Friday, 8 January 2010

FXing Again

The big Jobs numbers from the U.S. was surely going to keep the stock markets quiet ahead of the numbers, although after number action was expected. So Kiki and I headed for the Euro FX charts. The new monitor was due to arrive yesterday but because of the snow in the U.K. it didn't and as of writing this at just after 17.00 there is still no sign of it despite a complaint to the online store. The idea is to have the ES or DowEuro50 on one monitor, the Euro FX on another and the Bund on the third. I run off an 18 1/2 inch laptop and there will be two 24 inch monitors when the second one arrives.

Anyway, the choice of the Euro FX future to trade was a good one. There was plenty of action, almost too much. We finished early but still managed to notch up a dozen trades, 11 winners and 1 loser. By now, you can see that this stuff is not too complicated although developing all the nuances to stay out of trouble takes a bit of time to develop.

There are two charts today: the morning pre-announcement and the post announcement after 13:30 London time. The numbers were a non event so we decided to stay with the Euro FX in the afternoon too, especially after the good morning we had.

I must admit I am not as comfortable with the Euro yet as I'd like to be. The thinner volume makes it different to trade and I am still relearning its fingerprint. We stuck with our strategy of all in and all out as I both don't have a feel for the exits and I have not worked out how to better use the Profile with it. Taking a pragmatic approach of taking the surest juice out of it seems to be working, so if you are a 1 lot trader and have passed your tests SIM trading (see my criteria early in the blog) then perhaps this is a market you can look at.

Today's trades earned more than 100 ticks/contract without too much heat in any of the trades. Those of you who still have a day job might look to trading it both in SIM and, when successful, live in the hours outside your working hours. Its a true 24 hour market. If you want to trade really small then you could trade the FX market using the Euro FX future for your charting so you have the volume info. The arb between the cash and futures is very efficient, I'm told.

Morning trades Above, Afternoon below

Click to enlarge

Again, a reminder to register for the January 16 webinar. You can find the link under the Key Posts at the right hand side of the blog. I should have the agenda posted on Sunday so check in if you are interested.


  1. So you aren't using MP analysis for any context on these 6E trades, just reading the order flow and momentum for 10 tick profits and stops?

  2. I have been using the "system" to trade the BP (smaller value per tick .. so I can have a few more contracts for the scale out). It was a great mover today.

    On the EURO do you always have a BUY STOP (or SELL STOP for shorts) in the market at the theoretical bar close price? I know you mentioned this earlier in the blog regarding the ES...

    For my setup ... I have set the ticksize on the rangebar to 10 ... amazingly different looking chart than when set to 5. The result is that I find I can determine where the new bar will form and immediately upon it's creation... enter a limit order at the prior bar's close. I have not yet missed a trade using this method but you do have to be ready to enter immediately on the new bar creation.

    I find the 10Tick movement of bars easier to stay in ... the 5 is a bit jumpy.

  3. AaronP. I am using MP or context but am still working on the s&r aspects. I am looking for a better way to find the proper distributions.
    bakrob99, the issue with the range bar size is that with longer range bar settings you have bigger stops. Its a trade off. I agree with the jumpyness of the 5 tick and I'm trying tick sizes between 5 and 9 but also have to look at the stop issue. If the % winners remains high then its not such a big issue. Thanks for your feedback.

  4. How do you get the Momdots in market delta? I know the formula but not where to enter it.

  5. Mpe, SETUP > CUSTOM INDICATOR will do it.

  6. HFT, would you care to share your chart definition by email with me. Looks great.

  7. I just came across your blog earlier last week. I'm using Market Delta with Market Profile so I've found it very interesting. Thank you for sharing. I don't have the Pro version of MD which it appears you need to get the momo dots. After some experimentation I've come up with what appears to be a very close substitute.
    I plot a moving average, with type set to Least Square, period 12, Price O+H+L+C/4 drawn as Line, Continuous and style Dotted. Any comments on this approach would be appreciated.