Check My Settings Please

[westone]

I am new to trading and slowly losing, but at the same time learning. I started with the FTSE Rolling Daily and the settings and indicators I am using are: Candlestick Chart - 5 Minute Time Frame - MA - Parabolic Indicator - RSI - Stochastic. My stake is £1 and Stop is £7.

Using the Indicators I can identify trends, but frequently get stopped out in the early stages. I find it difficult to know a strong trend as against a weak one. Not sure what stop to use.

I am retired so am able to trade at any time of the day or night. Still looking for the best time to trade.

Ambition: Five to Ten pips profit per day.

I know I have a lot to learn, but you have to start somewhere. So any suggestions would be appreciated.

 

[pssonice]

listen to the news !

i.e. EADS is announcing additional profits because of a lower EURO
EURO zone is getting weaker but exports getting stronger
this indicates that EURUSD bottomed out.

look for every dip in EURUSD and be prepared to go long at limit
while using the last available fibonacci zones in YOUR 5-min candle chart.

 

[Black Swan]

I am new to trading and slowly losing, but at the same time learning. I started with the FTSE Rolling Daily and the settings and indicators I am using are: Candlestick Chart - 5 Minute Time Frame - MA - Parabolic Indicator - RSI - Stochastic. My stake is £1 and Stop is £7.

Using the Indicators I can identify trends, but frequently get stopped out in the early stages. I find it difficult to know a strong trend as against a weak one. Not sure what stop to use.

I am retired so am able to trade at any time of the day or night. Still looking for the best time to trade.

Ambition: Five to Ten pips profit per day.

I know I have a lot to learn, but you have to start somewhere. So any suggestions would be appreciated.

Not sure if I've got this correct but are you betting £1 pp and only using a 7 pip stop loss and frequently getting stopped out? Does the trend you've identified (close to the 'b of the bang') then go in the direction your indicators suggested was probable? If so you've answered your own question re. position sizing...

IMHO (and I'm not an indices trader) you need to place your stop close to the highest high or lowest low of the session you're in...also, look at your TF, folk think choosing smaller TFs equals less risk needed, but in my experience you often need 30 pip *room* on 5 min TFs (I'm talking forex here so adjust for indices) and it can go pop in a blink of an eye. Whereas on 30 min TFs my average was 50 pip SL and it rarely got stopped out, often a point was reached were it was evident that the trade had failed and I reversed, losing perhaps 30-40pips, but that's often the price paid for market information...

 

[westone]

pssonice,

Thanks for that advice it was very helpful. I try to keep an eye on the news and use http://www.dailyfx.com/calendar/ to help me with the most important changes. The color coding of high, medium and low makes it easier for me.

That part of your message - "go long at limit while using the last available Fibonacci zones in YOUR 5-min candle chart" is something I am not sure about but will look it up. I know the Fibonacci as a numbering system of 0,1,1,2,3,5,8 where subsequent numbers being the sum of the previous two, but that's all I know at this point.

I am only a few weeks into trading and the more I get into it the more complicated it becomes, but it is very interesting.

I will watch the EUR/USD charts and take action or learn from what happens.

 

[westone]

Black Swan

Yes, I have been betting a £1 per pip and had a 7 pip stop loss. Somewhere in my reading about spread betting and the FTSE that was suggested as a good strategy.

I started with the FTSE Rolling Daily and the settings and the indicators I am using are: Candlestick Chart - 5 Minute Time Frame - MA - Parabolic Indicator - RSI - Stochastic.

Originally, I thought my losses were due to me not being able to read the charts and that probably is part of the answer. However, I have now reached the stage where I can read up and down trends with reasonable accuracy. I am sure you are right in saying that a 7 pip stop loss is too fine.

I understand what you are saying about the additional room that 30 or even 50 pip stop loss gives. Certainly, my stop losses are sometimes triggered very quickly even though the predicted trend continues.

What I still have to understand is why changing from a 5 minute to a 30 minute time frame would be better. So that is another area I have to get to grips with.

Thanks for your help and advice, I am learning.