Book Image

Getting Started with Forex Trading Using Python

By : Alex Krishtop
Book Image

Getting Started with Forex Trading Using Python

By: Alex Krishtop

Overview of this book

Algorithm-based trading is a popular choice for Python programmers due to its apparent simplicity. However, very few traders get the results they want, partly because they aren’t able to capture the complexity of the factors that influence the market. Getting Started with Forex Trading Using Python helps you understand the market and build an application that reaps desirable results. The book is a comprehensive guide to everything that is market-related: data, orders, trading venues, and risk. From the programming side, you’ll learn the general architecture of trading applications, systemic risk management, de-facto industry standards such as FIX protocol, and practical examples of using simple Python codes. You’ll gain an understanding of how to connect to data sources and brokers, implement trading logic, and perform realistic tests. Throughout the book, you’ll be encouraged to further study the intricacies of algo trading with the help of code snippets. By the end of this book, you’ll have a deep understanding of the fx market from the perspective of a professional trader. You’ll learn to retrieve market data, clean it, filter it, compress it into various formats, apply trading logic, emulate the execution of orders, and test the trading app before trading live.
Table of Contents (21 chapters)
1
Part 1: Introduction to FX Trading Strategy Development
5
Part 2: General Architecture of a Trading Application and A Detailed Study of Its Components
11
Part 3: Orders, Trading Strategies, and Their Performance
15
Part 4: Strategies, Performance Analysis, and Vistas

Why do I need all this?

Well, actually you don’t. Of course, you can just quickly download unclear historical price data from an unknown source, develop a model using tools you don’t fully understand and optimize it using this data, connect to an unknown broker and start trading. The question is: will this trading be successful? Most likely not.

If you read this chapter carefully, you’ll most likely already understand why.

Firstly, when you plan to use certain historical price data for your models you should realize what exactly you are going to use: whether it’s last trade, bid, ask, or both, or anything else. You should check if historical data contains correct timestamps and that no tick is dated earlier than the preceding one. You may want to make sure the data you use contains information about trading volume – otherwise, you won’t be able to develop a wide range of trading strategies. You should make sure that data is clean and...