Comparing Forex to other trading modalities?

[blackhatyeah]

For those of you with experience with regular stock swing trading, day trading, stock options, and even binary options trading -- how do you think Forex trading compares? Advantages? Disadvantages/pitfalls?

Thanks.

[grert]

(06-08-2020 08:28 AM)blackhatyeah Wrote:  For those of you with experience with regular stock swing trading, day trading, stock options, and even binary options trading -- how do you think Forex trading compares? Advantages? Disadvantages/pitfalls?

Thanks.

Going by what coffezilla says here, it's not worth doing any of them. I got to say I have dabbled with fx on off for 15 years and am in a negative equity so he may well be correct.

[v555]

@blackhatyeah :

I think it does not matter what Market you Trade in, and hence all Markets are the same, if you engage in it with the proper approach.

I learnt this via TradingTemplate dot com first.

You may wish to watch the video of a real Doctor having 30 years of day trading experience at : https://www.youtube.com/watch?v=KBXnfay-BQE .

[Suchitra]

I prefer swing trading in equity and day trading in commodities. Crude, Silver are my favs to trade.

I prefer to test my strategies in FX rather than trade in it. That's because it fluctuates widely and gives proper insights into where I need to correct myself.

[BinaryHunter007]

Advantage: forex trading offers liquidity. so your order mostly will get filled when you are buying or selling. also forex brokers offers high leverage.brokers offer 1:500,so that you can fund minim 10 and trade currencies[ leverage can be good/bad]. many resources and study material available compared to others.

Disadvantage: 70% of time currency pairs starts to range. vola on most pairs arenot good enough. each pair have two currency,so it does offer advantage also disadavantage.. because you need to keep track of each currency pair. also most currencies are correlated with each other and metals.so currencies are bit hard to trade if you give too much attention to every details

[BuildingWealth]

From my experience. It all comes down to your personality .ie attention span and risk tolerance.

I would advise you to paper trade each one. Or pick one and paper trade.

I usually swing trade and day trade stocks. I day trade forex.

I like Forex the best, but I'm still learning it. I like it because it moves faster. There's more liquidity (I can buy and sell quicker). You can trade 24 hours a day 5 days a week. Also there less things to trade compared to the stock market. So for me I spend less time "searching for plays" and more time learning and trading.


In short this would be my personal ranking best to worst. (My opinion)

1.) Forex - ( US Indices and Major Pairs)
2.) Stocks - ( Breakout Stocks w/ A trailing Stop and Swing Trades on Strong News)
3.) Options - ( Seeing how new effect a company ie. Corona Virus and Nike)
4.) Binary - (Traded them a few times. Don't like how its all or nothing)


You ultimately have to figure out what your style is:

Whats you risk tolerance?
How much time do you have?
Are you looking for monthly income or long term retirement?
Are you patient?
Can you do something boring or do you need excitement?
Whats you budget?

I'm still learning. But these are my thoughts on your question.

[mrpelage]

On the contrary. Any demo account will just teach you bad habits and trade management. Start with $25 and learn to manage your trades. Fake money doesn't give you any accountability. Forex is pretty simple, not easy but simple.

Whatever you put in there be willing to lose it all. $25 won't allow you to trade big lots and 0.01 is a great start for a beginner. Your goal shouldn't be to make any money, but understand what a real live market is doing. A demo account is live but not really the real market, gotta get used to stop loss hunting and crap like that.

Learn quarter points and 123 method and use Stochastic to confirm entries. All free on YouTube. Daniel Savage, Rayner, and Jay Take Profits. All consistent earners teaching all different methods.

The key is to learn one thing at a time.

For example only take sells and look for sells and develop entry conditions. Once you get that down learn to take buys and only buys. That way you don't just jump in because it looks like it's going that way. Take your time and check your entry conditions off.

You have to develop your skills and know the difference. Learn structure and supply and demand.

The key to Forex is knowing at what point will confirm that you're right and enter there or where will confirm your wrong and cut your losses.

Biggest mistakes besides not understanding lot sizes and margin or multiple trades at once, are exiting winning trades before they develop and letting losses run. You have to know at what point you were right or wrong to confirm your next step.

For example a few of my sell entry conditions are...

Trade Entry Sell 1HR

Check spread
Major Bull Candle to left
Volume spike to left
Bull candle closed = Blue volume candle close
Maroon Supply Zone formed by BULL candle high
Look at 15m and 5m Timeframe for Entry confirmation
Look for timeframe confluence
Follow 4hr Trend
Check 1hr Timeframe for Pullback ATR
Check 1hr Timeframe for Supply Zone Volume +/-
Look for inverted V shape in CMF - CMF above 0
CMF Volume High and Volumes High identical/close
Volumes High must be blue when closed before entry
Look for Fibonacci 50. or 61.8 Pullback zone and entry
Look for dip in CMF and low volume right after volume spike

CMF is an indicator, Chaiken Money Flow. These rules are mine and mine only developed by blowing over $25k in Forex before I got consistent. I traded demo for a year and still lost $25k. Avoid demo. If you can't afford to lose $25 then trading isn't for you. It'll take forever to understand trade management. Nothing cuts the learning curve like real money.

Some of my other entry rules are things like checking the time and not trading after New York closes. Not chasing trades I lose. If I loss 25 pips for the day, I'm done. If I made 50 pips I adjust my stop loss to 30 pips in profit and let it run.

10 pip stop loss as my entry is on point. But this is just how I trade and you'll develop your own strategy and rules. You won't use the same indicators or chart setup so my strategy is mine and mine alone. I'm very impulsive and impatient. If my rules aren't met, I don't enter. It doesn't matter if it goes 100 pips in my favor. I do 1.00 to 2.00 lot sizes which is $10-$20 a pip.

Hope this helps somewhat. It's like internet marketing, a strategy is just that. You have to learn and make your own based on how you interpret the market.

Besides big banks and money makers, someone has to lose. So every time you win a trade you're taking that money from someone else. Every time you lose you're giving your money to another trader or the bank.

No Nonsense Forex on YouTube has great videos as well. I don't trade the way he does, but great content.

Check out YouTube and search Live Trading Session. They'll usually be online at London open Monday, just watch and learn. Or just visit their channel for replays of previous sessions "Trade With Monty" is the channel name. Not affiliated with any of these guys.

Good luck. Your goal should be to break even and start profiting in 6 to 12 months. Develop a strategy and be consistent. Don't break your rules, even if it's money in the bank. If you're strapped for cash then trading isn't it.

[Lumos]

A very generous bunch of info in this thread !!!

[va737]

blackhatyeah and mrpelage for the info

max reps

[mrpelage]

Thanks for the appreciation. Took me time to find my trading style and consistency. But once you got it, you're good. Just have to track your trades and entries. Most times you'll realize you got in too early. But if your trade entry is the same every time you'll bank.