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Review of The Forex & Options Expo (Las Vegas, August 2-4, 2009)

Thursday, August 13th, 2009

I traveled to Las Vegas last week to attend my first Forex & Options Expo.  As a guy who trades from home, I looked forward to gaining a trading insight or two and then going back to my hotel to lounge around the pool in contemplation.  I had received a packet in the mail with a show schedule on which I studiously marked all of the presentations I thought would be insightful (I have since learned what to avoid as well as what to try and make).  Once in Las Vegas, I summoned all of my will power to walk past the poker rooms and into the conference rooms.

The Expo

I was surprised by how small the expo felt.  There are hundreds of brokerages out there, but less than a dozen had boothes at the show, amongst them GFT, FXDD, and InterbankFX (IBFX).  I didn’t see any red light/green light type of trading platforms (or did I just avert my eyes?), but there were a few education companies willing to teach you how to read the market, such as FX Bootcamp and SolomonFX.  There were a few publishers, such as Futures Magazine, Stocks & Commodities, Active Trader, and Traders Press.

I was actually interested in visiting the Dukascopy booth, but they pulled out before the show even began.  Bummer.  I was hoping they would have been stationed right next to the National Futures Association (NFA) booth so our nation’s regulators could hear just how many traders were fleeing to overseas brokers to escape their draconian regulations.

The InterbankFX booth had a 10-minute scalping competiion.  It definitely was a draw and I managed to get a seat to compete.  I was leading until the very last minute-and-a-half when the trade went against me.  Doh!  But unlike the real world of trading, I was a winner because I was given a little USB flash drive for my time—the actual winner was given an iPod.  It was pretty fun, but they could have put those trading stations to better use by having a trading pro sit with us, simulate a few market conditions and show us how they would trade it (with us pulling the triggers at our workstations).  If IBFX had done that, I imagine they would have had a lot of people opening accounts with them.

That being said, I thought the GFT booth was where it was really happening.  I’m not big on swag, but they gave away little booklets of trading tips (isn’t that why most people are there?).  And who kept appearing at the GFT booth to explain trading strategies and tips?  Why author Kathy Lien of course (who is director of currency research at GFT).  As far as deals go, rather than give away 10% or 8% bonuses for depositing your money with them as were the deals from IBFX and FXDD respectively, GFT was giving away a more modest $200 account deposit bonus and a seat at an exclusive presentation by Kathy Lien and Boris Schlossberg.  I’m not a fan of Kathy or Boris, but the thought of a little education was a little more tempting than cash.

Skipping the options and stock market vendors, I walked past all the boothes during one of the hour-long breaks.  But I hadn’t gone to the expo to check out marketing materials, I came for the presentations after all.

The Presentations

There were actually a few presentations that made the trip out to the desert worth it.  But having gone to a few duds, I have developed three rules to filter what I will attend at future expos:

1. If it is presented by an education company, forget going to their presentations—they are pure sales pitches.  What could they sell you after they tell you the specifics for free?  The one exception to this is a live trading presentation (where you can actually see them putting their money where their mouthes are).

2. If the presentation description mentions anything about Elliot Waves walk away.  If they spring it on you after you have taken your seat, run for the exit.  I’m not discounting the framework, but it can’t be covered in a 1-2 hour presentation with any meat—there are too many people at the show who just aren’t familiar with it and the presentation becomes an education in the theory instead of the trading mechanics.

3. If they neither tell you something you didn’t know nor tell you what you came to see in 10 minutes (or at least promise to show you what you came to see), walk out.  Some time slots are packed with good speakers—why waste an opportunity to see the really good ones?

Below are my reviews of the sessions I attended.  Some of them actually contained trading strategies that could be somewhat easily scripted and thus back tested.  I’ll review some of these strategies in-depth at a later time.

Advanced Order Types Tailored for the Active Currency Trader (Sunday, August 2, 12PM)

Presented by Steve Quirk & Don Kaufman, Instructors at Thinkorswim

The presentation featured no slides, a platform most people hadn’t seen and pretty little information about the stated topic of order types.  They pretty much were just showing off the thinkorswim trading platform which allows traders to set their entry and stop losses visually on the chart they are making their trading decisions from.  They were also touting a future feature of the platform where you could construct alerts and trading robots by dragging-and-dropping trading indicators and logic on a palette.  Cool features, but ones I didn’t need a whole hour to see nor expected to see at all.

Rating: Ugh! I passed up a tour of a chocolate factory for this?

InterbankFX Q&A Session (Sunday, August 2 6:00PM)

An invite went out to IBFX customers (me included) to meet with staff for an informal discussion of IBFX.  Personally, IBFX has been a headache for me as a trader (look for my review of them at a later date), so I had a list of points I wanted to bring up with them.  Marilyn McDonald, VP of Customer Experience, did most of the answering of questions.  She came off as a straight shooter and appeared to answer our questions honestly.  On the topic of how they were going to handle the new NFA FIFO regulations, they said they had developed their own back-end solution that would allow you to decide in which order you wanted to close trades as long as each trade had a different lot size.  There solution was different than the one MetaQuotes (the company that develops the MetaTrader Platform) had developed and hence trade execution with other brokers running MT4 may be different than that of IBFX. It also meant they were going from the normal MetaTrader statement e-mailed to you to an e-mail announcement with a link to your daily trading report (cludgy if you ask me—I love seeing my trades in chart form directly in the e-mail).  On the topic of the new NFA hedging regulations, they said it was on their to do list.  As for the annoyingly frequent problems with their data feed, one of the staff knew about the problem, but Marilyn did not.  The staff member explained the problem and Marilyn said she would give me her contact info later so I could contact her because customer support was blowing me off.  After the meeting, Marilyn didn’t seem to remember she promised me her contact info, but she did hand me a t-shirt for coming.

Rating: Ok (no marketing B.S., but I was disappointed Marilyn didn’t give me her contact info—I asked about a third of the questions during the session, so I can’t imagine she forgot me)

Live Forex Trading with Wayne McDonell, Chief Currency Coach, FX Bootcamp (Monday, August 3, 6:15AM)

I had driven out to see Wayne McDonell earlier this year in Cal State Fullerton where he gave us a two hour talk on fundamentals, quickly listed the technical indicators he used, and by golly, he ran out of time to show us how he put them in play.  He more or less said then that fundamentals are more interesting to him than the technical mechanics of trading.  But when I saw that McDonell was going to do a live trading demonstration, I woke up extra early to get to his presentation to see him set up his charts and pull the trigger.  This time around, he set up his charts and then basically talked about fundamentals for two hours.  We watched as the USDJPY spiked, retraced and spiked again, but the guy didn’t take the trade at all.  Pretty disappointing.  Now I don’t expect the perfect trade to appear during a two-hour demo, but I expect a guy logged into a $5 million trading account trying to demonstrate his trading method to at least throw on a micro mini lot on a genuine set-up.  Heck, I would have been happy if he told us he was using a demo account so he could feel free to take a more aggressive trade.

The chart set-up looked like it could work, although it was a heck of a lot of indicators to look at for trading in a single time frame (for the demonstration, he was trading on a 5 minute chart) .  He used 5, 21, 55 and 200 period exponential moving averages (EMAs), an 8 period simple moving average (SMA), Bollinger Bands at 2 standard deviations, a MACD set at 21, 55, & 8 and stoichastics set at 8, 3 & 5.  He also threw on some Fibonacci retracement lines during a set-up to determine support and resistance.  I could go on into more details about what he looked for in each of the indicators, but after watching him unable to place a trade, why would I write any more about it?

As an aside, it should be noted that InterbankFX was the sponsor of this live trading session.  As a promotion, FX Bootcamp was offering one month of their service for free for telling your existing broker (which included FXSolutions, FXCM, GFT, Forex.com and InterbankFX) to list FX Bootcamp as your introducing broker (new accounts got two months free).  Well, when I contacted InterbankFX (my broker) to have them list FX Bootcamp as my introducing broker (Introducing Advisor (IA) in InterbankFX-speak), they said they had no deal with FX Bootcamp.  When I contacted Wayne via an e-mail address his staff gave me at the show, I got no response.  I’m not sure who is to blame here, but they sure didn’t make me happy.

Rating: Meh, but at least the demo and subsequent deceiving promotion offer made up my mind not to subscribe to FX Bootcamp and hurry along my efforts to find a better broker.

High Probability Breakout Trading in the Forex Market (Monday, August 3, 10AM)

Presented by James Chen, Chief Technical Strategist, FX Solutions, LLC

Author of

This was actually the first good presentation I saw at the Expo.  James spoke well, showed us different consolidation and breakout patterns using a variety of common tools, such as horizontal support and resistance lines, trendlines and channels, moving averages, Bollinger bands, and Point & Figure chart patterns.  I don’t currently trade with either Bollinger bands or PF charts, but his set-ups using those tools looked so simple I’ve put it on my list of future trading methods to evaluate.

In case you are wondering, James says that FX Solutions offers Point and Figure charting tools.

Rating: Good.  It would have been better if he actually walked us through a few trade set-ups step by step. Or actually told us which methods he prefers.

How to Earn a Full-Time Income Trading Forex (Monday, August 3, 1:15PM)

Presented by Robert Sharpe, Founder and CEO, SolomonFX

Robert Sharpe gave us his rags-to-riches story.  Then he broke down the trading system his school teaches into measuring risk appetite, measuring currency strength, and timing the market.  He claimed to be teaching us how to measure risk appetite (but he didn’t, because it’s their proprietary algorithm) and then said we would have to watch another presentation, “How the Other 5% of Traders are Winning at Forex”, for coverage of the other two aspects of their system.  I’d rather be amongst the 95% of the other traders attending better seminars.

Rating: Ugh! I regret missing out on the “Fast and Furious Trading” presentation by Kathy Lien and Boris Schlossberg which ran at the same time.

FX360.com Tips and Trading Strategies (Monday, August 3, 2:30PM)

Presented by Kathy Lien, Director of Currency Research, GFT

Author of

Kathy presented 10 tips.  By my count, 7 of them involved intermarket analysis (such as AUD strenghtening when US ISM reports are positive), which for me are only useful for impressing my friends with my knowledge of world economics at parties.  But I found her first couple of tips most interesting—volatility for US and European currencies tended to increase from August to December and then sort of taper off while JPY pairs peak in March.  Maybe I’ll not trade April through July next year…hmmm…  And her other interesting observation was that pairs exhibited a monthly bias to whether they went up or down (basically, they had seasonal patterns).  Not exactly earth shattering news—I’ve seen these similar observations published before, but it was nice to be reminded of them.

If this were all that were presented, I would have wished I had stayed by the pool.  But alas, Lien described a Bollinger Band Retracement strategy using two sets of bands 1 and 2 standard deviations apart. I have no idea how this strategy pertained to the 10 tips, but at least it was something I could fool around with at home.  And one that I absolutely have to test out just because it is so simple was an extension fade: look for a major pair to record 7 or more of consecutively bearish or bullish candles, then enter a trade in the opposite direction after the US Session close with a 30 PIP stop loss and with targets of 60 and 120 PIPs.  I am always skeptical of trading strategies that use fixed PIP stop losses and take profits, but I wouldn’t mind checking something like this out.

Rating: Good.  A couple of trading strategies kept this from being a presentation to skip.

Trading Strategies of a Professional FX Trader (Tuesday, August 4, 10AM)

Presented by Todd Gordon, Senior Technical Strategist, FOREX.com

I actually don’t know if Gordon ever made it to any actual trading strategies.  I left half way through the presentation when he started to hand out prizes to audience members who could distinguish Elliot waves labeled i, ii, iii from those labeled I, II, III.  This presentation on Elliot Waves was not bad, just not good use of time for someone with any trading experience looking to start testing trading ideas right after the show.

Rating: To be fair, I can’t rate it because I didn’t sit through the whole presentation.  But I wish either the presentation title or the speaker profile in the resource guide gave me a clue I was walking into an Elliot Wave class.

Forex Technical Indicators and Trading Set-Ups (Tuesday, August 4, 1:15PM)

Presented by Jeffrey Baskin, Director of Client Education, FXDD

Jeffrey Baskin knew what we wanted.  After a few slides on chart patterns like double tops, he asked us if we wanted to skip them and look at real charts and setups.  The vast majority of people wanted that, so he pretty much dived into charts.  This was the only presentation I attended that mentioned Ichimoku clouds, which was refreshing.  He also mentioned the Vegas Tunnel strategy using the 144 & 169 EMAs (several other presenters mentioned that same strategy—was it just because we were in Las Vegas?).

Jeffrey said he traded Daily, 4-hour and 1-hour charts containing the 100 & 200 period SMAs, the 144 & 169 EMAs and the Ichimoku Cloud (with no indicator signals).  The SMAs were both trend indicators and support/resistance lines.  He didn’t actually size up a trade and describe entry and exit prices, but the way he described the charts he was doing entries off bounces or breaks of support and resistance.  Candle closure beyond moving averages or into or out of the Ichimoku cloud constituted a break of support or resistance.

Rating: Good. (Would have been excellent if he went into detail of how he calculated entry and exits of a few trades).

How to Trade News with Technical Indicators (Tuesday, August 4, 2:30PM)

Presented by Boris Schlossberg, GFT

Author of

This presentation was completely not what I expected and introduced the most bizarre concept I saw at the show.  In a nutshell, the technical indicator he proposed trading with was actually a report (available to GFT customers) which forecasted price action for the next US trading session (only the US Session).  This report would be ready before the US Session began and would depict price action at an hourly interval on a chart.  So, if the report showed price action would break down early in the US Session and then quickly rally in the opposite direction, you were supposed to take that possible scenario into account when trying to decide whether or not to follow your indicators.  Boris admitted the forecasts were sometimes wrong, but wasn’t able to describe to what extent.  He also suggested not trading the report directly, but instead using it to supplement your indicators.

I thought to myself, my technical analysis and indicators project a highly probable future for me…why would I want someone else’s chart analysis showing an uncertain future to guide me.  I also thought it was kind of funny that he presented it, because he focuses his analysis on the European market.  No one asked if he (or anyone) actually traded with it.

Rating: Huh?  Was this an August Fool’s prank?

Forex Trading for Maximum Profit (Tuesday, August 4, 4:30PM)

Presented by Raghee Horner

Author of

By the middle of Tuesday, I was dead tired and the conference rooms at Caesar’s Palace were icy tombs.  I had tried to read Rahee Horner’s books before, but her trading philosophies and habits were so different from my own that I sort of lost interest after reading a few pages.  So I was pretty tempted to jump ship and head out of town instead of waiting for her to present, but the fact that Raghee Horner is an actual trader for a living made me stick it out and stay for the final presentation at the Expo.

I am so glad.  It was the best presentation at the Expo and I can honestly say that some of her ideas have made their way into my trading and have improved my results.  Her trading set-ups and strategies can be found in her books, but the one I have been playing around with this last week involve using Autochartist to identify triangles, wait for the price to breakout and then take the trade in the breakout direction only if the MACD (12,26,9) points in the direction of the break out and the commodity channel index (CCI) (20 period) breaks out above 100 or below -100 (in the same direction as the price action).  Simple strategy. Kind of hard to back test given the use of chart patterns, but from what I’ve seen, seems pretty effective.

Prior to her talk, I was biased toward not using timeframes below 1 hour for my set-ups—I thought they were too noisy.  After her presentation, I re-examined my trading strategies at the 30 minute chart for several set-ups in the last few days, and timing my entries in that time frame resulted in good results with better risk characteristics than some of my hourly set-ups.

Thanks, Raghee!

Rating: Excellent.  I will try and read and review her books at some point in the future.

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