Sunday, September 5, 2010

current incarnation of meantrades

This has been coming together for years. I feel the most confident trading this method than I have with any previous incarnation. In the truest sense of the word, this is the evolution of my trading methodology.

First we need to set up the template. We require a few MT4 indicators. We need to use MT4 since we are using a script. Apparently MT5 does not natively support scripts--which seems absurd, but anyways..

Use this demo if you do not have your own MT4 feed. Hands down the most comprehensive MT4 feed available. Commodities, Futures, World Indicies. I would not endorse actually trading with them, they are a little shady on fees.

Once you have your broker feed set up. Install these indicators in the correct folder. In my case this is: Program Files/Broco Trader/experts/indicators.

Now you have to set up the time for the ant-GUBreakout_V.0.4.2.mq4 file. This is somewhat subjective but the main purpose is to start it at the beginning of the Tokyo session and end it about an hour or so before London. This creates a nice opening range to trade off.

The main idea with meantrades is that we are seeking balance in the markets. We expect market prices to revert to their "mean" over time. Some people prefer to trade breakouts and that is fine, I prefer a value oriented approach.

It is counterintuitive but suits me fine. When prices are out of line I want to be looking for a reversal.

We are buying when prices are too cheap and we are selling when prices are too high. Simple enough. Now let's look at how we seek this out.

The main indicator to determine value in this case is fiboncacci extensions. When prices reach the outer range of the ORB or opening range breakout, we are looking for reversal trades.

We do not look at price alone, we also employ a very special script to determine when prices are ready to reverse. We use the constant range bars script which is available for download on this website. Please note it is not free. If you do not wish to invest in it at this time you can apply the template to a 5 minute chart with similar results. The main difference is the trend will reverse much faster and you will not be able to hang on for the ride quite as easily as you can with constant range bars. I am not a paid affiliate of the site but I can vouch for it's services. Enough said.

So what we are using in this template is:

Friday, September 3, 2010

Intoxicated oil trader fined £72,000 for trading ‘binge’

Steven Perkins, a formerly oil futures broker for PVM Oil Futures Ltd, went on an unauthorised trading shopping spree after a heavy weekend of drinking and purchased 7 million barrels of oil.

This not only stirred the market up to an ‘abnormal and artificial’ level of $73.50 per barrel, he also managed to rack up trades worth $520 million.

Perkins’s job was to trade Brent Crude Futures to qualify for the Intercontinental Exchange (ICE) on an execution only basis. But in the small hours on that fateful drunken day he traded without any client authorisation.

After his drunken splurge in the early hours of Tuesday 30th June 2009 he then called his office and tried to lie his way out of the mess.

Perkins has admitted to alcoholism and straight away went on a drying out course. The FSA have given him a trading ban of five years minimum but shied away from a lifetime ban as he may well recover and end up as no longer a irritating nuisance to the markets.

Wednesday, September 1, 2010

Good demo of a live chart on range bars

I miss trading the currencies

I have been away for a while running my offline trading business in Chinese goods. I love the challenge and I really don't think I make what the time requires of it. Nowadays I am trying to keep a balance on things and including trading again would be a great way to keep things fresh.

I have refined my method a bit since last year and will probably hand the system over to a programmer in the next few months. I still enjoy the manual trade though. The challenge of it is quite exhilarating.