the-counter markets
outlawed operations, brokers 36-8
outsiders 11-12
outsourcing, third-party services 54
over-the-counter markets (OTC) 35-6,43, 53, 185
overleveraging dangers 36-8, 59
overseas bank accounts 146
P/Ls 13-14, 37, 53, 58Paris 76-8patterns 3-4, 187pawn shops 15pennants 187pension funds 114-15perceptionsmulti-viewpoint perceptions 14-15risks 5-6perfect markets 9-10performance measures, traders 13-14,58personalities, retail traders 57-8‘piggy back’ practices, dealers 120-2PIMCO 49pip, definition 185-6pivot pointsconcepts 79-81definition 79
playerssee also banks; brokers; corporateaccounts; dealers; retail ...; tradersfood chain 29, 39types 27-32
point, definition 186poker analogy, traders 14, 119political events, currency markets 16,63, 175-6portfolio selections 3positionsbuilding a position 163-7definition 186pressure valves, crosses 88-91price actionsee also discretionary tradingconcepts 66-71, 103-8, 123-30,157-66price quotes, ‘who’s who’ factor 11-12price ranges, entry considerations 163-6216
Index
 
pricesbrokers 11-12, 40-1, 43-4, 137-8demand and supply 66feeds 51-2, 68-71, 138-41shading 11-12, 40-1slippage 44-5, 137-8, 186volatility 7, 66, 131-5, 138, 145,170, 187probabilities 64-6Procter & Gamble 59profitable trading strategies 10, 58prop deskssee also banks; speculatorsconcepts 27, 28, 48-9psychological battles, retail traders 57,163, 170-1psychology of markets 3-7, 57, 126-7,163, 170-1‘pure’ aspects, currency markets 9
random price movements 3-4random walks 3rare breeds, traders 13-17rational markets 6-7RBS 10real-money driven moves 70-1record-keeping needs, fightback methods52, 154-5REFCO 43regulationsCFTC 35, 43-4, 45-6, 52-3,193-208change needs 46, 146-7currency markets 9, 11-12, 35, 43-5,146-7minimum net capital requirements45-6, 193-208NFA 45self-regulatory agencies 45research benefits, currency markets9-10resistance levels 65-6, 71retail spot dealers 21see also dealersretail traders 29-32, 33-4, 35-41,51-4, 57-61, 145-7see also traderscard stacking 35-41CME alternative 53concepts 29-32, 33-4, 35-41, 51-4,145-7discretionary trading 66-71
fightbacks 51-4, 57-61, 122, 123-30flexibility needs 59-61, 163-7,169-70, 171-6food chain 29, 39‘forex trading contests’ 38-9future prospects 145-7great traders 13-17, 49, 54, 57-61,147, 169-76historical background 35-6learning curves 49, 54, 147losing positions 94, 169-76mistakes 58, 61money management rules 30-2,38-9, 49, 58, 60, 63, 146-7, 164,169multiple lots 59-61, 164-7overleveraging dangers 36-8, 59performance measures 13-14, 58personalities 57-8picking the right approach 63-71price action 66-71, 103-8, 123-30,157-66price feeds 51-2, 68-71, 138-41profitable trading strategies 10, 58psychological battles 57, 163, 170-1record-keeping needs 52, 154-5self awareness 57-8small trades 59-61, 164-7stopped-out experiences 59-60strengths utilisation 57-8survival rates 38, 54systematic trading 65-71technical analysis 65-71, 146-7,163-6third-party services 43-4, 47-9, 54,113-16time management needs 81-2trading against dealers 119-22trading habits 54trading tips 75-116, 122, 123-30,149-76Reuters 23, 35, 51, 81, 138reversals 77-8, 99, 100-1, 110, 151-5,173-6important times of the day 78news releases 110, 112trend example 99, 100-1risksconcepts 5-6, 11, 14-15, 28, 58,119-22, 125-30, 164-5, 183models 64-5perceptions 5-6Index
217
 
tolerance levels 5, 28, 58uncertainty 14-15Robertson, Julian 6rolling pivot points, concepts 79-81Rothschild family 14round numbers, stops 95, 123-4rumors 120-2runaway market dangers, dealers 20runaway trades 171-6Rusnak, John 17
Salomon 61SARs 95scaling considerations 163-4scams 48-9scenario planning 153-4screen shots, record-keeping needs 52seasonal factors, thin markets 84a select club 10-11self awareness, retail traders 57-8self-fulfilling price moves 123self-regulatory agencies 45‘sell’ signals 81set your orders, Big Figure Trade 125-6SFA 53Shanghai 4sharp moves, moving averages 160-1‘shifting points’ 79-81shooting stars 69, 99, 100short-term moves, great traders 14, 16shorting tactics 6, 123-4sigma-nine events 16, 64-5Singaporebackground 25, 76-8market share statistics 25slippage 44-5, 137-8, 186slow feeds 138-41small speculatorssee also speculatorsprice action 66-71roles 29-32, 37-8small trades, flexibility needs 59-61,164-7, 171-6Smith, Adam 9Société Générale in Tokyo 30solicitors 43-4Soros, George 16, 26speculators 16-17, 20-1, 26-9, 70-1,83-4, 120-2, 145-7see also CTAs; hedge funds; propdesks; tradersCOMs 26, 28
 
concepts 28-9, 70-1food chain 29small speculators 29-32, 37-8types 28spikes 40, 52, 81, 126-7, 132-5,157-61, 187spot dealers 10-11, 19-21, 24-5see also dealersspread-betting shops 35spreads 11-12, 15-16, 23, 137-41,181, 186squeezes 159-61stair-case patterns 70, 174statistics, currency markets 23-5sterling see GBP...‘sticking it to your dealer’ 137-41stock market crashes 4-71929 5, 37‘Black Monday’ 19 October 1987 4,6, 64stopped-out experiences 59-60stops 41, 51-2, 58, 59-60, 65-71,83-5, 93-6, 103-8, 110-12,123-4, 125-30, 131-5, 141concepts 83-5, 93-6, 103-8levels 93-6news releases 95-6, 110-12round numbers 95, 123-4thin markets 83-5, 93-6trading the FED 103-8strategies 3, 10, 14-16, 58see also trading tipsstrengths utilisation, retail traders 57-8subjective viewpoints, great traders 14subscriptions, third-party services 47-9Sumitomo Corp. 17Sun-Tzu 43support levels 65-6swaps 21, 24-5, 187SWIFT 187Swissy, definition 187Switzerlandmarket share statistics 25USDCHF 24, 84-5, 91, 132, 179Sydney 76-8, 83-5, 131-5systematic trading, concepts 65-71
tactics 3, 14-16, 19-21see also trading tips‘take back’ the trade 141‘talking their book’ dangers, third-partyservices 49218
technical analysis (continued)technical analysis 3-7, 63-71, 146-7,163-6, 187benefits 63, 65-6concepts 3-7, 63-71, 146-7, 187critique 65-6, 146-7definition 187discretionary trading 66-71retail traders 65-71, 146-7, 163-6technological developments 11, 23-6,35-6, 43-4terminology 179-80terrorist attacks 26, 175thin marketsconcepts 77-8, 83-5, 93-6, 120-2,134-5definition 83news releases 83seasonal factors 84stops 83-5, 93-6trading tips 84-5, 93-6third-party services 43-4, 47-9, 54,113-16throwing in the towel stagetrading the FED 103-8trend example 99, 100tick, definition 187time management needs 81-2times of the daycurrency markets 75-82, 83-5, 121,151-5, 166-7thin markets 83-5, 93-4Tokyo 76-8, 81, 121, 131-5see also Japantolerance levels, risks 5, 28tops 30-1, 187
traders 5, 11-12, 13-17, 29-34,35-41, 51-4, 119-22, 123-30,145-7
see also retail ...
arrogance/self-confidence contrasts16-17, 49
Big Figure Trade 122, 123-30
concepts 13-17, 29-34, 35-41,51-4, 119-22, 145-7
dealers 20-1, 119-22
edge 14-16
fightback methods 51-4, 57-61, 122,123-30
food chain 29, 39
Friday to Sunday price extension131-5
Index
future prospects 145-7gambling 14, 35, 37great traders 13-17, 49, 54, 57-61,147, 169-76learning curves 49, 54, 147‘let your winners run, cut losers short’10, 166-7, 169-76losing positions 94, 169-76macroeconomic events 16, 63, 175-6mental toughness 13-14, 174performance measures 13-14, 58poker analogy 14, 119rare breeds 13-17self-confidence 16-17, 49short-term moves 14, 16speculators 16-17, 20-1, 26-9,70-1, 83-4, 120-2, 145-7‘sticking it to your dealer’ 137-41survival rates 38, 54time management needs 81-2tricks 21, 51-4, 123-30atypical day 121unfair playing fields 11-12, 34,36-41, 53‘walk the walk and talk the talk’13-14winning traders 13-17, 29-30, 37-8,57-61, 146-7trading against the clients, brokers 36-8trading habits, fightback methods 54trading how to’s 149-76trading journals 154-5trading maxims 189-90trading platforms, price feeds 51-2,68-71, 138-41trading techniques 66-71, 75-116,
146-7, 149-76trading tips 75-116, 122, 123-30,149-76
see also fightback methods
analysts 113-16
Big Figure Trade 122, 123-30
building a position 163-7
crosses 87-91, 133-5
fading news 109-12
FOMC_ 103-8
Friday to Sunday price extension131-5
losing positions 94, 169-76
money centers 76-8, 131-5
stops 93-6, 103-8
thin markets 77-8, 83-5, 93-6Index
219
 
trading the FED 103-8trends 97-101, 151-5trading to your strengths, fightbackmethods 57-8transparency shortfallsbrokers 36-40currency markets 11-12, 36-40trending markets 68-9trendsaccumulation stage 99-100concepts 68-9, 97-101, 126-30,151-5, 187corrections/consolidations 97-8, 174example 99-101hot money stage 99, 100public realizations 97-8reversal stage 99, 100-1slow starts 97throwing in the towel stage 99, 100trustbrokers 43-6third-party services 48-9Tudor Investment 13turnover statisticscurrency markets 23-5, 27multiplication effects 25a typical day, traders 121
UBS 10, II, 61
UK see United Kingdom
uncertainty concepts 14-15
unfair playing fields 11-12, 34, 36-41,53
United Kingdom“Black Wednesday’ (1992) 26EURGBP 67-71, 89-91, 120-2GBPCHF 91GBPDM 26GBPJPY 88, 91, 129-30, 140GBPUSD 24, 89-91, 96, 121-2, 130,132, 134, 139-40, 152, 179London money center 76-81, 83-5,131-5market share statistics 25United StatesAUDUSD 24, 98-9EURUSD 24, 84-5, 87-91, 94-5,103-8, 109-12, 115-16, 128-30,134, 139-40, 179FOMC_ 103-8future prospects 145-7futures exchanges 35
GBPUSD 24, 89-91, 96, 121-2, 130,132, 134, 139-40, 152, 179market power 145-6market share statistics 25New York money center 76-81,83-5, 131-5NFP 84, 110, 114-16, 137USDCAD 163-5, 179USDCHF 24, 84-5, 91, 132, 179USDJPY 20, 24, 30, 91, 99-101,133, 170-6, 179USD Index (USDX) 87USD/other statistics 24USDCAD 163-5, 179USDCHF 24, 84-5, 91, 132, 179crosses 91statistics 24thin markets 84-5USDJPY 20, 24, 30, 91, 99-101, 133,
170-6, 179crash of 1998 20crosses 91
statistics 24, 30trend example 99-101
value creation 9-10
Verne, Jules 14
voice brokers 23
volatility 7, 66, 131-5, 138, 145, 170,187
‘walk the walk and talk the talk’ 13-14Wall Street 3, 6, 9-10Wall Street Journal 190whipsaw, definition 187‘who’s who’ factor, price quotes 11-12winning traders 13-17, 29-30, 37-8,57-61, 146-7see also great tradersworking day, definition 188
yard, definition 188yen see JapanYoung, Peter 17
zero-sum games 14
Index compiled by Terry Halliday<|end|>