Scalping the EUR/USD

T

Trend Fader

I opened an OANDA account and I really think they have a great platform.. THey also have a 2 pip spread much of the time so i do believe scalping is possible.

I am curious as to if anyone tries to scalp it.. and if they do I would love to share different methods and techniques.

Since there is a 2 pip spread and there is no commision I cant imagine a better market to scalp. The futures have a 1-3 pip spread and u also have to pay commisions... so I think OANDA has an advantage.

One technique that I like to use is try to gun down stops. When the market is basing for quite some time and is about to take out a key resistance/support level.. I watch the tape and like to see it start getting quick and firm. I usually watch the futures because they give the best indication of the tape. Then once the market looks as if its about to take out the resistance/support level I jump into the market and ride the breakout as it takes out stops and jumps through price levels. Once i am up atleast 5 pips I start to scale out..

Usually I can make 5-10 pips on a basic move.. sometimes I make 20-30... but thats not the norm.

When I scalp I try to make a min of 3 pips... 5 pips is my avg. On a good day I try to target 50 pips profit.

Looking forward in hearing from u guys.
 
Indeed OANDA has the best spreads on EUR/USD one can

find, you have positive and negative slippage but on average

you got the price you see.

No dealers at OANDA, just a computer making prices...
 
Quote from virgin:

Indeed OANDA has the best spreads on EUR/USD one can

find, you have positive and negative slippage but on average

you got the price you see.

No dealers at OANDA, just a computer making prices...
More...

Yea... I notice they correlate to the futures very well.. thats why I think they are the best... its not as if the prices they post are bogus. I have used many brokers in my lifetime in regards to stocks, futures, forex.... and Oanda is by far the simplest and best.

I think if used properly this is the ultimate scalping tool. Just curious if anyone is successful at it.


--MIKE
 
Quote from Trend Fader:

Yea... I notice they correlate to the futures very well.. thats why I think they are the best... its not as if the prices they post are bogus. I have used many brokers in my lifetime in regards to stocks, futures, forex.... and Oanda is by far the simplest and best.

I think if used properly this is the ultimate scalping tool. Just curious if anyone is successful at it.


--MIKE
More...

I just use two wma and micro support/resistance.
 
I've been looking at their platform with interest the last few weeks as well.

I like the fact that:

- simple, but effective platform
- reasonably large number of currency pairs to trade (20-30), unlike some dealers that just have the majors

And the single most important thing for me is since I have a small account, the ability to choose leverage. In other words, I believe if I want to buy literally $1 USD worth of Yen I can do that with no commission (just 3 pips or so spread).

This is really appealing to me since some of the other brokers, and currency futures, would require me using more leverage than is prudent.

I've tried their demo account and am generally impressed, but it is good to hear some of you have had no problems trading live with them as well.. that is encouraging.

Regarding scalping-- I have never done that or day-trading so I don't know what I'm talking about :) But just theoretically I would think that currency markets are *way* better for day-trading / scalping than for example the ES. Here's why: even lower spreads, and IMO most importantly, I believe in Fx trading your stops can hold within 3 pips or so? Ie let's say the EUR/USD changes 5% in one day to say another 9-11 attack or something of that nature. Even if most of that change occurs in the space of 5 minutes, I believe you wouldn't lose more than an extra 2-5 pips at most due to slippage? With ES on the other hand, just imagine if that is all you trade and the S&P 500 drops 20% like it has before (though rarely). But if you have 5x leverage you are wiped out if it moves/gaps/slips way past your stop... where as in FX your stops barely slip at all I believe (perhaps that is not true if you trade > $100 million, not sure).

Anyhow.. good luck all!

-Taric
 
I have been using their platform live.. and its pretty much right on par with the experience I had with the demo.

Anyways... I am curious as to if anyone is scalping the EURO and I would like to share different ideas.

I noticed that whenever the market takes out hourly support/resistance it starts to move and volume builds up. Otherwise when its stuck between support and resistance it gets very choppy and most of the time I will stay out... unless it acts trendy.

I always watch key eco# and for rumors that might make the market move... when the market is event driven and its about to break and take out stops thats when I will increase size because it usually willl have above avg. momentum.

For example when the market broke the 1.2260 level today on the greenspan rumors I knew it would have some fuel. The interesting thing is that once the poor eco# came out the euro didnt really rally much after 10am. Its as if the bad #'s were already priced into the market and the market didnt want to continue its advance as the stock market tanked at 10am.

From my limited experience trading the Euro I realize that if the market makes a pretty big directional move before a key eco# and there is no particular chart setup ... its best to stay away becaause the market is pricing in the news before its released. The best scenerio is when the market is range bound and volatility drops off completely and the eco# turn out to be totally off the esitimates.. times like that are the best... aka.. that friday we got those horrible job reports



--MIKE


 
Mike and Taric,

Let me combine and reply to a few of your comments.

On those breakouts I think Mike mentions that he rides, I usually am on the other side taking the dangerous trades - heh - EUR/USD had one yesterday and suddenly spiked down 11 points in 1 second where I closed the trade.

You can scalp 2 to 4 points or more. OANDA is the same (they say) if you trade 1 unit or 10,000,000 units.

I was short trading last night with my last trades going in at around 1.2212. Well, at about 3AM the price tumbled to 1.2212 - I was at 0 on my PROFIT (PIPS) indicator but did not close the trade.

heh... I should have.

I crashed after that and this morning when I came back I was sitting 100 points drawdown on those positions. Must have been the Greenspan heart attack rumor.

Now I get to try to trade out of that hole. Fun.

Anyway, hope you guys do well with scalping forex at OANDA!

I have had no problems with them.

Remember to trade in proportion to your real account size.

Cheers!

Sam
 
I also like to fade breakouts at key support/resistance level... especially if the break comes off an extended move w/o any fundementals behind it.

When there is fundementals or event... like the greenspan heart attack and there is a breakout taken out key resistance... I u know I am not gonna fade it and ride it for a good 20+ pips.
 
Guys, I have considered OANDA because of their great spread, however, I have been reluctant to open an account.

Their site isn't very company like- they have banners (why do they need this source of income if they are well funded and do well?).

They don't seem to have the background that Gain has and don't seem to be more than a source to learn-

Am I being too skeptical based upon their site? I have heard raves about this company, but I am still keeping a step away until I hear more.

NYCDT
 
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