Forex vs Stock trading?

D

dominover

I've never traded Forex but I want to start. I'm just curious about whether it is considered much harder than stock trading? Without the usual markers such as Volume to help judge sentiment I can imagine that knocks out VWAP and other indicators. I've looked at the RSI on some Forex charts and they seem to be very choppy and there's loads of false signals (that's even when you look at the RSI in two different timeframes).

How do you all approach this? Is Forex considered much harder to trade than stocks?

Thanks
 
dominover said:
I've never traded Forex but I want to start. I'm just curious about whether it is considered much harder than stock trading? Without the usual markers such as Volume to help judge sentiment I can imagine that knocks out VWAP and other indicators. I've looked at the RSI on some Forex charts and they seem to be very choppy and there's loads of false signals (that's even when you look at the RSI in two different timeframes).

How do you all approach this? Is Forex considered much harder to trade than stocks?

Thanks
More...
You need to ask yourself this question: Am I making money trading?
If not, why not?
If you can't make money trading stocks, why would you think you can make money in fx?
Can you make money in sim?
If not, forget about trading altogether until you can.
 
dominover said:
I've never traded Forex but I want to start. I'm just curious about whether it is considered much harder than stock trading? Without the usual markers such as Volume to help judge sentiment I can imagine that knocks out VWAP and other indicators. I've looked at the RSI on some Forex charts and they seem to be very choppy and there's loads of false signals (that's even when you look at the RSI in two different timeframes).

How do you all approach this? Is Forex considered much harder to trade than stocks?

Thanks
More...
This is a good question. First, you can definitely use volumes and VWAP, and IMO, it's even more effective than when you use it on the index/equity markets sometimes.

[example]
yen-png.294426


Depending on your familiarity and experience with CME, and your ability to chart futures spreads, you can get volumes and VWAP studies for all the majors. For example, the forex quote on GBP/EUR can be analyzed using the futures spread long GBP and short EUR in a 1:1 ratio. You can chart the cash value of the spread by subtracting the notional value of the euro contract from sterling. Schwab/thinkScript (above) can do this.

I don't use RSI, but I have found Dorsey's other invention, the RVI, to be useful.
 
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dominover said:
How do you all approach this? Is Forex considered much harder to trade than stocks?
More...
It's my experience that generally, Forex is considered harder to trade than stocks. But personally, having traded both, I am of the exact opposite opinion. My approach is to trade in the direction of the trend as price is coming out of pullbacks. Here is an image I recently posted in another thread illustrating the indicator I just coded this morning to alert me when a given pair is exhibiting the structure I seek for a possible trade...

Screenshot_7.png


Moreover, I'd approach this in a manner compatible with the principles illustrated by Peter Reznicek, AJ Monte and Gareth Soloway on the free videos they post to YouTube, even though the first two guys are primarily concerned with options trading and Soloway focuses on stocks, indices and commodities. (Normally, none of them spend any time at all looking at currency pairs.)
 
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