Fib Retracement Trading...

[kagein]

would you use limit orders with your trades?

[daedalus]

Originally Posted by kagein

would you use limit orders with your trades?

You could if you want a more precise entry. Personally I just market order in as long as I can get in for a price anywhere under the 50% level on the retracement. Like always, its a double edged sword, you might get better fills on some trades, and others will blow away from you. I decided I rather be in on the action regardless of a couple pips discrepancy on entry.

Cheers!

[pippiphooray]

daedalus,

I see you use tradestation for your charting, I'm very interested in the tick chart formations. You are right, they are very clean looking and are obviously more accurately depicting the market.

Does tradestation provide you with your data feed too or do you use a different source for that. I use ODL as my broker and I don't think I can interface tradestation with them. I guess what I'm asking is, do I need to use a separate broker for trading and another for data feeds if I'm using Tradestation for charting? I see that Tradestation does provide FX but I think it's a little more expensive to use their FX platform.

[daedalus]

Yea i'm loving the tick charts. I just got rid of my 60 minute charts all together and am not trading those off a 512 tick chart.

Tradestation provides the data feed and the chart package all together for one price. If you use them as a broker you do X amount of trades a month and the platform is free. If you don't, its 99 bucks a month for charts and various data (Forex data is free).

Currently i'm just using TS for my data and charting and I use EFX as my Broker because I didn't want to setup a 5k minimum account with TS.

Hope that answers your questions!

Cheers!

[daedalus]

Stumbled onto this video that talks about Fib Retracements. A couple minutes, but well worth the watch. Talks about the basics of Fibs, where they come from, how to apply them in a couple examples.

A look at Fib Analysis:
Profiting with Forex (PFX) - Watch Forex Professionals Currency Trade

*edit* Found some more by the same guys... good ideas in these videos.

Trading W/Fibs:
Profiting with Forex (PFX) - Watch Forex Professionals Currency Trade

Trading W/Fibs Pt. 2:
Profiting with Forex (PFX) - Watch Forex Professionals Currency Trade

Using Fibs to Set Stops:
Profiting with Forex (PFX) - Watch Forex Professionals Currency Trade

Cheers!

[kagein]

I had a look at the links you just posted and the other links on a different thread .They really have changed the way i view the markets and how i approach my trades. Thanks and keep em coming....

[daedalus]

I should mention for anyone just reading this I have modified my chart settings a bit... The changes are as follows: Everything else remains the same!

The only thing I have changed is I now am just using a 21 EMA and 34 EMA for trend bias on ANY TIMEFRAME, and i tweaked my 85% stop loss level to 87%. I also ditched the 60 minute charts for a 512 tick.

[kagein]

Do you hold positions over night, or do you exit every session?

[daedalus]

I'll hold 4 hour trades overnight and some of my 512tick/60min trades. Most of my others I typically exit prior to the session close so I don't get hit with rollover costs (kind of pricey with EFX).

To be honest, its pretty rare that I have a trade that either hasn't stopped out or hit a profit target by the end of session. If I do however, and my profit target is going to be greater than the cost incurred by rollover rates i'll hold. Or if the rollover rates are in my favor i'll defiantly hold.

I'm actually looking into using FX Options to take my 4 hour trades with to reduce my risk to increase my overall risk:reward ratios. I think it will be a much more efficient trading instrument than the spot market on these longer term swing trades.

Glad to hear you've got questions, i'm happy to answer them!

Cheers!

[kagein]

im looking to be good enough so i can trade full time when i finish university your posts have been a great help, thanks.

ok, i determine the trend and the likely retracement levels on my daily chart.

Do you set you stop losses off the daily chart or do you set a new Fibonacci levels on your hourly chart and set stops and take entries off that?