I’m rookie in this whole thing called forex. I’ve done the crash course available here in babypips, and I’m reading some books and another financial blogs.
I have chosen Oanda as my broker mainly due to its low spread in EUR/USD. Even though most people recommend newbies to paper trade for a few weeks or months, I’ve decided to use a couple of bucks to get a real feel. I really don’t mind losing them as long as I learn and improve my knowledge.
I’ve been trading (or trying to :p) for about a week, but I’ve noticed two strange things.
1st - Take profit and stop loss are not very precise. Sometimes I add “take profit” to some order and then when I open it I see a different value (e.g. I sate take profit to 5 pips, and then when I open the order I see something like 4.8, 6, etc). Is this normal?
This happens not only with take profit feature, but also with stop loss.
2nd - take a look at this image
Can anybody explain to me where does those interest payment come from?
As well as the above you will also get slippage on execution, don’t worry about the interest payment, it will be insignificant, but it’s the difference between the currencies interest rates.
That makes sense. But now I’m having another problem and this one seems more serious.
I have placed a short order on EUR/USD at 1.34802 with a 5 pip take profit order about an hour ago.
Now when got back to check the results I saw that the trade was closed costing me 25 pips. If I didn’t close the order and my available margin was more than enough, why was it closed without my permission?
Might be worth getting in touch with Oanda, they are very helpful, and also they are not perfect, I remember a while back that their stop and profits didn’t work for a few hours, but this is the exception, try the min/max on the chart and show historical trades, might give you clue to what happened.
The online chat/help is quick, free and very good.
Thanks for the advice. I did that and I think I understood what is happening.
Everytime I place a take profit order, it is placed based on the actual price.
Let us say that I place a short order at 1.34500 and later at a price of 1.34550 I place a 5 pip “take profit” order, this 5 pip profit is based on the actual price which means that if the market reaches 1.34545 the “take profit” order will be triggered costing me 45 pips.
I thought that the “take profit” would always be based on the initial price which I used to open the order so it would only be triggered when the price reaches 1.34495.
The same thing is valid for stop loss orders.
I still don’t understand how do they accept take [U][B]profit[/B][/U] orders when you don’t receive any profit, but at least I now understand what went wrong
Haven’t you ever seen Office Space? They just take off fractions of a penny on your trades so that you won’t care and they get filthy rich from all the traders using their platform!
when you place a trade with Oanda (I use Oanda) did you see the blue line dashed line? This is your entry.
Did you also see the red solid line? (which is the stop loss line), go and left click it and it will tell you that you can move the lineup up or down (right click it and move up/down to the new place, then left click) and the line is in the new place.
Did you see the Green line? (Take profit) same there you can move it up/down.
Right click somewhere on the black part of the chart, menu will show up and you can place a long or short order but it will open a new order window first.
Place check mark in (keep open) and the window stays open. Why?
Simple, if you scalp, lets say the dot was on (buy) click submit order will be executed. Now place the dot on (sell) and as soon as you would like to close the order click (submit) it will close the open order.
A moment later you can click (submit) and you place a (short) order, switch the dot into (buy), go with the mouse to (submit) wait till you made profit (or to much loss) click submit and it will close the order and is ready for a (buy) order.
Market Order window shows by default,lower bound, upper bound, take profit…
see the black triangle in the center? Click it and it will make a smaller order window.
Just in case you did not know a few of the (short cuts) you can use on Oanda to make life easier.
Personally, I don’t like to see any profit/loss numbers while trading, it only distracts, but then I have a system in place and I trade by it.
Most important [B]cut loosing trades fast, let the winners run[/B]
BTW 5 pips profit means you are scalping and this also means you must have bid line AND ask line on the chart. Then you can see bid/ask lines crossing over your order line (blue dashed line) and you know if you are in profit or loss.
Under tools on the main chart you can set preferences.
units 10, 100, 1000, 10000…
SL (since you scalp) max 10 pips and you should trade the 1 minute chart.
If the trade goes against you close around half distance between blue dash line and red (SL) line ~6pips including spread.
If the trade is with you, let it run, once you have ~14 pips, move the SL to +2~3 pips into the entry. Keep the winner running. If somebody places a big order against your trade, at least you still made 1~2 pips profit.
Remember, every long term trend started actually on the tick chart at one time.
I like to enter the train at the station (M1 means the train just started moving) and you don’t know if the ride is a short or long one.
Neither does anybody else who is trading the (higher) time-frames.
Wow 99, never considered moving my SL as I gain/lose pips. I’ve actually thought of it as a very static thing to put in place. Learn something new every day!
Congratulation, you are doing the right thing. It’s the only way to get the feel for the real thing, even if it is only 1 cent.
If you get “bored” winning/loosing 1 cent at a time, don’t go back to demo, increase to 10 cent or more until the emotions are out of the way.
I know. I just wrote an extra decimal point by mistake. Either way the example is still valid.
Good advice. Thanks!
Moving your stop loss is similar to using a trailing stop order
Now I’m trying to understand how can I create short and long orders at the same time (everytime I’m going short/long and then try to open a new order the other way around, the system thinks that I’m trying to close the previous order when in fact I want to have two open orders in different directions).
