Finished reading babypips - got some questions

Hi everyone,

so I just finished reading babypips and some other stuff and have some questions now.

  1. Does one monitor suffice for trading or do you need two or more?
  2. For carry trading: Lets say I sell USDJPY, there is an interest rate difference of -5,00%. Let’s assume I sell 1 Lot (100.000 dollars, right) and the price doesn’t move, do I loose 5000 Dollars (100.000*0,05) due to the interest difference?
  3. I know this question has been discussed excessively, but what is a good amount to start trading forex. Why do the babypips guys recommend trading with 50-100.000 Dollars or is the leverage already included in this amount (500-1000 Dollar Margin)?

As you can see I am pretty new to the topic and it would be cool if someone answered. I am going to post further questions in this thread as well, so this is my official Forex Newbie Thread.

Yours, Christian

  1. No need to add monitors. When you begin, you should be concentrating on longer time frames not intraday noise. It is possible to trade without a computer.

  2. Interest is calculated on a daily basis by most dealers. Here’s an online calculator I ran across: Interest rates - (I’m not promoting this or any other site, sponsor, calculator manufacturer, cereal, etc… :smiley: )

  3. Just about once a month someone poses a similar question. IMO, for real money traders: Not matter what dollar size you begin with, it should be a tiny percentage of your overall investment portfolio. No matter what size account you open, you need to observe tight money management rules. Always guard your capital. Concentrate on reading prices and market action correctly, not on your daily pip count. Never risk more than you can afford to lose - don’t bet the rent money. :wink:

well i�ll answere to your last question
why to start with 50-100.000$ is very simple because it�s easier to make 10% profit out of it than double that amount which would make 5000$-10000$ profit a week which isn�t that bed and your level of risk is very low.but if you make 10% profit out of 500$ that would make you only 50$ profit a week which for most of us is just small amound and it�s silly to try to double or treble your account in a week because you play with high level of risk and you can quickly end up with 0$ balance in your account.

try to start with 5000$ at least so your 10% profit is better than 50$ only and your 10% profit is raising every week because if you reach 8000$ balance then it is not 500$ profit but 800$ one a week you know what i mean.

try to focus on 10%-30% profit of your balance a week so you�ll keep low risk of loss than try to double or treble your balance.

try to make 10% first and then try to double your balance on your demo so you can practice what i�m writing about.

i hope this exemple helped you.

I have no idea what certicex is saying.

You asked:

Why do the babypips guys recommend trading with 50-100.000 Dollars or is the leverage already included in this amount (500-1000 Dollar Margin)?

Is is precisely because of the degree of leverage that you need a considerable cushion. Re-read the pips school lesson on leverage. It has nothing to do with the ease of securing percentage returns or the significance of the dollar amount those percentages represent.

Best of luck…

Cool, thanks for your replies.

I am going to take a look at the school of pipsology again.

I downloaded Strategy Builder FX - Metatrader and have a small problem. The MACD indicator just shows ONE line and the histogram. However, obviously there have to be two lines (faster average and slower average). How do I display the second line?

Yours, Chris

PS: Which charting software are you guys using?

if you read the following thread you will see how you can get the MACD with 2 lines (the info is on the the 1st page down a few posts)

good luck : )

I really like what Certicex is saying here, mainly because I understand it :slight_smile: I’ve been trading a short time, but I shoot for 20% a week growth which will double your money in a month (a shade bit more than double). I started on April 23rd with a $5k demo account, and used only 20% of that with (I think) a 400:1 leverage. The first week I had a 35.8% increase. This week I already have a 19% increase.

I realize that sustaining a 20% increase a week is probably unlikely, and trading real money is quite different than trading demo accounts. BUT … if you can sustain it, or keep close … starting June with a $3000 account, you will be a millionaire by next February! And a billionaire by next Christmas!

It’s similar to the old trick question … would you rather me hand you $20, or give you a penny on day 1 and double the previous day for a month? If you double your previous day for a month, you will have over $5 million in 30 days!