Archive through April 03, 2007

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lafee

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Post Number: 512
Registered: 04-2003

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Votes: 0


Thursday, March 29, 2007 - 01:10 pm:

Target around 116.74

Lafee

There is no danger of the public ever finding any key to the secret of winning. The crazy gambling urge and speculative hysteria make that a certainty. But if the public play ever did get wise to the facts of life, the principle of ever-changing cycles would move the form away from the public immediately.

Robert Bacon
Secrets of Professional Turf Betting

ingot54

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Post Number: 1771
Registered: 05-2004

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Votes: 0


Thursday, March 29, 2007 - 05:14 pm:

Lafee - all the best for the special day mate.

Don't leverage your time too much with the special lady, or she might issue a margin call!

Hope you don't find this too "off topic" or offensive.

Keep Smiling - Don't look back

Trading style: Chartist Artist _ Breakouts and Shakeouts.

msparks

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Post Number: 865
Registered: 10-2004

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Votes: 0


Friday, March 30, 2007 - 12:02 am:

yeh, and the bit about the jar of jellybeans is true

lafee

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Post Number: 513
Registered: 04-2003

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Friday, March 30, 2007 - 11:42 am:

Closed out USDJPY @ 11777
Closed out AUDJPY @ 9500

Cheers Lafee

stocky

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Post Number: 56
Registered: 10-2003

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Votes: 0


Saturday, March 31, 2007 - 12:33 am:

Good Evening,

A Good Risk/Reward short in the USD/JPY right now. Currently at the 50% retracement level. Expect initial drop back to 117.60 which is the 38.2% and also one of the Daily Pivot Points.

I'm Short from 118.37, Stop @ 118.67

Stocky..

ingot54

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Post Number: 1775
Registered: 05-2004

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Votes: 0


Saturday, March 31, 2007 - 01:00 am:

Thanks Stocky.

I had a very quick peek at the chart and jumped in at 118.23 (eMini FX with IG).

Thanks for the heads up!

Let's see where she goes.

Keep Smiling - Don't look back

Trading style: Chartist Artist _ Breakouts and Shakeouts.

ingot54

Member

Post Number: 1776
Registered: 05-2004

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Votes: 0


Saturday, March 31, 2007 - 01:56 am:

Stopped out at 11754

Nice - owe you one Stocky.

Prosperity to you.

Ingot

Keep Smiling - Don't look back

Trading style: Chartist Artist _ Breakouts and Shakeouts.

msparks

Member

Post Number: 887
Registered: 10-2004

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Votes: 0


Saturday, March 31, 2007 - 03:31 am:

Hi Ivan
Do you mean target reached at 11754 and closed ?

If you were short from above how did you get stopped in the direction of your trade.

PS What are the figures on the trade please ? 69 pips is ?
You are only taking tit bits on the chart.

Is the margin and costs too high to ride any distance on these FX charts ? Can't allow too many pips or the bank account is drained trying to keep margin, although if the trade went your way initially, guess you could work the quantum trading method ?

ingot54

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Post Number: 1777
Registered: 05-2004

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Votes: 0


Saturday, March 31, 2007 - 03:59 am:

Hi Mark

With the USDJPY the stop must be a minimum of 21 pips away from the opening (or current) level. So on a short trade, the stop can be manually stepped down behind the price.

I could have closed the trade at 117.24 which was originally one of my limit orders. I removed it

because the support level was broken (Stocky said 117.60 was both pivot and 38.2% level.

I thought the USD was going to end up under 117 yen, but it rallied. My stop was set at 117.54 and I watched it thinking I had set it too tight. But in hindsight it was the correct (imho) level to have a stop take me out.

69 pips came to $72 per lot (or per contract). That's AUD $1.05 per pip. I had 6 lots which netted me $438.

The USDJPY is perhaps one of the cheaper ones to trade - you can get one lot for about AUD$22. I am still trying to get the balance between time-frame and stop distance, so I am not a good one to advise you.

But (I love that word) if support and resistance can be pinpointed, and the trend identified (that's the grail right there!) then you could ride it along for a day or two.

If you do, be prepared for an interest adjustment to your a/c. Remember you are dealing with large leverage, and you are charged interest on the WHOLE contract, not just the margin - same as for CFD's.

One of the risks (and I have not found all of those risks yet) of FX is the stop level. You can have a wide stop for a longer term trade, but the drawdown would cripple a normal a/c. You would need to aim at small bites and small margin dealers if you can find one.

I would like to trade about 10:1 margin, but I think the minimum around the place is 50:1. Deadly.

Off to grab a nap before my real duties resume in the morning. Keep chucking in questions - I am sure some of the knowledgeable traders can lay it straight for you.

Keep Smiling - Don't look back

Trading style: Chartist Artist _ Breakouts and Shakeouts.

stocky

Member

Post Number: 57
Registered: 10-2003

Rating:
Votes: 1


Saturday, March 31, 2007 - 06:32 am:

Hi Mark/Ivan.,

There isn't always an interest charge. the interest is different depending on your position direction and currency cross. eg.

You buy $100,000 AUD/JPY. which means you bought 100,000 AUD and sold the Equivalent JPY, for an example we will use a rate of 95.00 for the trade, so the JPY value is 9,500,000 JPY. SO obviously the person on the other side of the trade (the seller of the AUD) is Short 100,000 AUD and long 9,500,000 JPY.

For this example we'll ignore the fact that all brokers take a spread on the interest they give/pay you. we'll use the currencies cash rate.

Say we hold the trade for 7 days. So the person that is long AUD will receive interest on 100,000 AUD for 7 days BUT will PAY the interest on 9,500,000 JPY.

AUD = (100,000 x 6.25%) x (7/365) = $119.86
JPY = (9,500,000 x 0.05%)x (7/365) = 911 JPY ($9.59 AUD)

So a Long Position would receive $110.27 and a short position would pay the same amount.

As i mentioned, all brokers will take a spread and this is all measured in pips. so a Long AUD would be 1.575342 pips per day. Interest debit/credit. Terminology used for this is the "Forward Value".

If you ask your broker for a forward value schedule for the current day i'm sure they'll be happy to provide.

Online brokers generally rip you off big time with this, and this is why you would have got your $22 charge for your EUR/USD Ivan, i'm guessing you were long.

For scalp trades i'll generally use an online broker (i'm with cmc) as i don't pay commission and will only hold for a day or 2 maximum. I also have another account with a broker that offers me the wholesale rates they receive from the counterparty they execute the trade with (either UBS or Deutsche). They operate a desk 24hrs a day that i place my orders over the phone.

I traded a long AUD/JPY trade with my broker at the start of feb and got 2880 JPY for a 1 day roll, which is 1.44 pips.

Well done on the USD/JPY trade Ivan, worked out to plan!

Just remember not to over leverage yourself, it's easy to get carried away when trading with the online FX brokers. I generally work out my Entry point and my stop loss, work out the amount i'm prepared to lose based on my account size at the time should the trade go against me and then work out my position size from that.

Cheers,
Stocky.

ingot54

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Post Number: 1778
Registered: 05-2004

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Votes: 0


Sunday, April 01, 2007 - 04:02 am:

Stocky

That is a clear and instructive response - thanks for taking the time.

Online brokers generally rip you off big time with this, and this is why you would have got your $22 charge for your EUR/USD Ivan, I'm guessing you were long

Yes that is what it was Stocky.

Coincidentally the same number came up in the USDJPY you tipped me.

Unfortunately in Oz we are probably treated rather shabbily regarding margin charges and spreads. That should improve when more competition arrives, as it surely will while these exorbitant prices/charges exist.

The $22 charge is the cost per lot to establish the contract with IG Markets.

They took 6 x $22 = $132 from my a/c as soon as they accepted the short position. It actually equates to 21 x $1.05 = $22.05 which is the cost of the 21-pip spread.

So my 6 lots charges were about right.

One thing I learned very swiftly is that the cost of one lot of the EURUSD (E100,000 worth of the $USD) is not the same as the cost of one lot of the USDJPY ($USD100,000 worth of the Yen) if I have that the right way around ... better go back and have another read of your above post!

... on the other hand, such a position also makes heaps more per pip.

I would like to know if there is a broker who would not require the stops to be further away than 21 pips.

Several times last night I wanted to place my stops 120 to 12 pips above the price, only to be told that I could not place them any closer than 21 pips. The only way to avoid this is to manually close the position without waiting for it to be taken out on stop.

It is a "back door" to double dip on the spread imho. Once the position is established they have already been paid their spread. Why then do they have the restriction on stop?

Anyway Stocky I am in your debt for the tip-off, and it brought me back from a bad fortnight to a "respectable loss" if there is any such thing! I ended the week about 34% down on the small a/c I established, instead of 84% down!

Happy to pay my dues for now - this is a difficult instrument, but a very exciting one. When currencies are on the move the dollars roll faster than the eye can follow!}

Keep Smiling - Don't look back

Trading style: Chartist Artist _ Breakouts and Shakeouts.

ingot54

Member

Post Number: 1779
Registered: 05-2004

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Votes: 0


Sunday, April 01, 2007 - 09:49 pm:

Anyone know if the USDJPY is being quoted at the moment?

I know trading does not open until tomorrow morning (early) but IG Markets have removed it from the list of quoted currencies.

All of the others are there as far as I can tell.

Keep Smiling - Don't look back

Trading style: Chartist Artist _ Breakouts and Shakeouts.

stocky

Member

Post Number: 58
Registered: 10-2003

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Votes: 0


Sunday, April 01, 2007 - 10:39 pm:

Hi Ivan,

Glad i could be of assistance.

Can't see a reason why USD/JPY wouldn't be quoted, it's still on my list with CMC

Seems like IG are charging you commission on the trading..?

I'm with CMC, No entry/exit charges, i can place orders 5 pips away from the market, never had any problems with getting an order filled and i haven't noticed a reason to complain about the forward value's. I find it easy to use, 1 click execution on trades are handy, especially with fast moving FX markets. (i'm sounding like a salesman, sorry) i get 2 pip spread on EUR/USD and 3 on the rest of the Majors. They have a trial version of the platform, maybe download it and give it a go.

With regard to the different cost for different crosses. Margins are charged on what's refered to as the "terms" currency. Eg. Terms for EUR/USD is USD and terms for USD/JPY is the JPY. So if you're trading on 1% margin, costs will be 1% of the equivalent USD or JPY value's converted back to AUD. Let me know if you want me to go into more detail with some examples etc, once you know how FX works you will feel a lot more confident trading it and i'm happy to share any knowledge i have.

I'm not sure of your account size, but 6 lots is decent commitment if you're just starting out. My suggestion would be to trade with 20K at a time (2lots) and consistently use this trade size. it will teach you to maximise your return by making more pips, rather than just jacking up the trade size to make more $$'s. once you've built the bank up a bit, then increase accordingly.

Stocky.

ingot54

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Post Number: 1780
Registered: 05-2004

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Votes: 0