Hello Fellow Traders,
In addition to the great news that you have a freely
available news trading tool with direct news server connection from now on, I
can tell you that you are not alone with setting up release parameters. I'm
Peter and I'm going to share with you my weekly
spike trading schedule and
parameters just to make it easier for you to grab some money from the forex
market.
As a first step download Forex News Gun client:
Forex News Gun client for Windows (fng.exe)
Forex News Gun client for Mac (fng.jar)
This is a standalone application, no need to install and it
doesn't make any changes in registry (and actually it doesn't write anything on
the disk). That is it requires minimal administration - probably the simplest
is to save it on the desktop.
Reading this thread you're probably willing to know more
about how some money can be made on news spikes. Well, some say that news
trading is already dead. If they mean that they are not able to multiply their
accounts by 100 in a day then probably they're right. In my opinion new trading
is getting mature. News makes market move and will do for a long time, you
simply need an appropriate approach, mindset and environment to benefit from
it. More precisely here is my list of things you may have at hand and mind:
Proper trading parameters based on historical market
analysis.
>> From now on you can follow the parameters I use in
daily practice.
Proper local trading environment (trading platform, news
trading application, network connection).
>> Now you can add news trading application to your
trading environment for free by downloading it for Windows or Mac.
Proper broker (appropriate spread policy, no execution
delays and requotes).
>> Read your broker's policy and make low risk
experiments preferably on a live account. ECN/STP brokers are preferred of
course.
Proper money management.
>> Use constant and moderate percentage of the account
balance. Keep in mind that we trade volatile markets.
Using these principles I experienced consistent profit over
a longer period - and I also experienced what happens when any of these
conditions is not met. Once when I saw that significant losses had appeared in
the account statement after some research I realized that new spread policy of
my broker took me to minus 15 pips at every spike.
Now you have a really great tool for spike trading and from
this week you can read my previews of upcoming events, trade parameters and
even more (let me not announce too much for now) that gradually build up from
week to week. I tell you, if you have 8.5 minutes now you can have your first
automated news trading environment. It only takes 5 steps:
Download the Forex News Gun client to your computer for
Windows (fng.exe) or Mac (fng.jar).
Go to the review of the next release in the Forex News Gun
signals.
Start your trading
platform and open the market order
execution window with Buy and Sell buttons for the currency pair you find in
the release signal parameters.
Start Forex News Gun client and set buy and sell triggers
according to the release parameters and set Buy and Sell button locations. You
can find detailed description at each release data at the forum.
Make sure that both platform and FNG client are running at
the time of the release and trading
platform window is on the top of other windows (in order to catch the screen
click from FNG client when release triggers).
Now you have slingshot with motion sensor, just don't forget
to manage your position so that to close it in profit. It's a spike trading method so don't let it run too
long (initial spike lasts for several
minutes). Don't worry if release figures don't
trigger often - we are about to pick low hanging fruits. As I see now 58
releases triggered out of the last 250 so about every 4th-5th release results
in an open position. It may seem boring sometimes (I see a 24-day period last
year with 15 releases without a single trade) but believe me, if your trading
strategy seems boring then it's a very good sign.
Let me tell you a good news again. Together with FNG setups
I'm going to share with you series of parameters for another trading technique:
the Diamonds Trading Signals. This is practically an after- spike trading method and as such it doesn't
care much about actual release figure but price pattern evolvement instead. I
don't trade every release type using this after- spike technique but I will always post a DTS
trade plan together with FNG when it's applicable.
Diamonds Trading Signal trade plan benefits from trend
continuation and its parameters help to identify a spike , entry level, stop loss and take profit . Here are the steps of a DTS
trade plan:
Set up single click execution on your broker platform, and
if possible, pre-determine default stop/loss and default take/profit to a given
number of pips, so that when you click to execute your order, your platform
will automatically set your stop/loss and take/profit at that distance from
your entry price. Do not try this with brokers that don’t offer single click
execution.
If your platform does not allow to pre-determine default
stop/loss and take/profit, then after entering the trade, simply set the
stop/loss and take/profit points manually.
Pull up either tick, 1-second, 3-second, or 5-second chart,
and 15 seconds before the announcement, start paying very close attention to
the price action of the currency pair we trade.
If during the first short period of time (in most trade
plans less than a minute) after the report you see the price move up or down by
given pips or more (you will find numbers in trade plans), then enter in the
direction of the initial spike at the
very first sufficient retracement (given in percentage), but only if your
spread at the time of your entry is tight enough (also given). Set stop/loss
take/profit according to the trade plan.
The retracement will happen within seconds. Don’t draw
anything on your chart, and don’t try to get a perfect entry. As soon as you
see the sufficient retracement on your chart, compared to the initial spike , click to enter without any
hesitation.
If the move either up or down was too small during the
first spike , then the actual number of
the report did not generate sufficient interest in the market, and you simply
skip the trade. If your spread at the time of desired entry is too high, then
skip the trade.
If after a perdetermined period neither your stop/loss nor
your take/profit points were hit, then close the trade automatically at market
price of the time.
Important Note: it’s absolutely not necessary to know the
number that was released for this trade plan. It’s based 100% on price action.
Price action decides whether it’s worth trading.
Be patient, and do at least 20 “second wave” trades, before
getting frustrated and quitting.
Once you become good at it, you will be able to win on
average 7 to 8 out of 10 trades.
Keep win to loss ratio at 1:1. Tweak it only after you are
consistently profitable with 1:1.
Remember, it does not matter whether you make or lose 10
pips or 100 pips on a trade. What matters is how much money you make or lose on
a trade. When risking 10 pips, simply put up 10 times more lots than you would
when you risk 100 pips, and at the end you will make or lose the same amount of
money. Yes, spread to pips targeted ratio matters, but these news “second wave”
moves have such high probability of success that they somehow make up for the
very high spread to pips targeted ratio (2 to 10), which is a small miracle in
itself.
For convenience I will always include these steps with
specific numbers in my signals so you don't need to come back to here every
time.
I think that's quite enough for now. I hope you will see the
benefits of these trading techniques soon in your account statements. If you
have any question just post it here - I'm lurking around.
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