Intraday Live short term trading calls from an Expert Retail Forex Trader

[NickBk]

Hi,
I was more referring to just the strategies employed here and the ability to scale that, to my mind scalping is effective at small lots and not affecting any flows but being flexible to, well scalp.
I am not sure how the $2m equated to a spread bet in say pounds per point.
Anyhow no point clogging this super thread with this just interested to hear from F and if he experienced problems.
I know a couple of people who spread indexes for quite sporty sums but they are not in for 3 minutes or so and it is not an issue.

 

[NVP]

hey all

ive been tied up and out all day today agreeing a new consultancy role starting in early April - will pay the rent for a while as i'm not ready to go pro yet trading...........i'm a babe at 55 so not going to get into the trading saddle F/T for a few years yet ...........not whilst theres decent work around anyway and clients to upset .........hahahahaha

anyway look at that green usd ............its ground all the losses back from yesterday ........jees Forexperian and the gang must have made a mint here today !!!!

respect
N

 

[DowJones]

Hi,
I was more referring to just the strategies employed here and the ability to scale that, to my mind scalping is effective at small lots and not affecting any flows but being flexible to, well scalp.
I am not sure how the $2m equated to a spread bet in say pounds per point.
Anyhow no point clogging this super thread with this just interested to hear from F and if he experienced problems.
I know a couple of people who spread indexes for quite sporty sums but they are not in for 3 minutes or so and it is not an issue.

Nick, you're definitely not clogging the thread - I think these are good questions.

To answer your points... $2mio notional would be (roughly) ~$200/pip, & as this liquidity was per 0.1 pip, you've got about $2k/pip liquidity in that 1 pip range. Re: scalping, most professional scalpers trade reasonable size - basically the movement's are small so the only way you make money is either trading size, or grinding out tiny amounts on a HFT basis. Re: flows - with an institutional quality provider you'll have no problems, however as you indicate, you're not gonna get far with a SB firm/bucket-shop.

I'll leave F to answer any specifics from his approach, as we trade differing styles.

 

[Forexmospherian]

Hi,
I was more referring to just the strategies employed here and the ability to scale that, to my mind scalping is effective at small lots and not affecting any flows but being flexible to, well scalp.
I am not sure how the $2m equated to a spread bet in say pounds per point.
Anyhow no point clogging this super thread with this just interested to hear from F and if he experienced problems.
I know a couple of people who spread indexes for quite sporty sums but they are not in for 3 minutes or so and it is not an issue.

Hi Nick

Its no problem and pleased DJ has commented

Maybe this member can also help us more - @globalarbtrader

I trade a continous system so I don't really have discrete 'trades' exactly.

However there is a simple formula I've developed which converts from continous risk to % of risk per 'trade' to make things comparable.

This gives me an equivalent figure of 0.3% of my capital risked on each 'trade'. I'm holding positions for an average of a month.

If for example I was holding them for a week it would be 0.08% per trade.

I don't understand the difference between 'just against profits' or 'pure loss', but if you read my explanation it might help.

I target 25% volatility a year on average. So that's about 1.5% a day, or £6000.

Looking at intra day p&l will often make moves look larger, especially when things go a little crazy.

So yesterday for example I lost £7800 on a close to close basis, which is well within expectations. From yesterdays close to now I am down about £2000, which is hardly even noise.

The reason these numbers are smaller than 25K is that I'd made about 8 grand yesterday morning, and its from that high water mark that I measured my loss, and also because I've made about 6 grand from the low point this morning.

If returns are normally distributed, then about 2.5% of the time you'd expect to lose 2 sigma - or for me around £12K - in a day. That's every couple of months. You'd expect to lose about £28K in a week, or if you prefer about 6 months of conservative expectations of profits, in 2.5% of weeks; or slightly more once a year. Thats just the maths of return versus vol.

This applies if you're trading system has zero or positive skew. If you're seeing more regular profits and fewer losses then you're probably trading something with hidden negative skew that will bite you much harder every year, or maybe every few years.

To put things into perspective I've had a very good year - much higher than long run expectations - and my profit for the year was £372K on Tuesday night; £380K Wednesday lunchtime, £365K last nights close, £355K in the early hours of this morning, and is now £363K.

The point is you have to be able to stare at that £25K

Thank you - I follow now and I had been initially thinking your 25% was ROI and therefore your annual profits were a lot lower.

Having never worked in the commercial world - I have never really understood your terminology etc - but you have explained it well

I have never been able to trade more than a $250K account size and approx 20 -25 lots max and so no longer even bother compounding as I could not adjust to seeing larger losses - but quite rightly as you say on the amount of profits you are looking at per month and year - you just have to stare at losses and know its still all under control

Regards

F

That's very similar to my experience. I started with £300K run at a 50% risk target, which theoretically at least is below the optimum, and then compounded up. At the peak I was running £210K of annualised risk, so an average bad day was £13K and a bad day (close to close, not intraday) was £26K. My peak drawdown was £75K. These numbers were just too large for me, even though I was comfortable with the theory.

So I cut my risk target in half, dropped my maximum capital to a round £400K, and I no longer increase it when I go over the HWM. When I go over HWM I mentally (if not always actually) remove the HWM profits from the account. Effectively I'm running a hedge fund with 100% performance fees.

It's a very interesting subject, the pyschology of risk.

Without giving too much away (since I've already told you the trading account is less than 49.999% of my asset base) the daily p&l risk on the rest of my investments was, and still is, more than the £13K I was seeing on my trading account. But I don't get emails or monitor them anywhere near as closely, so that doesn't bother me.

Another example is it would make mathematical sense to put all my liquid funds into my trading account (or at least split between one for me and one for my wife) and then run at the same £ risk, which means the % risk on the account size would be the same as now, and the daily swings would be the same, except I would be seeing all of them not just the the money in my trading account as now. This makes sense if you think that trading has a higher Sharpe Ratio than long only investment (if it doesn't, why bother at all?).

But even though the daily cash p&l would be the same, I still want to rule out the possibility no matter how small of a blow up wiping out our entire asset base.

i would love to know if over 25 or 50 lots could be taken by a retailer using a scalp strategy with trades lasting say anything from 1 to 30 mins.

Regards


F

 

[Forexmospherian]

hey all

ive been tied up and out all day today agreeing a new consultancy role starting in early April - will pay the rent for a while as i'm not ready to go pro yet trading...........i'm a babe at 55 so not going to get into the trading saddle F/T for a few years yet ...........not whilst theres decent work around anyway and clients to upset .........hahahahaha

anyway look at that green usd ............its ground all the losses back from yesterday ........jees Forexperian and the gang must have made a mint here today !!!!

respect
N

Hi N

Pleased you have another role lined up - giving you at least another 3 -6 months to progress on the FX journey

You are right - 55 is nothing nowadays - I am 61 and still able to cope with 35 -50 hr weeks easy and I want to remain fit so I can enter the London Marathon at the age of 65 - or even 70 yrs old if i am still Ok. I have done many half marathons and a few triathlons over last 15 yrs but never the full 26.2 miles

The father in law who had his first heart attack in his mid 50's - is now 94 yr old this year and still doing 2 crosswords a day and getting around OK without a stick or frame - so their is hope for us still Neil

Don't fancy scalping over 65 or 70 yrs old though - unless its just a few hours a couple of days a week - keeps the brain active

GL with the new role and keep active on the FX


Regards


F

 

[frostbliss]

Hi F, could u help explain how the time windows works? I uses interactive brokers platform, the nearest LR indicator i can find is a Least Square Moving Average, which seems good for parameter 100 or less.
Regards,
Frost

 

[Forexmospherian]

Hi F, could u help explain how the time windows works? I uses interactive brokers platform, the nearest LR indicator i can find is a Least Square Moving Average, which seems good for parameter 100 or less.
Regards,
Frost

Morning Frost

Yes certainly can

Will say though my time windows can be added to any chart - but its not always the case with linear regression indicators

The main LR indicator is like a moving average - but as additional qualities - and its not the straight lines or channels - ie on the ctrader platform its down as the linear regression forecast indicator and is available on many other platforms

My 2 time windows are 9 min periods either side the 30 min and 60 min frame change periods - and this results in me having 6 key times - ie the hr change - 9 mins past- 21 mins past - 30 mins past - 39 mins past - and 51 mins past.

Those are my main times to look for scalp entries - ( and even exits ) if they agree with LR crossovers and levels and PA etc - 80% + of all my trades start in a TW and around a KT

Hope that helps for now

Good Trading


Regards


F

 

[NickBk]

Thanks F,
Interesting reading.
I guess I was curious as to the upper restrictions on a strategy like F's or other fast moving, scalping in 1-15 minutes. With the exception of F and maybe one or two others here, I doubt we can get an accurate answer to this question here.

 

[Forexmospherian]

Friday - 20th March 2015 - Pre Opens

GM to all FX Intraday Traders

Last day of another busy week

No red news announcements to 12 30 pm UK time

Normal stuff and all FX related questions and contributions etc welcome

Have a good day


Regards


F

 

[globalarbtrader]

Hi Nick

Its no problem and pleased DJ has commented

Maybe this member can also help us more - @globalarbtrader


i would love to know if over 25 or 50 lots could be taken by a retailer using a scalp strategy with trades lasting say anything from 1 to 30 mins.

Regards


F

Sorry thats not my area of expertise - my average holding period is a month. Scalping is way too much like hard work for me.

 

[Forexmospherian]

6 41 am

I always try and be ready to get a scalp on - one or two pairs for either 6 21 am or 6 30 am

Some mornings its easy ( like yesterday ) other mornings - my first scalp of the morning might only bag me just 2-5 pips - rather than a 7 to 25+ pip move I am ideally wanting to catch

Well 2 this morning on just one FX pair - the EU but as I am typing and looking at my monitors I have also jumped in the EJ - on a scalp sell - like the EU from 6 31/ 32 am

The EU from 6 21 am was a scalp buy for 4 pips and the sell after 6 31 am as so far got me 8 pips and on EJ - 5 pips atm - as entered later

 

[Forexmospherian]

Sorry thats not my area of expertise - my average holding period is a month. Scalping is way too much like hard work for me.

Cheers globalarbtrader

Yes - would agree it can be hard work - and even very frustrating for the first few years.

Nowadays I rarely take over 20 trades over the course of the day - and dont chase just 1-3 pips etc - prefer to try and catch the 7 -25 pip moves

For me - it might only be 2 scalps on average per hour with stops from 3-7 pips - and normally I only spend then say 15 -30 mins at monitors out of every hour. - taking many breaks as well

I am sure your set up seems a dream compared to mine and hope it carries on making you an extremely good income etc

All the best

F

 

[Forexmospherian]

6 50 am

EU

so far dropped 13 pips from its 6 32 am high

Out myself now with 10 pips and 7 pips on EJ off a later entry

Not left anything on either trade

 

[Forexmospherian]

There you go - should have left 30% stake on both - shame - but missed out ;-(

 

[Forexmospherian]

Price session structure wise

The US dollar as been weaker over last 8 -12 hrs - and therefore we have seen EU / GU / AU rise and UCHF / UCad / UJ falls

This last 30 mins this as started to change

 

[Forexmospherian]

EU

6 58 am

That extra drop took it down to 0667 - a 26 pips fall - and i just got 10 pips - terrible - need a coffee to get my brain working

Now - any bounce staying under 0680 / 82 - we should be able to sell again

Need to watch new 30 min rules as well on interim highs and lows

 

[Forexmospherian]

Noticed GU as dropped 17 pips from after 6 30 am - and AU 12 pips for now - not taken scalps on either of those pairs - but its always better if we have a synce in moves - with EU / GU / AU moving in same direction etc

 

[Forexmospherian]

EU

7 14 am

7 09 am was my new low atm - i got another 7 pips off another sell but now scalp buying above 59

 

[Forexmospherian]

Yes again bounces staying under say 75 - or possible 82 are sells again

 

[NickBk]

Hi F,
Do you hit your desk straight from the bed or do you get showered etc and be ready for work in a more formal way?