Tuesday, January 14, 2014


                                 Before This He Tried To Trade FX

Few things in life really prepare you for a career trading FX; all your fancy schooling and upbringing mean absolutely nothing. Money talks; well, you know the rest. Dealing with disappointment and failure [not from a money standpoint, but from the market “not behaving”] on a constant basis can have a negative cumulative effect on your life if you don’t prepare yourself properly.

Now that I’m “wired in” to the FX Twitter universe, how many were calling for USDJPY to scream lower today, and by default the Yen crosses would get smashed and the carry trade traders would suffer horrendous losses?

“Ummmm, excuse me, liftoff in GBPJPY in 5…4…3…2…”

Once again, the “Long Term –vegas Big Bang Algorithm” should have kept you on the sidelines [in GBPJPY] most of the day; in other words, keep you out of trouble! How many of you couldn’t wait to sell GBPJPY today on the rally? “It’s easy money.” [There is no such thing by the way.] For the most part, the algorithm never gave the sell signal after about 8 A.M. [Chicago time]; it spent the next 7 hours going straight up.

As the sword swallower can attest, spending too much time worrying about one side of the sharp sword can leave you vulnerable to the other side. There is no such thing as “ a comfortable trade” in FX.

I have updated the “-vegas Scalper Algorithm” and the new and revised MQ4 file can be downloaded for free in the downloads section here on the blog. It is important you use this latest version, as it will give superior results versus the previous version; as always, if you prefer, email me at and I will send it to you if you don’t want to use

One thing is clear from the last couple of days; scalping at C2 will not work. Here’s why; I made simultaneous trades of 10K at C2 and Assets FX on Monday, buying GBPJPY off a buy signal from the “-vegas Scalper Algorithm” [previous version, not the new one]. Likewise, I liquidated at the same time; I made 6.6 pips [after a $0.26 commission] at Assets FX [where the spread was 1 pip and change], and I made 3 pips at C2, where only God knows what brokerage house they used for the quote and what the spread was [I’m guessing it was about 5 pips]. This is over a 100% difference.

If you made 2 trades like this every trading day over the entire year with a 1 lot [100K base currency], you would be handing the brokerage house approximately $17,000!!

Most of the time, regardless the session, the crosses with the best spreads are 1) EURJPY, 2) EURAUD, and 3) GBPJPY. EURJPY is usually lower than 1 pip, while the other two are between 0.5 – 1.5 pips at Assets FX.

What I plan on doing is using C2 for the “Long Term –vegas Big Bang Algorithm”, and posting each month the results from an account at Assets FX where I threw $1,000 bucks into an account and will trade it using the “-vegas Scalper Algorithm”. Of course, I will keep a running daily total of the Scalper Algorithm, but will make available to the public the end of month records so anyone can verify the results.

I have had some talks with Assets FX about having other accounts “mirror” my trades automatically, but there are some details that still have to be worked out. Right now, I’m waiting for a call back with answers from questions I had about logistics and leverage. I’ll keep you posted, but I remain optimistic both I and Assets FX can work out a plan that benefits primarily you.

The Scalper Algorithm is currently using RM=1 in GBPJPY, EURJPY, and EURAUD. I’m using the hourly candlesticks [1 HR] as the basis for long and short positions; when the candlestick is green, I only establish long positions; when the candlestick is red, I only establish short positions. The 1 minute [1M] candlestick cross over/under of plum and yellow establishes the buy/sell signal.

If you are trading multiple lots, take partial profits at the aqua line and let the rest ride until either the 1M red exhaustion line is hit by price or the plum and yellow lines cross.

Please change your yellow line setting manually to “17” from “9” on the 1M candlestick chart. Then insert onto your 1M chart the “-vegas scalper.mq4” file.

With the updated Scalper Algorithm, you literally have hundreds of opportunities per day to scalp these 3 volatile pairs listed above. With spreads less than you would get at an exchange, you have the 3 biggest factors for success in short term trading; 1) very tight spreads, 2) volatile pairs that move, and 3) an algorithm that works and produces results.

Over the last few days, I have had some problems with our email account. Yahoo reset the account, and unfortunately some emails were lost. If you have sent me an email that I haven’t answered, please copy and paste it from your email “send” directory and send it to me again so I can answer it and hopefully answer any questions you have.

Have a great day everyone.


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