I'm Nearly in THAT 90% Category

This is a discussion on I'm Nearly in THAT 90% Category within the General Trading Chat forums, part of the Reception category; Originally Posted by sangfroidFX Yes yes, we all know of the "90% of traders fail" comments, the thing is I ...

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Old Nov 2, 2009, 2:38am   #73
 
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hang in there...

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Originally Posted by sangfroidFX View Post
Yes yes, we all know of the "90% of traders fail" comments, the thing is I really don't want to be one of those. I'm going to be brutally honest about myself here, and what I'd like from people who read this is advice. When I say advice, I mean any advice, even if it's give up. I'm not expecting for 'magic' solve all answers, even if no one reads this I think by writing it down and reading it for myself might help, therapy almost!

First off, let me tell you about my background, this is just so people can get a general idea of why I'm trading and what I'm trying to achieve. I'm 28, and a law graduate who incidentally doesn't work in the law field. I currently work nights in a hotel. The reason I took this job is it fits in perfectly with my trading. I'd like to eventually trade full time from home. That's it, no ifs no buts. Trade full time from home.

I'm single, no kids, no mortgage. I've small outgoings, mainly rent and bills.... the usual. In order to make forex my main source of income, I would need to earn between £12,000 and £15,000pa to live quite comfortably.

Now, I've been trading forex for three years. The first year and a half was on a demo account, this easy I thought, I'm making thousands. I invested £400 and promptly blew my account in a little under two weeks. Why? I knew NOTHING. My leverage was stupidly high, the lot size I was using was too high, I had no idea my emotions would suddenly come into play and effect every decison I made.

So, a year and a half on, demo trading up until then. Reading everything I can. Studying, practicing, re-reading the same books and internet forums. I invest £1000,
"this time I'm ready, this is it, this is the time". I use leverage of 1:100 and a lot size of 0.2. Careful money management is my plan. Don't run before you can walk. Start slow this isn't get rich quick. Build on this capital now until I can make consistent profits. I have a tested system and strategy. I have a trading plan. I know what times suit me and what times don't. I know what pairs I'm going to trade.

Everything starts off well, I make a few quid here and a few quid there, at the end of the first week I'm up with consistent profit. I'm using a simple macd crossover on a 5min chart with Heiken Ashi bars for entry and using the H1 for S/R levels. Typically I'll take profit around 5 pips. Why? I don't need to make that much money, this is a business for me, a living, only make what I need. 5 pips, 4 times a day with careful money management was my plan, easy huh! I avoided fundamentals like the plague. The thing I found I was saying was... "why the f**k didn't I leave that trade open? I could've hit my target for the week with that one trade". Never the less, I was making profit... lets not get greedy, take the profit, take the profit, take the profit was my motto. I'm quite an emotional person by nature, I'm not that greedy, in fact I'm quite risk averse. Occasionally the price would go in my favour, I'd take the profit bang on the mark before it turns the other way. "See", I'd say to myself, "imagine if you left that open, then you'd be sorry".

Into the second week and I got greedy, opening a trade against my trading plan, I never should've opened the trade and I got burned, and rightly so. I lose the profit I made the week before. I say to myself, "it's ok it's only the profit from last week" and "we all have to take losses every now and again". I trade without Stop Losses, prefering a mental Stop Loss if you like. I decide when the trade is no longer valid. I go on to make a few consecutive wins that week, enough to keep me in the game!

Third week and it falls apart totally. Monday starts of as usual, a couple of good trades, perhaps could've left the positon open a bit longer but still made some profit. I open a position, the price moves in my favour, I don't take the profit this time too early, before I know it the price is going the other way and I'm down. Closed the trade. I went away from my computer for half an hour or so, come back and low and behold, the price went the way I thought it would. Ok so what do I do next time that happens, hold the trade of course, have confidence in yourself, expect a bit of DD every now and again. The loss was big but not massive, just one of those things I tell myself, emotion, was very negative and I was very pissed off with myself.

A few days later (after two or three small good trades) the same thing happens again, ok this time I'm going to hold it for a bit, grow some balls!! Don't take losses, not everyone has to take losses It's going to turn round and come my way, BANG emotions come flooding in, screaming CLOSE CLOSE CLOSE. I close and make another loss the same size as last week. My account from an intial £1000 from having a high of £1080 inside two weeks, now reads £850.

Ok so what do I do? I know, I've been playing around with Systematic (automated trading using robots) through the broker Alpari. I've had numerous demo accounts and It's been fairly successful. I'll put that £850 into Systematic, sort my automated portfolio out and let some robots trade for me, the demo has been good.

Two days later my account now reads £350.

HELP! I really am stuck for ideas now. Don't get me wrong, I realise £1000 in the grand scheme is nothing. I was not expecting to go full time on £1000 I was using this to get the emotional side of trading with real money.

Are some people just not cut out for trading? If there are any newbies reading this please take this advice. Forex is not easy, emotions are everything in this environment, I underestimated that when I first started. I used to be of the belief that anybody can do anything if they try hard enough. I've been doing this for three years and am still no closer now as to where I was when I blew my first account! Maybe I need to change my strategy, maybe I need to start all over again. Maybe I need to read more books. Maybe I need to control my emotions more. MAYBE MAYBE MAYBE.....
yep, been there, done that. my apologies in advance if this is repeating comments from others. i am still quite new at this also, but from what i can see, you were actually doing ok to start with, having a trading plan that you had tested and seemed to be working. however, i would do something like sticking to risking 1% of your account per trade and defo use a stop loss to enforce this - (and don't move the stop loss!). That way you are not going to be wiped out by either a large loss, or a string of smaller losses. i wouldn't get psyched out by taking small profits and later finding that the mkt keeps moving in your favour just yet, seems to me that the key focus for you at the moment should be cutting your losses before they get out of hand - ie actually sticking to a money management plan. the way that i look at it, is that we are in the business of taking risk to earn an expected payoff, not every trade is going to pay off, and you will lose money on trades, but as long as you are taking a pre-determined amount of risk for each trade (ie have a money management plan), then that is acceptable. what is not acceptable is that you lose more money on a trade than you have pre-determined in your money management plan. i also think that having a TP lvl is also a great idea, but i have also tended to try and move my stop losses up to break-even once a trade starts to move in my favour, that way you are not letting your profits turn into losses. All up, i think you should keep going, forget about making $$, focus on taking all the trades that your trading plan spits out, and stick to your money management plan when you trade...oh yeah, and i wouldn't use robots. I think trading is also about getting a feel for price action and how your market trades which will become a bigger part of your trading plan once guys like us get more experience...you can't get that frrom a robot! for the time being, focus on sticking to your trading pland AND your money management plan and execute the trades yourself. hope this helps!

Last edited by spy74; Nov 2, 2009 at 2:41am. Reason: added a new sentence
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Old Nov 2, 2009, 11:15am   #74
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Originally Posted by virtuos0 View Post
Don't be a pratt, of course you wouldn't be £650 up, have a think about it.

Why don't you go up to the next homeless person you see and say to him ,"you know what mate, if you had just done the opposite with your life you would be living in a castle sipping cognac from a diamond-encrusted goblet" maybe you can turn their life around.
you are a beast...you been away at one of your steering committee/Bildeberger meet ups again?
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Old Nov 2, 2009, 3:04pm   #75
 
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you are a beast...you been away at one of your steering committee/Bildeberger meet ups again?
You mean he's either a driving instructor, a brickie, or mixes household emulsion paint?

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Old Nov 3, 2009, 11:14am   #76
 
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sangfroidFX,check PVT messages...
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Old Nov 3, 2009, 10:53pm   #77
 
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Quote:
Originally Posted by virtuos0 View Post
Don't be a pratt, of course you wouldn't be £650 up, have a think about it.

Why don't you go up to the next homeless person you see and say to him ,"you know what mate, if you had just done the opposite with your life you would be living in a castle sipping cognac from a diamond-encrusted goblet" maybe you can turn their life around.
Why not .....?
If all stops & limits had been swopped around.

The contrast with a homeless person is just stupid.

Its a well known fact that if do the opposite to a complete novice you will end up!...by the same amount!!!!....I have done it acting as a hedge fund!!!!

I mention it to provoke some thought.



It amazes me that you even have people agreeing with you...Its laughable.
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Old Nov 3, 2009, 11:43pm   #78
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agreed, Windowsill.
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Old Nov 4, 2009, 12:06am   #79
 
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Originally Posted by Windowsill View Post
Its a well known fact that if do the opposite to a complete novice you will end up!...by the same amount!!!!....I have done it acting as a hedge fund!!!!.
and of course when the complete novice gets a winning trade, you'll be down by the same amount.

The complete novice is trading at completely at random, and that means you are also trading at random, and so over time, you'll get the same results

Theres nothing wrong with randomly opening trades, but you dont need the time and trouble of roping in an accomplice, a coin will will do just fine.
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Old Nov 4, 2009, 12:17am   #80
 
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Quote:
Originally Posted by Windowsill View Post
Why not .....?
If all stops & limits had been swopped around.

The contrast with a homeless person is just stupid.

Its a well known fact that if do the opposite to a complete novice you will end up!...by the same amount!!!!....I have done it acting as a hedge fund!!!!

I mention it to provoke some thought.



It amazes me that you even have people agreeing with you...Its laughable.
Firstly let us imagine that we weren't even talking about human beings but emotion free algo's, one algo sells and the other buys at the exact same time using market orders, and they both take profit and stop losses at ten pips. Does one win what the other loses? Absolutely not, because of the effects of slippage. It's more than possible, in fact it's common for there to be slippage on the buy side and not on the sell side, depending on available liquidity and volatility.

As far as a human trader finding he has a losing system and choosing to do the opposite, as Zupcon points out all you are doing is picking the other side of the coin. Because of the spread you pay you will lose in the long run. It's no different than the guy in a coin toss game seeing that after 100 flips he has picked heads and is 60:40 down, and deciding to swap and pick tails for the next 100 flips. Is he then going to automatically win 60:40 as he would have in the previous set of flips? Of course not!
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