I'll try to sum this up in as little words as possible. I very much do enjoy trading Forex but there are key differences than stocks or futures in the structure of how the beast moves. I won't touch the other subjects like the leverage, broker legitimacy, or types of traders because frankly if you do your homework you can get past these types of things. I won't even touch why the currencies move the way they do, you can research that on your own.
If you look at a Forex chart you'll see a hell of a lot of range formations with sporadic quick bursts to other levels. Most people who start out trading have no idea how to capitalize on this type of movement and don't have the know how to trade a range let alone a trend. They end up putting on a trade and a random move comes that takes them out. They don't understand that you can also profit from random moves.
That and occasionally you'll see a monolithic account changing move when a bank decides to unpeg it's currency without telling anyone.
The following 3 users say Thank You to Itchymoku for this post:
For sure i know many traders who treat trading as gambling, i know others who treat it as investing. The gamblers treat it like a casino, topping up their trading pots from other sources. Most investors in the beginning blow a few pots until they learn how to trade and spot high probability trades and respect bank management percentages. Some learn quicker than others, usually takes about 3 years to get consistently profitable from what ive seen.
How much experience do you have trading emini futures, if you don't mind me asking. And what broker do you use for that?
Also, what do you mean by "you can get a more complete set of information trading futures."?
Just started emini as a product not long ago so I have limited experience but I am not new to trading, you can check out my journal for more details.
I use IB and kinetic for data.
Volume profile is part and parcel to how I analyse the markets, you can't get volume data for spot forex. You might find a lot of the successful traders (not all) rely heavily on order flow which requires volume.
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The following user says Thank You to PeakGrowth for this post:
Volume profile in spot FX would be limited to the liquidity provider or providers (ECN), but if you find someone that does large volume of trades and has good liquidity providers, in theory you can construct a solid volume profile.
There is a risk of loss in futures trading. Past performance is not indicative of future results.
PM with any questions about optimusfutures (800) 771-6748 (561) 367 8686. THERE IS A SUBSTANTIAL RISK OF LOSS IN FUTURES TRADING.
The following 2 users say Thank You to mattz for this post:
Unfortunately fx transactions are off-exchange since their is no centralized exchange - thus there is no way to record accurate volume. If I phone my custodian bank to set up a spot or forward trade, they are the counterparty, and they may offset it elsewhere if they need to get their currency exposure in line. If they decide to offset their exposure, they will just use another counterparty. Nowhere in the chain is an exchange and in the past no one was obligated to report any of these transactions to anyone interested in recording trading volumes.
With the recent regulation, namely EMIR, these transactions now need to be recorded in order to for regulatory authorities to monitor the exposures of all of the different counterparties. Unfortunately this data is not recorded in real time - I may be mistaken, but I believe the reconciliations need only be done monthly / quarterly.
No matter now you obtain your volume data, you can not get past the inherent inaccuracies in you dataset. Which is why mattz is correct with his post. You are relying on data which does not necessarily include big institutional volume.
The following user says Thank You to grausch for this post:
Forex Trading need lots of knowledge and skills and if you don't have that you have to rely on the broker and if you select a good broker, you can earn a lot. I have been trading with my broker since 3 years and I have earned a lot in these years.
theoretically we have to accept that trading is gambling. The definition of gambling is "wager/risk/bet on something with an uncertain outcome" . Even though we can justify that it's a 80% winning possibility, it's still a 20% uncertainty in the trade. Sometimes no matter how good we justify that trader is not a gambler, the other's that's not related to trading might not able to accept the fact.