Comment by sabbir on August 17, 2011 at 9:19am

agreed and well written.

Comment by raj patel on August 17, 2011 at 9:30am

Peter, Your choice of short trade is one idea of cashing in for trickle feed of course  there are combine ticket holders  and multiple unit holders that invest on time duration then price building. the weighting of currency is the guiding factor the holding price is another. Multiple trade holders view currency as investment and normally last the duration. Its horses for courses and vehicle does not out beat another its who gets there first and how many times.

Comment by Peter jcp on August 17, 2011 at 9:45am

Thanks Sabbir - Hi Raj - yes I can totally understand the commercial bodies and the guys who view the market as a investment vehicle - holding for months and years etc. But most retail traders with accounts under say $100k ( love to know the average size retail account) want to make weekly or monthly returns etc and so I can understand them even using the strategy in their "toolbox" - but still doing what you do and many others - making money on an hourly or session basis.

As we know its not the number of pips that are made in isolation the key - its the risk and the maximum return you can get within the shortest time which will add value the quickest. So if we can put say 20 full lots on with a 10 pip stop with a very high probabality and obtain say 40 pips in under 15 minutes - we are far better off than putting  2 full lots on with 100 pips stop and waiting two day to make 400 pips - the reason being  in the two days the shorter term trader will have made another 10 trades etc etc and so his profit and capital growth is higher and quicker

 

Looking forward to some mathematicians or accountants challanging me on this ?

Comment by Peter jcp on August 17, 2011 at 11:18am

Hi Lisa and Peter - Lisa - please please dont think I am wanting to change all long term traders into scalpers. I want all traders to make their minds up depending on their level of experience - time available ,capital, personality - full time /part time etc etce - so agree everybody is different and thank goodness we all are - lol 

 

Now  -lets take the emotion out of it all and look at it in cold facts -

If you treat fx trading as a part time money earner - fine - great and good luck to you - trade anyway you want

However if you study and learn for years and then after say 3- 5 years+ you become full time you should look upon it in an unbias way and say - am i serious - am i just happy with a good return - or am i going to become a top retail trader and make 100Ks per month year or what ever.

So Full time - can you spare 4 -8 hrs a day ?? - Ideally at key time sin this 24 hr market ?

Ok - would you like to be able to know with a very high accuracy what the market is moving to the nearest 10 pips within every say 30 minutes in the time you watch ??? - if yes learn to do it - i have and there are many better traders than me - so i am not unique or making this up.

 

Ok - so you are full time with say $25k account and you know good MM and also compounding and also you know what you are doing - after all you have gone through your 10K hrs etc etc

 

Now this is the crunch - Retails trading for guys like us is completely different to commercial trading done by banks and hedge funds etc - For example in the UK - I cannot really scalp over above 25 full lots - because i would not be able to get in and out the market with most stations in say 10 minutes . so on 50 lots trades you need another system and ideally look for trades over an hour. But I know guys like me who can double their account in amonth quite sensibly with low risk etc. You could never do that in commercial trading due to all the regulations etc etc and as i have said before if I had a $200 million account i would be very happy with 25% per annum - but as a full time retail FX trader no- way - you want that per 20 -50 trades  - ideally in a week - but 2 is ok  So commercial long view - understandable - retail - how quick can you increase you account sensibly etc after years of learning

Back to you Lisa - putting 20 full lots on a sensible AAA+ scalp trade with a 10 pip stop loss and a 15 -30 pip target as a far higher probabalilty then putting 1 lot on a trade and waiting 2 days for 100 pips or more. You should know the result inless than 15 minutes and you also pull it within 5 minutes under the stop if its not working - because you are experienced and done it hundreds of times and you know that the facts say you will get it correct on average over 70% of the time. Can you spare 15 minutes plus a set up time of 10 minutes to do and watch this trade - if so - learn to do it. The amount is irrelevant really from 1 full lot to 20 full lots except you might wait another 15 seconds to get in the trade. 

So on $25K equivalent account in Uk you can trade at say 3% ( you are experienced) at  equivalant to 6 full lots on a 10 pip stop loss. Remember you then compound and soon with an average of 5 trades a day losing one or two you take your account up quickly because you are able to have trades with R : R''s of 1: 4 or like me last week 2 over 1:9 in one day. so result you might only make 30 -50 pips a day - but you are making equivalent to other traders making 300 - 400 pips in day - every day - if they can do that. In an average day you are actually in the trades less than a total of 2hrs in 24 hrs and its taken you 4 - 8 hrs out of your day to be there to cover and watch these trades . Like a normal job you then clock off ( leave trades on if you want )

Peter M - why do you have to stay in the trade - come out and  re enter at a better position. i look forward top the day I pay my

Comment by No money on August 17, 2011 at 11:29am

Peter -real scalper man! thanks for post

Comment by Peter jcp on August 17, 2011 at 8:27pm

Yes - but Gissa - you can trade all ways and have your cake and eat it - 5 pip stops to 300 pip rallies and i know you will be there - that's because you know the market inside out and  therefore can play how you like  - in another 5 years i might be there - lol

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