B
Black Swan
Can you remember the stage were you finally begin to get an edge/strat together, you follow it to the absolute letter (planning trades/trading the plan). For a couple of days you bag pips, then the next day you lose a couple of percent from your account.."but how, I followed the plan to the letter..?" Then the next day you have a losing day, not as bad as the previous, only 1%, but now the gains you made on the previous two are wiped out and you fear another losing day as that would completely blow apart the faith you had in the edge you thought you had, an *edge* that you've taken a month to get to grips with..You also realise it's going to take at least a week of trading to get back to where you were..you're going to need perhaps 4 days of straight wins to break even...5hit..
Ever done this; you trade off 10/15 min TFs, you have a great day, you take 6 trades, 4 winners 2 losses = 80 pips for the day. "That's it *grail* found! This time next year Rodney".. Then the next day you have 4 losses 2 winners, you give back your gains by losing 80 pips. You then look at what would have happened on day 2 if you'd traded using the same entry exit criteria and MM on a 1 hr TF. You'd have taken 2 trades, one loss of 50 pips one winner of 30 pips, only a twenty pip loss.."OK decision made, I'll move up a few TFs that'll sort it..!"
So you now trade off the 1 hr TFs, and guess what you have a 2 day losing streak, but you've taken 4 trades, 3 loss, 1 winner a loss over the 2 days of 60 pips but there's something different, you felt in control, despite the alerts flashing and all your indicators lining up screaming "trade" you didn't feel rushed, not that you were happy to give pips back to the market, but it somehow felt different to how you had traded off the 10/15 mins. Then it hits you, "what would it have been like trading off the original 10/15 mins?" You look and you see that you'd have taken ten trades off the 10/15, 7 losses 2 winners 1 breakeven,,"Fook, what a mess! Am I glad I moved away from that type of trading.." Then it hits you, a real Eureka moment in relation to trading, when the market is gyrating or stuck in a tight range, (which it does for the 70/80% of the time), you're best sitting on your hands because chasing it, engaging with it is a total waste of time, so if you do engage you're taking a much better probability shot than on the smaller TFs..
We're told to look after the money, but what about looking after your psyche, how emotionally (and at times physically) exhausted do you become if you take 4 losing 15 min TF trades (4 x 25 pip losses) in the morning session, realising you now may need 5 winners to have a decent winning day? Compare that to the *hurt* of taking one losing trade in the morning session for 40-50 pips and still feeling/believing that you can finish up for the day when NY opens.
If you trade FX off small TFs you need lightening reactions, you need the best/fastest hardware, you need close to zero spreads from the 'Autobahns' of this world, you need (genuine) NDD/ECN, you need to have a mindset that is crucially different from the normal retail trader, a mindest that has been honed to 'trader perfection', over years of proven success and mentorship from colleagues sitting next to you that regularly pull down mega salaries because they've proven their worth over the years. If that description doesn't fit you don't fight it, you can pick enough fights with the market where you may fight and live to fight another day, you'll never win trading as a normal retail trader if you trade off small TFs.
Ever done this; you trade off 10/15 min TFs, you have a great day, you take 6 trades, 4 winners 2 losses = 80 pips for the day. "That's it *grail* found! This time next year Rodney".. Then the next day you have 4 losses 2 winners, you give back your gains by losing 80 pips. You then look at what would have happened on day 2 if you'd traded using the same entry exit criteria and MM on a 1 hr TF. You'd have taken 2 trades, one loss of 50 pips one winner of 30 pips, only a twenty pip loss.."OK decision made, I'll move up a few TFs that'll sort it..!"
So you now trade off the 1 hr TFs, and guess what you have a 2 day losing streak, but you've taken 4 trades, 3 loss, 1 winner a loss over the 2 days of 60 pips but there's something different, you felt in control, despite the alerts flashing and all your indicators lining up screaming "trade" you didn't feel rushed, not that you were happy to give pips back to the market, but it somehow felt different to how you had traded off the 10/15 mins. Then it hits you, "what would it have been like trading off the original 10/15 mins?" You look and you see that you'd have taken ten trades off the 10/15, 7 losses 2 winners 1 breakeven,,"Fook, what a mess! Am I glad I moved away from that type of trading.." Then it hits you, a real Eureka moment in relation to trading, when the market is gyrating or stuck in a tight range, (which it does for the 70/80% of the time), you're best sitting on your hands because chasing it, engaging with it is a total waste of time, so if you do engage you're taking a much better probability shot than on the smaller TFs..
We're told to look after the money, but what about looking after your psyche, how emotionally (and at times physically) exhausted do you become if you take 4 losing 15 min TF trades (4 x 25 pip losses) in the morning session, realising you now may need 5 winners to have a decent winning day? Compare that to the *hurt* of taking one losing trade in the morning session for 40-50 pips and still feeling/believing that you can finish up for the day when NY opens.
If you trade FX off small TFs you need lightening reactions, you need the best/fastest hardware, you need close to zero spreads from the 'Autobahns' of this world, you need (genuine) NDD/ECN, you need to have a mindset that is crucially different from the normal retail trader, a mindest that has been honed to 'trader perfection', over years of proven success and mentorship from colleagues sitting next to you that regularly pull down mega salaries because they've proven their worth over the years. If that description doesn't fit you don't fight it, you can pick enough fights with the market where you may fight and live to fight another day, you'll never win trading as a normal retail trader if you trade off small TFs.
