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ZenMachine

Differences Between Markets

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Hello board!

 

I'm a total newbie who just starting learning about trading. I'm thinking to focus on the YM first and study how the market behaves and the business of trading, as the YM (from what I understand) is one of easier markets for beginning traders.

But once I get comfortable with it, I'd like to venture out to forex markets, possibly JPY/GBP or JPY/EUR.

 

Here's my question. Are futures and forex markets similar enough so leaning in one and moving to another makes sense? Or are they so different that learning in one and changeing to another is a waste of time, and I should rather start and stick in one area?

 

Thanks for your input.

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I would start in whichever market you ultimately want to trade, and then switch if you need to. No market is going to be significantly "easier" than any other if you're just starting out and don't have a specific reason for trading the YM instead of a given currency pair. You're better off getting more experience in the market you're really interested in.

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Yup... start with what you want to trade. They all have a "personality".

 

I mean, all markets are going to print up basically the same kind of patterns, but the ES for example has more backfill than say the YM or NQ because it is arbitraged with the big contract so it doesn't move as much "in a straight line" as the YM/NQ/TF sometimes due to that because its always backfilling with the big contract.

 

Likewise, the FX markets have a different personality than a lot of the emini's... They tend to get momentum going in a swing and will BLAST through prior highs or lows... where in the mini's where this still happens sometimes, its much more likely to stop run or fake you out because the pit is pushing the market through those areas to catch people...

 

Again, these examples aren't 100% all the time (or even 40%) but each market has its own personality so I say learn where you want to stay.

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...I'm a total newbie who just starting learning about trading. I'm thinking to focus on the YM first and study how the market behaves ...But once I get comfortable with it, I'd like to venture out to forex markets, possibly JPY/GBP or JPY/EUR.

 

Here's my question. Are futures and forex markets similar enough so leaning in one and moving to another makes sense? Or are they so different that learning in one and changeing to another is a waste of time, and I should rather start and stick in one area?

 

 

 

re: "I'm a total newbie who just starting learning about trading... start and stick in one area?" etc. Imo, as a total noobie, you should not yet know which instrument(s) you will ultimately end up trading. A noobie should stay open to exploration, not totally haphazardly, but still with a questioning of what fits and is energizing. Yes the 'signatures' between instruments, for example ndx's and fx, are different but exposure to many in the beginning is imo ultimately beneficial... particularily if you are keeping a eye on developing systems that are truly transferable (ie yes they are "similar enough")

Basically, do what it takes to become extremely adaptive - even if you stay with just one market you will find that its 'signature' rotates and changes too. In the beginning, be open, flitter about(with your mind not your money :) ), enjoy - you will know when it's time to settle down and start to specialize... All these comments are fairly general. You alone can determine what is best for your particular nature.

 

HTH

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One step at a time there newbie. :roll eyes:

 

Pick a market - Indexes or Forex - and then roll w/ it. The grass may look greener on the other side initially, but this business is hard enough as it is w/o trying to be a market master in multiple, different markets.

 

I personally would suggest the regulated world of the US futures contracts.

 

INDEXES: ES, YM, NQ

 

BONDS: ZB, ZN, ZF

You can't go wrong IMO with any of those. I would pick one subgroup (indexes or bonds) and then focus on that subgroup - meaning, watch the ES and NQ while trading the YM. You don't have to trade the ES or NQ, but just see how the react in comparison to the YM. The moves should be similar, but also a little different.

 

This thread is a good little thread about bonds. I'm having a field day in bonds lately and barely even look at the ES anymore. Of course this depends on your trading style, but I think too many overlook bonds in their search.

 

If you need some software, I would demo Open ECry's. It's free to customers and you can get a free trial as well. I believe the trial is 2 weeks, but if you ask nicely, you should be able to get an extension on that if needed. Data IS INCLUDED in their package. Hard to beat.

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Thanks for more inputs.

I've decided to NOT decide on one instrument, and keep an open mind. There are things I need to learn (i.e. the big picture) before deciding what I'll be trading in at this point.

Again, thanks all.

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Thanks for more inputs.

I've decided to NOT decide on one instrument, and keep an open mind. There are things I need to learn (i.e. the big picture) before deciding what I'll be trading in at this point.

Again, thanks all.

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what's the smallest amount of capital you need to trade YM?

 

I've heard to go with a big margin requirement incase the account blows up but what's a good amount to start with to just get a feel with say one contract?

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Jupiter,

 

As far as I know, the smallest amount of capital you need to (day) trade one YM is $500.

As far as is realistic, (and not being eaten up in high commissions and bank wire fees, btw :( ) real "staying power" starts around 12-15,000 USD per car.

.. very generally speaking though - your individual experience and edge may push that higher or lower... hth

 

zdo

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what's the smallest amount of capital you need to trade YM?

 

This can save you much money:

 

Start paper trading and do it until you are consistably profitable over a longer time period (if daytrading say 2 weeks in a row (that's still short), if interday trading much longer).

 

When you have found a way of becoming profitable on paper you will know EXACTLY how much downside you have to expect from your strategy. Then you can easily answer your question by yourself.

 

As long as you cannot answer the question by yourself this is a failsafe indicator that you better stay away from real money.

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