Choo Koon Lip

Recently, I was talking about price execution with some friends and I thought it will be great to share with all of you on MARKET Execution and INSTANT Execution.

Market Execution is only for ECN accounts typically.

You enter a price at 1.4199

Say the price now is at 1.4200, then it will be executed and entered at 1.4200.

If the price now is at 1.4198, then it will be executed and entered at 1.4198.So your price is secondary; market executed the actual price.

Instant Execution is what most brokers are offering.

You enter a price at 1.4199If the price now is at 1.4198, then it will be executed and entered at 1.4199 (your price, since you will need to pay more to broker – then broker earn more).

Say the price now is at 1.4200, then broker will requote you at 1.4200.

So your price is better for broker, they keep quiet. If price is not as good, they requote you.

These are my takes below:

1. Pro for MarketEx: NO requote

2. Con for Market Ex: You enter the price based on market.. sometime better price, sometime lousier price, depend what the market give you

3. Pro for InstantEx: You will get in at the price you want

4. Con for Instant Ex: Sometime the market give broker better price, you will get the price you want and broker keep excess pips. Sometime the market give broker lousier price, you will get a requote from the market.

Today July 4th as a trader you may be wondering whether it would be a good idea to trade the market…read on to find out why it’s not.

Market Open
You will generally find the markets open even on the major holidays like Christmas Eve and Christmas Day, New Year’s Eve and New Year’s Day, as well as on the U.S. Thanksgiving. Throughout the trading year, the U.S. or New York Session is one of the largest in the Forex. However, you must also remember that U.S. banks are very liberal with taking holidays off. Therefore, just because the Forex market itself is considered open, that does not mean that the banks are all open and rendering full service.

Brokers’ Platforms
Many brokers have facilities available for trading on these major holidays. But the reality is that the volume becomes very thin. Let’s face it-even traders like to take time off to spend with their families and friends and spend money at the mall. The effect of the decreased volume in the market is decreased liquidity. When a market does not have liquidity, it is difficult, at best, to get in and out of positions profitably. On the other hand, when there are lots of traders participating, fun can be had and money made. The U.S. Thanksgiving is not going to be as quiet as Christmas in the market, since it will perhaps affect only the U.S. Dollar-based currency pairs for the most part. Apparently, other countries and their traders are not as excited about our national holidays as we are. Surprise, surprise.

Risks
One of the consequences of a market that is not so liquid is the increase in the spread charged by the broker. You will notice a similar effect during any given weekend of the year, by virtue of the same reason of lack of liquidity. Naturally, as a trader, you prefer the smaller spreads, since you get to keep more of the profits in your pockets as a result.

Conclusion
So then should you or should you not engage in Forex trading on these holidays? If you like boring and expensive trades, then go for it. Otherwise, look your loved ones in the eye and tell them that you are so thrilled to spend some quality, uninterrupted time with them. Then prove it by spending some of that quality cash you earned during the previous months. Happy spending!

Sandy Robinson, J.D., Copyright 2007

I was emailing with my graduates on how to handle loss in trading and just decided to post it here too.

Here are 7 steps you can take to survive and even thrive when suffering a loss:

1. Write down the trade as it occurred: Don’t sweep the loss under the rug! You need to learn from the loss (that is its value), so write it down on your trading diary. Include how you percieved the market at the time and how the market action and your indicators appeared to meet the criteria for a trade entry confirmation.

2. Evaluate the trade: Once the trade is over, go back to what you wrote and see what can be learnt. Did you misinterpret the market? Was there something you failed to check? Did you undertake the trade even though it didn’t meet your trade criteria? Or, was the trade setup valid; it just didn’t work out?

3. Use the loss as a learning opportunity: Ask yourself, “What can I learn from this trade?” Is there an insight about market action that can be gained? Is there something about your trading behavior that needs to be addressed? Whatever it is, you have an occasion to grasp something new, and that is valuable!

4. Take immediate corrective action: Do you need to modify your trade setup? Is there a rule for personal discipline needed? Whatever you have learnt, take immediate action.

5. Keep your head and attitude right: You always have a choice about attitude. You can accept the loss as an inevitable part of trading and be grateful that you can learn from it, or you can enter a negative, downward spiral of feeling bad, getting down on yourself, and making yourself feel even more miserable. Follow the constructive steps outlined here and stay above all of this.

6. Remember, trading is ALWAYS based on probabilities: Every trade setup has a probability of winning and a probability for loss. Over a large number of trades, a setup with an edge will be profitable. Any given trade is always uncertain (and here we define our risk). This is the law of trading probability.

7. Turn to others: We all need support. Talk to your trading buddy, mentor, partner or spouse. It helps to unload a bit and you may gain a different perspective.

Put these 7 steps into place and you will easily be on the road to surviving and even thriving from losses.

Dear everyone who know Forex Asia Academy,

Celebrating our 3rd Anniversary and entering into the 4th year gives me great pleasure to share with you the excitement of leaving the old year behind and entering the new.

For Forex Asia Academy (FAA), 2010 was really tough year in which the growth of the Academy has been building on harsh market conditions and tough decision-makings. Through the feedbacks we have received, we have consolidated our position in the field of forex education and continued to lay a strong foundation for the future.

We kickstarted 2010 with an innovative auto-trading platform called ‘Performance Selector / Mirror Trader‘ which has been extremely well-received by the graduates base of FAA. The year 2010 will be a memorable one, albeit a challenging one.

Despite of stringent compliance and guidelines, our education programme was hand-picked by Phillip Capital CyberQuote to educate newbies and experienced traders on trading forex the right way. And despite of the tightening measure by Bank Negara Malaysia (January 2010), we were invited to speak at Securities Commission Kuala Lumpur in March 2010. Various major medias had featured me and FAA, like Straits Times (Singapore), New Straits Times (Malaysia), just to name a few.

At the end of 2010, we leapt forward and expand our offering to Brokerage Consultancy. Now providing consultancy to 4 brokers (in London, Dubai, Istanbul and Wellington), we are able to share more in-depth trading experiences and behind-the-scene insights no other educational provider can offer.

Education is an endless journey, and this is especially so for forex trading. In awareness of this, we took major steps to increase the quality of industry understanding. Knowing this, I personally visited major financial centres around the world – New York, Boston, Hong Kong, Tel Aviv and Dubai to further nourish my financial knowledge.

Time flies…

and it’s been over three years now since the establishment of my Forex Asia Academy. We press on and I’m glad to announce my Forex Asia Academy celebrated the 3rd Anniversary on 4th June 2011. FAA continues to move on to the 4th year of Inspiring, Informing and Improving and the Forex Education in Asia.

For those who believe in me, thank you so much. I will continue to bring values to people around me.

A heartfelt big thank you. Like what I always said to my graduates, Today is still the beginning.

Choo Koon Lip
Director, Forex Asia Academy

3. Successful forex traders do not trade all the time. A good trader will understand that the forex market does not move in a straight line, it moves in waves. For example, the trend may be an uptrend, but there will certainly be retracements, so conservative traders may only want to wait for forex trading signals to buy and will refrain from selling during retracements.

Having said that, it all depends on the market conditions and if it allows for trading during big retracements, so be it. You have to learn how to judge the market condition on whether it is trendy or choppy. For me, I’ll always avoid trading when the market is choppy because it’s too unpredictable. Furthermore, the current strategy I frequently used trade average once in every 2 days.

That’s all for the 3 short episodes of the book. There are more in-depth trading examples and analogies in the book!

2. Make sure you follow the trading rules. A forex trading system is meant to help you make accurate trading decisions, so please be sure that all the conditions are met before you even place a trade.

Sounds easy? Indeed it seems real easy for anyone to follow a rule right? But there are many traders who can’t control their temptation to trade when not all the rules are met, they often trade earlier even before the forex signals are generated. This is also an important part of forex trading psychology, you must not let excitement, fear or other people’s influence ruin your trading system that works.

1. Learn to trade forex with a disciplined plan and not by hindsight. There is a problem with many traders and that is they take shopping more seriously than forex trading, and I’m serious! An average shopper will not spend a $200 on something without much research or if he/she has not done some research on it. But I have seen tons of people risking their trades with a few hundred dollars based only on their intuition or ‘feeling’.

So what people need to do here is to have a trading plan at the starting of the day and follow it thoroughly. The trading plan should consist of stop loss (it’s a must!) and profit target levels (and preferably with multiple scenario planning), so that your trade is planned to be taken out early when the market goes against you and yet also there is a profit target to aim for if the market goes in your direction.

Stay tuned for next posting!

I was editing the 2^nd edition and Chinese edition  of my book ‘The Lemming Trader’ and thought of sharing this with all of you.

As my book is about trading pyschology and herd behaviour in trading, the contents discussed here are trading in general, not just Forex specific. You will read about 2 key destructive emotions that are always present in the world of trading and that is, greed and fear. I can say that most traders or 95% of the traders are hugely affected by these two emotions and no doubt it’s part of our human’s nature.

Successful traders have those emotions too, but the difference that separates the successful traders and those who failed is the technique of controlling the emotions well. We will look at some of the trading tips that can help you as a trader to control those emotions well and get consistent profits out from the forex market.

As my summary of the books can be quite long, I will split them up into 3 parts here and post here in my blog within the next 3 days. Stay tuned.

Anyway, I went to Santana Concert with my dad on Monday 7 March. Finally got to see the legendary guitarist!

I’d been super busy this month, preparing the recent Forex Graduates Gatherings. I only managed to catch 4 shows (and a concert)!

I Am Number Four – 1 Mar, 7.20pm @ TGV Cheras Selatan (KL)

Gnomeo and Juliet – 5 Mar @ GV Marina

Ghost: In Your Arms Again – 11 Mar, 3.00pm @ Shaw Serangoon NEX

Rango – 16 Mar, 12.15pm @ MBO KSL City (JB)

I posted now, knowing that it’s unlikely to catch a show on the last day of this quarter. It’s a fulfilling quarter where I have learnt a lot and experienced things I may never dream I will get close to.

Anyway, I went to Santana Concert with my dad on Monday 7 March. Finally got to see the legendary guitarist!

Once and again, I would like to extend my gratitude to our participants at our Forex Asia Congress 2010.

I thank all of you for the kind participation and I would like to share some of the great feedbacks emailed from the audiences in commerating our presenters. Thank you for writing in!

“‘Da Shi Xiong’ Chee Seng and Yeanjie (Ipoh guy) really impressed me in the Forex Asia Congress. Their sincerity attracted many interest and this must the reason why the 2 of them got the loudest applause.”

“Ram, watched your Kallang Roar movie before… didn’t expect to see you in person, and definitely not in a forex event… great to meet you in person, your session enlighten our mood throughout the meaningful congress…”

“Out of the sea of fx trading, i didn’t expect you guys can use forex as a tool to invest in aussie properties. hope KS can come more to malaysia to enlighten us…”

“Mr Loh really ‘li hai’ – wow no tech indicator wor, what he draw on the flipchart really appear on the chart on the friday gathering before congress… his theorist method (hope i spell correct) really really ‘li hai’… and also thanks for the USD50 trading credit.”

(on Elvis) “Despite not having EA or fanciful indicators, you really share a lot more than with his fibo lines and fractal. tq for ur kind sharing and was very impressed by ur unique strategies…”

“even though Billy have limited time in sharing his speed strategy, but i can sense the passion from him in scalping.. looking forward to the course conducted by him and you…”

Words from the Financial Experts!

“Koon Lip, Congrats to your Seminar in KL, Very Successful.”
- Peter Tai, Founder / CEO, PT Investment Academy (via Facebook)

“kawan, take care.. lets do a bigger one.. Your Singapore gang is all gear up for it . .. I believe so.”
- Kee Wah Soong, President, Malaysia Financial Planning Council (via Facebook)

…and finally, a thumb up for my admin and logistics team!