Hello

[fayalac]

Hello, my name is Francisco. I found these site while making a research over forex. I´ve been studying forex for almost four months and found its a challenching option to invest, but i´ve also found it could be highly rewarding. Since my first demo account, which i lost in a matter of hours, through now, that i increased my demo account by about 60% last week, i have found many ways to profit forex but i have also found that i consistently fall in what i call a pip trap, these is, at the end of the day i can have some positions facing each other ( some sale and buy leads ) with a difference of about 100 - 150 pips among them.
To be honest it doesnt worry me much, but i still look how to avoid these traps, i´ve beeen improving my development and closing these pips trap´s difference using a stochastic slow with 14, 24, 3, are these the best parameters?.
I have also read that other investors confirm the trends, before making a decition, using an EMA, anyone knows which would be the best period for these EMA to confirm the trend?.
To be honest, i already feel confortable with my trading method, what i want is to confirm with others what they do, these would help me improve my development.
By the way, i never trade far than 30% in my account, any post cant be far than 10% of my account, when i get a good in/out signal ( using stochastic slow ) i make a desition and i only consider a good in/out signal when these is over/under 80/20.

 

[timsk]

Hi Francisco,
Welcome to T2W.
You say you increased your demo account by 60% in one week - that's fantastic but, I'm sorry to say, it spells disaster! You are highly unlikely to be able to duplicate this with a live account using real money. Even if you do and, let's say, you do it for two or even three weeks on the trot - the forth or fifth week you'll blow your entire account. It's not so much a case of 'if' it will happen but 'when' it will happen. I suspect you're risking way, way too much money on any one trade and recommend that you look very closely at your risk management strategy. Sorry to be the bearer of bad news, but 60% gains in a week aren't realistic.
As for moving averages, the answer depends on the style of trader you are and the timeframe you trade. For example, I day trade and use a 10 period EMA on the timeframe I'm trading plus a 10 EMA on a slower timeframe so I can quickly see where I am viz a viz the intra day trend. If you're swing or position trading using a daily chart, the 50 EMA and 200 EMA's are commonly used.
Tim.

 

[fayalac]

Thanks

Thanks timsk.
Regarding to the blowout chance, let me tell you i have had higher profit but involving higher risks, when i have risked beyond certain limits i´ve always finished with a margin call, you know the results.
Every day i start trading at 8 am local time and through 10 am local, the rest i trade from 6 to 8 pm when the asian markets start, those are my best hours, when i limit my trade to these, normally i make 5 - 6% a day which is 30-35% a week, not bad!, but when i get involved more time i can make up to 8.5% a day which gives me 50-60% a week.
I also make day trade and believe me if i tell you to make 6% a day i make maybe 80-100winning posts, its tired, is stressing but also rewarding.
Anyway you say its unreal, ok, can i ask you what could be real?, it is important, if i feel i have overcome unexperience, then i would like to know what to expect, i dont mind to be told whatever the thruth is.
You can send your answer to [email protected].
Thanks for your time

 

[timsk]

Anyway you say its unreal, ok, can i ask you what could be real?, it is important, if i feel i have overcome unexperience, then i would like to know what to expect, i dont mind to be told whatever the thruth is.

Hi Francisco,
Expectation and reality are rather nebulous and slippery concepts to pin down. The famous story about flees in a jam jar illustrates this rather well, I think. In case you (or anyone else reading this) isn't familiar with it - it goes something like this. . . Put some flees in a jam jar and screw the lid on. The flees will do what flees do which is to jump about a lot and repeatedly hit their heads on the lid of the jar. Eventually, they get very tired of this and learn that there's a barrier that's limiting how far they can jump. At that point, the lid is removed from the jar and, when the flees jump, they only do so to just below where the lid would be if it were still screwed to the jar. The flees could easily jump to freedom, but don't because they perceive a ceiling that is imprisoning them. And so they spend the rest of their lives jumping inside the jar that has no lid.
What's this got to do with trading? Well, it would be quite wrong of me to tell you what you can and can't earn as a trader - to impose my perception of reality and what is (or isn't) possible onto you. I don't want to be the one to put a lid on your trading 'jar'! You may be the exception that breaks the rule, but "8.5% a day which gives me 50-60% a week" puts you right at the very top of the trading premier league - IF you can do this consistently that is. If you can, then my best advice to you is not to listen to anything anyone has to say on this or any other forum! As a rule of thumb, if a daytrader makes 1% per day (i.e. 5% per week or 20% per month) then they are doing very well indeed. Anyone who achieves this doubles their account every five months and that's uncompounded. It all boils down to how much you're prepared to risk on any one trade. Some day traders risk as much as 1% - I am more conservative as I'm just starting out and have a 'disaster stop' of a tenth of that at 0.1%. Gradually, as my experience and confidence grows, backed by consistent performance, I aim to increase this to around 0.5% of total equity.
HTH,
Tim.