It’s a well known fact the Mrs. Watanabe’s of the
world are not a “happy bunch” of ladies; first getting shellacked in the Yen carry
trades of 10 years ago, now suffering the brunt of negative interest rates, and
now watching declining or stagnate world stock indices. Throw in consistent
losing trades in crude oil & gold into the mix, and is it any wonder they
are collectively scratching their heads in disbelief.
So, as a “public service”, Yours Truly is making the
algorithms available to anybody [even Mrs. Watanabe if she knows what’s good
for her!] with free downloads or online viewing of the various algorithms along
with important documentation. And where can Ho
Lee Sheet & Wat Dee Fuk [along with other traders worldwide] get this
financial porn? Easy Peezee; just take your eyes on a walk over to the right
hand column and go to “Download Links” and click. All the files are for free at
“box.com” and can be either viewed online or downloaded [no sign up needed;
just click and view or click and download]. And just so you know, there’s a lot
more files on the way.
Which brings me to today’s discussion; should I trade
futures or should I trade CFD’s? For my money, it’s an easy answer; CFD’s beat
futures hands down. Why? Take a look at the comparison table below of the CME
versus LMFX; 2 glaring facts stand out. 1) much more favorable margin
requirements, and 2) far greater flexibility in terms of risk management
because you can easily adjust your volume levels to fit your trading style.
In the case of gold, specifically, you can trade spot
gold in 1 Oz. increments [0.01 lots in the volume box on the MT4] with margin
of 1% per Oz., giving up approximately 1 tick to the futures market [where the
liquidity provider bank hedges] on fills. For me, if you’re losing money
because of $0.10 per Oz., you’re doing something wrong! This is a market that
consistently puts in daily ranges of $15 - $23 per Oz. [that’s 150 ticks – 230
ticks], so don’t sit there and tell me that 10 cents matters; it doesn’t.
With the SP500, you’re effective spread with
commissions [round turn] is 0.42 index points; since the futures have a minimum
spread of 0.25 [and forgetting whatever rate you pay with an FCM for
commissions], you’re paying LESS THAN 1
TICK for access to a market that is 1/5th the size of the
futures with approximately 80% less margin needed in your account.
SO, WITH THE OTHER MARKETS, DO THE MATH
MRS. WATANABE!
Our “long only” Gold PAMM [managed money] will be
ready here in the next few days; the added cost of the PAMM structure is a
major problem for money managers, and makes some markets not worth trading or
unavailable [hello stock indices & crude oil]; however, since spot gold is
considered part of FX, the added cost of trading gold inside a PAMM for all of
my clients is only $0.08 per Oz.; and that makes it the most attractive, lowest
cost, consistently volatile market traded. Details on the Gold PAMM will be
announced when it is ready; in the meantime, over in the “Download Links”
section of the website is the link to open an LMFX account, which you have to
do first anyway before you can have a PAMM account and participate. So, don’t
wait until the last minute to sign up.
One more thing: I’m putting the incentive fee back at
17% of profits to make my PAMM one of the lowest cost structures for investors
on the planet; this obviously puts a little more money into your account.
And now for commentary on today’s gold action.
Yup, Al Bundy pretty much sums everything up; sitting
here watching this crap waiting for 1) August to be over with, 2) BOE interest
rate meeting, and 3) Friday’s NFP to be released, it isn’t surprising there
isn’t much interest right now.
So, today’s action? Well, I made one trade, and I had
to wait for what seemed like a week. I mentioned in the algorithm manual, that
you have to be really careful about buying any kind of waterfall or even down
move when there is less than $13 per Oz. range; today points this out in
spades, as the M1 had several small waterfalls on the way down, which I didn’t
buy because of the small nature of the daily range. Starting at $12 per Oz.,
I’ll give it a shot, but I would much rather buy waterfalls with ranges for the
day higher than $15 per Oz. When you wait, you probability of success is much
greater than it is when the range is below $12 for the day.
Now, the chart below doesn’t really show a waterfall
to get long, but 2 factors entered my trade thoughts; 1) NFP and the BOE loom
tonight and Friday, and we have seen long stops get run for well over 2 hours
with plum being under yellow the entire time, and 2) the market coming back and
engulfing the 3 previous lows in one M1 candlestick. As the chart shows, I
didn’t make all that much on the trade [about $1.30 per Oz.], and the range is
still a paltry $12 and change with about 2 hours to go until the close. If I
was trading the PAMM, I more than likely would have skipped this trade, and
afterwards written the day off as a non event before key reports.
Have a great day everybody!
-vegas
OPEN A DEMO AND/OR LIVE ACCOUNT AT THE LMFX LINK IN
THE “DOWNLOAD LINKS” SECTION OF THE WEBSITE TITLED “OPEN TRADING ACCOUNT – DO
IT NOW!”
OUR LMFX GOLD TRADING PAMM WILL BE READY AS SOON AS
LMFX GETS THROUGH WITH UPGRADES TO ITS PAMM SOFTWARE! WE ARE VERY CLOSE; OPEN
YOUR LIVE TRADING ACCOUNT TODAY, FUND IT, AND BE READY TO PARTICIPATE!
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