Another trading contest from Dukascopy

Dukascopy started a new contest this month. This contest is manual trading only on a demo account with no cash commitment by contestants. The twist is that the ranking is determined not only by your demo account balance, but also the total pips gained, popularity, and scoring by Dukascopy’s judges.

Each trade in the contest needs to be commented by the contestant through the JForex trading platform (when you submit an order the platform asks you for a comment). See my contest page for comment examples (shameless plug). About half of your score is based on these trade comments as they are the basis for generating popularity points and the Dukascopy judges’ final evaluation.

I can see the potential in this contest as it offers transparency and encourages interactions rather than let everyone just gamble away. However, most of the trade comments now are meaningless as it’s clear that you can generate buzz simply by making ridiculous gains. Perhaps this might change after this month’s final ranking is released as it is not clear how Dukascopy will allocate each contestant’s 25% of points. The judging by Dukascopy can effectively bump or dump you a few ranking.

The incentive to do this is the USD $15,000 ‘cash’ prizes to be won every month just like the Dukascopy Strategy Contest. And similarly, these ‘cash’ prizes are deposited into the winner’s Dukascopy trading account with a withholding period. So they’re forcing you to open an account with them if you win, which is understandable as this is a marketing effort.

For information or registration in the contest, visit the Dukascopy website and navigate to the Trader Contest page.

Short 0.015 CADJPY @ 81.78, Stop 82.00

Edit: I was stopped out overnight for a loss of 0.37%.

I am taking a dabble at shorting oil via CAD/JPY. Here are where things stand.

CAD/JPY

USD/CAD

Crude Oil

CAD/JPY is forming a wedge on the 4 hour chart. I am shorting it at resistance and in-line with the downtrend. A break below 81.50 would signal a confirmation for even lower prices.

Risk is about 0.4% of account with a CAD$15,000 position.

Closed USDCAD short @ 1.06525, breakeven

It seem that USDCAD isn’t about to die just yet. My USDCAD short got stopped out at breakeven this morning. In fact, the pair is still struggling around the descending resistance line as shown in Figure 1. It made a higher low so I won’t be surprised if it cracks higher.

USDCAD, 4-hour

The reason why I took this trade was that the opportunity seemed too good to pass on based on my analysis at the time. I always keep an eye on the market even when I’m not trading. Although the basic setup remains intact, the opportunity isn’t so fantastic that I couldn’t say no anymore.

Anyway, I shouldn’t be wasting time managing a minuscule trade. Back to staring at codes.

Short USDCAD @ 1.0654, Stop 1.077

This is my first real forex trade after a year minus one day of studying the market and paper trading.

Shorted USDCAD based on the following intermarket observations:

1. Yesterday’s equities sell-off held around S&P at 1050
2. Overnight Asian market seem orderly, not every market followed through, but most did
3. European markets down move were slow overnight until US open
4. But perhaps most importantly, EUR/USD made a higher low with an increasing COT

Basically, as much as the sell-off tries to scare off people, the markets don’t seem to be moving in unison. So it would seem this move (in equities, thus inverse USD) is still a bear trap in an intermediate term bull rally.

Plus this daily chart, Figure 1, for picking USDCAD specifically.

USDCAD daily chart

And this 4-hour chart for trade execution.

USDCAD 4-hour

Size of trade is 1000 unit. Risking about 0.05% of capital with a hard stop at 1.077. Anything above 1.070 would put me on alert though.

Coincidentally, I first got into the forex market by studying the loonie. Let’s see how this first trade performs.

Comparing Trading API from 6 Online Forex Brokerages

Choosing a discount broker for forex trading is time consuming. As the forex market is not centralized, choosing a discount broker is sort of like picking a stall in a farmer’s market. They all offer the same product, but prices, features, quality, and services can vary considerably between fx brokerages. One criteria that I consider seriously is the Application Programming Interface (API) offered by the broker.

Most people couldn’t care less about API because they never intend to develop their own automated trading program. However, if this is something that interests you, then I’d like to save you some time here with the following table.

Forex brokers API table

All the dollar values are in U.S. dollar.

I highlighted the important limitation of each API. I have different level of experience with each of these six APIs. As of this writing, I am using JForex from Dukascopy for various personal reasons.