Sorry for the delay in replying, I've been very busy the last few days. Anyway......
Kevin 546
Is this best to take a positional daytrade approach due
to the range following a trend based set-up. for daytrading purposes
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Yes, I would say for daytrading fx, then a positional trade, aiming to catch the main moves of the day is probably the best approach.
I have to say I don't day trade myself but judging my posts on the fx threads, most would seem to employ this strategy, looking to catch the start of moves around 7- 8:30 am (start of european trade), 12.30 to 1.30 pm (start of us trade) being the main times. I would avoid using any timescale shorter than 5 min bars as the charts below this tend to look very messy IMO. 5min and 15min, supported by 1hr for general direction seems a popular choice.
Options:-
The sb do the usual tricks of jerking the price all over the place and this is at quiet times. Much more volatile than fxcm etc. So when the price does move and rebound the sb is going to overshoot prices by a fair bit. Although it is nothing like the Dow used to be.
Where you may have a stop in at 30 away with fxcm etc you'll need double that with cmc just so as you don't get gunned.
I have to say that I have never experienced cmc's prices to be any where near 30 points away from fxcm's prices.
I have looked at the charts you have posted and yes, cmc's prices seem more "jerky" but if you look at the price extremes, then FXCM's have both higher and lower extremes. What I have observed in realtime (with both fxcm and saxo) is that their prices (particularly during quiet times) will dance around very quickly, ranging up and down maybe 5 points whilst cmc's price stays quite stable and does not move unless fxcm/saxo's price stays at a particular level for a few seconds. I would conclude that cmc's prices are LESS spikey and you have less chance of being stopped out. I have experienced this personally when leaving stops in overnight. When I have looked at my (FXCM) chart in the morning, I have expected to have been stopped out of a position with cmc. However, this has turned out not to be the case as cmc's prices have missed my stop by 1 or 2 points! When examining fxcm's charts, the point at which my stop would have been hit appears as long tails on 1 min bars. ie small price spikes which may have only occured for a second or so which have not registered on CMC's prices. Of course, this does have the possibility of working against you, if the order you are waiting to be hit is a limit order to take profits!
The point I am trying to make overall, is that I beleive cmc's prices are not subject to large fluctuations (bias) away from the market on fx products. How can they, when they actually have their own "real" fx trading platform, they would be opening them selves up to some serious arbing possibilities?
