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FOREX trading.

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  #1 (permalink)
USA
 
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I would like to do some swing trading, but with very little risk hence would like to try FOREX EUR/USD. To start with I'll do micro account to make sure I can hold my trade as long as I can. any one who is trading FOREX please let me know a reliable broker with good customer service that you are using. Thank you Gregory

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  #3 (permalink)
Houston,Tx
 
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Broker: Mirus Futures/Zen-Fire
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I have traded 6E but I have never traded Forex. I'm not against it but I have some questions about it if anyone with experience at trading both Forex and Futures could explain to me , I would be grateful.

1. Forex Dealer told me to daytrade a EUR/USA regular lot required $2750 in margin. 6E requires $500. Both instruments pay about the same. Unless you are trading micro lots, it appears to me that Forex is more capital intensive. Is this correct or did I misunderstand ( yea... it happens...)

2. Commissions: They told me you only pay the spread . The EUR/USA spread they showed fluctuated between 1.5 and 2. Does that mean at a spread of 2 your paying $25 a trade?

3. Micro lots looks like a good first step up from SIM trading. EUR/USA micro lot = $1.25 per pip, you make 10 pips on a Micro trade = $12.50 , a 2 spread on a micro lot cost you $2.50 a trade, Are these numbers correct?

4. They told me the spot market has more liquidity than the futures market. If you have a chart of EUR/USA and a chart of 6E side by side in NT , do the charts look identical?

5. Other than opening a Micro account for $500, or you are doing HUGE volumes, is there any other advantage to trade Forex as opposed to futures?

6. Since last October, the Forex market has more scrutiny, but how do you know if you are getting the best fills or if the dealer is messing with you?

7. What is a bucket shop?

8. Which Forex dealers would you recommend?

Thanks in advance.


Regards,
TMFT

I'm just a simple man trading a simple plan.

My daddy always said, "Every day above ground is a good day!"
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  #4 (permalink)
USA
 
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ThatManFromTexas View Post
I have traded 6E but I have never traded Forex. I'm not against it but I have some questions about it if anyone with experience at trading both Forex and Futures could explain to me , I would be grateful.

1. Forex Dealer told me to daytrade a EUR/USA regular lot required $2750 in margin. 6E requires $500. Both instruments pay about the same. Unless you are trading micro lots, it appears to me that Forex is more capital intensive. Is this correct or did I misunderstand ( yea... it happens...)

2. Commissions: They told me you only pay the spread . The EUR/USA spread they showed fluctuated between 1.5 and 2. Does that mean at a spread of 2 your paying $25 a trade?

3. Micro lots looks like a good first step up from SIM trading. EUR/USA micro lot = $1.25 per pip, you make 10 pips on a Micro trade = $12.50 , a 2 spread on a micro lot cost you $2.50 a trade, Are these numbers correct?

4. They told me the spot market has more liquidity than the futures market. If you have a chart of EUR/USA and a chart of 6E side by side in NT , do the charts look identical?

5. Other than opening a Micro account for $500, or you are doing HUGE volumes, is there any other advantage to trade Forex as opposed to futures?

6. Since last October, the Forex market has more scrutiny, but how do you know if you are getting the best fills or if the dealer is messing with you?

7. What is a bucket shop?

8. Which Forex dealers would you recommend?

Thanks in advance.


Regards,
TMFT

TMFT

you are right with every point. I'm going to play with micro account and risk $1000.00 to teach myself how to stay in the trade for more then my current 24 ticks per trade.
I like to play with it but not in SIM real trades. If I loose $1000.00 OK if I make $500.00 OK education.

This is why I ask who any one would recommend to work with.

Thank you
Gregory

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  #5 (permalink)
Honolulu, Hawaii
 
Experience: Intermediate
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Margins between spreads are very good w/ futures in my opinion when you compare.

IBFX is a good broker.

Understand that "Market Makers"/brokers get to mess with you on the buy/sell side.

Futures are just as liquid if you consider the slippage you get when entering an order (unless limits). I doubt you would exceed the futures needs for liquidity and when considering bid/ask spread differences you will find futures is better IMO.

I traded forex for over 1 year almost full time. If you are swing trading then forex is a good platform considering mt4.

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  #6 (permalink)
Houston,Tx
 
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tickvix View Post
TMFT

you are right with every point. I'm going to play with micro account and risk $1000.00 to teach myself how to stay in the trade for more then my current 24 ticks per trade.
I like to play with it but not in SIM real trades. If I loose $1000.00 OK if I make $500.00 OK education.

This is why I ask who any one would recommend to work with.

Thank you
Gregory

I think that is an excellent idea. I could never take SIM trading seriously, no matter how much I tried.

BTW... you realize there are traders that would love to make 24 ticks per trade...

I'm just a simple man trading a simple plan.

My daddy always said, "Every day above ground is a good day!"
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  #7 (permalink)
Italy (IT)
 
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There are a lot of thread here on futures.io (formerly BMT) about forex and forex brokers, do a serch with this key words : forex, Dukas, MBT................

Take your Pips, go out and Live.
Luke.
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  #8 (permalink)
near Amsterdam
 
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1. Forex Dealer told me to daytrade a EUR/USA regular lot required $2750 in margin. 6E requires $500. Both instruments pay about the same. Unless you are trading micro lots, it appears to me that Forex is more capital intensive. Is this correct or did I misunderstand ( yea... it happens...) INCORRECT (well, maybe not with the broker you spoke with).

2. Commissions: They told me you only pay the spread . The EUR/USA spread they showed fluctuated between 1.5 and 2. Does that mean at a spread of 2 your paying $25 a trade? @2 pips on a $100k lot you are paying $20; 6E @1 tick = $12.50 + commission, say max $5 = $17.50... BUT on EURUSD a decent broker should be no more than 1 pip (I very occasionally see 0.1 pip).

3. Micro lots looks like a good first step up from SIM trading. EUR/USA micro lot = $1.25 per pip, you make 10 pips on a Micro trade = $12.50 , a 2 spread on a micro lot cost you $2.50 a trade, Are these numbers correct?
Numbers are correct, conclusion is wrong unless swing trading longer t/f (too little volume on microfx).

4. They told me the spot market has more liquidity than the futures market. If you have a chart of EUR/USA and a chart of 6E side by side in NT , do the charts look identical? Almost identical apart from adjustment for carry cost, which disappears as contract approaches delivery. Only CME FX Future with decent liquidity is 6E... but if you want to daytrade EURUSD and your account is big enough trade 6E.

5. Other than opening a Micro account for $500, or you are doing HUGE volumes, is there any other advantage to trade Forex as opposed to futures? Scaleability for MM + poss to day trade more pairs.

6. Since last October, the Forex market has more scrutiny, but how do you know if you are getting the best fills or if the dealer is messing with you? You don't until it's too late. Get a decent broker.

7. What is a bucket shop? An indecent broker... or rather one who takes the other side of your trades. You don't want one.

8. Which Forex dealers would you recommend? Small account : Oanda + MT4 ( a new combo, btw); larger account (all timeframes) : Interactive Brokers; larger account (but not short-term day-trading) : Saxo Schweiz AG. Don't waste your time with anyone else. These recs are for cash forex trading, not futures.

Edit : although I don't have an account there, I'd also recommend Dukascopy on the basis of reports from a friend who does.

Thanks in advance.
Thank-you, TMFT - I've enjoyed and appreciated many of your posts. J.

Regards,
TMFT

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  #9 (permalink)
Pt Vala
 
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Most problems have been addressed so far and you have been given valuable hints.

But...

tickvix View Post
... would like to try FOREX EUR/USD.

In my view that's a major problem.

Have a look at Oanda. You can have a practice account with them without paying for it.
It comes with free realtime data.

Look at the more "exotic" pairs.
Some of them behave much more predictable than EUR/USD especially when looking at longer time frames.

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  #10 (permalink)
California
 
 
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jtrade View Post
7. What is a bucket shop? An indecent broker... or rather one who takes the other side of your trades. You don't want one.

8. Which Forex dealers would you recommend? Small account : Oanda + MT4 ( a new combo, btw);

Regards,
TMFT

Oanda; was my first broker, is the largest marker maker and takes the other side of retail trades as outlined in their contract. So, does this make them a bucket shop?

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  #11 (permalink)
Fullerton, CA
 
 
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I understand MB is a reputable broker and ECN (doesn't take opposite side of trades).

I think Dukascopy requires a $50K deposit.

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  #12 (permalink)
NY
 
Experience: Advanced
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Slack View Post
Oanda; was my first broker, is the largest marker maker and takes the other side of retail trades as outlined in their contract. So, does this make them a bucket shop?

A market maker is a dealer and takes the other side to hedge their risk . By definition a bucketshop would ignore your order and throw the order slip in a trash bucket . What does make Oanda a bucketshop is the instability inherent to their platform that denies you access to making orders online . Frequently FXtrade freezes up or drops off completely during news events but if you trade news with them youll be rewarded with a spread of possibly 10 or more pips anyway .

An ECN is a broker that puts your order on the open market exposed to many banks and you pay them a commission for their troubles . They therefore dont take the other side of your trade because they dont have a vested interest .

I trade every day with MB trading , an ECN , and get treated real well as far as execution and service is concerned . I swing trade , use limit orders to enter and market to exit and receive positive slippage frequently (on entries). I pay about $1.25 RT for a $10,000 lot and MB also kicks a little back if you use a marketable limit order .

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  #13 (permalink)
CA
 
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Trading: EUR/USD
 
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Eric j View Post
A market maker is a dealer and takes the other side to hedge their risk . By definition a bucketshop would ignore your order and throw the order slip in a trash bucket . What does make Oanda a bucketshop is the instability inherent to their platform that denies you access to making orders online . Frequently FXtrade freezes up or drops off completely during news events but if you trade news with them youll be rewarded with a spread of possibly 10 or more pips anyway .

An ECN is a broker that puts your order on the open market exposed to many banks and you pay them a commission for their troubles . They therefore dont take the other side of your trade because they dont have a vested interest .

I trade every day with MB trading , an ECN , and get treated real well as far as execution and service is concerned . I swing trade , use limit orders to enter and market to exit and receive positive slippage frequently (on entries). I pay about $1.25 RT for a $10,000 lot and MB also kicks a little back if you use a marketable limit order .

Thanks for the information on MB Trading. I'm going to be opening my live Forex account soon and I was leaning toward them since they are an ECN.

I understand that even with ECN there is a spread (I don't think there is a market that doesn't have a difference between the bid / ask). So you need to look at total cost of spread plus commission. I've not seen any numbers better than MB Trading for total cost, assuming their spread is factual.

Andrew

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  #14 (permalink)
Honolulu, Hawaii
 
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Oanda hedges 100% of their trades I believe. So, they are not like others in that regard.

Check NFA for actions against brokers. If you are not a us citizen then I suggest a AUS or UK registered broker.

Good luck!

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Honolulu, Hawaii
 
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One more thing. Due to fluctuations, my indicators look nothing like the same when I use them on a forex data feed. Just FYI. Different monkey entirely with indi's, but price action is also slightly different.

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  #16 (permalink)
near Amsterdam
 
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Slack View Post
Oanda; was my first broker, is the largest marker maker and takes the other side of retail trades as outlined in their contract. So, does this make them a bucket shop?

Yes, but which broker would you recommend for a very small account ? The advantage with Oanda is that you can trade as small size as you like & they are/were well-capitalised (haven't checked them out carefully for some years).

Anyway, once you can afford an account with Interactive Brokers or similar (not many at their level as far as I can see), you are trading in a far preferable environment (IB tip : if you need customer service, call during the European morning when you will be routed to the Swiss desk : excellent, friendly service & and noticeably better than the US desk).

The only negative I can think of for IB is that they bank with Citigroup, less than ideal when the US economy finally joins Atlantis at the bottom of the deep blue sea... (a discussion for another thread maybe..) !

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  #17 (permalink)
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AR01 View Post
Thanks for the information on MB Trading. I'm going to be opening my live Forex account soon and I was leaning toward them since they are an ECN.

I understand that even with ECN there is a spread (I don't think there is a market that doesn't have a difference between the bid / ask). So you need to look at total cost of spread plus commission. I've not seen any numbers better than MB Trading for total cost, assuming their spread is factual.

Andrew

As far as what you pay , as a fee to trade , the spread doesnt factor into the equation and without a spread theres no market since everyone would be in agreement . The commission you pay to MB is $2.95 each side per $100k you trade , no additional fees and they pay you for using limit orders as an incentive . The spread is not a variable to your commissions but it is in regards to your order being picked up in the market . MB is an intermediary between you and the banks that provide liquidity for them .

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  #18 (permalink)
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jtrade View Post
Yes, but which broker would you recommend for a very small account ? The advantage with Oanda is that you can trade as small size as you like & they are/were well-capitalised (haven't checked them out carefully for some years).

The only real problem I have w / Oanda is their pos java platform. Going on this many years w / constant freezes / lockups is inexcusable.

I only have personal experience w / two other brokers, and only one of them offers micro accounts: IBFX. I have nothing bad to say about them... wouldn't hesitate to refund my account if my current broker became uncompetitive.


jtrade View Post
Anyway, once you can afford an account with Interactive Brokers or similar (not many at their level as far as I can see), you are trading in a far preferable environment (IB tip : if you need customer service, call during the European morning when you will be routed to the Swiss desk : excellent, friendly service & and noticeably better than the US desk).

The only negative I can think of for IB is that they bank with Citigroup, less than ideal when the US economy finally joins Atlantis at the bottom of the deep blue sea... (a discussion for another thread maybe..) !

I've heard good things about IB. They are definitely on short list if I ever learn how to trade properly.

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  #19 (permalink)
CA
 
Experience: Beginner
Platform: MT4, Ninja Trader
Trading: EUR/USD
 
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Eric j View Post
As far as what you pay , as a fee to trade , the spread doesnt factor into the equation and without a spread theres no market since everyone would be in agreement . The commission you pay to MB is $2.95 each side per $100k you trade , no additional fees and they pay you for using limit orders as an incentive . The spread is not a variable to your commissions but it is in regards to your order being picked up in the market . MB is an intermediary between you and the banks that provide liquidity for them .

Agree. My point was that the spread is a cost of doing business so it does come into play for overall profitability. Assuming the cost structure for commissions is the same you want the tightest spread because you are in profit sooner with your trade.

Andrew

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  #20 (permalink)
Houston,Tx
 
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Trading: TF
 
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jtrade View Post
The only negative I can think of for IB is that they bank with Citigroup, less than ideal when the US economy finally joins Atlantis at the bottom of the deep blue sea... (a discussion for another thread maybe..) !

What do you have against scuba diving ...

I'm just a simple man trading a simple plan.

My daddy always said, "Every day above ground is a good day!"
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  #21 (permalink)
California
 
Experience: Intermediate
Platform: FxTrade/Ninjatrader
Broker: Oanda/MBT
Trading: Eur/Usd
 
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In my opinion, Oanda is the best MM for Forex. I use them. The ONLY thing I don't like about them is they don't have a range bar option. Other than that, they're great.

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  #22 (permalink)
Australia
 
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Anyone know which liquidity pool MB Trading connects to? I have opened a live account with them today but before I fund it I just want to be sure they have enough liquidity.

Also how are they for trading news like Non-Farm payrolls etc? I am coming over from Interactive Brokers and they never had any issues trading news so I am hoping I get the same experience from MB Trading.

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  #23 (permalink)
Australia
 
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Traderji View Post
Anyone know which liquidity pool MB Trading connects to? I have opened a live account with them today but before I fund it I just want to be sure they have enough liquidity.

Also how are they for trading news like Non-Farm payrolls etc? I am coming over from Interactive Brokers and they never had any issues trading news so I am hoping I get the same experience from MB Trading.


I used MB Trading whole of last week. Their volumes are very very low compared to Interactive Brokers. In peak hours (London Open till London Close) Interactive Brokers had about 20 - 30 times the trading volume on MB Trading. I was looking at EURUSD which is the most liquid pair.

Now I only placed a couple of limit orders which did get filled but I am not so sure that MBT would be able to handle big spikes like NFP etc.

For the moment I am going to stick with IB.

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