EXNESS
Proudly sponsor the world's number one football team, Real Madrid, and the best football player alive, Cristiano Ronaldo
Adjusting stops
according to market’s
volatility
Adjusting stops according to the market’s volatility is a pretty simple and straightforward principle that many traders follow. Unless the intention is to go with a breakout or the market is expected to move quickly at that moment (momentum trading), stops should not be too tight; traders typically prepare for pullbacks and conduct tests before the market moves. Doing so allows them to hold a position and stay in the game.
A 5-minute USDJPY chart is shown in the example on the next page. As the price was going up, a buying position was entered after a pullback and an engulfing candlestick pattern was spotted. Taking risk management and position size into consideration, the stop loss implemented in this case was, again, ATR multiplied by two.
In general, part of the entries are usually made in both the active and comparably less active (rotational) phases of a trend. When the trend is active, one can place any stop—even four to five pips—which makes sense should the market move towards the rotational mode. This is also why most traders advice against tight stops, which can unintentionally jeopardize positions.
Key Takeaway
Not adjusting stops to current market volatility can lead to whipsaws. Using market volatility for stop placements is a common method employed by traders. However, one should monitor the changes in trading results to gauge the suitability of this method in one’s trading style.
EXNESS
Proudly sponsor the world's number one football team, Real Madrid, and the best football player alive, Cristiano Ronaldo
Floating forex spreads
In forex, a spread is the difference
between a currency's buy and sell prices. Basically, the spread
represents a forex company's main source of profits. The way profits are
obtained is very simple: a brokerage or dealer always sells a currency
for a higher price than it buys it. The spread is how brokerage
companies cover their expenses and generate profits. In effect, the
spread is a kind of commission taken from the trader for each
transaction.
How does spread size affect trading?
Obviously, the smaller the spread on trading instruments, the better.
However, the kind of trading must be taken into consideration. For
traders holding open positions for several days, weeks, or even months,
spread size is virtually irrelevant. By focusing on long-term
investments, you can ignore the spread size, because in this case the
total number of transactions for a certain period of time is small,
which means the total costs due to spreads will also be small. For those
who trade in short time frames, performing a large number of
transactions in a day, the relevance of the spread size increases
sharply. If the chosen forex trading strategy calls for thousands of
transactions per day, then spread sizes become the most significant
trading factor. Given a large number of transactions, reducing spreads
decreases a trader's costs.
An instrument's spread can change (such spread is called floating) or be constant (it is called a fixed spread in this case).
Fixed spreads can be useful in a highly
volatile market, but only if the quality of order execution is
maintained during large movements, which rarely occurs. Generally, the
quality of order execution is maintained for a relatively short period
of time. One more factor must be considered: periods of high volatility
on the forex market are quite rare. We may therefore conclude that only a
few highly-experienced professional traders who can correctly predict
the market's behavior will be able to fully take advantage of these
periods.
What can we say about "floating
spreads"? Also known as dynamic spreads, these spreads accurately
reflect the prices of trading instruments and how quickly those prices
are changing. They are more realistic and sought after for predicting
market behavior and determining where trends are going. To successfully
trade with dynamic spreads it is important that a trading strategy
account for the possibility of the spread expanding. This is quite
simple to do - periods of expanding spreads are brief and easily
predictable. However, avoiding losses in these periods requires a
certain reserve of funds in your trading account, which will let you
survive a short-term drawdown, or simply refraining from trading on news
that will induce abrupt changes in exchange rates and expanded spreads.
Exness specialists systematically
research ways to improve interactions with liquidity providers. The use
of advanced technology has produced unsurpassed results: at Exness the
spreads on the main currency pairs are currently substantially lower
than those offered by our competitors.
By reducing client costs, tight spreads
are one of the key factors in making forex trading more profitable (this
is most relevant for traders with a large number of transactions).
However, when discussing the advantages of floating spreads, the other
components of successful trading must also be remembered. First of all,
this means the quality of order execution: the speed of order execution
at Exness is 0.1 - 1 second. Moreover, Exness specialists have minimized
the number of requotes and virtually eliminated slippage for all
pending orders executed three hours after trading opens for a particular
forex instrument. At Exness we're always ready to hear the wishes and
suggestions of our many clients, so we can take them into consideration
when implementing plans to improve all aspects of our work.
================
BAHASA INDONESIA
================
Menyetel berhenti
menurut volatilitas pasar
Menyesuaikan stop sesuai dengan volatilitas pasar adalah prinsip yang cukup sederhana dan mudah diikuti yang diikuti banyak pedagang. Kecuali niatnya untuk pergi dengan pelarian atau pasar diperkirakan akan bergerak cepat pada saat itu (momentum trading), pemberhentian seharusnya tidak terlalu ketat; Pedagang biasanya mempersiapkan pullback dan melakukan tes sebelum pergerakan pasar. Dengan melakukan hal tersebut memungkinkan mereka untuk memegang posisi dan bertahan dalam permainan.
Bagan USDJPY 5 menit ditunjukkan pada contoh di halaman berikutnya. Seiring harga naik, posisi beli masuk setelah pullback dan pola candlestick melelan terlihat. Dengan mempertimbangkan manajemen risiko dan ukuran posisi, stop loss yang diterapkan dalam kasus ini adalah, sekali lagi, ATR dikalikan dua.
Secara umum, bagian dari entri biasanya dibuat baik dalam fase tren aktif maupun yang relatif tidak aktif (rotasi). Bila trennya aktif, seseorang dapat menghentikannya-bahkan empat sampai lima pips-yang masuk akal jika pasar bergerak menuju mode rotasi. Inilah sebabnya mengapa kebanyakan saran pedagang terhadap pemberhentian ketat, yang secara tidak sengaja dapat membahayakan posisi.
Kunci
Tidak menyesuaikan stop dengan volatilitas pasar saat ini dapat menyebabkan whipsaws. Menggunakan volatilitas pasar untuk penempatan berhenti adalah metode umum yang digunakan oleh pedagang. Namun, orang harus memantau perubahan dalam hasil perdagangan untuk mengukur kesesuaian metode ini dengan gaya trading seseorang.
Floating forex spreads
================
BAHASA INDONESIA
================
Chapter 08 Menyetel berhenti menurut volatilitas pasar
Proudly sponsor the world's number one football team, Real Madrid, and the best football player alive, Cristiano Ronaldo
Menyetel berhenti
menurut volatilitas pasar
Menyesuaikan stop sesuai dengan volatilitas pasar adalah prinsip yang cukup sederhana dan mudah diikuti yang diikuti banyak pedagang. Kecuali niatnya untuk pergi dengan pelarian atau pasar diperkirakan akan bergerak cepat pada saat itu (momentum trading), pemberhentian seharusnya tidak terlalu ketat; Pedagang biasanya mempersiapkan pullback dan melakukan tes sebelum pergerakan pasar. Dengan melakukan hal tersebut memungkinkan mereka untuk memegang posisi dan bertahan dalam permainan.
Bagan USDJPY 5 menit ditunjukkan pada contoh di halaman berikutnya. Seiring harga naik, posisi beli masuk setelah pullback dan pola candlestick melelan terlihat. Dengan mempertimbangkan manajemen risiko dan ukuran posisi, stop loss yang diterapkan dalam kasus ini adalah, sekali lagi, ATR dikalikan dua.
Secara umum, bagian dari entri biasanya dibuat baik dalam fase tren aktif maupun yang relatif tidak aktif (rotasi). Bila trennya aktif, seseorang dapat menghentikannya-bahkan empat sampai lima pips-yang masuk akal jika pasar bergerak menuju mode rotasi. Inilah sebabnya mengapa kebanyakan saran pedagang terhadap pemberhentian ketat, yang secara tidak sengaja dapat membahayakan posisi.
Kunci
Tidak menyesuaikan stop dengan volatilitas pasar saat ini dapat menyebabkan whipsaws. Menggunakan volatilitas pasar untuk penempatan berhenti adalah metode umum yang digunakan oleh pedagang. Namun, orang harus memantau perubahan dalam hasil perdagangan untuk mengukur kesesuaian metode ini dengan gaya trading seseorang.
=================================================
Proudly sponsor the world's number one football team, Real Madrid, and the best football player alive, Cristiano Ronaldo
Floating forex spreads
In forex, a spread is the difference between a currency's buy and sell prices. Basically, the spread represents a forex company's main source of profits. The way profits are obtained is very simple: a brokerage or dealer always sells a currency for a higher price than it buys it. The spread is how brokerage companies cover their expenses and generate profits. In effect, the spread is a kind of commission taken from the trader for each transaction.
How does spread size affect trading? Obviously, the smaller the spread on trading instruments, the better. However, the kind of trading must be taken into consideration. For traders holding open positions for several days, weeks, or even months, spread size is virtually irrelevant. By focusing on long-term investments, you can ignore the spread size, because in this case the total number of transactions for a certain period of time is small, which means the total costs due to spreads will also be small. For those who trade in short time frames, performing a large number of transactions in a day, the relevance of the spread size increases sharply. If the chosen forex trading strategy calls for thousands of transactions per day, then spread sizes become the most significant trading factor. Given a large number of transactions, reducing spreads decreases a trader's costs.
An instrument's spread can change (such spread is called floating) or be constant (it is called a fixed spread in this case).
Fixed spreads can be useful in a highly volatile market, but only if the quality of order execution is maintained during large movements, which rarely occurs. Generally, the quality of order execution is maintained for a relatively short period of time. One more factor must be considered: periods of high volatility on the forex market are quite rare. We may therefore conclude that only a few highly-experienced professional traders who can correctly predict the market's behavior will be able to fully take advantage of these periods.
What can we say about "floating spreads"? Also known as dynamic spreads, these spreads accurately reflect the prices of trading instruments and how quickly those prices are changing. They are more realistic and sought after for predicting market behavior and determining where trends are going. To successfully trade with dynamic spreads it is important that a trading strategy account for the possibility of the spread expanding. This is quite simple to do - periods of expanding spreads are brief and easily predictable. However, avoiding losses in these periods requires a certain reserve of funds in your trading account, which will let you survive a short-term drawdown, or simply refraining from trading on news that will induce abrupt changes in exchange rates and expanded spreads.
Exness specialists systematically research ways to improve interactions with liquidity providers. The use of advanced technology has produced unsurpassed results: at Exness the spreads on the main currency pairs are currently substantially lower than those offered by our competitors.
By reducing client costs, tight spreads are one of the key factors in making forex trading more profitable (this is most relevant for traders with a large number of transactions). However, when discussing the advantages of floating spreads, the other components of successful trading must also be remembered. First of all, this means the quality of order execution: the speed of order execution at Exness is 0.1 - 1 second. Moreover, Exness specialists have minimized the number of requotes and virtually eliminated slippage for all pending orders executed three hours after trading opens for a particular forex instrument. At Exness we're always ready to hear the wishes and suggestions of our many clients, so we can take them into consideration when implementing plans to improve all aspects of our work.
About senang hati
Hi, My Name is Lamet Se. I am a webdesigner, blogspot developer and UI designer. I am a certified Themeforest top contributor and popular at JavaScript engineers. We have a team of professinal programmers, developers work together and make unique blogger templates.
0 komentar:
Posting Komentar