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Forex News Trading: Trade for Sunday, Feb 5, 2012
Forex News Trading: Trade for Sunday, Feb 5, 2012
6:20 PM Eastern
New England Patriots/New York Giants – A game to decide the best team in pro football (though the best team doesn’t always win)
NEP/NYG
I’d trade cautiously here, and watch out for unpredictable behavior particularly toward the end of the game.
7:30 PM Eastern
AUD Retail Sales – Change in the total value of sales at the retail level
AUD/USD
Well, this is the best opportunity of the week, which doesn’t say much for the week. On November 2, this came out at 0 and 0. It spiked down 12 pips 3 seconds before the release time and stayed there. My orders didn’t go in till 2 seconds before the time, so no damage. Everyone was not so lucky. On Nov 30, the next time we saw this release, it came out at -.2. There was no spike at all but it started slowly pushing down. Moved 26 pips in 5 minutes. Then on Jan 8 (also a Sunday night) it came out at -.4 with a 22 pip spike. It did a quick 50% retracement and then pushed back down to about 20 pips again.
I will be at a super bowl party tonight and will not bring my laptop, so I will be watching the Skype room and listening to my friends (most of whom have no life) in our trade room to see how the trade goes. I would be on the watch for a premature spike or late data. There is row 2 data tonight and if it comes out first, you will likely be live before the row 1 data comes out. It is now akin to a coin toss. The new release will take you out if this happens if you want it to. Anyway, don’t be caught off guard. Stop watching the game long enough to insure you don’t get taken to the cleaners.
You might also take a look at what the pair does in the hour or two before the trade. If you see movement of 75 pips or more, cut your trade size down or go back to watching the game.
ORACLE TRADER – set medium to .5 and safe to .7. Trade 1/2 your normal lots on a .5 and 3/4 on a .7. Turn off the OT if you see any suspicious movement beforehand.
STRADDLE V1.3 – try maxSpread of 6 or 7. If there is no movement within 3 seconds after the release time, try to get your trades out asap.
STRADDLE PRO – I’d set Buy/Sell Triggers to .4 and check the box. Have a plan for getting out fast and be sure to use a trailing stop or profit targets.
Forex News Trading: Trades for week of Feb 5 thru 10, 2012
Forex News Trading: Trades for week of Feb 5 thru 10, 2012
I will continue to test the new Straddle release as aggressively as possible this week and hopefully will complete testing. There are a number of folks assisting in this endeavor. Turns out this group needs to be kept to a minimum because with the frequency of changes, sometimes several per day, distributing the new code and keeping everyone on the same page becomes quite challenging.
This release will offer a lot of protections against these unpredictable markets and I am anxious to get it out there. It does add several new options and adds flexibility to the profit target choices which will undoubtedly cause some confusion.
I’ve discovered, to my surprise, that managing the moving profit-targets/order-closing/stop-losses requires quite a bit of overhead and complexity. The more flexible it becomes, the more difficult it becomes to understand. The new release will revert back to allowing either the profit targets OR the trailing stop, but not both at the same time. The problem here, for anyone who cares, is that when you close a part of an order using MT4, the remaining live order is assigned a new order number with no reference to the closed portion other than a comment placed in the closed portion. So there is no clean way to tie the open and closed parts of an order together. Reading through the history is the only way, a very time-consuming endeavor. If none of this makes an ounce of sense, you are in good company and should simply ignore it.
The overhead involved in allowing both at the same time would make the Straddle ineffective in managing fast moving news trades. I want to make sure that is not the case regardless of which options are selected.
Anyway, here is the paltry list of news trades for the upcoming week. I will post details shortly for the AUD trade coming up this evening.
Sun 2/5 7:30 PM – AUD Retail Sales (Straddle)
Mon 2/6 10:30 PM – AUD Cash Rate
Wed 2/8 4:45 PM – NZD Employment Change q/q (Straddle)
Thu 2/9 7:00 AM – UK Official Bank Rate
Thu 2/9 7:45 AM – EUR Minimum Bid Rate
Forex News Trading: Trades for Friday, Feb 3, 2012
Forex News Trading: Trades for Friday, Feb 3, 2012
Before launching into my regular soliloquy, let me give you an update on the new version of the EA. I have been running it day and night, over and over, looking at results and changing/fixing things as I find them. In some cases I fix something and break something else. Such is the destiny of a code writer. Anyway, it is not quite ready for prime time yet but moving very quickly in that direction. The following list is an excerpt from the release notes that summarizes the changes. Some will have a great deal of impact and some are cosmetic.
– An option to close your trade if you get in before the news comes out
– An option to set a hard stop as tight as the broker will allow as soon as one of your orders goes live, and to remove the other pending order at that time.
– If you are in the wrong way on a safe trigger (you have a live buy on a safe sell trigger or a live sell on a safe buy trigger), your live trade will be closed immediately.
– Added a reverse buy and sell flag (if you don’t know what this means, you will never need it)
- Took out the “failed to delete” messages from the Experts tab
- Fixed a bug in the pending sell retry logic
- Prints the total profit/loss for the trade on the trading station in the upper left once the last order is closed (perhaps a mixed blessing)
- Prints the largest the spread got during the course of the trade in the upper left once the last order is closed
- Fixed logic that sets and moves stops to hopefully reduce or get rid of “Invalid SL or TP” messages (maybe wishful thinking)
- Cleaned up the Experts tab to try to make it much easier to understand and follow
- Fixed timeToLive which is used to take trades out when there is no data expected (the 4:28 AM trades)
- In the profit targets section, allowed the close volume to be 0.0, which means you are just moving the stops without closing anything along the way (another idea from Andrius).
That’s it. Will keep you posted and will get this out very soon, hopefully next week (I think I said that last week also). I want to be careful not to release it and then find some glaring issue. Testing is near impossible with this style of trading because no 2 news releases behave exactly the same way.
Anyway, for tomorrow we have:
4:28 AM Eastern
UK Services PMI – Level of diffusion index based on surveyed purchasing managers in the services industry
GBP/USD
To be perfectly honest, I’m thinking of staying in bed for this one. If you are up and want to take a whack at it, feel free, but setting an alarm and wrecking a perfectly good nights sleep to try to break even borders on foolish.
Perhaps I can offer some supporting documentation to substantiate my reasoning. Lets see …. in November this spiked -8 pips. In other words, a second after the release time it spiked down to take us live. Then it spiked up 15 pips. The data came out at -.7. Lost money on this one. Then in December we saw a 17 pip spike but instant full retracement. Then it popped up to the top of the spike within 2 seconds then fell back down below where it started and stayed there. The deviation, for what its worth, was 1.6. Lost money on this one. In January, hoping for new behavior in the new year, it delivered a 10 pip spike up and instant spike back down, once again taking in the buy. The deviation, which didn’t show up for 5 minutes, was 2.5. Lost money on this one.
Hhmmm…. there is one consistent characteristic of all 3 of these trades. It looks like staying in bed can be construed here as a good way to make money, as it were. So that’s what I’m doing. Maybe ought to stop posting it. If you want to try it, trade very lightly and use whatever settings you deem appropriate. Remember you don’t check the box for this one. If someone could post in the blog a little writeup on what happens (spike, behavior over the first couple minutes, deviation, …) I would appreciate it.
7:00 AM Eastern
CAD Employment Change – Change in the number of employed people for the previous month.
USD/CAD
OK now we’re talking. In November this came out at -69 and .2 with a spike of 52 pips. It retraced slightly and continued to 74 pips in 2 minutes. Very nice. And rare. This is a ridiculously high deviation. In December it came out at -38.6 and .1 with a 34 pip spike, 50% retracement, and continuation back up to about 40 pips total. In January it came out at -2.5 and .1 with a 22 pip spike. It retraced slightly and continued 28 pips in 7 minutes.
If we get a real big deviation, like say over 35, you may want to close part of the trade and see if we don’t get some continuation after the retracement.
ORACLE TRADER – I would try maybe 25 medium and 35 safe, trading 1/3 your normal lots on a medium and 3/4 on a safe.
STRADDLE V1.3 – try maxSpread of maybe 8.
STRADDLE PRO – I’d set Buy and Sell Triggers to 15 and check the box. I’d also use the trade management stuff to take out part of my trade after the spike.
8:30 AM Eastern
USD Non-Farm Employment Change – Change in the number of employed people excluding the farming industry.
EUR/JPY
In November we saw -15 and .1 with a 3 pip spike. Prior to this I advised not bothering to check the box because we never got a spike less than 20 or 30 on NFP. In December we saw -5 and -.4 with an 11 pip spike. This is like seeing a football score of 425 for one team and -35 for the other. The markets didn’t know how to react to this nonsense, so it thrashed up and down. In January we saw 45 and .2 with a 19 pip spike, 50% retracement, pushed back up within 19 seconds, then fell down well below where it started.
Obviously not for the faint of heart……
ORACLE TRADER – I’d go with 65 medium and 80 safe. Trade 1/3 your normal lots on a medium and maybe 2/3 on a safe.
STRADDLE V1.3 – try maxSpread of 8 or 9. I’d get out fast.
STRADDLE PRO – set Buy and Sell Triggers to 55 and check the box. Use profit levels or trailing stop. Get out after the spike.
