Hello Traders it’s a Samurai Trader here welcome
to this video day trading the currency futures markets not a day goes past that
I don’t receive an email or a call from a member that asks me about the major
differences or the differences between trading currency futures markets and the
spot FX market itself you just wanted to run through a couple of differences
we’ll also look at some charts and some setups and a couple of recommendations
on perhaps the best way to trade the currency futures markets now as we get
underway as always we do need to put up the understanding the risk disclaimer if
you haven’t read one of my disclaimers for a period of time please pause the
video and read the disclaimer there is of course a risk in trading also if you
haven’t subscribed to my channel or perhaps you’ve just googled or gone on
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channel and you’ll be kept up to date I’ve got over 300 public videos
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and request my free the day trading ebook the truth about day trading let me
get this right and I should have mentioned traders as always with my
videos always real real and unedited I don’t run to a script your laugh
forgive me if I fluff up anywhere and of course I’ve got another free training
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Standard where I teach traders how to trade my setups in a live market so
let’s get into this so let’s get straight to it here we go so first of
all a couple of things I want to point out on my website so this is are not
only for the general public but some members I need to show my members a
couple of things which are very very important here
first of all I do have a cheat sheet and this is part of it now you’ll see here
on the cheat sheet we’ve got there the where is it here the currencies now
there are some changes for an example of euro FX there on the cheat sheet that
I’ve got and let me show you where it is by the way so just simply go to the the
file the folder cheech’s and you’ll see it there so it’s in the folder cheat
sheets a couple of other things while we’re here i’ma show you I am going to
be talking about the rule of two I love the rule of two on range charts
particularly on the forex markets and you will find a downloadable copy of the
PowerPoint on the rule of two and this is just taking a little time to load
here on their very comprehensive when it is taking its time here we are
PowerPoint on trading the rule of two so this is very very important for members
that you go to that folder which is strategy powerpoints and I think we have
one more I want to refer to and that is nowhere is it here new member downloads
now in new member downloads I’ve uploaded a new video a new set of videos
I should say or a copy of recording so this is kindly a lot of work was put
into this by one of our members and what they did was they went through all of my
videos and as I mentioned is well over three hundred and if you look at that
masterless which you can download there’s a master of all the videos but
then the ones with strategies General youtube’s webinars live trading day
trading Q&A CL NQ ES YM and FOREX so you’ll find now all of my videos and as you
know there’s hundreds of them now in a easy reference spreadsheet and sorry there
is one more thing I did have to refer to and that is there is under where is it
which file is it in under cheat sheets here we are trading strategies here we
are under the section trading strategies now for new members specifically should
be coming to this for all the videos here so if you’re not a member
please hold will be here end of the strategies in a moment there is all the
links here are available so you can go there but there is also an upload there
on the rule of two the video on the rule of two because I’m going to be
mentioning the rule of two so there is the video so I just wanted to point that
out now back to the general slide here okay so in the currency’s please note
the euro FX and the yen for an example showing 12:50 that’s now been halved to
25 per tick so there are some changes so all of these here except for the US
dollar index are all futures contracts put out and managed by the CMA and
that’s a very very important as we’re going to discuss and let me quickly
let’s just go back so don’t want to distract you from moment I just want to
point out some major differences so first of all what are the differences so if
you look at the the spot FX market the liquidity of that is over five trillion
a day where the combined futures markets is less than 30 billion dollars a day so
if we look at the forex market it’s a 24 hour a day five day a week market where
the futures contracts market for futures contracts some as managed by the CME
it’s a twenty three point five hour day another big thing here is that the most
brokers will tell you that I don’t have a commission that is I don’t charge a
commission instead they take a best bidder I’ve done best offer bid and best
offer from there into bank counterparts then I add a couple of pips however
that’s where it’s really important you understand this is that when you’re
trading futures contracts but you are basically across the board now you’ll
pay well under five dollars in commissions and down as low as about
three dollars fifty round turn where if you’re trading a standard lot and a
standard lot for most standard lot sites around say ten dollars a tick and your
commissions are going to be anywhere or the spreads going to be anywhere between
two and three ticks now that is twenty to thirty dollars and in a lot of work
we’ve done what we’ve shown is that on average
you’re paying 16% if you’re a scalper 16 percent of your revenues are going
commissions where it’s less than 4% if you’re a scalper on standard trading
futures contracts so there’s a massive difference that you need to look at but
there’s also some disadvantages for an example internationally you can go up to
leverage up to around 200 to one but there’s of course a maximum rule of 2%
risk which will look at the slide in a moment you also if you’re trading Forex
you can start off with under $1,000 where as we’re about to see if you’re
trading a futures contract you really need to have three and a half to four
thousand dollars so there’s no denying trading futures currency futures is more
expensive especially well really only in the terms of initial capital required
there’s another major point here and this is getting better but there is a
major point that is what we call market integrity the CMA is regulated by the US
government and this ETF sorry the CFTC so the integrity and openness openness a
critical elements of the CME markets we’ve seen massive issues with brokers
running stops you know all sorts of skullduggery and things happening now
it’s becoming more transparent the regulators have been coming down on the
forex brokers we’ve seen of course that fxcm recently lost their license for
revealing in the US market the US market and the Australian market are two of the
most regulated and even the UK is really catching up now the most regulated
markets in the world so it’s really important that you open your accounts
with brokers really in the UK the USA all down under with ethic regulator
brokers that is very very important so it’s just some major differences I
really wanted to put up now you also really want to be dealing with a broker
of it’s a pure easy and straight through processing that is very very important
because if you’re dealing with a broker was straight through processing then of
course it’s a non dearly this broker or at least if you’re
dealing with a standard lot so this is very very important
I really should bring this up and let me show you this straight away so what I
want to show you here is in a lot of traders are unaware of how this actually
works if you’re dealing with a Forex broker they have what they call the a
book and the B book now the e book sorry the B book is for all the traders that
are dealing with either micro or mini Lots because they kind of put them
through to the bank sort through to a prime broker and the reason being is
because you’re looking at ten cents and a dollar a pip they’ve got to go through
in blocks so what be or what most brokers will do
they will manage and take the risk of all of their clients that are trading
mini and micro lots why because the majority lose their money
that’s quite frankly why so they run this B book so if you’re trading
standard Lots so with a standard lot they will then put it through to our
prime broker straight through to enter liquidity providers that’s very very
important to understand that because it comes down to openness and fairness
because when you’re dealing with a CMA dealing with the CMA you’re dealing with
straight through processing you’re dealing straight with the broker itself
there’s faith they can’t run stops etc it’s so most it really truly is the most
theorists market in the world so I know I might have gone on a little bit about
that but it’s just very very important that you fully understand that so back
to this so before we look at the charts a few important things here is that if
we look at the liquidity wise and today is Monday the 21st of August 2017 so
let’s just go back to last Friday so Friday itself we saw the volume on the
euro currency futures contracts 163,000 in the twenty three and a half hours on
the yen there was two hundred and thirteen thousand contracts now as a
comparison to say the ES it was two million one hundred and eighty one
thousand contracts traded the NQ 442 thousand
Gold 379 thousand and CL the black gold 719,000 so it’s right at the lower end
however one hundred and sixty three to two hundred and thirteen thousand
contracts is still a healthy range okay and if you’re trading one to ten lots
you might get one or two ticks lipids or pips whatever you want to call it when
you’re trading the currency futures but it’s minimal and so it’s a great market
now also if you’re say based in be let’s say New York the market opens Sunday
evening and you get home from work so it’s 7 p.m. 8 p.m. you’re able to do
some trading of an evening because that’s the peak time that you’re going
to see a lot of these markets trading so so if you’re on the west coast you get
home from work at 5:00 p.m. you can be day trading when you get home sis’s
there’s some really good advantages for consideration of these markets
besides that as we’re about to see that you get some fantastic trends so they
train really well so on tradestation the ticker code is easy and for the euro the
yen is jy on the let’s see what is it ninja trader sorry 6e and 6j now let’s
talk about account sizes and this is we’re dealing directly with a spot
market has a major advantage over currency futures because you really need
to have at least three and a half thousand dollars to stay within the two
percent maximum rule because let’s look at it this way so if you’ll trade in a
four range which we’ll look at in a moment and you get a ten tick ticks stop
that’s sixty two dollars fifty put on let’s say five dollars commission say
you get us a ticks lipid you’ll risk is seventy dollars so two percent of that
unit require two a sorry a three and a half thousand dollar account this is
very very important and trade has been under capitalized and I have thousands
of members around the world now but I deal with is that it’s one of the most
common mistakes it’s very very important so what if you only have a thousand
dollars our Forex and build your account then
move to futures because the Commission’s are much much lower
it is a fairer market and is a whole lot of other reasons so get in with maybe a
thousand with five hundred and yes you’re not going to make much money only
making 20 40 50 pips a day however it’s a great learning experience for a great
spot to actually start with so what sort of chart times do I like in trading the
currency futures well of course you’ve got time based charts well hands down
you want to go for tick or range hands down and I won’t go into why in this
video but really ticking ranges we’re going to look at both in a moment you
got Renko you’ve got you know lots of other types of charts but I really like
the tick and range now what about stops on a four range and
I love the full range on the Euro futures and also on the yen and my
target is a minimum of 12 plus ticks okay so you’re looking at 60 to 50 on
average now I’ve already mentioned here the cheat sheet where you can look up
the different types of currency contracts that are offered by the CMA
and so a couple of these as slightly updated as I mentioned they roll over a
recorder so anyway members you can go to the downloads of sorry the cheat sheets
and you’ll be able to download this and it’s a lot more extensive is more than
that are on this sheet that I’ve just shown you here I’ve already explained
them a couple of major issues there are a couple of things on the Forex what
else we got here okay now we’re about to look at the charts and at just one point
I really wanted to make here we need to know for Bulls or Bears are in control
and we do this with our EMA’s now for the newark traders watching my video yes
we will use indicators indicators or tools of course indicators virtually
every indicator is a derivative of price which means they’re lagging now you can
trade pure price action for an example of fuel trading what we call the two two
over t25 which is a two to five counter retracement the old floor trader
strategy that is pure price action you don’t have to refer to the indicators
you’ll see at the bottom of my that they can be very useful with some
of our strategies now what is critical to me the absolutely critical ones are
our EMAS because that’s going to tell us whether
the Bulls or bears are in control or whether they’re all in neutral and what
direction we should be trading so let’s now go and have a look at the charts so
I’m going to give you a couple of options here and a couple of concerns a
couple of things for you to really think about now really should have mentioned
to really have a notebook handy because some of the important things I’m about
to cover you might like to actually jot down there first of all it is 5:52 p.m.
in my part of the world now so the market opened up by what time was that
this morning it was at 9 a.m. Australian time so it’s um now 5:52 as I mentioned
p.m. so if we looked up as a slight gap down now what we’re looking at here
sorry is an 89 tick this is the yen we’re looking at this is the yen so
we’re looking at an 89 tick now if we look at then the price action across
the day there’s been lots of great trends and this is what we’re really
after is traders I’m a momentum trader I want to see a trading range so of course
I’ll refer to my anchor chart to confirm this but this is what we call the sweet
spot trading this is where you make all your days profits just in it one of
these moves now just as a general guide by the way just under 40,000 contracts
have traded since this morning so it’s been plenty of volume for a one to ten
khat contract trader plenty of volume during that time and so what we’ve seen
with the 89 tick we’ve seen at t33 we’ve seen some nice divergence trades we’ve
seen an 89B you see in a nice t7 a nice double bottom a classic double bottom
with divergence you’ve got let’s see 200 bounce now this is the area you want to
stay at it and just start for for non-members these are the areas that we
really want to be cautious of when we see all of our EMA is converging we want
to stay out of these areas and wait for a breakout now one of the ways we can do
that of course is looking for a fractal break whoops it’s not plotting now I
won’t worry about that right now we’re looking generally for a fractal
breakout and there are lots of there’s lots of training on that we’ve got here
our classic 34b 34b classic divergence trading again nice t3 so just
lots of great trading opportunities during this time and just for the trend
traders and into your consistently profitable stick with trading with the
trend there’s just plenty of trades now what I do want to show you now is the
range chart so this is the open so we are looking at a full range here I
really like the full range charts particularly during faster moving
markets so we can see er it’s been very slow in comparison to the 89 you know if
it’s too slow and you want to smoother chart drop it down to maybe a 2 or 3
range chart but for a sort of optimum I tend to find but what I do love traders
and this is specifically for members is we’re rule of 2 on range charts here is
you’ve got a rule of 2 here you’ve got a rule of 2 while we’re in congestion
actually here so we probably would have taken that but here you’ve got a rule of
two you’ve got a rule of two you’ve got a rule of two again you had a rule of
two it be open so there’s lots of really good rule of two so remember there’s a
recording there there’s a very comprehensive PowerPoint and I’ve done a
lot of training for members on the rule of two so this is our full range and it
works really well now this is during the Globex session now during the main
market hours you can see here at trends or these markets trend really well so
once again this is a full range so these are just some great moves even though
you don’t have massive liquidity this plenty for the 1 to 10 contract traders
less they’re going to have a look at the Euro so what we’re looking at here with
the euro and let me just change this one I’ll change it in a moment so this is
the market open once again here so there hasn’t been a lot of price action on the
full range thus far we’ll really see this pick up as we head into on the
london session which is in another 5 minutes we’ll start to see the liquidity
pick up as a London market opens but during the normal
London and New York hours there’s plenty of volume this is what we really want
there are a couple of things that I’m really looking at you know really to
prove a market up every market has its own personality and this is where it’s
very very important that you spend the time is just don’t go by what I
recommend but have a look at the market yourself because every markets got its
own personality and you need to make sure the market suits your personality
so first of all you know is that market readable you want to mark if it’s not
too wild some of the pears before XPS can really move and go crazy so you just
want to look at the different markets so it suits your personality do you have a
healthy daily volume well of course on the yen and the euro here with the
currency futures have got plenty of volume do they train really well
absolutely you’ve got some great trends basically every day and the next thing
is do my patterns appear do your setups I’m a patent trader traders I mainly I’m
a momentum trader yes I’ll take CT trades counter trend trades with trend
trades but they’re all patent based and basically that makes my trading 99 or
actually that’s not true 95% mechanical there’s still some things such as are we
in a congestion zone and things like that you do need to consider that comes
down to discretion or the skillset of a trader but there are skills that you can
learn but let’s quickly now look at this is a 7 range that I use for mine but
let’s just go and have a look at a tick now the chart I like on the euro
currency I like an 89 tick so if we go and have a look at the 80 90 ignore
these I’m where you can see there but once it let me just put my super scalper
on their race super score bar which is just another limited we have alright so
we can see here since the market opened up let’s just go to the market open
today all right congestion do I get a few
scalps there but you can see here that what you had was what a descending
triangle very very so you know with the descending training triangle you get
other really that’s coiling the pressures building you’re going to get a
breakout we actually had one serve alongside there then you had a lower
hi you’ve got then your 89 you got your 89 you then had your 34 let me just pull
this over for you you had day 34 sorry 189 34 34 34 had an
89 so basically just with the trend trades you would have actually if you’re
targeting two to three hundred dollars per contract you would have wrapped your
trading up just in this trend today so so for those that are early rises in the
US or those that really rises particularly in the UK in the European
market these offer some great smooth some really good moves and I feel
they’re a lot better it’s a lot better than trading the standard forex market
and what we’ll see now as the London session opens will really start to see
if a liquidity pickup will run as I mentioned now actually be is been twenty
eight thousand contracts trade today so we really start to see some a lot more
market moves and as we head in to 8:00 a.m.
onwards which is New York which is what’s at six that’s another four hours
from now 10 p.m. my time when I actually open up the training room we will really
see the volume pick up there so traders let’s just give you a very quick rundown
so it’s a fantastic market this great liquidity if you’re looking at the rule
of two really you can’t go wrong with the euro dollar and the yen it’s just
really good market so last of all as we sign off if you’re not a member or if
you haven’t subscribed to my channel first of all please do go to my website
request my ebooks for $197 you get all of my cheat sheets hundreds of videos
really I won’t go into all the benefits of a member but it’s once owned the only
upsell if you choose is to join my training room which is only $97 a month
twelve hours of live training a week incredible values so traders thank you
very much for your time and I hope you picked up a few ideas