How many strategies & Market costs

[Nico667]

Just wondered if experienced traders use many strategies on either one or numerous markets? Does an experienced and successful trader have, for example, 15 tested and solid strategies that they utilise on one or more markets? I'm assuming that people will say it's possible to make profits with just one solid strategy ..... I'm thinking of learning one strategy and understanding it and testing it fully, just wondering if its common long term to master a few different strategies, thereby giving myself maximum opportunity to get involved with trades when I spot criteria for different strategies occurring?
It brings me onto the second part of my question; I've heard that Forex has lower costs than other markets (?), therefore I was planning to start learning fx. I would plan to start with a small bank as I'm a peasant (1+ year paper trading then £1000 real money, add £50+ month from wages, see how that goes for a year or few before thinking of getting more capital involved).
Is it possible to use the same strategies on fx & stocks? and would there be much more costs involved for sometimes using my strategies on stocks as well as fx? I appreciate that mastering one market (fx) at a time is probably wise?
Any help will be greatly received!

 

[tomorton]

I mostly trade forex. Also the Dow index value. Almost always long-term trend-following.

General TA applies equally well to stocks, forex , indices commodities or anything else you could mention as long as there is a transparent market with reasonable liquidity.

Forex has higher leverage under ESMA rules (for the major pairs) than stocks or indices. Forex is a bit different in that both the broker's market in the pair and the underlying market are tradable 24 hours a day (almost) 5 days a week. This is not really a great help to us as there is so little activity after the NY close its not worth short-term trading overnight unless the AUD or NZD banks change interest rates or China does something rowdy.

Forex's continuous trading means there are no true gaps apart from the Friday-Monday gap. So if your strategy depends on overnight gaps or opening prices, it won't work well with forex charts. This also means that many classic candlestick formations don't print well on forex charts and don;t perform well when traded - many of them rely on opening gaps.

 

[Nico667]

Thanks for your reply tomorton .... I heard about the high forex leverage, aside from that there is not much difference in 'other' fees when trading stocks compared with forex?

I will look into forex specific strategies, if the classic candlestick formations don't work as well with forex is it worth looking for strategies that don't rely too much on candlesticks or is it a case of looking at them in different ways on forex?

 

[tomorton]

Thanks for your reply tomorton .... I heard about the high forex leverage, aside from that there is not much difference in 'other' fees when trading stocks compared with forex?

I will look into forex specific strategies, if the classic candlestick formations don't work as well with forex is it worth looking for strategies that don't rely too much on candlesticks or is it a case of looking at them in different ways on forex?

Can't really be categoric Nico, I just follow trends. I'm sure you can use candlestick pattern based strategies in forex, its just that they won;t work quite as well as the textbooks say they will. you might find your own ways of adapting them which could be simple matters such as looking at a 2-day candlestick, which actually nobody does.

 

[fibo_trader]

Just wondered if experienced traders use many strategies on either one or numerous markets? Does an experienced and successful trader have, for example, 15 tested and solid strategies that they utilise on one or more markets? I'm assuming that people will say it's possible to make profits with just one solid strategy ..... I'm thinking of learning one strategy and understanding it and testing it fully, just wondering if its common long term to master a few different strategies, thereby giving myself maximum opportunity to get involved with trades when I spot criteria for different strategies occurring?
It brings me onto the second part of my question; I've heard that Forex has lower costs than other markets (?), therefore I was planning to start learning fx. I would plan to start with a small bank as I'm a peasant (1+ year paper trading then £1000 real money, add £50+ month from wages, see how that goes for a year or few before thinking of getting more capital involved).
Is it possible to use the same strategies on fx & stocks? and would there be much more costs involved for sometimes using my strategies on stocks as well as fx? I appreciate that mastering one market (fx) at a time is probably wise?
Any help will be greatly received!

I like the way you think. You're on the right track. These things take time to sort out. The 15+ strategies are just a way the dedicated traders keep their learning alive and progressive. But in the heat of the battle the leopard delivers a solid bite to the neck in one go. Nothing tops that. Same thing in Human Life - spot the opportunity, take the swing go for the jugular.

Forex is the way to go. Start with EurUsd. Stick with this for a couple years and make a load of profits. Then you can come back here and show off how you now have 30+ currency pairs you are trading and your attention is so split up that you have lost 4 accounts and can't pay your rent. Then you will get smacked on the face by me and bugger off to trade only the Euro and the money starts pouring in again.

Yes, same strategy on forex, stocks, commodities, indexes, wives.

 

[Nico667]

Thanks fibo_trader ... I think I saw the wisdom in your post? Stick to one market and master it/learn to profit from it? Seems reasonable and safe in the complex world of trading for a newbie to stick to one strategy and one market. Do other traders here agree or would one strategy and a few fx pairs be more beneficial for trying to find all the criteria that I need to execute my strategy?
I'm thinking from a technical analysis point of view that a few pairs would give me more opportunities to find situations where my strategy could be used. Then again, maybe better to stick to one market and hone down on my fundamental analysis of that market and how it fluctuates?

 

[fibo_trader]

Thanks fibo_trader ... I think I saw the wisdom in your post? Stick to one market and master it/learn to profit from it? Seems reasonable and safe in the complex world of trading for a newbie to stick to one strategy and one market. Do other traders here agree or would one strategy and a few fx pairs be more beneficial for trying to find all the criteria that I need to execute my strategy?
I'm thinking from a technical analysis point of view that a few pairs would give me more opportunities to find situations where my strategy could be used. Then again, maybe better to stick to one market and hone down on my fundamental analysis of that market and how it fluctuates?

Let me explain it better than I did the first time.

Start with Forex, stick to EurUsd. No change here. Formulate and modify your strategies here with just this one pair for months and months, all the while getting better and better and perhaps making good money too. Then when you feel you are good at it, you can use this technique below ........................

when you see EurUsd going into a sideways trend on the daily timeframe (this usually happens after a loooong trending move) do a scan of several other currency pairs to see which has an extant trend or a new trend, Long or Short. Pick the one with the clearest, cleanest looking trend and go there and trade it while you are waiting for the EurUsd to sort out its consolidation.

You always always always want to trade with the trend = go with the river = why fight against the river = why do what all T2W traders do which is for example, in a galloping downtrend, they will not go Short but instead wait for each Bear market rally and enter Long for a few minutes or hours. Dumb! Dumb! They all do it this way. Do NOT get cott up in this stupidity. It will kill your trading career right at the starting gate.

Good luck