Filed Under (Forex eBook) by ForexDigg on 15-07-2008
The transparency of the American markets offers an array of indicators and allows deep insights of prevailing sentiment. You find the activities of NYSE members like specialists and floor traders, public and odd lot short sales, the Short Interest Ratio as well as the large block transactions of the institutional investors published every week. Other tools for technical analysis include trend indicators, daily advances and declines, daily new highs and lows, volume, indices, put/call ratios and other useful information like Stochastics, RSI, MACD, TICK and more. The problem is only that all these indicators contradict each other most of the time. Countless books have been written on this subject, and no matter how many will be written in the future: always be aware that there is no such thing as the Holy Grail of the stock market. But some people are more successful than others and the answer is quite simple:
No indicator is right all the time and you don’t have to be right all the time. Just be right a higher percentage of the time than wrong. Choose some reliable indicators and stick to them. Don’t follow some indicators for a while and switch to some others if they fail. Don’t be a technician in the first half of the year and a fundamentalist the next half. Be consistent and disciplined in your approach. Don’t abandon a good indicator because you think this time everything is different.
It takes of course a lot of guts because the opinions of the most widely quoted gurus of Wall Street are usually contrary to your indicators at that time. This is much easier if you don’t use margin. You will sleep a lot better if you buy fifty shares of IBM with the money you can spare than two hundred shares on credit.
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Filed Under (Forex eBook) by ForexDigg on 15-07-2008
Day trading the
foreign currency (
forex, FX or interbank) market is definitely one of the more challenging endeavors an aspiring trader can pursue. The higher degree of
leverage (as high as 50:1 or 100:1) available in this market can
increase profits, but it equally accelerates losses. This makes the issue of trade timing and selection that much more critical to success. Because of the lack of volume data in the spot currency market (i.e., there are no Level I or II quotes, or time and sales data), newer traders will find they will need to develop much more disciplined strategies that rely less on broadermarket dynamics and more on raw price action and individual market “micro structure.”
The “Big Ben” strategy exemplifies this approach. It is a day-trading technique that takes advantage of the shift from trading from one market center to another in the 24-hour forex trading environment.
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Filed Under (Forex eBook) by ForexDigg on 15-07-2008
There are three spokes that make up, what I call the ?Wheel of Success? as it relates to trading. The first spoke is content. Content consists of all the external and internal market information that traders utilize to make their trading decisions. All traders must purchase value-added content that provides utility in making their trading decisions.
The most important type of content is internal market information (IMI). IMI simply is time and price information as disseminated by the exchanges. After all, we all make our trading decisions in the present tense based on time and price. In order to ?scalp? the markets effectively, we must have the most live and up-to-date time and price information seamlessly delivered to our PCs through a reliable execution platform and/or charting package. Without instantaneous time and price information, we would be trading in the dark.
The second spoke is mechanics. Mechanics is how you access the markets and the methodology that you employ to enter/exit your trades. You must master mechanics before you can enjoy any success as a trader. A simple keystroke error can result in a loss of thousands of dollars. A trader can ruin his entire day with an inadvertent trade entry error.
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Filed Under (Forex MT4 Indicators) by ForexDigg on 07-07-2008
Filed Under (Forex MT4 Indicators) by ForexDigg on 07-07-2008
Open Bar
Close Bar
Bug fixes:
- The trailing stop code would interfere with trades on other pairs.
- The InitialTarget exit wasn’t working for shorts, only for longs.
- Fixed spread inclusion in trailing logic for shorts — still not 100% sure
it’s correct though…
The new version is included in the zip as TrendScalper_TR_openbarstrail.mq4,
along with backtests for both versions in latestbacktests.zip. Note that
TrendScalper_TR was optimized on 2005 Jan-Sept data only and this is the
first backtest on MT4 data for 2004, so it’s clear the settings aren’t just a curve fit.
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