Whether or not FXLQ’s new multi-bank MetaTrader (MT4) system will solve our current day trading problems remains to be seen.

This morning, FXLQ was supposed to go live with their new day trading system (at least that’s what we were told). If all goes well, we should be trading currencies tomorrow with the new setup. This is not a sure thing yet; nor is it certain that the new system will eliminate the delayed executions and huge number of trade rejections we’re experiencing.

Yesterday, the problem with the delayed executions resurfaced. As a result, there are two trades that we want FXLQ to reverse. Let me explain (please note, all times are in London time):

Yesterday, a trade was placed at 15:00:41 to buy 25 lots of EURUSD at 1.3235. The trade was not accepted by the server until 15:01:34; 53 seconds later! Throughout these 53 seconds, the trader was held in “limbo,” not knowing if the trade was going to get filled or not. By that time, the price had dropped to 1.3227 or lower, which should have led to a trade rejection – since the price had moved beyond the 2-pip deviation setting that’s supposed to be present on our MT4 system; instead, there was a fill at 1.3235 (a price that occurred 53 seconds earlier)! We asked FXLQ to immediately bust this trade and are still waiting on the outcome. Here’s the corresponding section of the log:

Click here to see the chart of the EURUSD during this incident. The crosshairs point to the one-minute bar (15:00) when the trade was placed and shows the 1.3235 and 1.3227 price levels (horizontal lines).

In today’s trading session, the delays were also present. This led to a losing trade that we are also asking FXLQ to reverse. I’ve added the section of the corresponding log below with comments in between.

In the first section of the trading log, the order took 37 seconds to be opened (from 08:30:59 to 08:31:36)! Once the order is placed, it should be filled right away or time out in a few seconds (see below).

1st attempt to exit trade at 1.3188 – placed at 08:32:08.

Order held for 1 minute and 30 seconds before getting off quoted! (see below) – This is not acceptable. The trader should have been out way before this time, as would have been the case on any other trading platform or system.

2nd attempt to exit at 1.3194 – order placed at 08:35:20.

Order held for 61 seconds before getting off quoted! (see below) – This is not acceptable. Again, there’s no reason to still be in this trade at this time.

3rd attempt to exit at 1.3196 – order placed at 08:36:32.

The order was held for 11 seconds before getting executed at 1.3196; 8 pips worse than it should have been executed over 4 minutes earlier (see below).

For a chart that illustrates the problem above, click here.

We have begun testing a group of new day traders to be able to accept more assets.

Even though our current robot program is excellent and so is Nigel (the trader), forces beyond our control (which you should be familiar with by now) have prevented us from accepting new assets to keep pace with the demand for our program. While I’m confident that this will change soon, in the meantime we started assessing new manual and automated (algorithmic) day traders that have different trading styles. This might allow us to accept some more assets in the short term as we wait for liquidity conditions for our current program to increase and execution problems to diminish.

I think there’s a huge opportunity for growth in the automated day trading (a.k.a., algorithmic trading) front. I have seen some fascinating programs recently and will be working in the background to launch a fully automated managed account in the near future.

FXLQ said that they should be testing the new MT4 system live in a day or two. This was supposed to happen on Sunday (2/25), but it didn’t. IF FXLQ conducts the live tests this week, we might be able to run live trades with a test account soon. I won’t be holding my breath though!

Today, the forex market was pretty boring – void of any important news. Starting tomorrow and lasting through Friday, a series of important scheduled reports and speeches will probably increase market volatility. This should create a good environment for scalping. Let’s see what’s in store for us.

Day trading results so far this week are slightly negative. “Off quotes” are still coming up quite a bit on the MT4 platform, but at least the rejections are pretty fast.

We are still waiting for FXLQ’s launch of their new MetaTrader day trading system. We were supposed to receive a demo with their new, improved feed last week. We didn’t. We don’t know what’s going on and nobody has contacted us to give us an update. Tic…toc…tic…toc…

We are also in talks with a few other firms that are working on providing Currenex pricing through MT4. One Currenex firm that has very tight spreads and good liquidity told me that their MT4 platform should be ready in March (next month). If this is the case, we will have more options to diversify. Since our platform of choice is MetaTrader, this should be a big plus for the robot program.

I am also in talks with a few talented algorithmic (automated) traders that have all their day trading systems written in MetaTrader language. The ability to access a clean Currenex feed through MT4 will allow us to allocate some funds to them and accept more client capital.

Currenex Trading System Does Not Work

Today we put at end to the live tests with the Currenex Trading System. Even though the platform that was designed for us was pretty good (in theory) for manual scalping, the Currenex data was getting delayed during active forex market periods (like after news releases). For some reason, receiving Currenex pricing data over the internet (even while using DSL or Cable) is problematic.

It seems that we’ve exhausted many scalping options already. Here are the possibilities I see going forward for the DTT robot program:

• FXLQ’s new MT4 system - Hopefully it will allow us to increase the lot size we are trading.
• Strategy Runner plus Currenex - Strategy Runner can connect us to Currenex using Radianz, so it should be a lot faster than going through the regular internet. We might be testing this in a week or so.
• MT4 plus Currenex - This will be huge if any of the firms I’m in talks with pull it off. It might actually be the best scalping solution out of all three - and a sure blessing for automated day trading systems.

We keep pressing forward in our day trading journey!

FXLQ made some changes at their end that eliminated some of the trade delay problems.

Even though there were still many “off quotes,” both trade executions and rejections were relatively fast. Whatever FXLQ did seems to have gotten rid of the long delays we were experiencing when orders were being submitted.

Four forex scalping trades were generated - three positive; one breakeven (which should have also been profitable - I’ll explain below). So what’s the problem, you ask?

The biggest problem I noticed today is that a huge number of “off quotes” is generated when exiting trades if the market is not moving much. When you look at the trading log (click here to see it), this will become apparent. Look at the entry in the trading log at 14:12:32. That’s the first time when the order to close the short 25.00 EURUSD position (order #200373) was submitted. The order was rejected 18 straight times with an “off quotes” message even though the price was barely moving. These are the prices at which the trade rejections occurred (in order): 1.3095, 1.3095, 1.3094, 1.3095, 1.3095, 1.3096, 1.3096, 1.3096, 1.3095, 1.3095, 1.3095, 1.3096, 1.3096, 1.3097, 1.3097, 1.3098, 1.3099, and 1.3099. Notice that from one rejection to the next, the price never moved away by more than 1 pip; so the rejections were not because the market was moving fast.

Instead of getting out the first time at 1.3095 with a 4-pip profit, the trade wound up being a breakeven trade.

Currenex Platform Update - Incorrect Handling of Exit Market Orders

During yesterday’s post, I mentioned that we had problems with the execution of an exit stop on the Currenex Trading System (CTS) we had been testing. Today, we found out why the problem occurred.

The CTS platform was supposed to send simple market orders to exit trades after the stop price was reached (limit orders are used for entry orders). For some strange reason, the programmer had designed the platform to send Market + IOC (Immediate or Cancel) orders when the stop was triggered. An IOC order is supposed to execute as much of the specified size as possible at the price when the order was sent and cancel the remaining portion of the order. On Currenex, market orders can’t be cancelled, but IOC orders are cancelled instantly if the price when the order was sent is worse than the market price when the order arrives. This can be problematic in a fast market, causing orders to be cancelled as the price keeps moving away fast.

This problem is what got us out of the market a price that was over 20 pips worse than it should have been. The platform kept trying to execute the exit trade, but the price kept changing. Consequently, the order was cancelled by Currenex several times causing us to get a worse price than we normally would have. I immediately instructed the programmer to change the exit orders from Market + IOC to simply Market. We might try a few scalping trades with this puppy again next week.

No; this is not a science fiction drama about a robotic day trader! I just like to use tragic titles to release my frustrations from time to time!

First of all, our Currenex Trading System project might have to be scrapped. It is taking too long for the orders to travel to the Currenex server. In today’s trading session, by the time the stop price to exit a short trade was reached and the sell signal was sent, the exit price wound up being about 20 pips worse than it should have been.

To avoid issues like these going forward, we are seriously looking at Strategy Runner. It works with a Radianz connection instead of through the traditional internet where data might be lost and delayed. This should decrease our trade execution times - a big plus!

More Trade Rejections at FXLQ and Weird Executions on MT4

Today we basically couldn’t get in any trades when the currency market was really moving. The same typical one-minute-plus trade rejections were the norm. The execution of the only trade today was also really, really weird.

First, here’s the section of the trading log that corresponds to this trade:

An order was sent to buy 25.00 EURUSD at 1.3142 at 17:00:13 UK time (the yellow arrow on this chart – the horizontal yellow line at 1.3141 corresponds to the bid price at that time). The order took 1 minute and 12 seconds to get filled!!! (see the log above). After the order was sent, the price of the Euro started ticking up to the high (1.3148) of the 1-minute bar at 17:00 (see the chart); there was no fill or rejected order throughout this move (like there should have been). The price then started to retrace, dropping slowly back to 1.3142 (still no fill). The price then dropped to 1.3138 and the order was filled at 1.3142! – 1 minute and 12 seconds later!

The price then started going up. It went to 1.3146 but stalled. The price ticked down two pips to 1.3144 and the sell order was sent. The price was static at 1.3144; no movement – yet no fill. The price started climbing rapidly to 1.3147 (the high of the 17:03 bar labeled on the chart). When at 1.3147, the fill took place at 1.3144; 8 seconds after the order was submitted!

Weird, isn’t it? When the Buy order was sent, it wasn’t filled as the price went up. It was instead held in “limbo” and only filled when the market price came back down and went lower than the original price. The fill occurred at a worse price (higher) than the current market price. When the Sell order was given, which would have closed out the position at a profit, the order was stalled for 8 seconds; then, when the price went higher, a fill occurred at a worse price (lower) than the current market price.

Maybe the trading platform is possessed!

We continue waiting for the new MT4 system to be ready.

Valentine’s Day was pretty active for currency trading. Both the Euro and the British Pound against the US Dollar had ranges of 100+ pips. Unfortunately, we were plagued by the same excruciating trade rejections (”off quotes”) as yesterday on the MT4 platform.

The day started at 8:11 AM London Time with an “off quotes” rejection that took a whopping one minute and thirty seconds to surface! Click here to see the trading log.

The first trade execution took 21 seconds to materialize (from 10:35:34 to 10:35:51 UK time). After multiple attempts trying to get out of that position, the exit trade took 10 seconds to get filled (at 10:38:42). The first trade of the day was a loser and the second and last trade was a winner. The second position took 14 seconds to open and 9 seconds to close - still not acceptable in day trading.

On a different note, the programmer did not provide us with the proper upgrade for the Currenex Trading System, so we weren’t able to trade on that either. It should be ready tomorrow, though. We need to see if the data from Currenex does not bog down a normal internet connection (something we suspect might be happening). If it does, then Strategy Runner (which we are testing now as well) is the only remaining option.

The forex market is moving. The EUR/USD is taking off; GBP/USD is following suit. A great day trading opportunity draws near; slowly creeping in sight of our crosshairs.

“Click!” - The trigger is squeezed. “Click, click, click!” No bang! No kill! No execution! - Instead, a freaking “off quotes” message as the prey escapes. Arrrgggghhh!

If you have been wondering why there is only one execution despite two back-to-back, active trading sessions, now you know. We’ve had two straight days where the British Pound has had a range (from High to Low) of over 100 pips and the Euro about 90 pips. Can you tell I’m frustrated?

Today’s trading log will give you an idea of the severity of this problem.

Three trades took about a minute and a half to get rejected; an eternity in the world of Forex day trading.

We are told that the new MT4 system will be ready possibly this week (maybe the 15th, as we were told last time), so we might be testing that as well. Hallelujah!

Currenex Scalping Platform Update

With the latest programming upgrade, the Currenex trading platform is performing a bit better - even though the prices become intermittent from time to time. We will continue to place trades through this platform tomorrow. We are also flirting again with Strategy Runner, which works with Currenex as well. We’ll keep you informed about the progress of our endless Forex day trading quest! Stay positive!

When I started my Day Trading Tutor (DTT) website in the late 90’s, it was more like a journal where I dumped megabits of information about the trading of stocks and currency day trading in general.

New Day Trading Tutor Structure Implemented

Many new and experienced traders have visited the site over the years and sent me their testimonials. I never expected that a non-corporate-like experiment about day trading would help so many people. One of my friends, Giovanny “Geo” Gutierrez, a brilliant web designer and internet marketer, was really impressed by this. He is the owner of Ionic Studios and he suggested redesigning the site to make it more user-friendly, cleaner, and more “professional” (whatever that means).

That’s how the Day Trading Tutor redesign began in 2006. Geo came up with the new look and structure; then went on to apply cascading style sheets (CSS) to the entire DTT website.

DTT’s Dan Alvarez gets Iconized

Despite being overwhelmed with many other projects, the brilliant artists of Iconize Me were nice enough to then embark on the icononization of your’s truly, Dan Alvarez (Day Trading Tutor). See the transformation below of one of my ugly pictures. The three extremely talented artist of Iconize Me (Paul Sahner, Shalimar Luis, and José Ramos) came up with their own unique versions of me. These images are rotated at random on the upper left corner of each page, to add a little flavor to the whole operation!

I love all three versions of me, especially José’s design. His unique and witty style of caricature resonates with my jovial personality.

DTT Day Trading Information Orbits The Blogosphere

Internet Marketing Consulting and Entrepreneur Coach, Barry Welford of Strategic Marketing Montreal, then took over. Barry, an exceptionally bright and talented professional, stressed the importance of implementing a blog for Day Trading Tutor and having an architecture or navigation structure for the site that made sense to my visitors.

With the help and talent of web designer Denis Doyle, Barry succeeded in creating and launching a Day Trading Tutor News Blog section using WordPress, as well as implementing a better site navigational structure. This also transformed DTT into a more search engine friendly site. Barry is also handling the gradual move of DTT’s original GeoCities pages into the new domain www.mydaytradingtutor.com.

Will DTT Be Making Further Improvements?

Day Trading Tutor is not done by far! The trading robot program has witnessed demand from many corners of the world. I have also provided a free day trading e-book to my visitors and will be including more powerful educational tools from talented traders I work with on the site in the near future. All of these things (and the birth of my handsome baby boy, Kaiser), should keep me busy and make DTT an ever-changing and growing place over the years to come.

May the new Day Trading Tutor be a blessing to you and your family.

Today, all scalping trades positive. Comments by ECB President Jean-Claude Trichet were interpreted to mean that a rate increase next month is likely - and possibly higher rates by year end. This caused volatility in the Euro as it moved up, which generated the most transactions during today’s day trading session.

The Bank of England’s (BoE) decision to leave rates unchanged also contributed to weakness in the pound (GBP). One scalp on the GBP/USD came about as a result.

The robot trading program is making progress, although small. We need access to greater liquidity and hopefully, the Currenex system will be the key (or at least one of the keys going forward).

The DTT Robot program continued to operate in total boredom today as the market reacted very little to the US productivity numbers at 8:30 AM EST. Only one trade was executed and it was a loser. Hey; we can’t win’em all, right? The possibilities to day trade tomorrow might come near 7:00 AM EST during the UK interest rate statement and again at 8:30 AM when European Central Bank President Trichet speaks.

There was not enough price action today to finish the troubleshooting of the Currenex Trading System.

We are also looking at other traders and scalpers going forward for added diversification. This should be an exciting year.