If Forex is so lucrative then why many people are not interested in this?

[Toccata]

....drop me a mail on toccatafx@hotmail.com - sorry, moneytec is not letting me drop you a mail

[Johnny]

"My system is so good that it's going to break the bank?" Oh c'mon! *laughs heartily* I'm sure refco, cms and fxcm are shaking in their 20 billion dollar collective shoes! Hahahhaaha! You really think you can break the market makers with your system? Well, Pete, I've got to admit, you've lost a little credebility by saying this. I want some of what you're smoking! I was just talking with George Soros the other day and he said he's planning on shutting down refco the day you release your system. He said he's afraid you and your gaggle of customers are going to take him to the cleaners and he'll be broke by the end of February! *chuckles*


Automated trading systems can be a nightmare as the API's are constantly being updated and changed. Just ask andrew from fabrefactum. I would say keep it manual. It will serve you and your customers better in the long run, I believe. But hey, with your system, we'll all be retired by march!

Thanks for the good ol' belly laugh.

[kuepper]

Artificial intelligence has long been applied to the world markets - it is no secret. More accurately, they are known as Artificial Neural Networks, or ANNs. They have the ability to adapt to market conditions, and continually optimize themselves. To put it in basic terms, you tell it what you want, and it can - in theory - learn to make it happen. This technology is behind many programs used by institutions - as someone previously stated - and is only now becoming a common sight amongst the more general trading community.

Interested in coding your own? Try Joone to create it; and, ANN Evolve to gain a basic understanding of how they work, and how to construct one. It can be rather complex for the beginner, especially when you get into all the different methods for "learning"; however, it is proving successful for many. There are even simplistic ANN plugins for many popular trading programs (TradeStation, MetaTrader, etc.)

Research Example:
http://citeseer.nj.nec.com/20949.html

Public Application Example:
Trading Solutions

-Justin

[peteuk]

Further lets say your system fires a buy just before an interest rate announcement that 50% of economists predict will stay put and the other 50% expect a hike - hmmm - do you take the buy signal???? And if so with what kind of stop - different to your usual 30-50pips??


In theory, assuming the system is already in a position, then stop and limit orders would already be in place. In practice, personally I'd want to exit any trades around news release and go have a coffee and read the paper for an hour or two until the market settled. Now if only there was a way to program the computer to understand news.....


There are lots of points of failure here so can you trust it?

That's the question for sure! Would I be able to sleep at night knowing a computer had total access to my account
Maybe a mini with a couple hundred bucks would do to start with!


If the position is taken that FOREX is a zero sum game, and if in time, everyone trades using these computers - who wins and who loses?
Basically we are talking about a kind of FOREX AI, artifical intelligence, that is able to read or adapt to changing market conditions. Would not all AI systems adapt instantaneously? Are some systems smarter than others?

lol, I guess you're right, we'll be back to square one after everyone has built bigger and better machines, maybe there'll be a Forex Resolution overseen by the UN for the global disarmament and disassembly of automated trading systems!

Thinking about it, these types of automated systems are already is use by all MarketMakers, every platform is automated, they have the edge, and if traders used an automated system it would only be levelling the playing field wouldn't it?

Have a great day all!

Pete

ps Johnny, you're living on a different planet if you really believe this isn't possible. Where you been for the past 20 years, didn't they have computers in that padded cell
Hey, remember Las Vegas and card counting, lol, now tell me the big guys don't get worried and want to protect their businesses. If it wasn't a threat why would they worry?
pps At least I have some credibility to lose, whereas....

[peteuk]

kuepper, thanks for the links, they make interesting reading, now bookmarked.

Talking automated systems, I had to write off for a new driving licence the other week and apparantly all incoming mail (not just forms, handwritten letters too apparantly) is scanned instead of read, and replied to automatically based on what the computer has read! Even though I guess it could lead to some amusing responses humans in more and more clerical and some manual jobs are being replaced by computers. It's frightening!

Pete

[Johnny]

Well you got me all excited last month and then you say "my system is so great that it will ruin the entire forex market and market makers will shut us down?" Chance would be a fine thing! It just sounded a bit funny that's all! I believe in you Pete! I think you can do it! And I think you probably do have a great system. That's why I want to be one of your first customers! Are we still on schedule for February? My fingers are itching to get on that demo!

Good to see ya' back Pete!

PS- I wanted to use it manually but will it be able to interface with fxcm's trading platform?

[peteuk]

Originally posted by Johnny
That's why I want to be one of your first customers!

You want ITS? You couldn't handle ITS, and I wouldn't want it on my conscience.

First there'll be the obligatory Beverly Hills mansion, then the fast cars, faster women, booze, drugs, and when you get bored with those you'll probably turn to 'guys' for excitement....I'm saving you from yourself Johnny!

Take my advice, you'll thank me one day.

Pete

[kuepper]

Hey, remember Las Vegas and card counting, lol, now tell me the big guys don't get worried and want to protect their businesses. If it wasn't a threat why would they worry?

Actually a lot of people who "card count" are people looking for a quick buck that do not take the time to learn the system well enough. It turns out that losing the count (or miscalculating the count) when card counting decreases your odds of winning even more than not card counting at all. So, most of the time the idiots trying to card count offset the winnings of the real card counters. Add in the fact that pit bosses only go after the successful card counters, and you can see that casinos actually LIKE to have "card counters" playing in their casinos. Granted teams like the MIT card counting group took some of the major casinos for a lot of money - these are few and far between. Casinos make out in the long run, else why would they continue an unprofitable business?

Perhaps system trading is the same. Many people think there is a ton of money to be made in system trading and try to create the Holy Grail. Most end up losing their money trying to decode the market. The ones who make money system trading are few and far between... but like the MIT group and other pioneers of card counting, they make a killing before being stopped.

-Justin