Interview - what's next with Daniel Kostecki?

Interview with Daniel Kostecki, former analyst at DM HFT Brokers and X-Trade Brokers, known from internet forums and blogs under the pseudonym "magictrader". What has he prepared for us, what does he think about the situations that took place on the domestic Forex market? We invite you to read an interview with one of the speakers at Expo FxCuffs 2017.

What are you doing now, after leaving HFT Brokers?

After six years of working in brokerage houses, I decided it was time to try my hand at my own project, which aims to spread access to knowledge and information on financial markets, as this subject is becoming less and less popular in nationwide media. I manage to achieve this goal by setting up the first internet TV channel in Poland dealing with financial markets - the marketplace.tv. During the transmission, I share with the viewers information that the markets live in a given moment, we look at the charts, or we discuss the topic, because viewers can confidently participate in the transmission via chat.

What is more, the programs are also invited to guests who are experts in their fields and shed more light on current topics. Answer in one sentence - after leaving HFT I share knowledge and information about the market, because I like to do it in a project that was not yet in our country.

Do you still act as an analyst and you will be giving media coverage?

Yes, it has remained unchanged. I continue to analyze the market situation and provide media coverage whenever necessary, maintaining contacts with journalists. However, I have a little less time for it than before.

Do you have time to trade?

I had the most time for trading at university. Later it was different, but the 2010-2014 years were also marked by a constant presence on the market. Then in the years 2014-2016 time was definitely less, which involved interesting challenges in the newly emerging brokerage house. The market has not changed, neither has the method changed, but the change in the environment caused that I had to stop trading because the losses deepened, because the lack of time and focus were giving away. This, on the other hand, led to the search for new methods and ways of trading, which absorb much less time and attention. At present, the trading time will be in live or in between. Already once with the change of the environment, which affected the trading, I managed, I would manage and the second time.

On what platform do you trade?

Previously, it was always a classic and well-known Meta Trader 4, but currently it is a xStation platform. In today's world, where you use so many mobile devices, it is important to have access to your own analyzes, settings and charts always at hand, and this solution is provided by xStation. In addition, I have a fondness for this platform, because while working in XTB I also helped with the implementation of several small functions, corresponding to the needs of traders.

What is your recipe for successful trading, some advice / suggestions for new traders?

The less you do, the better. There is nothing worse than the so-called overtrading or falling into a whirlwind of orders, where one transaction is chasing the other and there is no place to focus, control and rethink the situation, which may lead to a series of unsuccessful transactions in a very short time, which in turn translates very unfavorably into the trader's psyche. This is also where the subject of capital management comes into play and, above all, it is never allowed to averify lossy positions, as this is the main reason for the loss of the majority of deposits along with the unwise application of too much leverage to the funds held. It is said that there is only one easier thing than making money - losing it. Therefore, all attention should be focused on losing as little as possible, and then it will be easier to make money.

What are your favorite instruments?

I only traded exclusively on the EURUSD pair at one time. However, later it was extended to the main currencies and cross-lines between them, that is everything related to USD, EUR, CHF, JPY, GBP, AUD, NZD, CAD.

What is your investment strategy based on?

Mainly I base on the analysis of the graph in terms of Fal Elliott theory, classical technical analysis and I support this with volume. On the other hand, from the fundamental perspective, which sets trends in long terms, I look at the interest rate market and markets dependent on it to know long-term trends.

Do you think that beginners on Forex should use demo accounts?

A demo account is useful for getting to know the platform's functions. We then learn how to enter into transactions, modify transactions, get to know the platform interface, available tools, etc., while trading on a demo platform to check the results of transactions can pass the goal because the real account comes from real money. At that time, demo-based patterns of conduct in concluding and conducting transactions may not be effective, because emotions will do their job. Therefore, with the very low entry barriers present, it is even better to start real-world trading with the smallest amount and learn the impact of emotions on the behavior of the trader at once. After such attempts, everyone can then decide whether he wants to invest further or not and take care of other things.

What should you pay attention to when choosing a Forex / CFD broker?

First of all, the credibility of the institution with which we want to cooperate. Even a good friend of mine could be mistaken on the phone and lost money - unfortunately he contacted me only after the fact and it was not possible to recover them. Keep in mind that it's about our money and the same as we do not choose a bank by phone, because someone called us with a great offer, the same should be approached to brokers. So credibility, supervision, history of the company and the best office and service in our native language. I did not mention here the choice about the offer only because the market has become very competitive and the offers can be very similar.

What do you think about the Polish Forex market, where are we going?

For me, the Polish FX market has been like the mobile phone market in our country for several years. There are several most recognizable entities on the market for years, among which are divided Customers, and the rest of the entities try their forces with a better or worse effect. It will not change in the near future - or the larger entity / entities will take over smaller ones. However, when it comes to the side of not an institution and traders, the Polish market looks quite professional - I have feelings. We have access to a really large range of knowledge, which is constantly expanding, we do not stand out in any way. In Poland, there are world-class stars on trade or education - we are also in the lead and we are moving forward.

How important is investor education, especially in the Forex market?

It's the most important thing. Anyone who wants to learn something new or acquire new skills must start with education. It is not possible otherwise, as if you never drive a car immediately to the F1 car and try to drive (or even without problems) to go through one corner - not to mention the whole lap. It must end with an accident. Therefore, gradual education, acquiring new knowledge and skills is crucial to go first through the stage of unconscious incompetence, conscious incompetence, conscious competence and unconscious competence. It is also important to know yourself, or how you react in specific situations. Does it get into a state of euphoria, depression, joy, sadness, etc. It sounds maybe a bit strange, but it is full of emotions that it has to deal with. Forex / CFD meetings, workshops or webinars are also very important. For example, XTB organizes regular Trading Club meetings, every Thursday in its office at Ogrodowa 58. I am a special guest there and I think that there should be more such initiatives, where traders will be able to meet market practitioners and exchange insights with each other.

What do you think about the latest KNF guidelines and what impact they may have on the Forex market in Poland?

As you can see, the guidelines have not changed much for clients of regulated institutions - even the reduction of leverage by most probably was not felt, because just few people use such a high leverage. I also think that we should not go crazy. After all, it is not forbidden to drive a car because there are accidents. The same goes for the preparation, awareness and consistency of market activities for the portfolio and account balance. The Commission could instead of restrictive measures carry out educational and awareness-raising activities, but in an objective manner.

In recent months, several brokerage houses / brokers have resigned from providing Forex services. Do you think it should be interpreted as a disturbing signal or simply a market reality?

If there is demand, there will be and supply. As long as clients of brokerage houses want to participate in the currency market and CFD instruments, there will be no alarming signal. Hence, it is a market reality, where at one time "on a hurray" part of the entities opened CFD trading services probably for reasons that others have such services and that you can make money on it. However, it was not a key business for them, and the profits were insignificant compared to other services. If we add some black PR to it, then the recipe for closing the activity in this area will be ready.

As it happens in the free market, they will become the strongest.

Thank you for the conversation.

Daniel Kostecki will be one speaker at the Expo FxCuffs 2017 in Krakow. Subscribe today, completely free.

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