Good read! @PipMeHappy
Especially this bit:
" Bankers and policymakers agree that an industry-wide switch to machine-trading in FX markets is behind the frequency and severity of the price moves, meaning that further crashes are likely.
āOur pessimistic view is that this technology is going to become an increasing part of the FX market and we need to step up our monitoring,ā a G10 central bank official said, declining to be named because he is not authorised to speak publicly."
yes,Manxx, also the graph showing the declining FX traders in the industry year-on-year is quite starkā¦
Yes, And not just the employed professional traders. We were talking recently about the āimprovementsā in the statistics published by ESMA brokers showing a significant drop in the percentage of losing accounts.
But whilst this would be magnificent if it demonstrated an overall improvement in trading skills among retail traders, it is far more likely to reflect a drop in the number of small retail accounts entering the business in the first place.
With the clearly increasing risk of such sharp moves it does reduce the desire to trade long term. I find this increased influence of machine-trading quite disturbing. It puts an entirely different meaning to the concept of self-fulfilling!
I have been slowly dropping my aims of longer term investment-type trading before it even got going really and returning to intraday exposures.
I noticed that FXCM has just recently introduced a new currency index instrument called the EMBasket which is a basket of emerging markets currencies. My first thought was how dangerous that sounds in modern times despite its exotic appealā¦
How does this article impact on your own plans?
Hello Manxx,
yes, me too, long trends are harder to trade
My risk management has been the issue: risk too little and you do not get the benefit of good timing on a trade; risk too much and (fill in the blanks)ā¦
With pairs like UsdMxn and EurTry you need a lot of leverage because the pip moves are massive but the pip value is very low relative to maintenance margin requirements: also, with some of these pairs experiencing momentum to the upside, cumulative overnight negative swap can cripple you if you attempt a long-term play to the long side. So you are limited to waiting for retracements or possibly reversals to sell and hold for a few days or weeks and add positive carry to pip-gain in the direction of your trade.
I have started trading EurUsd on a demo and using CMEās Euro FX Futures hourly volume for peak times sell/buy confirmation as well as CMEās FX EurUsd Options Heatmap to see clusters of Calls and Puts at each price level. So far the tremendous Puts cluster at 1.200 has indeed been shown to hold the EurUsd below that level and I have shorted heavily several times from that level down
What do you think?
I do certainly agree with you about the constraints of managing longer term positions. It is very difficult to juggle (and adjust where necessary) the triangle of 1) sufficient position size to make it worth the wait, 2) sufficiently limited risk to avoid a crash out in these ever more frequent flashes, 3) sufficiently wide stops to allow for normal fluctuations.
I am still of the opinion that it is easier to look for ā10 pips on 10 lots than 100 pips on 1 lotā . One jst has to be much more careful and disciplined on when to trade!
I am still intrigued by this new EM basket which matches USD against a basket of MXN, SAR and TRY but it is quite a larege contract with min $1per pip and a hefty margin, but it seems to move 
Regarding EURUSD futures, that is not an area that I have much experience of having only traded interest futures. I think there is probably some value in what you are watching but I wonder have you also looked at running an options portfolio yourself e.g. mix of futures and short call/puts keeping a fairly neutral exposure and collecting time decay, etc?
There are certainly many ways to be creative in this way to suit whatever outlook you may have e.g. steep trends or ranging markets.
Either way, good to hear you are still keen and active! 
PS I guess your young one is no longer such a young one!
Hey Pip!
I think you are naturally drawn to the āGreat Challengeā and all that it entails, particularly the creative solutions required. I think that the Long term trading you did in the past and exotics are testimony to this.
With the wealth of experience you have under your belt now, i think that if you would trade something that you can live with practically for a year, practically and not just intellectuallyā¦ then it would be almost impossible for all of the pieces not to come together in your favour.
Win
@anon46773462 Yes, she is now three years old! It has been an intense experience, raising her from baby to toddler, and being so involvedā¦ Hours and hours of my energy and effort spent teaching her, cooking for her, looking after the house, watching her grow, cuddling her, saying āNoā the first few times and seeing her suddenly realising that there are limits to respect in the home and around people. It is hard work, and I love those times with my partner where we find each other again away from nappy talk 
How is springtime in Finland?
I have not thought about options etc. I would love to be put in touch with someone who could set up a backtest for an options volume-at-price data set for EURUSD and spot forex EURUSD, to see how successful the odds would be when aligning spot fx entries (long and short) with Calls (Buy) or Puts (Sell) at price levels.
If it was a 50/50, it would be a toin-coss and one could introduce Euro FX futures buy/sell volume data to enhance the backtestā¦
Without backtesting it is hard to know how to manage expectations. What @WinPsych hints at would be best achieved with a bot, i.e. when price reaches a level x that has a buying or selling volume y (based on Futures and/or options volume) then the system would buy/sell accordingly. Stops and limits would be based on something like ATRā¦ There could be several entries set up so that if you were stopped out but price revisited a level that was good for short/long then a second order would be ready, to increase the odds of getting filled.
Anyway, doing all this with no backtesting and by hand is too loose. I am trying with set (entry) orders from today, currently sells at 1.12 as this seems to be the strong cluster at the moment.
PipMeHappy