I’ve been play trading on accounts and am ready to take the plunge into real world trades. I am hoping to get some insight on trading ideas, market trends and where to trade.
Would appreciate insight on the following:
[B]1. [/B]Where did you get your trading education from, beyond the play accounts?
[B]2. [/B]Do you rely on the views of the FX analysts from major banks and/or brokers?
[B]3.[/B] How do you decide which platform to trade on?
[B]4. [/B]Do you follow mainstream financial media at all? Are the trade ideas there useful?
I’ll answer a few of your questions here and hopefully save you a lot of time.
One thing to keep in mind (wrt Forex) is that the fx market is the bank’s market place for moving money around, no one elses (banks, funds, hedges etc). (For some reason) we’re allowed to look into this market place!
So the key thing (for me), how do the banks accumulate a position? How do they dsitribute a position? What times of day do they move the market or mark-up or mark-down prices? Does price “fill” gaps in the market, what happens before large moves etc…
It’s all very repeatable My answers;
Screen time. Blank chart, times of day, key supply/demand or resistance/support levels, and see how the pair (the currency) is moved around.
Never! Analysts are rubbish, and are happy to call things “after” they’ve happened. The Pound doesn’t go up on good news (all the time)… It’s goes up because the banks have pushed it down to flush out positions, generate liquidity and spent a few days building up a long position, the news is a nice excuse to move the markets.
Research, find a regulated broker for your country, don’t trade anything less than a 15m chart (1h and daily recommended). If you’re concerned about spread etc you’re trading too small SL and TP.
As little financial media as possible, they’re like gossip mags for the market. If these idiots knew what they were on about, they’d be swimming in $$. It’s all about generating revenue (for their broadcaster). Technical analysis rules the world
Ha, ok sorry, that’s my brash view on things. Good luck.
Spot on and while I agree with most of what you’d posted, esp the part about the Banks. On the financial news, well when the big ticket announcements do the rounds would suggest that all noobs stay away from the market for a day or so, given the volatility…
For an education, study at the free pipschool right here and read the threads.
What you learn there will help you decide what type of trader you want to be which will in turn determine what news etc you follow
Of course - as most of us here - started with babypips, then went on to tradeitsimple to gain deeper knowledge, watched a lot of John Kickligther webinars (dailyfx) - he’s a fundamental guru, then started studying behavioral finance.
Banks? No! Analysts? Some…
I spent a lot of time tryng all of them out. And as far as platform goes - the FXCM’s marketscope is by far the best. too bad darvinex (broker) doesnt support it.
No, No, No - if anything - when they come up with statements like ‘‘this is going to drop bigtime’’ or ‘‘it will gain value twice this year’’ - I start scaling out of my positions.
I have added my answers below each question. Hope you find them useful.
[B]1. Where did you get your trading education from, beyond the play accounts?[/B]
I use educational websites such as babypips, forums, trading magazines as well as my broker. I trade with Ironfx as they provide free seminars, webinars and educational material for their clients. I think a good mixture of all the above is very useful in understanding the market.
[B]2. Do you rely on the views of the FX analysts from major banks and/or brokers? [/B]
To be honest my account manager sends me a lot of information that their analysts provide. I find this useful but I still need to use my own initiative to understand and predict what is going to happen in the market.
[B]3. How do you decide which platform to trade on?[/B]
You decide by using it and seeing if it provides what you need. The mt4 has the basic info I use and it’s easy to use. Most brokers offer this one so I am currently using that one.
[B]4. Do you follow mainstream financial media at all? Are the trade ideas there useful?[/B]
Yes, I do and some times they give you ideas that are useful in your trading.
jalapenoninja! great advice! I’m not sure I agree however about your stance on financial analysts. I’ve placed some pretty profitable trades on some tips from financial analysts. Whilst i’m a fan of fundamental analysis, I simply don’t have the time to do all the research myself. I’m using economic calendars to see what big events come up, and I’m getting advice from analysts on what the implications will be on any given currency.
Education is extremely necessary, a trader cannot develop into a successful trader without proper education. And it takes some years to complete forex education also.
I attended a very expensive and comprehensive course over a 12 month period. No argument it covered a lot but their suggested strategies were all best suited to trending markets and since a lot of markets aren’t really in strong trends their approach/EA’s were not really useful. I also found it difficult to trade on my own so I found another trainer who provides video training, webinars for live trading, and is happy to provide mentoring.
I’ve found Babypips very helpful in providing a basic understanding, but I really needed the human interaction for the training to be effective. Probably that’s just me, but I do learn better from live example.
I’m using MT4 because my broker provides it for free and there are so many other users that a wide variety of EA’s are available from the internet. My minimum time frame is M30 because I’m just too damn slow to analyse and place an order at the smaller time frames. That’s me, not MT4Also because the PIP movement at smaller time frames is normally small my stop had to be small and I kept getting stopped out.
My trading is primarily based on Price Action not news, and especially not on the TV experts who are brilliant at saying why something happened after the event but crap at predicting what will happen before the event. I do however stay away from trading just before major announcements like Non Farm Payroll.
I’m still learning, my account goes up and down, but so far it’s stayed about where it began which isn’t great but at least I’m not hemorrhaging money.
And when you say you stay away from trading news before major announcements, why is that? Do you think analysts make comments that might have an effect on trading?
I have used MT4 from a few brokers but currently use axitrader and find them good.
I do not think that analysts comments force any changes on price action. They are like a moving average and always based on history. Their forecasts are similar to weather forecasts… and just because they forecast rain doesn’t make it rain. However, major reserve bank and government announcements can seriously change the market and can come totally unexpectedly as was seen recently with the CHF. So I think that it’s safer to avoid trading around any major statements
But analysis and economic events can take the pulse of the price action. You can read them in order to figure out how markets will react. And yes indeed bank and government announcements can change the market so you have to be very careful and watch the economic news before you trade and not avoid trading during major statements.
Education is very necessary to become good forex trader just like any other field of life. A doctor studies for at least 5 years before he becomes a doctor, trading is even difficult that becoming a doctor, so it requires more education and practice.
My answers;