CanOz
Home runs feel good, but base hits pay bills!
- Joined
- 11 July 2006
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so really it should pick the same spot to trade?
thats strange then you have such a variance in the results then.
same broker?
if the EA makes money, then we must identify who is losing money. The EA trades frequently and consistently which creates liquidity for the retail broker. Most likely the EA opens a position against one trader, and closes it against a different trader, all within the retail broker's book. The broker would like the EA because they make more money from spreads. This is risk free income. The broker is just redistributing money between traders and taking commission.A big question I have is whether the financial system will allow an auto trading system to be that successful.
For dealers, its a different game, because when markets are going up in a BEAR market, customers keep making them short, their book keeps getting bigger short, but their average cost of being short keeps going up.
all they have to do is to wait for the trend to enforce and
when the market returns to the point where the buying started ,
he would make nearly the amount of money that made him short in the first place.
For this to happen, he has to have a book big enough to accommadate the customer base.
AND as the market swings back towards the start point, he has to ascertain that his book of shorts, be kept constant.
This is because on the way down the customers will be making him long.
So by constantly covering back to back on the way down he maintains his book short.
So for the dealer, as long as he maintains his poise in the direction of the markets major trend,
he will always make "scalp money", guanranteed.
His modus operandi, is to "duck and move quickly"
so as to have a better average on the up swing towards stops to maximise his shorting near the top of the swing.
This scenerio is most effective if there are stop near levels where he las a large order to sell,
where he can help the customer sell OB and "kill the sitting duck stops" in the same blow.
Another senerio is where by the heavy selling is CB levels or specific sell zones,
where many teir 1 are ready to pounch on the buyers.
You must understand that only tier 1 and some big tier 2 will have this advantage.
This is the reason, why you have rubber band snap backs in the direction of trend directions,
and slow puffy moves counter trend.
Am I making any sense to anyone here?
So we use daily trend as the direction to build book size and short charts to make market for retraces.
The trick is to hold very steadfast to the position allowing the snowball build on you,
the maxim is to be able to take the punches first,
once the rubber band swings back, whack them like theres no tomorrow,
within your capacity and keep taking profits along the way untill the frenzy slows off
then square down for the next attack.
If the retail broker cannot match orders internally they must hedge the positions in the wholesale market. The Tier 1 interbank dealers sit on top of the market pyramid with vast resources to make profit at the expense of everyone else in the market. The "financial system" allows these dealers to succeed, so it cannot prevent a smaller EA doing much the same thing.
A Forex ECN broker does not have a dealing desk but instead provides a marketplace where multiple market makers, banks and traders can enter in competing bids and offers into the platform either inside or outside the spread, allowing traders to be market makers and have their trades filled by multiple liquidity providers.
A trader might have their buy order filled by liquidity provider "A", and close the same order against liquidity provider "B", or have their trade matched internally by the bid or offer of another trader.
That makes sense when the individual is making trades of the same size as the other participants in the ECN. The minimum sizes are quite large for genuine ECNs.Doing away with a dealing desk would surely be beneficial to an individual trader in that they have access to multiple participants.
"A Forex ECN broker does not have a dealing desk but instead provides a marketplace where multiple market makers, banks and traders can enter in competing bids and offers into the platform either inside or outside the spread, allowing traders to be market makers and have their trades filled by multiple liquidity providers."
That makes sense when the individual is making trades of the same size as the other participants in the ECN. The minimum sizes are quite large for genuine ECNs.
For example, this broker gives you access to the following ECNs: Currenex, Lava FX, Hotspot FXi, Baxter FX, FXall, but requires the following minimums:
http://www.vcapfx.com/forex-commissions.asp
Spreads: Bid/Ask spreads are dependent on market liquidity.
Commissions: Determined by monthly volume transacted.
Lot Size: $100,000 USD Per Currency Lot.
Min Trade Size: $500,000 USD per trade.
Min. Equity: $250,000 USD minimum required to open account.
Margin: 1% - 6% varies according to account balance and strategy.
Spreads: Bid/Ask spreads are dependent on market liquidity
Commissions: Determined by monthly volume transacted and clearing firm selected
Lot Size: $100,000 USD Per Lot
Min Trade Size: $100,000 USD Per Lot
Min. Equity: $7,000 USD minimum(HotSpot) required to open account.
Margin: 1%
nah it's about climbing the ladder, from small broker to big broker!
For an EA we all agree the best place to start is with a MT4 broker but then what is the next step up? What is the best medium size broker for an EA like Bunjip? I think it might work well within the large liquidity pool created internally by one of the very largest retail brokers (like Oanda) or does it require access to true ECN once the order size gets beyond a certain limit?
I think Ninja Trader + Interactive Brokers would be a platform/broker combo worth evaluating.
choices for Oanda might be limited. You could code the entire EA as a server application with their API, and then monitor the EA and override trades using their regular platform.
Oanda has a FIX protocol so your programmer could use that to connect to a range of trading platforms, like X Trader.
Maybe if you want to also trade futures, options and precious metals etc,
check out this list of high-end platforms certified for use with CME http://www.cmegroup.com/globex/intr...tionality/certified-trading-applications.html
Hmmm,going strong!
after the hiccup when the fed printed money (which it turned out the EA would have recovered from, but i didnt want to risk it at the time) normal service has resumed.
some programming changes were made to make it more safe, which has reduced the return by about half.
late last week i decided the old system mightnt have been broken, so re-installed it - and it went into a nice big drawdown (seen above) - so ive changed for good back to the new one.
on the .01 lot setting with $5k account, its returning about $650 a week.
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