Is it really possible to be profitable?

[kompresor]

Hello, my name is James. I am now 2 years in trading, just learning, I find it very difficult to finally be profitable. My question is just ask if you can answer me to the question...

Is it really possible to be profitable?

Thanks, your answer will be much appreciated.

 

[FX Bandit]

Yes.

 

[kompresor]

Thanks.

 

[FX Bandit]

Thanks.

LOL

It just takes a lot of work and thought. But why shouldn't it, just like any occupation that can produce large rewards?

One of the main reasons for failure is that people look for ready-made solutions.

 

[kompresor]

With ready-made solutions you mean these softwares which promise to make you rich while you sleeping right? Haha...

FX Bandit, could you recommend me a good book?

I am novice but with knowledge of the main technical analysis theory. I just finished the book "Technical Analysis of Stock Trends", by Edwards and Magee.

 

[Shakone]

Is it possible to be profitable is not really your question. And whatever you're looking for is unlikely to be found in any book.

 

[FX Bandit]

With ready-made solutions you mean these softwares which promise to make you rich while you sleeping right? Haha...

FX Bandit, could you recommend me a good book?

I am novice but with knowledge of the main technical analysis theory. I just finished the book "Technical Analysis of Stock Trends", by Edwards and Magee.

Reminiscences of a Stock Operator. Absolutely superb - really, really priceless.

For methods or techniques, I don't really know any good books. Pring, I suppose.

My own approach is fairly simple - wait for price to reach pre-defined areas on the chart (which in reality is just a certain price or price-band) and look for indications that it might be moving in a certain direction.

If you can't find clear indications, stay out. I prefer the "good set up, many markets" approach to the "learn one pair" idea.

The best "areas" are those that are obvious or that are drawn by other people. So big numbers, prior highs and lows, pivot zones (areas where prior support becomes resistance and vice versa), support and resistance, floor trader pivots for some markets.

Obvious is better because a lot of action tends to take place around these areas. All traders need orderflow - you can only make money buying if someone buys after you. You can only make money selling if someone sells after you. Orderflow is all that markets are - try to harness it to your advantage. If you can't don't try to fight it - stand aside until you can see an opportunity to harness it.

So you wait for areas that are likely to attract significant orderflow, and trade only if you get a signal to do so.

The signals can be lots of things - I like candle formations. Not because of the candle formation, but because they are a picture of a certain price behaviour that can help me reach a decision about the likely short-term movement of price.

I manage my trades using the same areas of significance - again because there is likely to be a reaction around these areas.

Employ strict money management and develop the right mental attitude to trading - the desire and willingness to learn and the ability to take responsibility for your mistakes (see Reminiscences for help). Accept that losses are inevitable and wring whatever you can out of them - they are the tuition fees you pay the market (Livermore again).

That's about it.

 

[FX Bandit]

One other thing.

Education might be worth paying for. Systems, signals and tips almost certainly are not.

 

[kompresor]

FX Bandit, thanks very much for your answer. I will start this first book.

So, for you, it's useful to pay a course instead of reading more theoretical technical analysis?

Thanks.

 

[kwickwool]

Hey Komp,

You know this is a the game of the gods so to speak, it is a very hard way to make a very easy living and you have to be a certain animal to survive. The are a million systems, key indicators etc etc etc

If it was easy everyone would be making millions on it but it is not and it will suck you dry and chew you up if you dont continually learn from your mistakes.

My advice to you is watch the markets continuously and get to feel how they behave, how each market relates to each other. Get inside the markets and almost feel like you are conducting an orchestra, sounds corny but always feel that anyone who just looks for key indicator points is not actually feeling and seeing exactly what the markets are doing.

Take notes on how the equity markets relate and respond to the major currency pairs as they are so related and give out a lot of info as to where the markets might be headed for starters, keep a diary and note all information you see in your diary and keep reading it so you spot patterns.

Looking for the great key indicator pattern that will make you millions is short lived in my opinion, but then again there are a million opinions you could go by, ultimately you have to drive yourself where you want to go and how much work you want to put into it?

Good luck to you and happy trading

 

[MarketMoverTrader]

It is, you just need an edge (a system, or whatever) and stick to your rules.

Read 'Trading in the Zone'. I'm going to soon add some book resources and reviews to my blog, www.marketmovertrader.net, they will help you find your edge.

Systems can be worth paying for, if they also provide the education.
I have certainly found that to be true for me anyway.

 

[Pat494]

Hey Komp,

You know this is a the game of the gods so to speak, it is a very hard way to make a very easy living and you have to be a certain animal to survive. The are a million systems, key indicators etc etc etc

If it was easy everyone would be making millions on it but it is not and it will suck you dry and chew you up if you dont continually learn from your mistakes.

My advice to you is watch the markets continuously and get to feel how they behave, how each market relates to each other. Get inside the markets and almost feel like you are conducting an orchestra, sounds corny but always feel that anyone who just looks for key indicator points is not actually feeling and seeing exactly what the markets are doing.

Take notes on how the equity markets relate and respond to the major currency pairs as they are so related and give out a lot of info as to where the markets might be headed for starters, keep a diary and note all information you see in your diary and keep reading it so you spot patterns.

Looking for the great key indicator pattern that will make you millions is short lived in my opinion, but then again there are a million opinions you could go by, ultimately you have to drive yourself where you want to go and how much work you want to put into it?

Good luck to you and happy trading

Some good points except for the highlight in red imho
NO ONE person conducts the orchestra. Much better to approach the market with the humbling thought that IT conducts the players.

The markets are evolving and changing rapidly. What worked for years may suddenly be redundant as new methodologies are applied. Not everyone can win consistantly, but ~5% can. Its like the highjump the bar keeps going up and up !!
If you have an edge keep it to yourself. The more it's known the more it becomes diluted and less valuable. Bollinger bands are a good example of this.


:smart:

 

[kwickwool]

Sounds arogant by me but I spent the first few months not reading any books at all and just watching the markets and seeing how they behaved. I wanted to see what my perspective would be on being a successful trader being totally unclouded by other views. Since then I have added a few indictors and read a bit to home in a few raw edges from people that I felt could add something to my trading but principly still trade the same.

Ask yourself what if you had no books, no forums, no support at all, how would you look at the markets and try to be successful? What ideas would you come up with because then you would be coming up with something that totally works for you and your personality? Then remove the edges, read further info to add onto what you start, and continually look for imnprovement?

 

[kwickwool]

Pat494,

It was an analogy in terms of dont just watch for key indicators but feel the market and see if you can have a good feel as to where it is going. Don't you sometimes fell that you are conducting an orchestra sometimes when the market is continually going where you expect?

The whole point of working this way is to continually assess the ever changing markets every minute, hour, day etc

 

[Pat494]

Pat494,

It was an analogy in terms of dont just watch for key indicators but feel the market and see if you can have a good feel as to where it is going. Don't you sometimes fell that you are conducting an orchestra sometimes when the market is continually going where you expect?

The whole point of working this way is to continually assess the ever changing markets every minute, hour, day etc

I understand what you are saying. When the market behaves as I expect it to then indeed I'm a happy trader

P.S. They seem to have put a French flag on your pages ? Whilst hovering with the mouse it says UK ?

 

[kwickwool]

Dubai at the moment but UK based

 

[Pat494]

Dubai at the moment but UK based

Alrighty but doesn't explain the French flag unless.......

youv'e joined The Foreign Legion ?

 

[kwickwool]

I think I might have been living in France during the time I joined and guess somewhere along the line I have been labelled with the French flag, will have to change that as soon as

 

[kompresor]

Ok guys, thanks for your response. I am starting now and reading, every day find it more interesting, and the more things I learn, the more I feel that this is too difficult to be successful. Anyway, my idea is learn before acting, so I don't care spending a whole year or more just with a demo account, because I don't want to risk more money (I lost 800euros already when I started). I've been tempted to join a job position in forex, you can see it the forex forum of this website, it's the "5K training course then salaried job..", but I really find it impossible to learn to be successful in just one month of training.

Please recommend me some books, and if there is a "guide" to define the framework of a strategy or a plan, because you all say how important is to have a plan, but I would like to start knowing a bit of how te define a plan, not step by step, because every one I suppose would have his own, but the fundamentals of that.

Best regards!

 

[HowardCohodas]

Please recommend me some books, and if there is a "guide" to define the framework of a strategy or a plan, because you all say how important is to have a plan, but I would like to start knowing a bit of how te define a plan, not step by step, because every one I suppose would have his own, but the fundamentals of that.

Any book by Dr. Alexander Elder, a successful psychiatrist, trader and author. Books by Alexander Elder