New nfa rules gonna change the way you trade

Christiaan

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So i'm suppose to open a live account today.I need to scan my pc for virusses that will take around 3 hours and then it is all systems go_Ofcource my broker is not only regulated with the nfa it also has a perfect record.Everything is falling into place time for a real live account until I got this e-mail

A bit long but if you don't know about these new rules you really should read them I am quoting directly as I got the e-mail

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Hi, Christiaan

Here we are - the end of an era... and the end of the road for many
Forex traders...

------------------------------------------------------------------------------
FACT: NEW NFA Regulations Will KILL Your FX Trading
===> 2 Great "Life Saving" Options For You...
------------------------------------------------------------------------------

GAME OVER for anyone trading with an NFA regulated broker... no
more, no less... it is as simple as that.

No doubt you have already heard about the various NFA directives that
threaten to end profitability for many FX traders...

The latest batch are kicking off after the market closes this Friday and
it is one of those blows that will KILL any FX trader who hasn't yet been
terminated by their previous directive.

Ok... I would like to cover the present situation and how it affects YOU
so please pay close attention.

==> No way to have long (buy) and short (sell) orders open at the same
time (THIS ONE is the one that MOST annoys me!)

This is often referred to as "hedging" and, if you listen to the NFA, is a
very bad thing to do. If, however, you step back and consider things
sensibly and rationally, you can see immediately that hedging is not a
bad thing at all - it is actually a very useful way to operate your trading
account.

What this rule actually means for you is that you are no longer able to
trade your account with multiple strategies on the same currency pair.

Perhaps you trade several EAs (Expert Advisors), perhaps several
manual strategies, perhaps a combination of manual and automated
systems. If so, it would be very common to find some strategies / EAs
trading long positions and some trading short positions - until the
"experts" at the NFA decided that the whole idea of trading in two
directions was bad for you and banned the concept!


==> No way to open orders with StopLoss and TakeProfit levels set

One of the most fundamental aspects of trading is money management
and the best way to achieve that is with correctly placed StopLoss
orders to accompany each trade opened.

Another important aspect of money management is being able to take
a profit on an open trade. Once again, the NFA disagree with long-held
principles of trading because one of their new rules (takes effect this
weekend) will not allow StopLoss and TakeProfit orders to be specified
- you must choose one or the other!

I am sure that this little revelation will send you searching for your crystal
ball so that you can accurately predict which type of order you will require
before placing each new trade :)


==> No way to close the order(s) that YOU want to close

The final gem of an idea thought up for you by your caring, sharing NFA
is something referred to FIFO (First In, First Out)...

What that means is this: assume that you were trading EURUSD and
opened a long position... the market moves up and looks like it will
continue so you open another long position. Now price starts to
decline so you want to close the 2nd order before it becomes a
loser and let the initial order run in the hope that the upward move
will resume, after all, you can always close that initial order later if
the need arises...

Sorry - that is not allowed! You would be forced to close the initial
order before you could close the second order.


So, once the markets re-open on Sunday, the face of trading for vast
numbers of people will have changed very much for the worse!

If your current broker is registered (and therefore regulated) by the NFA
then there is a very, very high probability that any EAs that you might be
using will cease to function.

Depending upon the order types used, there is a slight possibility that
an EA might continue to function if it was the sole trading system used
on a particular currency pair, however, under the new rules there is no
safe way of simultaneously running multiple EAs on the same currency
pair - even if they were all trading in the same direction because the
FIFO rule prevents an EA from monitoring and managing its own
positions.

Remember: This does not just affect traders using EAs - anyone trading
more than one manual strategy is also going to find things incredibly
difficult from next week.

To quote from the US national anthem "...the home of the brave and
the land of the free (unless you trade Forex!)"


------------------------------------------------
To HELL With This... THE Solution!
------------------------------------------------

You have really only got 2 options - you either stop trading FX or you
adjust.

The bottom line is this... life is all about adjusting. Nothing is static in
life... you have got to overcome those issues that eventually hit you
head on!

I would like to recommend 2 very special brokers that you may chose
from if you want to continue trading FX PROPERLY.

When judging any broker's performance, you need to take into account
8 criteria:

Service, reliability, spread, slippage, ease of opening an account,
reputation, suitability for the small trader AND MT4 compatibility.


Remember - it is not just about the spread... or the slippage... or the
service - it is about a whole range of characteristics that are KEY to
your FX trading success.

I would like to recommend 2 particular Forex brokers:

1. FXCM UK

- Account opening minimum: $500 (FXCM normally insists on USD
$2,000 to open a live account. However, I arranged a special deal
were you can open an account with just USD $500!)

You can sign-up for a FXCM UK live or demo account here:

Back Bay FX | FXCM UK & BACK BAY FX



2. FOREX META

- Minimum account opening balance: $100

You can sign-up for a FOREX META live or demo account here:

Sign Up Page




I know... many people might think "Damn, do I have to open a new FX
account now?"... YES, my friend - you do, unless you want to stay
behind and suffer the bitter consequences.

Do something about it now - do not just sit and wait for the new NFA
rules to hit your FX trading account.



All the best,


Martin Alexander
Forex Auto-Scalper
 
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