Best intruments to short term trade: Looking at the spreads.
Howdi fearless gamblers.
Today/Tonight/Yesterday I want to post about spreads. I have spend some time calculating them, so I thought, why not share?
It does not cost me anything and it has value to you.
In what is best to short term trade, this is what you must look at (correct me if I am wrong):
- The volatility: if it does not move you are not going to get anything out of it.
- When are we open? Does it fit your time schedule?
- Your personal preference.
- The spreads: if you aim for 1% moves and 0.3% is going to the broker, you won't get very far...
Of course, this is not very important for anyone holding trades over periods of several days or weeks.
So this is what I have:
Currencies
All calculated with FXCM, it is around the same everywhere (decent).
*** USD pairs ***
--- Tier 1 ---
EURUSD => 0,010%
USDJPY => 0,010%
GBPUSD => 0,011%
--- Tier 2 ---
USDCAD => 0,017%
USDCHF => 0,017%
USDMXN => 0,017%
--- Tier 3 ---
AUDUSD => 0,023%
--- Tier no thank you ---
NZDUSD => 0,027%
USDSEK => 0,031%
--- God Tier ---
USDCNH => < 0,0075%
*** Cross pairs ***
--- Tier 2 ---
EURJPY => 0,016%
GBPJPY => 0,018%
EURCAD => 0,018%
EURNZD => 0,020%
EURAUD => 0,015%
EURCHF => 0,019%
--- Tier 3 ---
GBPAUD => 0,022%
GBPCAD => 0,022%
--- Tier no thank you ---
AUDCAD => 0,027%
GBPNZD => 0,025%
EURGBP => 0,024%
AUDJPY => 0,026%
AUDNZD => 0,032%
CHFJPY => 0,022%
GBPCHF => 0,027%
--- Tier lol dis a joke man? ---
NZDCAD => > 0,045%
The Forex moves I look at that happen in a few hours to maybe 2 days are 0.30% 0.50% 0.75% 1%. A spread of 0.03% is 10% of that 0.30% move.
Futures
--- Tier 1 ---
Gold => 0,03% Moves twice as much as FX
--- Tier 2 ---
Copper => 0,11% Moves 3 times as much as gold, 6 times FX.
Oil => 0,07% Moves a little more than gold I think? Maybe 1,5-twice as much.
--- Tier lol dis a joke man? ---
Silver => 0,30% TOO DAMN HIGH
NatGas => 0,33% Moves alot, but still too high.
Cryptocurrencies
The volatility at the time is non existant for crypto but it will change so I am looking at it anyway, for the day this changes (I get spammed with alerts every day for FX and see moves over and over and over, crypto? Something I might see 30 times a month with FX I might see once a time with crypto. Just look at the charts.)
So usually the commissions are the same for all, on Binance without BNB it is 0.1%. Crypto moves are 3% 5% 7.5% 10% etc (with bigger risk thought).
On Kraken it is going to be more or less the same as Binance, it depends on your volume. On Bittrex Polo etc it is higher (unless it changed).
If you are taker you got higher fees + a little spread.
So if it moves 10 times as much as FX (when it moves I mean), you dive 1% by 10, BUT remember you will pay it twice (go long and take profit).
So 0.2% / 10 = 0.02%
Which places Crypto between Tier 2 and Tier 3. Same as a GBP pair or Copper. Copper moves as much as Bitcoin too or almost as. Pretty much you can trade either and have the same experience minus the sideways and armies of bagholders telling you what a fool you are for not accumulating with Copper.
Indices
I do not have the values with me but alot are super low, with DAX the lowest and NASDAQ second, maybe the euro thing too.
The big indices are tier 1. UK and French ones I think are tier 1 too.
The surprise for alot of people would be that Dollar vs Yuan is the one with the lowest spread.
Every one is talking about how many pounds per pip and how many pips they take because they are obssessed with how much money they will make and really bad at math.
That is not what matters.
What matters is USDCNH has the lowest spread and is the most profitable thing to trade in the whole universe if everything else is equal.
* It depends WHEN you look at USDCNH thought...
At the time, I am fully focussed on trading FX perfectly before I move back to anything else.
I only trade the tier 1 to 3 as well of course, as the mighty USDYUAN.
So this is my watchlist and what I am trading at the moment, 16 of them:
FX:EURUSD,FX:USDJPY,FX:AUDUSD,FX:USDCAD,FX:GBPUSD,FX:USDCHF,FX:USDMXN,FX:USDCNH,FX:EURJPY,FX:GBPJPY,FX:EURCAD,FX:GBPAUD,FX:GBPCAD,FX:EURNZD,FX:EURAUD,FX:EURCHF
I really want to trade gold and copper again, but for now I am focussed on perfecting a new strategy (I already had one before but I wanted to master a new one... I cannot help it I am too competitive...).
Then I will add Futures again, and then go look at crypto, which might have stopped being unbearably pointless by then. I think we get a mighty dump in the next weeks, but that will not mean the volatility is back, just a mighty dump a sharp bounce, and then back to boredom for months or even years.
I am not interested in looking at stocks. Open a few hours a day with only the first and last hours being worth spending time on? Haha no than you!
I would rather do macro economics and trade indices. I cannot be bothered with the latest FOMO news and this mighty stock that will make idiots millionaires GUARENTEED.
Today/Tonight/Yesterday I want to post about spreads. I have spend some time calculating them, so I thought, why not share?
It does not cost me anything and it has value to you.
In what is best to short term trade, this is what you must look at (correct me if I am wrong):
- The volatility: if it does not move you are not going to get anything out of it.
- When are we open? Does it fit your time schedule?
- Your personal preference.
- The spreads: if you aim for 1% moves and 0.3% is going to the broker, you won't get very far...
Of course, this is not very important for anyone holding trades over periods of several days or weeks.
So this is what I have:
Currencies
All calculated with FXCM, it is around the same everywhere (decent).
*** USD pairs ***
--- Tier 1 ---
EURUSD => 0,010%
USDJPY => 0,010%
GBPUSD => 0,011%
--- Tier 2 ---
USDCAD => 0,017%
USDCHF => 0,017%
USDMXN => 0,017%
--- Tier 3 ---
AUDUSD => 0,023%
--- Tier no thank you ---
NZDUSD => 0,027%
USDSEK => 0,031%
--- God Tier ---
USDCNH => < 0,0075%
*** Cross pairs ***
--- Tier 2 ---
EURJPY => 0,016%
GBPJPY => 0,018%
EURCAD => 0,018%
EURNZD => 0,020%
EURAUD => 0,015%
EURCHF => 0,019%
--- Tier 3 ---
GBPAUD => 0,022%
GBPCAD => 0,022%
--- Tier no thank you ---
AUDCAD => 0,027%
GBPNZD => 0,025%
EURGBP => 0,024%
AUDJPY => 0,026%
AUDNZD => 0,032%
CHFJPY => 0,022%
GBPCHF => 0,027%
--- Tier lol dis a joke man? ---
NZDCAD => > 0,045%
The Forex moves I look at that happen in a few hours to maybe 2 days are 0.30% 0.50% 0.75% 1%. A spread of 0.03% is 10% of that 0.30% move.
Futures
--- Tier 1 ---
Gold => 0,03% Moves twice as much as FX
--- Tier 2 ---
Copper => 0,11% Moves 3 times as much as gold, 6 times FX.
Oil => 0,07% Moves a little more than gold I think? Maybe 1,5-twice as much.
--- Tier lol dis a joke man? ---
Silver => 0,30% TOO DAMN HIGH
NatGas => 0,33% Moves alot, but still too high.
Cryptocurrencies
The volatility at the time is non existant for crypto but it will change so I am looking at it anyway, for the day this changes (I get spammed with alerts every day for FX and see moves over and over and over, crypto? Something I might see 30 times a month with FX I might see once a time with crypto. Just look at the charts.)
So usually the commissions are the same for all, on Binance without BNB it is 0.1%. Crypto moves are 3% 5% 7.5% 10% etc (with bigger risk thought).
On Kraken it is going to be more or less the same as Binance, it depends on your volume. On Bittrex Polo etc it is higher (unless it changed).
If you are taker you got higher fees + a little spread.
So if it moves 10 times as much as FX (when it moves I mean), you dive 1% by 10, BUT remember you will pay it twice (go long and take profit).
So 0.2% / 10 = 0.02%
Which places Crypto between Tier 2 and Tier 3. Same as a GBP pair or Copper. Copper moves as much as Bitcoin too or almost as. Pretty much you can trade either and have the same experience minus the sideways and armies of bagholders telling you what a fool you are for not accumulating with Copper.
Indices
I do not have the values with me but alot are super low, with DAX the lowest and NASDAQ second, maybe the euro thing too.
The big indices are tier 1. UK and French ones I think are tier 1 too.
The surprise for alot of people would be that Dollar vs Yuan is the one with the lowest spread.
Every one is talking about how many pounds per pip and how many pips they take because they are obssessed with how much money they will make and really bad at math.
That is not what matters.
What matters is USDCNH has the lowest spread and is the most profitable thing to trade in the whole universe if everything else is equal.
* It depends WHEN you look at USDCNH thought...
At the time, I am fully focussed on trading FX perfectly before I move back to anything else.
I only trade the tier 1 to 3 as well of course, as the mighty USDYUAN.
So this is my watchlist and what I am trading at the moment, 16 of them:
FX:EURUSD,FX:USDJPY,FX:AUDUSD,FX:USDCAD,FX:GBPUSD,FX:USDCHF,FX:USDMXN,FX:USDCNH,FX:EURJPY,FX:GBPJPY,FX:EURCAD,FX:GBPAUD,FX:GBPCAD,FX:EURNZD,FX:EURAUD,FX:EURCHF
I really want to trade gold and copper again, but for now I am focussed on perfecting a new strategy (I already had one before but I wanted to master a new one... I cannot help it I am too competitive...).
Then I will add Futures again, and then go look at crypto, which might have stopped being unbearably pointless by then. I think we get a mighty dump in the next weeks, but that will not mean the volatility is back, just a mighty dump a sharp bounce, and then back to boredom for months or even years.
I am not interested in looking at stocks. Open a few hours a day with only the first and last hours being worth spending time on? Haha no than you!
I would rather do macro economics and trade indices. I cannot be bothered with the latest FOMO news and this mighty stock that will make idiots millionaires GUARENTEED.
Comment:
Hop and here we go. Useless Sidney session...
Tokyo opened, USDCNH down to the lowest spread of them all.
I think it is always like this except during Sidney session.
Plus the price is so volatile, opportunities all the time.
You won't find any bagholding sideways there.
ALWAYS ALWAYS ALWAYS plenty of opportunities. AWESOME
Tokyo opened, USDCNH down to the lowest spread of them all.
I think it is always like this except during Sidney session.
Plus the price is so volatile, opportunities all the time.
You won't find any bagholding sideways there.
ALWAYS ALWAYS ALWAYS plenty of opportunities. AWESOME
Comment:
Big news just got a message from my broker they are opening Bitcoin trading.
The spread is 0.7% right now.
Too high for short term trading.
If it were to get lower I would start looking for strategies and trade Bitcoin much more.
16 fx pairs + gold oil copper bitcoin futures.
This is what I would like.
But with BTC fees, only swing trading would work, and because of leverage restrictions a large portion of my capital would get locked.
Plus I did not even check rollover.
A shame. Well IF the volatility comes back, say we dump super hard again down 30% in a day like when btc dropped to 9000 or 6000 and the spread does not skyrocket or trading does not get disabled, I will definetly be trading it with real money.
Anyway, I will add btc to my view with my broker because I like following what it does.
The spread is 0.7% right now.
Too high for short term trading.
If it were to get lower I would start looking for strategies and trade Bitcoin much more.
16 fx pairs + gold oil copper bitcoin futures.
This is what I would like.
But with BTC fees, only swing trading would work, and because of leverage restrictions a large portion of my capital would get locked.
Plus I did not even check rollover.
A shame. Well IF the volatility comes back, say we dump super hard again down 30% in a day like when btc dropped to 9000 or 6000 and the spread does not skyrocket or trading does not get disabled, I will definetly be trading it with real money.
Anyway, I will add btc to my view with my broker because I like following what it does.
Comment:
If you hold a trade on Bitcoin for several weeks (since it moves so slow now) with 20% of you money, you still are able to trade FX majors with 30*0.9 = 27 leverage (since crypto has a leverage availability of 2). Even if you go 50% in on Bitcoin (this is probably too much) you can still trade FX majors with 22.5 leverage and minors + indices with 15 leverage. This is more than enough even if you have several trades at the same time (if you have enough money with your broker that is).
I made a list of what I am watching now. I am not sure about bonds, Soybeans, Oil, Copper, and Bitcoin, but all the rest won't move. I really like it this way. I feel comfortable with everything in the list except the ones I said I am not sure about.
I will keep a list of 15 to 20 whatever happens. I am interested in those.
I removed the Forex pairs that are volatile during the night, they were really pointless. Higher spreads too. I just feel better already having removed them from my watchlist.
Got 3 strategies:
1- First one I use since forever, it is based on going against the trend at the right time when there is RSI regular divergence on the daily chart. For FX and gold, maybe other commodities too, maybe BUNDS. For indices I prefer to avoid this, and Bitcoin is just too garbage to make this work.
This is all going to be intraday or intra-TwoDay.
2- A strategy I have been working on in the past month. Non stop actually, I probably spent 250 hours on that. It is a short term strategy that only works for FX. It is going to test my skill live, my experience and instinct too, we will see.
3- Going to go with the trend on indices. I see some very interesting things on the chart, and they are not that hard to predict.
I do not have to take every trade. I have only started working on this strategy.
Non gold commodities and crypto, I might swing trade using an adapted version of 1 and 3.
See, it is not that hard to have a system on paper. Of course I don't give all the details, and there is alot of simply thinking and experience that will go with it.
I made a list of what I am watching now. I am not sure about bonds, Soybeans, Oil, Copper, and Bitcoin, but all the rest won't move. I really like it this way. I feel comfortable with everything in the list except the ones I said I am not sure about.
I will keep a list of 15 to 20 whatever happens. I am interested in those.
I removed the Forex pairs that are volatile during the night, they were really pointless. Higher spreads too. I just feel better already having removed them from my watchlist.
Got 3 strategies:
1- First one I use since forever, it is based on going against the trend at the right time when there is RSI regular divergence on the daily chart. For FX and gold, maybe other commodities too, maybe BUNDS. For indices I prefer to avoid this, and Bitcoin is just too garbage to make this work.
This is all going to be intraday or intra-TwoDay.
2- A strategy I have been working on in the past month. Non stop actually, I probably spent 250 hours on that. It is a short term strategy that only works for FX. It is going to test my skill live, my experience and instinct too, we will see.
3- Going to go with the trend on indices. I see some very interesting things on the chart, and they are not that hard to predict.
I do not have to take every trade. I have only started working on this strategy.
Non gold commodities and crypto, I might swing trade using an adapted version of 1 and 3.
See, it is not that hard to have a system on paper. Of course I don't give all the details, and there is alot of simply thinking and experience that will go with it.
This is all I need in life.
ibb.co/daHDGz
2 spots left, disappointing they do not have Bitcoin.
I would have loved to see Bitcoin and Gold there.