Moderate signals given in EUR, CHF, AUD and CAD but none for GBP and JPY.
Friday, 22 May 2015
Today's Screenshot 22 May 2015
Moderate signals given in EUR, CHF, AUD and CAD but none for GBP and JPY.
Managed Account and Subscription Service Finally Available!
Since 2010, the STAR:fx model has been developed further: It now is able to filter the signals using volatility and the triggered alerts provide potential risk and return for each suggested trade to help the trader more easily calculate position size. The results speak for themselves: In last 8 days, despite the news that roiled the FX markets, a return of 15.83% was achieved in live markets with one losing day.
The model is now in the hands of a professional regulated trader and is producing solid results. A maximum risk of 1% (of account size) is taken per trade and a maximum of 4% risk per day. The trader can only deal with elective professional clients. These are individuals who meet 2 out of 3 of the following criteria:
This link provides more information on the consequences of choosing to be treated as a Professional Client. If you are interested to learn more about the professional managed FX service available to such clients using the STAR:fx model, please call +44(0)7957 142979.
Future market conditions are good for the model too: The resurgent US dollar, worries about a Greek exit from the Euro and negative inflation in the UK is causing volatility leading to more breakout opportunities across the six major spot FX pairs analysed. I will post screenshots daily so you can see how the new model looks and behaves. If you wish to subscribe to a live signals service, please contact me via the blog or on the number provided above.
Good luck in your trading!
The model is now in the hands of a professional regulated trader and is producing solid results. A maximum risk of 1% (of account size) is taken per trade and a maximum of 4% risk per day. The trader can only deal with elective professional clients. These are individuals who meet 2 out of 3 of the following criteria:
- have conducted 10 trades per quarter in the last 4 quarters of 'significant size';
- have a liquid net worth in excess of EUR 500,000;
- has worked in Financial Services in a professional position for more than 1 year that requires knowledge of the services or transactions envisaged.
This link provides more information on the consequences of choosing to be treated as a Professional Client. If you are interested to learn more about the professional managed FX service available to such clients using the STAR:fx model, please call +44(0)7957 142979.
Future market conditions are good for the model too: The resurgent US dollar, worries about a Greek exit from the Euro and negative inflation in the UK is causing volatility leading to more breakout opportunities across the six major spot FX pairs analysed. I will post screenshots daily so you can see how the new model looks and behaves. If you wish to subscribe to a live signals service, please contact me via the blog or on the number provided above.
Good luck in your trading!
Friday, 29 October 2010
Tuesday, 16 February 2010
Monday, 15 February 2010
Friday, 12 February 2010
FREE Trading Book Download
Click HERE to download a free ebook on trading.
The book is easy to read and easy to understand. It covers trading signals, use of stop loss, trends and reversals in prices. Although the book refers to stock trading, the book is completely relevant to forex trading. Click HERE to read reviews from Amazon and purchase your own copy.
Friday Wrap Up
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At last we are seeing some decent volatility and continued dollar strength as fears of sovereign debt failure grow amid a fragile global economic recovery. Four out of six trades this morning have produced a profit, one a loss and the other breakeven.
At 09:20 we saw the Sell signal in GBP, a few minutes later a Sell signal in EUR and after a further 20m, we saw signals in AUD, CAD and CHF. With barely any time to catch our breath, the next minute saw GBP, AUD and EUR trades reach their Targets yielding profits of 43, 22 and 43 pips respectively. Fifteen minutes later, we saw the final signal of the session from JPY which was stopped out at 11:52 for a loss of 20.5 pips. The CAD position met its Target at 10:25 giving us 32 pips profit and the CHF position lacked momentum to reach its target and was stopped out at entry price at the end of the trading session. The net haul was a profit of 119 pips leaving us with a net profit of 116 pips for the week. Have a great Valentine's weekend and join us next week for some great trading opportunities.
Thursday, 11 February 2010
Thursday Wrap Up
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A reasonable day: we saw signals in all 6 currency pairs and achieved a net profit of 25 pips. The GBP Buy signal was closed at the session end at the entry price, the EUR and CHF trades met their Targets providing profits of 22 and 18 pips respectively. We saw signals in CAD and AUD but were stopped twice in each losing a total of 21 pips and finally the JPY Sell trade met its target and netted a small profit of 11 pips. We are approximately break even on the week so a few more pips profit tomorrow will push us back into profit for the week.
Wednesday, 10 February 2010
Wednesday Wrap Up
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The trading session started quickly with a Sell in CAD and a Buy in GBP at 09:02 followed 1 minute later with a Buy in EUR and Sell in CHF. At 09:49, we closed the GBP position and took 37 pips profit. At 10:09, we closed the EUR & CHF positions for 17 pips & 14 pips profit respectively, closed the CAD position for an 18 pip profit and took the Buy signal in AUD. 1 minute later, we closed the AUD position for a swift 16 pip profit. The mornings trades resulted in a net profit of 102 pips.
Tuesday, 9 February 2010
Tuesday Wrap Up
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The currencies remained range bound and again none of our trades achieved their targets and were stopped. We saw a net loss of 97 pips after 10 trades. Not very enjoyable.
Monday, 8 February 2010
Monday Wrap Up
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Today the currencies remained range-bound, staying largely within the Buy and Sell levels defined by our model. Stops too were tight and as a result some positions were entered more than once. The morning began with signals in CHF and EUR followed by several in the JPY! Towards the end of the session, we saw further signals but none of the trades made it to their Target except the JPY!
Thirteen trades later, the net result was a loss of 33 pips. It all feels depressingly similar to previous weeks whereby there has been little movement until "big" economic release from the USA on Thursday. Should we stop trading until Thursday? No - small, controlled losses are part of the fabric of trading and by taking no risk, you are not going to make a return: You've gotta be in it to win it!
Friday, 5 February 2010
Thursday Wrap Up
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Technical issues still prevail. The day saw narrow ranges and began at 09:15 with signals in EUR, CAD and CHF. These were followed by trades in GBP, JPY and AUD. However, only the GBP trade met its target whilst the CHF trade was stopped and all other positions were closed at entry price at the session end.
You can see from the above screenshot that the big moves of the day occurred after the release of the US economic data. We expect the market will take a little time to digest this information together with Friday's scheduled data releases.
We are at an interesting crossroads: market expectations are for interest rates to rise around the world and the first country to raise their rates will see heavy buying of their currency. We may see high volatility in currency prices as rates begin to rise. But the side effects of a dramatically strengthening or weakening currency are undesirable and it is likely that Central Banks will try to "co-ordinate" such rate rises. But with global economies still weak and the systemic risks posed by the dire financial health of several countries most notably Greece and US states e.g. California, raising rates to moderate growth & slow inflation will be tricky: too early and growth could be slowed to a standstill; too late and inflationary forces may take hold.
In short, while the central banks play a game of chicken with inflation, the FOREX market should be very exciting and offer profitable trading opportunities. We hope to help you make decent profits during this period.
Wednesday, 3 February 2010
Wednesday Wrap Up
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We are sorry we were unable to post signals due to technical reasons. The day started with Buy signals in EUR and AUD with a Sell signal in CHF at 09:30. A buy signal in GBP was triggered on the next bar. Lastly, at 10:30 we saw Buy signals in CAD and JPY.
The GBP and CHF positions met their Targets but these profits were offset by losses arising from the AUD position being stopped and the EUR, CAD and JPY positions being closed at the end of the session. Currencies continue to tread water ahead of Thursday's economic data release from the USA. We hope to resolve our technical issues soonest.
Tuesday, 2 February 2010
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Another sideways trading day. Our first signals were to Buy the EUR and Sell the CAD and CHF. Then we saw a Buy signal in the GBP. At 10:15, momentum in the open positions fell and prices fell back towards their stops. All open positions were closed. Momentum returned again to FX prices and we took the signal in the EUR and closed it for a net profit of 3 pips at the end of the trading session. There is a lot of economic data scheduled for release later in the week and we expect the FX markets will be quiet ahead of this news.
Live Signal
Buy EUR at 1.3935 Target 1.3959 Stop 1.3920
Sell CAD at 1.0588 Target 1.0574 Stop 1.0596
Sell CHF at 1.0573 Target 1.0556 Stop 1.0583
Tuesday Signal Levels
.......Buy@ Sell@ Stop@
GBP 1.5949 1.5901 1.5945
CAD 1.0602 1.0588 1.0597
EUR 1.3935 1.3911 1.3932
CHF 1.0590 1.0573 1.0579
AUD 0.8806 0.8779 0.8796
JPY 90.720 90.460 90.685
Monday, 1 February 2010
Monday Wrap Up
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A new month and a new week begin but the story is still the same: low volatility and poor momentum between economic data releases. Today we saw a good signal in the GBP but all other signals failed to meet their targets and were stopped or closed accordingly. Our net haul was a 35 pip profit and we look forward to a new trading day tomorrow.
Monday Signal Levels
.......Buy@ Sell@ Stop@
GBP 1.5949 1.5905 1.5934
CAD 1.0716 1.0684 1.0709
EUR 1.3903 1.3875 1.3879
CHF 1.0613 1.0586 1.0610
AUD 0.8840 0.8812 0.8820
JPY 90.470 90.280 90.320
CAD 1.0716 1.0684 1.0709
EUR 1.3903 1.3875 1.3879
CHF 1.0613 1.0586 1.0610
AUD 0.8840 0.8812 0.8820
JPY 90.470 90.280 90.320
Friday, 29 January 2010
Live Signal
Sell CHF at 1.0498 Target 1.0469 Stop 1.0518
Buy EUR at 1.3977 Target 1.4013 Stop 1.3952
Buy JPY at 90.220 Target 90.320 Stop 90.175
Friday Signal Levels
GBP High 1.6179 Low 1.6119 Stop 1.6129
CAD High 1.0664 Low 1.0622 Stop 1.0661
EUR High 1.3977 Low 1.3941 Stop 1.3952
CHF High 1.0527 Low 1.0498 Stop 1.0518
AUD High 0.8956 Low 0.8912 Stop 0.8918
JPY High 90.220 Low 90.120 Stop 90.175
Thursday, 28 January 2010
Thursday Wrap Up
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Narrow ranges and a quiet morning ahead of the economic data from the USA at 13:30. We saw a buy signal in the AUD and were subsequently stopped out and the only other trade of the day in the JPY actually made it to the target! The net result for the day is a small profit of 12 pips.
Why are the ranges narrow?
The ranges are defined each day by an upper level (blue line) and a lower level (red line). If the currency pair price moves above or below these levels, a live trading signal is triggered. The upper and lower level are calculated by looking at prices prior to 09:00. The volatility (a measure of how much price varies) seen during this period affects the range between the upper and lower levels : the range increases as volatility increases. Thus today we are seeing narrow ranges because volatility is low.
The low volatility is probably due to today's scheduled USA economic data releases regarding production (Durable Goods) and employment (Jobless Claims) at 13:30 GMT. The market is sensitive to the latter release and therefore currency prices will likely continue to remain "quiet" this morning as traders wait for the Jobless Claims number which will help them assess whether the US economy is in recovery or not.
You will have seen in the past that currency prices can "spike" or suddenly move 100 pips or more when important economic data is released. This happens when the market is "surprised" with data that is very different to the expected number i.e. the released data differs greatly from the consensus forecast by economists, traders and other market professionals.
You can keep up to date with the release of economic data by visiting the Useful Links section on our blog and clicking on the World Economic Calendar. Click HERE to see todays schedule.
Thursday Signal Levels
GBP High 1.6275 Low 1.6244 Stop 1.6250
CAD High 1.0590 Low 1.0567 Stop 1.0587
EUR High 1.4051 Low 1.4021 Stop 1.4038
CHF High 1.0501 Low 1.0476 Stop 1.0491
AUD High 0.9041 Low .9021 Stop .9036
JPY High 90.49 Low 90.32 Stop 90.42
Alert: narrow ranges.
Wednesday, 27 January 2010
Wednesday Wrap Up
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A slow day with tight stops which were annoying. We saw trades in GBP, CAD and JPY which worked out but a lack of momentum failed to carry AUD, EUR and CHF prices to their targets. The net result was xx pips profit.
We have tried a number of methods to try and calculate a stop value that works best but no method works best in all market conditions. We have looked at placing the stop halfway between the buy and sell levels, using volatility based stops and trailing stops. We will continue to use the model's stop suggestion but if you want you can place a stop automatically with each trade at 20 - 30 pips from the entry price. Be careful - when trading ranges are narrow, this naive method could place your stops beyond the buy and sell levels and you could end up having a buy AND a sell position in a currency pair at the same time!
Wednesday Signal Levels
GBP High 1.6148 Low 1.6107 Stop 1.6143
CAD High 1.0678 Low 1.0647 Stop 1.0651
EUR High 1.4060 Low 1.4021 Stop 1.4055
CHF High 1.0502 Low 1.0471 Stop 1.0474
AUD High 0.8988 Low 0.8946 Stop 0.8983
JPY High 89.45 Low 89.29 Stop 89.40
Tuesday, 26 January 2010
Tuesday Wrap Up
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A better day: by 09:45, we saw signals in the CAD, GBP JPY and AUD. The first 3 currency pairs achieved their targets in the next 15 minutes while the AUD reversed and the trade was stopped. A trendless period followed until 11:30 when we saw signals in EUR, CHF and AUD whcih were all closed at a small profit at the end of our trading session. The net result was a tidy 82 pip profit.
Live Signal AUD EUR & CHF
Sell AUD at 0.8954 Target 0.8930 Stop 0.8970 Position closed at 0.8954
Sell EUR at 1.4080 Target 1.4054 Stop 1.4095 Position closed at 1.4071
Buy CHF at 1.0447 Target 1.0463 Stop 1.0438 Position closed at 1.0455
Tuesday Signal Levels
GBP High 1.6263 Low 1.6217 Stop 1.6223
CAD High 1.0615 Low 1.0598 Stop 1.0610
EUR High 1.4106 Low 1.4080 Stop 1.4095
CHF High 1.0447 Low 1.0431 Stop 1.0439
AUD High 0.8978 Low 0.8954 Stop 0.8970
JPY High 90.16 Low 89.89 Stop 90.11
Monday, 25 January 2010
Monday Wrap Up
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A trading day rather than a trending one and early positions were stopped out. By 10:30, we saw a decent move in the EUR & CHF but remaining positions got stopped out either by price or by time as the morning session ended at 12:00. The net result was a loss of 33 pips and it looks like the market is digesting recent news and awaiting further clues on the health of the global economy.
Monday Signal Levels
GBP High 1.61614 Low 1.6120 Stop 1.6142
CAD High 1.0566 Low 1.0533 Stop 1.0538
EUR High 1.4156 Low 1.4129 Stop 1.4152
CHF High 1.0420 Low 1.0398 Stop 1.403
AUD High 0.9067 Low 0.9032 Stop 0.9061
JPY High 90.26 Low 89.98 Stop 90.23
Friday, 22 January 2010
Friday Signal Levels
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Today was frustrating. Our model was unable to capture the swift moves in price due to the built-in lagging momentum detector: once a sudden move in price occurred, our model registered the change in momentum at about the same time the move was exhausted. If this move was registered by our model outside of the signal levels, then no signal. Look at the GBP and AUD charts above as examples.
This reminds us that no single trading model will work under all market conditions. Our model relies on momentum and does not work well under conditions of high volatility. On average, it produces decent profits and keeps us out of the market in difficult conditions thus avoiding large losses. It never feels good to be involved in losing trades but they are a very real component of any trading model and must be expected. And they must be controlled.
Not a happy end to the week but we are seeing a net profit. Have a good weekend and let's trade new prices on Monday.
Live Signal
Close EUR and CAD - Stop Met. 1.4142 & 1.0478. Net 24 pip loss.
Close CHF at Market. 1.0399.
Live SIgnal
CHF Sell at 1.0390 Target 1.0368 Stop 1.03981
EUR Buy at 1.4151 Target 1.4274 Stop 1.4142
JPY Buy at 90.46 Target 90.71 Stop 90.26
Friday Signal Levels
GBP High 1.6283 Low 1.6242 Stop 1.6250
EUR High 1.4151 Low 1.4128 Sop 1.4142
AUD High 0.9091 Low 0.9064 Stop 0.9082
CAD High 1.0482 Low 1.0464 Stop 1.0478
CHF High 1.0412 Low 1.039 Stop 1.0399
JPY High 90.46 Low 90.21 Stop 90.43
Thursday Wrap Up
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Last night, we managed to get the STAR:fx model, which currently exists as an eSignal EFS script, to update this blog automatically. Sadly this fragile process failed this am and once again we were unable to post to the blog. Of course, we missed another good trading day during the morning session and the moves in the afternoon after President Obama proposed some interesting banking legislation were eye watering. Tomorrow should be lively!
Todays signals were:
09:00 Sell EUR 1.4075 Target Met at 1.4051 Profit 24 pips
09:00 Sell AUD 0.9125 Target Met at 0.9083 Profit 22 pips
09:15 Sell GBP 1.6182 Target Met at 1.6125 Profit 57 pips
09:15 Buy CAD 1.0493 Stopped 1.0473 Loss 20 pips
09:15 Buy CHF 1.0464 Target Met at 1.0481 Profit 17 pips
Wednesday, 20 January 2010
Wednesday Wrap Up
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Wednesday Signal Levels
GBP High 1.6285 Low 1.6251 Stop 1.6260
CAD High 1.0369 Low 1.0344 Stop 1.0361
EUR High 1.4200 Low 1.4175 Stop 1.4185
CHF High 1.0403 Low 1.0384 Stop 1.0394
AUD High 0.9165 Low 0.9130 Stop 0.9137
JPY High 90.99 Low 90.78 Stop 90.84
CAD High 1.0369 Low 1.0344 Stop 1.0361
EUR High 1.4200 Low 1.4175 Stop 1.4185
CHF High 1.0403 Low 1.0384 Stop 1.0394
AUD High 0.9165 Low 0.9130 Stop 0.9137
JPY High 90.99 Low 90.78 Stop 90.84
Tuesday, 19 January 2010
Tuesday Wrap Up
Thank you to the reader who pointed out that today's move at 9:30 was triggered by UK CPI which I had stated was released on Monday. Once again, we see that some breakout moves can be sudden and require very swift typing if you are to get all of your orders placed in time. For this reason, its a good idea at the start of our trading session, to place limit orders based on the Signal Levels posted at 09:00 GMT.
Assuming you managed to place all the orders signalled, you made a tidy 62 pip profit. Whatever profits you managed to grab today, the news is good - currencies have finally started to move in firmer trends and we should be able to take advantage of this over the rest of the week.
Live Signal GBP EUR CHF AUD & CAD
Buy GBP at 1.6422 Target 1.6459 Stop 1.6417 Stopped 5 pip loss
Sell EUR at 1.4389 Target 1.4373 Stop 1.4400 Target Met 16 pip profit
Sell AUD at 0.9250 Target 0.9236 Stop 0.9259 Target Met 14 pip profit
Buy CHF 1.0256 Target 1.0275 Stop 1.0241 Target Met 19 pip profit
Buy CAD 1.0268 Target 1.0286 Stop 1.0257 Target Met 18 pip profit
** All of these trades were signalled at the same time and it is difficult for an experienced user to manually place the trades all at once. It is a good idea to place limit orders at the start of the session and then sit back and relax. At the end of the session, you can cancel any non-executed orders **
Sell EUR at 1.4389 Target 1.4373 Stop 1.4400 Target Met 16 pip profit
Sell AUD at 0.9250 Target 0.9236 Stop 0.9259 Target Met 14 pip profit
Buy CHF 1.0256 Target 1.0275 Stop 1.0241 Target Met 19 pip profit
Buy CAD 1.0268 Target 1.0286 Stop 1.0257 Target Met 18 pip profit
** All of these trades were signalled at the same time and it is difficult for an experienced user to manually place the trades all at once. It is a good idea to place limit orders at the start of the session and then sit back and relax. At the end of the session, you can cancel any non-executed orders **
Tuesday Signal Levels
GBP High 1.6422 Low 1.6385 Stop 1.6417
CAD High 1.0268 Low 1.0250 Stop 1.0257
EUR High 1.4405 Low 1.4389 Stop 1.4400
CHF High 1.0256 Low 1.0237 Stop 1.0241
AUD High 0.9264 Low 0.9250 Stop 0.9259
JPY High 90.62 Low 90.30 Stop 90.59
CAD High 1.0268 Low 1.0250 Stop 1.0257
EUR High 1.4405 Low 1.4389 Stop 1.4400
CHF High 1.0256 Low 1.0237 Stop 1.0241
AUD High 0.9264 Low 0.9250 Stop 0.9259
JPY High 90.62 Low 90.30 Stop 90.59
Monday, 18 January 2010
Monday Wrap Up
Another sideways trading day which extended beyond the morning session as there was a bank holiday in the USA. We warned at the beginning of the trading session to expect little excitement and small losses and that's pretty much what was achieved. Signals in the AUD and JPY gave us decent profits but these were eroded by several small losses in other currency pairs. We ended the day with a poor 2 pip gain. Still, we have conserved our capital and are ready to trade new levels tomorrow.
Close Position
Close GBP CAD and CHF positions. 1.6338 (15 pip loss), 1.0274 (9 pip loss) & 1.0260 (4 pip loss). End of session.
Live SIgnal GBP CAD & JPY
Buy GBP at 1.6362 Target 1.6384 Stop 1.6327
Sell CAD at 1.0265 Target 1.0251 Stop 1.0269
Sell JPY at 90.84 Target 90.65 Stop 90.95
Sell CAD at 1.0265 Target 1.0251 Stop 1.0269
Sell JPY at 90.84 Target 90.65 Stop 90.95
Alert: Narrow Ranges
Once again we are seeing narrow ranges in all our currency pairs. The big economic release today is UK CPI(inflation) at 09:30. Once that is out of the way, there is little to push prices one way or another. We should therefore expect a sideways trading day which will be frustrating: we want prices to have a firm direction (momnetum) so that when our signal levels are triggered, the prices have a high probability of reaching their target.
Today, that lack of momentum will mean that we will be repeatedly starting and stopping trades and likely losing money in the process. We recommend if you are a beginner to watch todays "action" and not trade live.
Today, that lack of momentum will mean that we will be repeatedly starting and stopping trades and likely losing money in the process. We recommend if you are a beginner to watch todays "action" and not trade live.
Mondays Signal Levels
GBP High 1.6353 Low 1.6321 Stop 1.6327
CAD High 1.0279 Low 1.0265 Stop 1.0269
EUR High 1.4390 Low 1.4369 Stop 1.4382
CHF High 1.0267 Low 1.0256 Stop 1.0265
AUD High 0.9243 Low 0.9228 Stop 0.9232
JPY High 91.03 Low 90.84 Stop 90.96
CAD High 1.0279 Low 1.0265 Stop 1.0269
EUR High 1.4390 Low 1.4369 Stop 1.4382
CHF High 1.0267 Low 1.0256 Stop 1.0265
AUD High 0.9243 Low 0.9228 Stop 0.9232
JPY High 91.03 Low 90.84 Stop 90.96
Friday, 15 January 2010
Friday Wrap Up
All systems are now working and we will be back online Monday. As we have stated before, we only post results from live trading so the following recap of today's trading signals will not be added to our performance statistics.
Today's results were dismal - not one of the trading signals achieved its target and like yesterday, prices remained rangebound for the morning session. The results were:
Buy AUD - stopped 23 pips loss
Sell GBP - session ended 0 pips
Buy CHF - stopped 14 pips loss
Sell EUR - stopped 18 pips loss
Buy CAD - stopped 6 pips loss
Live Signals
We are experiencing a technical fault and are unable to post live signals this morning. While we work to fix the problem, you can either a) draw the high and low levels on your real time charts for each currency and watch for moves through these levels to trigger a trade or b) place a limit order with stop and a target of say 20 pips for each currency pair. Click HERE to find out how to do this.
Like yesterday, we expect this morning's session to be quiet pending further economic data releases from the USA at 1:30 this afternoon. Click HERE to find out more about the impact of economic data release on FX prices.
Like yesterday, we expect this morning's session to be quiet pending further economic data releases from the USA at 1:30 this afternoon. Click HERE to find out more about the impact of economic data release on FX prices.
Friday Signal Levels
GBP High 1.6338 Low 1.6297 Stop 1.6318
CAD High 1.0278 Low 1.0258 Stop 1.0272
EUR High 1.4413 Low 1.4377 Stop 1.4395
CHF High 1.0267 Low 1.0239 Stop 1.0253
AUD High 0.9268 Low 0.9235 Stop 0.9245
JPY High 91.05 Low 90.64 Stop 90.99
CAD High 1.0278 Low 1.0258 Stop 1.0272
EUR High 1.4413 Low 1.4377 Stop 1.4395
CHF High 1.0267 Low 1.0239 Stop 1.0253
AUD High 0.9268 Low 0.9235 Stop 0.9245
JPY High 91.05 Low 90.64 Stop 90.99
Thursday, 14 January 2010
Thursday Wrap Up
Todays session was characterised by low volatility - prices remained largely range bound, trendless. Trading produced a small loss of 21 pips. Hopefully we will see larger ranges and greater volatility tomorrow.
Live Signal EUR & AUD
Sell EUR 1.4513 Target 1.4494 Stop 1.4526
Sell AUD 0.9301 Target 0.9281 Stop 0.9316
Sell AUD 0.9301 Target 0.9281 Stop 0.9316
Alert - Narrow Breakout Ranges
Today's ranges (high - low) are narrow, the largest is 30 pips. You will note that for certain pairs, the Stop value is a few pips away from either the High or Low value which pretty much guarantees your trades will get stopped.
Under these conditions, it makes sense to use the "opposite" High/Low values as stops e.g. if a currency moves up through the High value to trigger a "Buy" then use the Low value as the stop.
Under these conditions, it makes sense to use the "opposite" High/Low values as stops e.g. if a currency moves up through the High value to trigger a "Buy" then use the Low value as the stop.
Thursday Signal Levels
GBP High 1.6295 Low 1.6265 Stop 1.6277
CAD High 1.0321 Low 1.0298 Stop 1.0303
EUR High 1.4532 Low 1.4513 Stop 1.4526
CHF High 1.0195 Low 1.0182 Stop 1.0186
AUD High 0.9321 Low 0.9301 Stop 0.9316
JPY High 91.92 Low 91.81 Stop 91.83
CAD High 1.0321 Low 1.0298 Stop 1.0303
EUR High 1.4532 Low 1.4513 Stop 1.4526
CHF High 1.0195 Low 1.0182 Stop 1.0186
AUD High 0.9321 Low 0.9301 Stop 0.9316
JPY High 91.92 Low 91.81 Stop 91.83
Wednesday, 13 January 2010
Wednesday Wrap Up
We saw action at the start of our trading session with 4 trading signals. 30 minutes later, prices made little progress and we saw increased risk that prices would fall to their stops. To preserve capital, we closed the AUD, EUR & CHF positions. Today's trades have made a total profit of 57 pips.
Close Positions CHF AUD & EUR
Close CHF AUD and EUR positions. Closed at 1.0192, 0.9246 and 1.4500 respectively.
Live Signal AUD, EUR
GBP is showing signs that support has been found. We will re-enter EUR and AUD positions at current levels (1.4506 & 0.9251), place stops at 1.4488 and 0.9233 respectively.
Live SIgnal CAD EUR & GBP
Sell CAD at 1.0379 Target 1.0350 Stop 1.0389
Buy EUR at 1.4488 Target 1.4514 Stop 1.4480
Buy GBP at 1.6227 Target 1.6262 Stop 1.6208
Buy EUR at 1.4488 Target 1.4514 Stop 1.4480
Buy GBP at 1.6227 Target 1.6262 Stop 1.6208
Wednesday Signal Levels
GBP High 1.6227 Low 1.6192 Stop 1.6208
CAD High 1.0408 Low 1.0379 Stop 1.0389
EUR High 1.4488 Low 1.4462 Stop 1.4480
CHF High 1.0218 Low 1.0187 Stop 1.0194
AUD High 0.925 Low 0.9224 Stop 0.9233
JPY High 91.49 Low 91.15 Stop 91.26
CAD High 1.0408 Low 1.0379 Stop 1.0389
EUR High 1.4488 Low 1.4462 Stop 1.4480
CHF High 1.0218 Low 1.0187 Stop 1.0194
AUD High 0.925 Low 0.9224 Stop 0.9233
JPY High 91.49 Low 91.15 Stop 91.26
Tuesday, 12 January 2010
Tuesday Wrap Up
The morning was a little scrappy but at least we managed to close the AUD EUR CHF and CAD positions before their stops were eventually hit. But this cleverness came at a cost: when the GBP hit its target and began to reverse, the sudden moves in the AUD and CAD at 11:00 caught us out and we missed some quick profits. We have 50 pips profit in hand and recommend you stop trading to preserve your gains.
Live Signal CHF and EUR
Close CHF and EUR positions. CHF closed at 1.0189, 4 pip loss. EUR closed at 1.4478, 0 pip profit.
Live Signal EUR & CHF
Sell EUR at 1.4478 Target 1.4442 Stop 1.4508
Buy CHF at 1.0193 Target 1.0217 Stop 1.0174
Buy CHF at 1.0193 Target 1.0217 Stop 1.0174
Live SIgnal AUD & CAD
The CAD and AUD moves were too fast to post a signal. The AUD move has met its target and could have made us a tidy 34 pip profit. The CAD move has further to run so I will put a position on now at 1.0345 for a few pips profit.
Live Signal: AUD EUR CHF and CAD
Close AUD EUR CHF and CAD positions.
Closed at EUR 1.4483, 5 pip loss
Closed at CHF 1.0192, 1 pip loss
Closed at CAD 1.0335, 1 pip profit
Closed at AUD 0.9261, 0 pip profit
Closed at EUR 1.4483, 5 pip loss
Closed at CHF 1.0192, 1 pip loss
Closed at CAD 1.0335, 1 pip profit
Closed at AUD 0.9261, 0 pip profit
Tuesday Signal Levels
GBP High 1.6111 Low 1.6063 Stop 1.609
CAD High 1.0334 Low 1.0312 Stop 1.0321
EUR High 1.4514 Low 1.4478 Stop 1.4508
CHF High 1.0193 Low 1.0169 Stop 1.0175
JPY High 91.95 Low 91.82 Stop 91.86
AUD High 0.9297 Low 0.9261 Stop 0.9294
Tip: If you have real time charting, you can place a horizontal line at each of the 3 signal levels for each currency shown. You can then get ready to trade as prices approach these signal levels.
CAD High 1.0334 Low 1.0312 Stop 1.0321
EUR High 1.4514 Low 1.4478 Stop 1.4508
CHF High 1.0193 Low 1.0169 Stop 1.0175
JPY High 91.95 Low 91.82 Stop 91.86
AUD High 0.9297 Low 0.9261 Stop 0.9294
Tip: If you have real time charting, you can place a horizontal line at each of the 3 signal levels for each currency shown. You can then get ready to trade as prices approach these signal levels.
Live Signals: AUD EUR CHF and CAD
Sell AUD at 0.9261 Target 0.9225 Stop 0.9294
Sell EUR 1.4478 Target 1.4442 Stop 1.4508
Buy CHF 1.0193 Target 1.0217 Stop 1.0174
Buy CAD 1.0334 Target 1.0356 Stop 1.0321
Sell EUR 1.4478 Target 1.4442 Stop 1.4508
Buy CHF 1.0193 Target 1.0217 Stop 1.0174
Buy CAD 1.0334 Target 1.0356 Stop 1.0321
A Reminder of the SIgnals Service
As we are starting the service on a full time basis, we thought it would be helpful to remind former subscribers and new followers of how our service works. Rather than write a description, we think it will be helpful for you to see the service live over the next 2 weeks until 1st Feb 2010.
Monday, 11 January 2010
Going Live 1st Feb 2010
After our successful initial test period in 2009, we are finally going live on 1st Feb 2010. The STAR:fx model performed well throughout the rest of 2009 and continues to be robust to current market conditions. Those of you that have followed the signals service in the past, know that our model takes account of volatility so that you, the individual trader are protected during periods of extreme price movements.
The current signals service will be available only by subscription of GBP 20.00 per month. See our website www.forexinvestor.co.uk for further details.
We look forward to continued success and wish you health, wealth and happiness for 2010.
The current signals service will be available only by subscription of GBP 20.00 per month. See our website www.forexinvestor.co.uk for further details.
We look forward to continued success and wish you health, wealth and happiness for 2010.
Tuesday, 10 February 2009
Tuesday Wrap Up
Another day of positive performance with gains in the region of 175 - 200 pips. But to get these gains you needed to have placed your limit orders at 9:00pm or place market orders quickly such was the speed of the moves in AUD, CAD and JPY. EUR and CHF moved more leisurely towards their targets and GBP ran out of time.
Monday, 9 February 2009
Monday Wrap Up
As you can see, the model captured 4 good trades in GBP, EUR, AUD and CHF, was stopped in CAD and ran out of time in JPY netting something in the region of 200 pips. Please note we will only record performance when the signals are traded live.
Friday, 5 December 2008
Could 'ave, Would 'ave, Should 'ave
Some of you may have noticed that when a break-out occurs in a currency pair, the price moves well beyond our Target price and you may think "ooh if I could have known, I would have left the position open for a few more pips profit" or "Drat ... I should not have closed the position ... I could have gotten a few more pips..." and so on. Personally, I like to enter a trade late to be sure that a break-out or trend is underway and I like to exit early so there are plenty of willing buyers or sellers to take the position off my hands.
Hindsight is a wonderful thing but when you place each trade, the world is uncertain and we should be grateful for small consistent wins. But the psychological nature of trading makes use remorseful when we close our trading position and then realise we could have made more profits by closing a few seconds or minutes later. This distressing "after the fact" knowledge will often make the trader wail "If I had known, I could 'ave / would 'ave /should 'ave ...".
The STAR:fx trading system places the target price relative to the entry price according to volatility: if volatility is high, the target is placed further from the entry price and if volatility is low, the target is placed nearer to the entry price such that the probability of either target being met is approximately the same and that the target is highly likely to be met.
So if there is a break-out in a currency pair leading to a sustained trend for the remainder of the day and you wish to participate in that trend, you could do one of the following:
1. When the Target Price is reached, move your stop to the target price and close the trade when the trend is exhausted;
2. When the Target Price is reached, move your stop to the target price and trail it so that the trade closes automatically on a trend reversal;
But now you have the problem of either determining when a trend is exhausted to close your trade or finding the optimal method to trail a stop so that you are not taken out of the trade prematurely. Neither of these is an easy task but we are trying to find a robust solution and will release it to you as soon as we are confidant in its performance.
Until then, consider this: if you are able to make say 50 pips a day on average (which is where our system lies) then as there are 250 trading days per year, that adds up to 12,500 pips per year and ignores the power of compounding. If each pip were worth GBP 2.00, you have a very tidy GBP 25,000 annual gain.
Hindsight is a wonderful thing but when you place each trade, the world is uncertain and we should be grateful for small consistent wins. But the psychological nature of trading makes use remorseful when we close our trading position and then realise we could have made more profits by closing a few seconds or minutes later. This distressing "after the fact" knowledge will often make the trader wail "If I had known, I could 'ave / would 'ave /should 'ave ...".
The STAR:fx trading system places the target price relative to the entry price according to volatility: if volatility is high, the target is placed further from the entry price and if volatility is low, the target is placed nearer to the entry price such that the probability of either target being met is approximately the same and that the target is highly likely to be met.
So if there is a break-out in a currency pair leading to a sustained trend for the remainder of the day and you wish to participate in that trend, you could do one of the following:
1. When the Target Price is reached, move your stop to the target price and close the trade when the trend is exhausted;
2. When the Target Price is reached, move your stop to the target price and trail it so that the trade closes automatically on a trend reversal;
But now you have the problem of either determining when a trend is exhausted to close your trade or finding the optimal method to trail a stop so that you are not taken out of the trade prematurely. Neither of these is an easy task but we are trying to find a robust solution and will release it to you as soon as we are confidant in its performance.
Until then, consider this: if you are able to make say 50 pips a day on average (which is where our system lies) then as there are 250 trading days per year, that adds up to 12,500 pips per year and ignores the power of compounding. If each pip were worth GBP 2.00, you have a very tidy GBP 25,000 annual gain.
Friday Wrap Up
Not a bad day: we saw 2 profitable signals in CAD which is unusual and got good results from EUR, CHF and AUD. No signal seen in JPY. The trades were:Buy EUR at 1.2780 Stopped 1.2766 -14 pips
Sell CAD at 1.2762 Target Met 1.2739 +23 pips
Sell GBP at 1.4678 Stopped 1.4686 -8 pips
Sell EUR at 1.2747 Target Met 1.2715 +32 pips
Buy CHF at 1.2023 Target Met 1.2064 +41 pips
Sell AUD at 0.6440 Target Met 0.6411 +29 pips
Buy CAD at 1.2787 Target Met 1.2819 +32 pips
Thursday, 4 December 2008
Thursday Wrap Up
A quiet morning session ahead of the interest rate announcement from UK, Europe and Sweden at midday. There was a huge range of nearly 200 pips for GBP and as a result no signal was seen. The rest of the session saw the following signals. We closed positions at 11:15 as the rally in GBP threatened the progress of the other positions:-GBP No signal
AUD Buy 0.6432 Target Met 0.6457 +25 pips
CAD Sell 1.2600 Stopped 1.2613 -13 pips
JPY Sell 92.75 Stopped 92.81 -6 pips
JPY Sell 92.75 Position Closed 11:15 92.58 +17 pips
EUR Sell 1.2588 Position Closed 11:15 1.2618 -30 pips
CHF Buy 1.2158 Position Closed 1.2154 -4 pips
Wednesday, 3 December 2008
Wednesday Wrap Up
A poor day: 3 signals given but NO targets reached and 3 currency pairs gave NO signal. We saw a SELL signal in GBP ( 0 pips) and EUR (-13 pips) but got timed out at the end of the session at 12:00 and saw a small loss. CHF gave a BUY signal but that too failed to reach its target and we were stooped out for -21 pips. The net result for the day -34 pips.
Tuesday Wrap Up
We saw 3 good BUY signals for GBP (+112 pips), EUR (+68 pips) and AUD (+45 pips) which provided a total of 225 pips. We got stopped out of the CAD position (-9 pips) and the CHF position ( -34 pips) and did not see a signal in JPY during the morning session. The total net pips were +182 which is a welcome change from the previous week's low results.
Tuesday, 2 December 2008
Tuesday Signal Levels
GBP High 1.4895 Low 1.4783 Stop 1.4883
CAD High 1.2489 Low 1.2436 Stop 1.2449
EUR High 1.2628 Low 1.2560 Stop 1.2601
CHF High 1.2081 Low 1.2040 Stop 1.2047
AUD High 0.6392 Low 0.6347 Stop 0.6383
JPY High 93.39 Low 92.60 Stop 93.19
CAD High 1.2489 Low 1.2436 Stop 1.2449
EUR High 1.2628 Low 1.2560 Stop 1.2601
CHF High 1.2081 Low 1.2040 Stop 1.2047
AUD High 0.6392 Low 0.6347 Stop 0.6383
JPY High 93.39 Low 92.60 Stop 93.19
Monday Wrap Up
Monday provided 2 excellent trades: Sell GBP at 1.5148 Target 1.5009, 139 pip profit and Sell JPY 94.57 Target 93.97, 60 pip profit. This was offset to a small degree by losing trades in CHF (stopped -9 pips), CAD (stopped -12 pips), AUD trade was closed out at the end of the session at breakeven and EUR gave no signal during the morning session. This gives a total net profit of 178 pips.
Friday, 28 November 2008
Friday Wrap Up
We have ended the day with a small profit of 39 pips and with hindsight should not have moved the stop on the CAD position nor closed out the GBP position but as the session grew more volatile, it was prudent to preserve capital.
Friday Signal Levels
GBP High 1.5449 Low 1.5399 Stop 1.5423
CAD High 1.2368 Low 1.2305 Stop 1.2333
EUR High 1.2950 Low 1.2910 Stop 1.2940
CHF High 1.1986 Low 1.1956 Stop 1.1969
AUD High 0.6597 Low 0.6572 Stop 0.6589
JPY High 95.34 Low 95.14 Stop 95.285
CAD High 1.2368 Low 1.2305 Stop 1.2333
EUR High 1.2950 Low 1.2910 Stop 1.2940
CHF High 1.1986 Low 1.1956 Stop 1.1969
AUD High 0.6597 Low 0.6572 Stop 0.6589
JPY High 95.34 Low 95.14 Stop 95.285
Thursday, 27 November 2008
Live Signal GBP and EUR
Buy EUR at 1.2927 Target 1.2971 Stop 1.2892 Position Closed 1.2942 +15 pip
Buy GBP at 1.5427 Target 1.5514 Stop 1.5354 Position Closed 1.5463 +36 pip
As soon as you see some profits in your positions, move your stops closer to your entry price.
Buy GBP at 1.5427 Target 1.5514 Stop 1.5354 Position Closed 1.5463 +36 pip
As soon as you see some profits in your positions, move your stops closer to your entry price.
Thursday Signal Levels
GBP High 1.5427 Low 1.534 Stop 1.5353
CAD High 1.2309 Low 1.2251 Stop 1.2280
EUR High 1.2927 Low 1.2883 Stop 1.2892
CHF High 1.2014 Low 1.1964 Stop 1.2005
AUD High 0.6526 Low 0.6488 Stop 0.6504
JPY High 95.20 Low 95.03 Stop 95.125
CAD High 1.2309 Low 1.2251 Stop 1.2280
EUR High 1.2927 Low 1.2883 Stop 1.2892
CHF High 1.2014 Low 1.1964 Stop 1.2005
AUD High 0.6526 Low 0.6488 Stop 0.6504
JPY High 95.20 Low 95.03 Stop 95.125
Wednesday, 26 November 2008
Wednesday Wrap Up
Tomorrow is Thanksgiving in the US which is a major public holiday. There is a slew of data to be released in the afternoon ahead of the holiday which should provide some excitement. However, prices this morning drifted and we only saw one good signal from CAD and took some losses in other pairs as they threatened to break out of the am session range but failed to do so.
Why do FX pairs follow each other?
CAD and CHF rallying. Close GBP AUD and EUR with a view to re-entering later in the session.
The 6 currency pairs that we follow all move together to some degree because of the relationship between their economies. This degree of co-movement is called "correlation" and can be calculated as a number between 0% and 100% where 0% means there is no co-movement and 100% means the two currencies move the same way all the time. So for example, if we see CHF moving higher, then we should expect EUR to be moving lower because these two currencies are highly correlated. So when we Buy EUR again, we want to see CHF falling and ideally have a Sell signal in CHF too!
But correlation is a double-edged sword: if all the pairs move together to some degree, then when one position turns against you, most likely there will be others too. And all of this happens at the same time. This is why you need to place your stops and targets as soon as you place an order to protect you from losses and sometimes to reap sudden unexpected gains.
The 6 currency pairs that we follow all move together to some degree because of the relationship between their economies. This degree of co-movement is called "correlation" and can be calculated as a number between 0% and 100% where 0% means there is no co-movement and 100% means the two currencies move the same way all the time. So for example, if we see CHF moving higher, then we should expect EUR to be moving lower because these two currencies are highly correlated. So when we Buy EUR again, we want to see CHF falling and ideally have a Sell signal in CHF too!
But correlation is a double-edged sword: if all the pairs move together to some degree, then when one position turns against you, most likely there will be others too. And all of this happens at the same time. This is why you need to place your stops and targets as soon as you place an order to protect you from losses and sometimes to reap sudden unexpected gains.
Live Signal GBP EUR
GBP Buy at 1.5416 Target 1.5501 Stop 1.5353 Position Closed 1.5413 -3 pip loss
EUR Buy at 1.3003 Target 1.3079 Stop 1.2953 Position Closed 1.2987 -16 pip loss
CAD Sell at 1.2217 Target 1.2159 Stop 1.2256 (late signal) Target Met +58 pips
Bring your stops as close to entry price as soon as you can.
EUR Buy at 1.3003 Target 1.3079 Stop 1.2953 Position Closed 1.2987 -16 pip loss
CAD Sell at 1.2217 Target 1.2159 Stop 1.2256 (late signal) Target Met +58 pips
Bring your stops as close to entry price as soon as you can.
Wednesday Signal Levels
GBP High 1.5416 Low 1.5331 Stop 1.5353
CAD High 1.2275 Low 1.2217 Stop 1.2265
AUD High 0.6503 Low 0.6427 Stop 0.6434
JPY High 95.27 Low 94.85 Stop 94.91
EUR High 1.3003 Low 1.2927 Stop 1.2953
CHF High 1.1945 Low 1.1914 Stop 1.1924
CAD High 1.2275 Low 1.2217 Stop 1.2265
AUD High 0.6503 Low 0.6427 Stop 0.6434
JPY High 95.27 Low 94.85 Stop 94.91
EUR High 1.3003 Low 1.2927 Stop 1.2953
CHF High 1.1945 Low 1.1914 Stop 1.1924
Tuesday, 25 November 2008
Tuesday Wrap Up
Once again the am session was uneventful compared to the moves seen in the afternoon session.
The GBP and JPY gave good signals early on, followed by CAD but EUR, CHF and AUD were less accommodating with the AUD giving us a good kick as we appraoched the end of the session. The net result was a poor 32 pip loss.
Live Signal EUR and CHF
Sell EUR at 1,2855 Target 1.2804 Stop 1.2871 Position Closed 1.2834 +21 pips
Buy CHF 1.2029 Target 1.2061 Stop 1.2020 Position Closed 1.2045 +16 pips
Buy CHF 1.2029 Target 1.2061 Stop 1.2020 Position Closed 1.2045 +16 pips
Close Position JPY
I have closed the JPY position and will re-enter later if there is an opportunity.
Note: for those who did not close the position, the target was met at 10:09.
Note: for those who did not close the position, the target was met at 10:09.
Live SIgnal GBP EUR AUD
Sell GBP at 1.5109 Target 1.5055 Stop 1.5153 Stopped -44 pips
Sell EUR at 1.2855 Target 1.2801 Stop 1.2871 Stopped -16 pips
Sell AUD at 0.6365 Target 0.6293 Stop 0.6424 Position Closed 0.6369 -4 pips
Sell EUR at 1.2855 Target 1.2801 Stop 1.2871 Stopped -16 pips
Sell AUD at 0.6365 Target 0.6293 Stop 0.6424 Position Closed 0.6369 -4 pips
Tuesday Signal Levels
GBP High 1.5163 Low 1.5109 Stop 1.5131
CAD High 1.2427 Low 1.2386 Stop 1.2400
EUR High 1.2906 Low 1.2855 Stop 1.2870
CHF High 1.2029 Low 1.1997 Stop 1.2020
AUD High 0.6437 Low 0.6365 Stop 0.6424
JPY High 96.66 Low 96.2 Stop 96.58
CAD High 1.2427 Low 1.2386 Stop 1.2400
EUR High 1.2906 Low 1.2855 Stop 1.2870
CHF High 1.2029 Low 1.1997 Stop 1.2020
AUD High 0.6437 Low 0.6365 Stop 0.6424
JPY High 96.66 Low 96.2 Stop 96.58
Monday, 24 November 2008
Monday Wrap Up
We saw good signals in GBP, EUR, AUD and JPY but the CAD could not seem to make up its mind! We missed the CHF trade (51 pip profit) because I had to reload the software and in doing so missed the signal. We have ended the session with a welcome profit of 67 pips and hopefully much more this week.
Close Position JPY
The signal is still good but it's the end of the session so we are closing this position.
Target met at 12:06
Target met at 12:06
Monday Signal Levels
GBP High 1.4935 Low 1.4859 Stop 1.4920
CAD High 1.2726 Low 1.2667 Stop 1.2680
EUR High 1.2610 Low 1.2566 Stop 1.2602
CHF High 1.2225 Low 1.2174 Stop 1.2199
AUD High 0.6282 Low 0.6252 Stop 0.6264
JPY High 95.31 Low 95.06 Stop 95.15 (narrow range!)
CAD High 1.2726 Low 1.2667 Stop 1.2680
EUR High 1.2610 Low 1.2566 Stop 1.2602
CHF High 1.2225 Low 1.2174 Stop 1.2199
AUD High 0.6282 Low 0.6252 Stop 0.6264
JPY High 95.31 Low 95.06 Stop 95.15 (narrow range!)
Saturday, 22 November 2008
Why only trade 9 -12:00am?
"Somewhere on the planet, financial centers are open for business, and banks and other institutions are trading the dollar and other currencies, every hour of the day and night, aside from possible minor gaps on weekends. In financial centers around the world, business hours overlap; as some centers close, others open and begin to trade. The foreign exchange market follows the sun around the earth.The International Date Line is located in the western Pacific, and each business day arrives first in the Asia-Pacific financial centers— first Wellington, New Zealand, then Sydney, Australia, followed by Tokyo, Hong Kong, and Singapore. A few hours later, while markets remain active in those Asian centers, trading begins in Bahrain and elsewhere in the Middle East. Later still, when it is late in the business day in Tokyo, markets in Europe open for business. Subsequently, when it is early afternoon in Europe, trading in New York and other U.S. centers starts (see diagram). Finally, completing the circle, when it is mid- or late-afternoon in the United States, the next day has arrived in the Asia-Pacific area, the first markets there have opened, and the process begins again." – Sam Cross, Federal Reserve Bank NY.
The Foreign Exchange market is broken up into three major trading sessions: the Asian Session, the European Session, and the U.S. Session. If you live in London, trading starts at 07:00 and finishes at 17:00. Then the US Session opens at 12:00 and closes at 22:00 when the Tokyo session opens at 22:00 and closes at 09:00. However, these times are approximate and the sessions overlap as one session leads into another. The forex market experiences greatest liquidity during these points of overlap as more participants use the market than at other times.
The STAR:fx model trades the European Session because the high degree of overlap with other Sessions means higher liquidity which produces more competitive pricing and tighter spreads, it participates in the day's major currency moves and we stop before the more volatile US Session begins.
Friday, 21 November 2008
Economic Data Releases
Global economic news is released publicly, often on scheduled dates, so that everyone can have access to the same news at the same time. Most FX brokers provide a calendar of these economic releases Click Here to see an example. Because these news releases have the potential to move currency prices dramtically, you should look at an economic calendar before you trade and note the times of the day's releases, if any.FX Rates and Interest Rates
The foreign exchange market exists to enable the currency of one country to be exchanged for another and the price of that exchange depends on the demand for one currency over another. A country’s economic health is directly measured by these economic reports: Surpluses and deficits in the trade of goods and services reflect the competitiveness of a nation's economy, as does employment levels, productivity and inflation. Interest rates and the strength of the economy are two primary factors that influence demand for a currency. The scheduled economic releases help traders gauge a country’s economic health and its likely impact on interest rates. Generally, a healthy and robust economy will see demand for its currency. This demand translates into higher prices versus other weaker currencies.
Trading News Releases
Typically, you will see currency prices spike on the announcment of such news: the more the newly releaased data exceeds the expected value, the greater the move in currency prices. Many traders try to trade around news releases to capture these price spikes. This is a specialist strategy and requires the ability to place certain types of order and preferably have access to more than one broker or market maker. I don't like this trade as it is largely a 50/50 bet - after all, what do you know about the upcoming release that no-one else knows? Your only edge is in the placing of orders and their execution. Perhaps this is a strategy you may want to visit in the future.
Demo Accounts
A demonstration or demo account is a test trading account which is supplied by most good FX brokers which allows you to trial all the features of their trading platform. It will also give you dummy funds to trade in current real-time market conditions.You will often hear traders be scornful about demo accounts by saying trading 'paper' money is not the same as trading real money - its easy to be brave with imaginary money. Whilst this is true, the whole point of using a trading system is that is helps you control your emotions of fear, greed etc experienced during trading.
But the real benefit of a demo account is that it allows you to test and examine all the features on several trading platforms so that you can learn to use your chosen trading platform with confidence. There is nothing worse than trying to place a trade and not knowing what to press or click on your computer. And then you miss a perfectly good trade.
Practice, practice, practice.
The legendary pianist Arthur Rubenstein was once walking in the street towards New York's famous concert venue, Carnegie Hall. He was stopped by a fellow pedestrian and asked "Excuse me, how do I get to Carnegie Hall?" to which the pianist replied "Practice, practice, practice!".
Before opening a live account, you should use a demo account to practice using your trading platform. Try entering Market and Limit orders during slow and fast markets and see what price you get and find out as much as you can about how your account works:
- How do you know when my order is executed?
- How much are my trades winning or losing?
- Where is my account balance?
- Where can I see my order history?
- Where can I see Limit Oders that have not yet been executed?
- Are there any other order types that your trading platform has that would be helpful?
- How can I change or cancel a single order?
- How can I close all orders if there is an emergency?
- How do I set the default size for my trades?
You need to know as much as you can about your trading platform if you want to use its features to help your trading.
Errors can be Costly
Every trader makes "fat finger" errors where you press 'Buy' instead of 'Sell' or you Buy '100,000' instead of '10,000' etc. These simple but often costly errors (they are rarely in your favour) happen if you are unfamiliar with your trading platform so practicing placing orders, cancelling them, closing all orders, changing them etc will help you avoid these errors in the future. This means you should have no nasty surprises when you trade your own funds in a live account and you will be able to place your orders quickly, accurately and efficiently.
Don't assume
This practice in a demo account is important as I discovered something about my broker platform recently: when I place a Limit Order to Enter a trade what actually happens is that when the limit is reached, the order turns into a Market Order and I get the best available price NOT the limit price. I only get the limit price when the Limit Order is placed to Exit a trade. I had assumed that a Limit Order was the same for Entry and Exit trades. Not knowing this cost me 40 pips on one trade! So what I now do is Enter trades using a Market Order and Exit via a Target or Stop price using a Limit Order.
This practice in a demo account is important as I discovered something about my broker platform recently: when I place a Limit Order to Enter a trade what actually happens is that when the limit is reached, the order turns into a Market Order and I get the best available price NOT the limit price. I only get the limit price when the Limit Order is placed to Exit a trade. I had assumed that a Limit Order was the same for Entry and Exit trades. Not knowing this cost me 40 pips on one trade! So what I now do is Enter trades using a Market Order and Exit via a Target or Stop price using a Limit Order.
Order Types and Trade Entry & Exit
Market OrderA market order is the simplest of the order types. A market order is an order to buy or sell at the best available current price. As long as there are many sellers and buyers, a market order will be filled immediately. Once the order is placed, the customer has no control over the price at which the transaction is executed. The broker is required find the best price available at that time. In fast-moving markets, the price you actually buy or sell at may be different from the last price quoted before your order was entered.
Limit Order
A limit order is an order placed to buy or sell at an exact price for a certain length of time e.g. GTC where the limit order is Good Till Cancelled. For example, if the EUR/USD is currently trading at 1.2582 and you want to Buy when the price reaches 1.2600. You can either sit in front of your computer and wait for it to reach 1.2600 (at which point you would enter a buy market order), or you can place a Buy Limit Order at 1.2600 now. If you walk away from your computer to make a cup of coffee and the price goes up to 1.2600, your trading platform will automatically execute a buy order at that limit price.
Stop Order
A stop order is a limit order linked to an open or live trade for the purpose of preventing uncontrolled losses if the price goes the wrong way. These orders are commonly referred to a Stop Loss orders. A Stop Loss order remains in effect until the position is exited or you cancel the Stop Loss order.
Both Limit and Stop Loss orders are extremely useful if you don’t want to sit in front of your computer continuously throughout the 9 - 12:00am session, they are a form of insurance so that you don't miss the Target or Stop in fast moving markets and they help enforce good trading practice: you should never place a trade if you don't know when to take profits or stop losses.
Trade Entry and Exit
To Enter a trade, you can either Buy or Sell using a Market Order which will get you into the trade immediately at the best available current price. Or you could enter a Limit Order to specify the exact price you want to pay. But the risk here is that when prices are moving quickly, a limit order may not get executed and you will have to quickly type in Market order and hope you get a decent execution price when your order is confirmed.
To Exit a trade, either at a Target price or a Stop price, again you can use a Market Order once the price level is reached but this requires you to be sat continuously in fron of your computer 9 - 12:00. Or you can place 2 Limit Orders (one for the Target and one for the Stop) so that if there is a sudden burst of price movement, your limit orders will get executed and you won't be left desperately trying to type in market orders for several trades.
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