boys.

So if I can do it , anyone can do it. May be we all are worrying about our brokers too much and not worrying about catching the daily trends for the day.:confused: