Question about the MTPredictor program

[davn]

Hi, first of all, let me apologise if this post happens to be in the wrong thread, I just don't know where it should go.

I'm trading in the Forex market, and only forex. A search in this forum brings up less than 10 threads with forex in it. I'm wondering if the MTPredictor works well for forex? I can't find any review on the net about forex traders using MTPredictor and is taking money out of the markets on a constant basis. With very little information about success with forex, I just can't commit my money into leasing the software and sign up with any of the affilated vendor for data streaming.

Steve, I'm impressed with your results with MTP in the few currency pairs that you traded, I know that you're not into forex, is there any site out there or any person that you know that is using MTP and is trading in the currency market that could provide more information about success and drawdowns?

Appreciate your attention in this and good trades ahead!

[Matt Bowen]

Hi Davn,

No apologies necessary...We probably should add a "General Questions" topic to the Bulletin board so let me say thanks for the heads up.

I get asked this question all the time...and the answer from me is only one view, so talk to as many people as you can (that trade or have traded Forex in the past). I have no problem with the Forex markets or the participants (traders)...what I have a SERIOUS problem with is how the game is setup to trade the Forex markets... Let me explain:


What I find is that many or most new traders are drawn to this market for the incredibly low margins of 100 to 1...
Clients must have approximately 1% of the value of the positions they hold in their account for each lot of currency being traded (approximately 100:1 leverage). This equates to $1000 per lot (100,000 units), all trades are executed in standard sizes of 100,000 base currency per one lot.

So far, so good... Where the problem starts with trading Forex is the business side of things (Yes, trading is a business and you MUST look at it that way...I'll show you why in a minute).

First lets look at the REAL cost of doing business in this market. I went to one of the Largest Forex broker web pages and pulled these commissions...Whoops did I say commissions, well let me take take back because you Forex traders most certainly do not pay commissions on any trades. That's right, NO COMMISSIONS on FOREX.

You Forex guys get to play another game called "PIP" spread and this my friends is where the problem starts. In Fact, you a better off day-trading Currency Futures rather than Forex:

Currency futures are the futures equivalent of Forex, which is a cash market. The big difference is that you can trade currency futures for under $10 whereas Forex you will pay $30. for a 3 pip spread (If your pip spread is 5 then you $50.) See the chart below to show you the average pip spread on each currency pair

As for a new trader with a small account the typical spread is 5 pips(3 for large account) While you are not paying commissions you most certainly are paying the spread. The spread is the difference between the bid and the ask price. The firm (broker) quoting the spread makes money based on the size of that spread. Remember, if a pip is $10. and your spread is 5 pips, that's $50. commission...Oh, I forgot..there is no commission in Forex...Trust me, nothing is FREE. It's a lot cheaper to trade the Currency Futures...but you're never going to hear that from a Forex broker.

People ask me all the time...why do you trade E-mini S&P's vs. trading Forex. It's real simple: Because it's a lot cheaper and the spreads are smallest of ANY market out there.

I think Forex is fine for LONG-TERM trading (Daily or Weekly) bars because you can absorb the cost of doing business, but to Day-Trade this market...No way, the cost of business is too high and if your a scalper...Good luck!!!

Let me Explain:

If I trade 5 contracts on the E-mini S&P 500 futures my cost is $25.00 ($5.00 per round-turn per contract) X 5 contracts = $25.00.

If I trade 5 GBP / USD Currency Pair my cost is $250.00 ( 5 pips X $10.00 per pip =$50.00) X 5 contracts = $250.00

I can trade Stocks for $10.00 round-trip (but I only have 50% margin).
(I'll bet it was never explained this way, was it?)

Now we have a couple of other minor issues that need to be addressed:

Currency futures are traded at a regulated exchange. Forex is unregulated and traded either through a broker or a bank. Think about this for a second...let's suppose you get a bad fill or you get a price quote that's way out of line with what the trading activity report on time and sales... When you are trading Currency Futures you can go to the exchange and file an arbitration report...they then review the trade in front of board of directors and adjust the problem accordingly. Now, if you have a problem with your Bad fill, bad tick, bad price who are you going to go see to get this adjusted...the Bank? the Broker? Try telling a broker they are wrong on the price and you want an adjustment (meaning they need to eat this trade) and see what happens...ha ha!!!

In currency futures there is no such thing as a "guaranteed fill" With Forex you see "guaranteed fill" advertised all over the place. But this is not good thing. It means the broker is taking the other side of your trade rather than some other trader.

Currency futures gives you true price, Forex does not. Forex prices can be and are manipulated by the broker

Now, as you can see I'm not real big on the Forex market for Day Trading (the odds are stacked against you), if you want to trade the Forex from a Daily or Weekly chart... which is what most Hedge Funds do, then I think it is a good market to trade.

Again, this is my personal view... Ultimately, it's like buying a software program...you can talk about it for weeks, but in order to truly know if it works...you have to try it. Look at it like a trade: What is my risk to try the MTPredictor program $250. Now, what is my Reward: You might pay for the software in three weeks and then you would have ZERO risk.

Best regards,

[davn]

Matt,

Thanks for the reply. All I can say is, your post does not answer the question that I asked. :p

Not everyone eats from the same plate, and one man's meat, could be poison to the other. Granted that the application of TAs, risk and trade managment are about the same in any markets, I just don't trade equities, futures or commodities as much as you don't trade forex.

The way forex brokers maket their services is what I guess, "marketing ploy" in that they don't take commissions, but the trader pay pips difference to interbank rates the brokerages get, think about it for a moment, the reason why we're all traders is because we're hoping to be able to take money out of the markets on a regular basis, paying the extra 1 or 2 pips to the brokerage for their "services" rendered is justifiable IMO, as long as we're able to walk away with our profits at the end of the day.

Ultimately, it's like buying a software program...you can talk about it for weeks, but in order to truly know if it works...you have to try it. Look at it like a trade: What is my risk to try the MTPredictor program $250. Now, what is my Reward: You might pay for the software in three weeks and then you would have ZERO risk. This best sums it up. Thanks. :)

[Steve Griffiths]

Hi Davin,

A good question. The $250 covers the ongoing education for the 60-day trail peroid, this covers my daily report plus two free Seminars. This is far more education that is very oftern given in a 1 day seminar costing much more than $250.

I agree that my main RT trading is on the e-minis (ES, Ym, NQ and AB) manily beacuse of the many tradabale opportunties these marets give us. There are far too many examples to unclude all of them here in this forum.

But, as with all trading, there are opportunities on all markets and all time frames, for example here is a great TS3 short on a 60min CHF (Swiss Franc)Forex chart from today.

I hope this helps ?

Steve

[Steve Griffiths]

Hi,

This is why I like the minis, as you can see from the chart below, a perfect TS3 buy set-up that rallied off the trigger point perfectly only stoping at the the first projected profit target. And all for a return of 5x the initial risk (ignoring slippage and commission).

Perfect............

Thanks

Steve