I’ve just started into forex and opened a 50k demo account with fxcm. I have to say it’s kind of exciting. I’ve been successful with my first trade, taking a 500k buy on the eur/usd and finishing 2k strong. Now, I’m hesitant to open another trade, as I feel I could have just been lucky on my first trade.
What position would you take on this?
How long would you hold it for?
Your question is not that simple. It depends on what your looking to do and your trading plan. I do not take trades without knowing what my plan is. Like what is the time of day? Is this a short term trade, etc?
Well, looking at the chart, I would consider a long term trade. For days, or weeks. I have a full time job, so scalping wouldn’t be a realistic option unless I could do this full time. When opening a long term trade like this, does the time of day have much influence? I could understand scalpers focusing on financial news and trade volume, but they’re also opening multiple trades in a day.
At what time frame was this analysis done on? I do notice on the daily, even down to the 4hr, there is an uptrend, and it would not necessarily be wise to trade against it. In this case, when I say trend, I am speaking of minor trend, and intermediate/secondary trends are increasing.
There’s a lot of things you need to look at and consider before you enter a trade.
- News
- Support and resistance (round numbers)
- Order Flow
You can’t just stare at a chart and say this is a buy or sell as you’ve done in the OP - there needs to be more than one factor which will put the odds in your favour.
sell
yep
(is 10 characters long now this post mr administrator?)
You’re right, there definitely is an up trend. But, it seems to have peaked and I’m relying on how it will drop before rising again. I plan on closing this trade once it drops as low as it looks it’s going to go. Then opening a buy position and hold that as long as possible.
Also, I’ve looked at all of the chart data up to D1 from the beginning of the year. I’m looking for long term trades for now. Scalping looks to be something you shouldn’t leave the app while your doing it.
I’ve just started into forex trading a few days ago, what is order flow, support, and resistance? I’ve just been looking at trends in the chart data. Occasionally I look in the fx news section in the fxcm app.
Hi Teslein,
An order flow is when your broker sends an order to a third-party broker to fill orders that have a large position size. Support and resistance are key point that signal it you are in a great/good vicinity to buy or sell.
Support represents sections where it is more favorable to buy; conversely, resistance is where it would be more favorable to sell. This can be found by different methods such as Trendlines, Channels, Price Patterns, Fibonacci tools, etc.
Attached is a picture of an example.
Yup, that about sums it correctly…and it is really hard to suggest anything when we do not have all the facts, time frame, and rest…
Yes if you are trading short time frames.
[QUOTE=“ivanyo;637107”]There’s a lot of things you need to look at and consider before you enter a trade. - News - Support and resistance (round numbers) - Order Flow You can’t just stare at a chart and say this is a buy or sell as you’ve done in the OP - there needs to be more than one factor which will put the odds in your favour.[/QUOTE]
Why would you have to look at order flow? That information only means that a small institution cannot fulfill the size due to their limited amount of positions held, so they have to go to a third-party broker to “borrow” more positions in order to fully execute orders.
According to OANDA, the vast majority of retail traders are short on the GPBUSD. As we all know, most retail traders lose money.
So I would be looking for longs.
[QUOTE=“Kevin LaCoste;637194”]<img src=“301 Moved Permanently”/> According to OANDA, the vast majority of retail traders are short on the GPBUSD. As we all know, most retail traders lose money. So I would be looking for longs.[/QUOTE]
How long do they usually hold it for however, and I’m assuming it does matter what time frame you are looking at that would validate the statistic across the board.
If you poke around OANDA’s site, you can historical info about opened positions. For the last year on the GBPUSD:
Around 60%-70% of retail traders opened shorts against a bullish trend. Since these are the total orders opened, it would include traders of all time frames.
Ah ok. It helps to be able to put a name to what I’ve been looking at.
Flow order though., would that still stand if your broker is a “no dealing desk” type?
Also, just curious. What brokers does everyone here use? I’m on a demo with fxcm, and I have to say I really like themy so far.
Update on the demo:
Closed the trade in question ~20pips strong. Up to 52k on the demo. I’m hoping this keeps up and I become confident enough in my abilities to open a live account in the next month or two.
Thanks for the replies everyone, I don’t know what I’m doing yet and every bit of information helps.
I didn’t know about those charts. Are they reliable? Could you open small trades based on those charts alone and just keep an eye on them?
I’m not looking to rely on them. I want to develop my own strategies and strengths to become profitable. But, if they are over 50% reliable, consistently, it would make sense to open small, maybe .5 - 1k orders based on what the majority of traders are doing.
Since you’ve just started keep it simple and open and close your trades based on Support & Resistance. Don’t be fooled by its simplicity though. They can be your best bet as opposed to some fancy indicators.
I’d suggest you start from daily or 4H chart and try to draw support & resistance lines yourself. That should take some time to learn to develop the skills to spot key support and resistance on a chart.
[QUOTE=“Teslein;637200”]Ah ok. It helps to be able to put a name to what I’ve been looking at. Flow order though., would that still stand if your broker is a “no dealing desk” type? Also, just curious. What brokers does everyone here use? I’m on a demo with fxcm, and I have to say I really like themy so far. Update on the demo: <img src=“301 Moved Permanently”/> Closed the trade in question ~20pips strong. Up to 52k on the demo. I’m hoping this keeps up and I become confident enough in my abilities to open a live account in the next month or two. Thanks for the replies everyone, I don’t know what I’m doing yet and every bit of information helps.[/QUOTE] I use FXCM too great broker!
[QUOTE=“Kevin LaCoste;637199”] If you poke around OANDA’s site, you can historical info about opened positions. For the last year on the GBPUSD: <img src=“301 Moved Permanently”/> Around 60%-70% of retail traders opened shorts against a bullish trend. Since these are the total orders opened, it would include traders of all time frames.[/QUOTE]
What year is this chart being displayed on? The weekly time data does show high buying power in the recent trend on GBPUSD, the monthly is not sufficient to have a direct call thus far, being that major trends are those that last for a year and greater, it seemed as though there has been an extreme buying power in the market in the last 12 months as opposed to selling. (Hence the strong uptrend).