Account still disabled. Can’t day trade. Still waiting for FXLQ’s phone call. I will keep you informed regarding the status of this new adventure.

You know the story of David and Goliath, right? If you don’t, Google it! Today reminds me of that story. Let me explain…

Everything started well. Profits were good, the sun was shinning, the sky was clear, and then…without warning…Goliath reared its ugly head. The account was disabled!

Yes; after 10 AM New York time, WHAMMO! See the screenshot from the trader’s computer (in a new window).

Why do these things happen when I’m out of town?

I spoke to someone at FXLQ and was told that one of the “counterparties” (banks) complained about our style of trading: quick in – quick out (a.ka., “scalping”). FXLQ said that they could not jeopardize their relationship with their counterparties and that’s why the account was halted.

As I was being told this on the phone, I wondered, “What; are we making too much money?” Freaking, greedy banks!

I was totally shocked by the entire ordeal. We made FXLQ aware of our “need for speed,” from day 1 and no one had a problem with it. Even with all the limitations we have had and problems we have encountered, we are still generating pretty good trading volume – something that should make banks and brokers happy.

I requested to speak to the top guy at FXLQ to see what they want to do going forward. He’s supposed to call me back.

I know this is not good news, but just in case we can’t day trade anymore at FXLQ, our programmer should finish a customized order entry application that works with Currenex in a few weeks. I will keep you informed about this.

This is why it is important to diversify across different firms. We have something good going and there will always be resistance. We can’t let that stop us though – and need to keep pressing forward. I believe there is a much higher power behind our efforts.

I thank you for your prayers and support during difficult times like these.

Considering the myriad of rejected trades with the still-unexplainable “off quotes” message, today was a pretty good day for scalping. The great majority of trades were winners. The rest of the week should be pretty active as well, since Wednesday, Thursday, and Friday all have their share of potentially market moving economic releases and Bernanke speeches. Can’t wait. This day trading stuff is addictive!

Even though all trades were positive today, the MetaTrader (MT4) trading platform started crashing. (Click here to see a snapshot from the trader’s computer).

A few customers confirmed this on their end as well, while trying to view their accounts. We are still getting rejected trades with the “off quotes” message. FXLQ is still working on this issue. Sometimes it seems as if a “dark force” keeps trying to hold us back. Thank God there’s a higher force on our side!

A day like today comes around once or twice a year. There were plenty of scalping opportunities today as the US Dollar got progressively hammered due to a widespread fear of a continually weakening US economy.

Did we take full advantage of this “textbook” trading day in the forex market? Not quite…

Today’s results were positive and pretty good to the casual observer – but the trader was only able to get around three trades executed due to more problems. What problems?

While long on a winning 35-lot EUR/USD trade he entered at 8:31 AM London Time, the trader tried to buy another 35 lots during the up move. Result?

“Trade Context Busy” message!

After that time, the trader was locked out of the market for hours and wasn’t able to day trade until the market was practically dead. Need I say more?

Click here to see today’s log (in a new window).

FXLQ did not know why the “Trade Context Busy” message came up. We don’t know either. It is being “looked into.”

FXLQ did confirm today that the “off quotes” messages we have been getting come up when the system “times out” and the “requote” message when the prices move outside of the maximum deviation number (which is supposed to be 2 pips). They also said that their programmers are looking into the “timeout” or “off quotes” situation (“off quotes” rejections are our biggest problem right now).

Why is the system “timing out” you ask? Who knows; but one thing is clear – we are all losing out on a great opportunity as a result of these problems because,

• We are trading less than 20% of the times we should be trading.
• Our trade size is around a third of what it should be based on the client assets we have.
• We have restricted additional funding from existing clients.
• We have basically stopped opening new accounts months ago.

As a result, I continue to explore alternatives to day trade our money (now more aggressively than ever). Today I contacted a new programmer to come up with a customized order-entry solution for our trader. The previous programmer was taking too long. I’ll let everyone know when this new solution is ready.

The trading day began with a failed attempt to buy 35 lots of GBP/USD at 1.9057 at 10:49:48 GMT – a relative quiet period for the pound as the chart during that time showed. Why the “off quotes” rejection? I don’t know. Someday, someone from the other side might be able to explain it to us. See the log covering November 21/22 (in a new window)

A 12:00:10 attempt to open a 35-lot position on USDCAD by selling into weakness was also unsuccessful – only this time it took the rejection 10 seconds to materialize! See the log snapshot below:

12:00:10 ’1002′: instant order sell 35.00 USDCAD at 1.1431 sl: 0.0000 tp: 0.0000
12:00:10 ’1002′: request was accepted by server
12:00:10 ’1002′: request in process
12:00:20 ’1002′: order sell 35.00 USDCAD opening at 1.1431 sl: 0.0000 tp: 0.0000 failed [Off quotes]

While waiting for the rejection, the Dollar-Cad proceeded its descent to 1.1420 before dropping even further. Don’t you love when that happens? Overall, the day was positive – even though the only losing scalping trade could have been cut in half if the trader wouldn’t have been rejected a few times while trying to get out before the stop was hit. See the log and notice the “off quotes” starting at 13:38:11 while the trader was trying to sell the 35 lots of EURUSD. You can’t win them all, right?

There is also one “requote” message on today’s log. See below:

14:44:54 ’1002′: instant order buy 35.00 EURUSD at 1.2923 sl: 0.0000 tp: 0.0000 (order placed at 14:44:54 when price was 1.2923)
14:44:54 ’1002′: request was accepted by server
14:44:54 ’1002′: requote 1.2924 / 1.2924 for open buy 35.00 EURUSD at 1.2923 sl: 0.0000 tp: 0.0000 (order requoted at 1.2924 – less than the 2-pip deviation setting away. Why?)

It’s a mystery why the above “requote” took place on MT4. The trader should have been filled at 1.2924! Why wasn’t he? Was there less than 35 lots at the other end? This is one reason why we haven’t increased from the 35-lot level.

Tomorrow and Friday are likely to be very quiet due to the Thanksgiving Holiday (tomorrow) in the States. Probably not a good time to day trade. Tomorrow [Thursday] FXLQ will shut down their servers from 8:00 AM EST to 8:00 PM EST – so we couldn’t trade even if we wanted to.

Happy Thanksgiving to you all!

The Forex market was relatively slow today. Just three round trip trades generated. This inactivity is expected, as the United States takes their mind away from trading and focuses on eating some turkey! Final result: a losing day. Yes! Whoopee!

Analyzing the log reveals one instant where a profitable trade could not be closed (“off quotes’) and eventually had to be closed at a loss. Stop loss placement delays still abound. Still waiting for FXLQ to do something about these issues.

To see today’s trading log, click here (opens in a new window)

NOTE: Please note that this log is a combination of 11/21/06′s and 11/22/06′s trades, since the trading computer was not shut down on 11/21/06 and, as a result, did not generate two separate log files for each day. The last entry on the 11/21 log occurred at 15:29:44. Right after that, the next log (11/22) starts at 03:47:15 GMT.

Today we missed excellent day trading opportunities. We should have had an excellent day based on the way the major currencies were moving, but as it turns out, we’re only going to have an OK day after our forex broker, FXLQ, “fixes” two bad trades that were caused by “problems” at their end. Let me explain…

Fridays are turning out to be problematic. For three straight Fridays we have had weird problems that have resulted in losses. It all started on 11/03/06 when the price froze for around two minutes and the trader was “stuck” in a trade that he couldn’t exit. FXLQ reversed the loss resulting from this trade.

Today we experienced problems that qualify as “Twilight Zone” material. When the price of the EURUSD started approaching the double-00 level of 1.2800 on the upside, buying pressure started taking over. Our trader latched on at 1.2800 for a beautiful entry. When he tried closing the trade at a profit a brief moment later, the execution price was 1.2782! What?!?!?

Yes, folks. You heard right – a price that didn’t exist. Freaky, isn’t it? If this wasn’t weird enough, it happened once more while he was trying to exit at a profit of over $1000 after having bought EURUSD at 1.2825. If you were following the action in your account tick-by-tick, you know what I’m talking about: the 35-lot EURUSD trades (yes, we’re still stuck at 35 lots, but who can blame us!) that were initiated at 14:50 London time (9:50 AM EST) and 15:05 London time.

Even though later on during the day FXLQ agreed to reverse the trades (since they should have been profitable), I am still upset about the opportunities we lost. Many more trades should have been placed and we should have had a much better day. Just imagine what these back-to-back episodes do to a trader’s nerves and confidence! Oh, well. Monday will be a new day with more opportunities and, hopefully, less problems! The wonders of day trading! Bring out the Prozac!

Click here for the screen shot of today’s problem trades (in a new window).

Today was a very good day to day trade the forex market. The FXLQ server we are on went down for around half an hour early this morning – close to 5 AM EST. I notified FXLQ and it was quickly restored. Don’t know why it happened.

I spoke to Brian from FXLQ this morning regarding the execution delays and rejection delays that we have been experiencing – lasting over a minute sometimes. He told me that last night FXLQ’s programmers “upgraded the server to reprioritize the order processing so the PAMM allocation is on the top of the list of actions to perform.” Whatever that means, it sure sounds good! My guess is that it won’t eliminate all of the issues we are experiencing, but it might definitely improve things.

When I looked at today’s day trading log, things have definitely improved – even though all of the problems haven’t been eliminated. It seems that when we do get an execution, it is reported relatively fast.

I think that the initial requotes today (see log below) around 09:30 AM UK time are justified because the price seemed to be moving past the 2-pip maximum deviation setting rather quickly on MT4 after the Eur Retail Sales numbers were released. This leads me to believe that the “requote” message is the one that should be coming up when the price moves past the maximum deviation setting (I still don’t have a firm confirmation from FXLQ on this). At the same time, the first rejected EURUSD order below at 13:30:13 London time generated an “off quotes” message – Why? Why wasn’t a “requote” message generated instead? Who knows. I guess we’ll find out as we move forward.

So I summarize problem #1: Why do we get “requotes” sometimes and “off quotes” some other times? What EXACT condition or conditions result in the generation of each message? The “Unsolved Mysteries” show comes to mind as I think about this.

Problem #2 is also evident from the “off quotes” example above: it still takes 10 seconds or more for “off quotes” messages to come up. Why? Why aren’t the messages instant like “requotes?” All rejections of entry orders took 10 to 15 seconds to come back with the “off quotes” message. This is not acceptable.

Problem #3: Execution delays when closing some positions. It took 4 seconds to close one trade and 10 seconds to close another one. This is an eternity in a fast market and unacceptable for scalping.

Click here for the trade log (in a new window).

Most scalps positive on 35-lot day trades of EURUSD. Still experiencing same type of execution problems. For example, the trader experienced many trade rejections in a row with the “off quotes” message – especially when trying to close out a position, even though the price had not moved by more than 2-pips [the maximum deviation setting] by the time the order reached its destination. Click here to see the actual trade log (in a new window).

Another problem is that the stop orders take from a few seconds to over 10 seconds to get activated after a position is opened. Until FXLQ solves the problem with the trade delays and constant (“off quotes”) rejections when getting out of a position, it is not a wise idea to increase the size of the trades too much.