OMG That was not good

[craigd]

I hope you won't think me too forward and brash for posting this as a first post, i've been a member for a while and stop by to surf from time to time but so far never posted.

I just went live for the first time a few days ago and I know this my personal journey and all but is there anyone here who would mind doing a bit of mentoring/pointing in the right direction. I am based in Dubai BTW.

yes I have read the articles the books etc and I know, papertrade and then go live and I did all that and made a reasonable profit (actually a few months the profit, on paper were shocking) anyway I put some money in the account a just wiped out the best part of 8000 GBP over the last few days;;;;; OOUUUCHH.

Confusion reigns at the moment

 

[Charlton]

yes I have read the articles the books etc and I know, papertrade and then go live and I did all that and made a reasonable profit (actually a few months the profit, on paper were shocking) anyway I put some money in the account a just wiped out the best part of 8000 GBP over the last few days;;;;; OOUUUCHH.

Confusion reigns at the moment

It sounds like you have not read (or not appllied) the material relating to money management.

Look at:
- correct position size based on volatility
- stop-losses - do you set them, how, are they appropriate for the instrument and market volatility
- potential risk of each trade compared to expected rewards
- high probability setups
- cutting losses quickly
- letting profits run - set predetermined profit targets, take 50% or 75% money off table when these are reached, leave remainder to run (with break-even stop)

There are lots of threads/posts on T2W or using google on these areas.

Only a slight edge can reap rewards with good money management processes in place, but good edges are quickly blunted when not honed by such techniques.

Charlton

 

[HaloTrader]

^^ Money management

 

[HaloTrader]

In conclusion... Here as some new rules -

1% per trade.
2:1 atleast aim for risk reward.

The end.

 

[Black Swan]

I hope you won't think me too forward and brash for posting this as a first post, i've been a member for a while and stop by to surf from time to time but so far never posted.

I just went live for the first time a few days ago and I know this my personal journey and all but is there anyone here who would mind doing a bit of mentoring/pointing in the right direction. I am based in Dubai BTW.

yes I have read the articles the books etc and I know, papertrade and then go live and I did all that and made a reasonable profit (actually a few months the profit, on paper were shocking) anyway I put some money in the account a just wiped out the best part of 8000 GBP over the last few days;;;;; OOUUUCHH.

Confusion reigns at the moment

was your paper trading profit shocking, then you went live and cooked 8 grand inside a couple of days?

 

[craigd]

Thank you for the quick replies, let me try and answer some of your questions starting from the top.

GammerJammer & Charlton
I have been trading USD/GBP and started off small with a profit here and there getting used to trading live. I started out with small lots at the minimum of 17000 GBP (using IB) with a little success. Then very quickly (quite probably too quicly) progressed onto 100K lots. thats when it all started going wrong. To add to the disaster I was adding lots as the trade was going my way and then the money management failed me and winning trades turned into losing trades.

One of the biggest mistakes I made was starting to chase my loss with larger and larger numbers of lots. I have excluded the finger trouble selling 1m instead of 100,000 that taught me quickly to take an extra second or two to check....

I beleive you are right I have read the books and the board but I think I have not put enough time in trying out what works for me.

Volatility and sizing - i think I need to revisit this part. (understatement lool)

Stoplosses - yes I set them but have had a few cases where I was stopped out only have the market go exactly with my closed trade. I also usually have an untransmitted order to reverse also, at market, waiting just incase I want to use it.

Risk reward - hmmmm, I think I answered this one above - needs serious work. I think after a while, this went out the window

High probability setups - I have read the books, done some paper trading but I am starting to doubt I have done enough.

Leting profit run etc - I am letting them run when they actually run.

I am also trying to trade too smaller time frame although I am now analysing down the time frames to see how the various support and ressistance levels are going to affect the smaller time frames. but and this is a big but, now i have got my self to a stage where I have so many possible trends, support, resistance; I cannot see how the damn market can move anywhere.

Halotrader

thanks for the figures - I have associated them with the cold sweat and dizzyness I experience when I saw my losses. An association similar to pavlov's dog and the bell as I am sure I will have the same feeling the minute my stupidity gets the better of me.

One of the reasons I asked for help was because I have realised that I need to go back to the basics and start from there and wanted a little shove in the right direction. I think there are some serious gaps in my knowledge, understanding and research or I have been reading totally the wrong stuff.

I have had one small thought, last time my wife bought an expensive hand bag, she said something like "its only money, it comes and goes and we cannot take it with us" I think I might be using that one shortly hehe

 

[elitejets]

I think what happened to you is very normal when you switch to real money. It certainly happened to me.
Trade real money but minimum stakes til you get your confidence back. If you go back to demo you will not get over it.
Good Luck

 

[craigd]

Hi Black Swan

Yes thats correct, one BIG wake up call. still; if I look at it positively, if I can lose it over a short period, I am damn sure if I know what I am doing I can make it over the same period....

And yes I did try a contrarian strategy, needless to say that didn' work too well either.

 

[craigd]

"Plan your trade and trade your plan".

If only I knew that a few days ago

At what point do the time frames get too small?

 

[NetTecture]

Move to larger ones. The timeframe you trade in is totally your control, you know.

 

[c_c405]

1 hour charts - foreget anything smaller unless the set up is coming to light

GBP/USd is difficult to trade and my best offer for advice is to be very patient!!! Wait then wait some more - NEVER chase cable only ever trade at zone/channel extremes - If you catch a good swing and take a profit avoid getting in again until the extremes reveal themselves again

in todays market GBP/USD is tough but if you limit your longs to the 1.35-1.38 zone and your sells at the 1.47-1.50 zone and use a wide enough stop you should be ok

when GBP/USd is limp look at a different pair

GBP/AUD is a good buy at this time

Avoid using stops under 100 pips when trading the GBP as it will chew them up like corn flakes 100 pips may be fine with other pairs but not the pound. I have lost 400 pips on the GBP/JPY with ease!!! SO BE VERY PATIENT with the pound.

for further help you can always check my thread here
http://www.trade2win.com/boards/trading-journals/49112-cc-s-new-broker-account.html

look for GBP/JPY trades and EUR/JPY trades as the movements on thsoe pair can be 500+ pips in a day or so

Cheers and hope this helps

 

[Xeno]

Hi Black Swan

Yes thats correct, one BIG wake up call. still; if I look at it positively, if I can lose it over a short period, I am damn sure if I know what I am doing I can make it over the same period....

Not really. The reason you lost is not because you chose the wrong direction, but because you didn't manage your trades and position size properly.

 

[HaloTrader]

Halotrader

thanks for the figures - I have associated them with the cold sweat and dizzyness I experience when I saw my losses. An association similar to pavlov's dog and the bell as I am sure I will have the same feeling the minute my stupidity gets the better of me.

One of the reasons I asked for help was because I have realised that I need to go back to the basics and start from there and wanted a little shove in the right direction. I think there are some serious gaps in my knowledge, understanding and research or I have been reading totally the wrong stuff.

I have had one small thought, last time my wife bought an expensive hand bag, she said something like "its only money, it comes and goes and we cannot take it with us" I think I might be using that one shortly hehe[/QUOTE]

When you trade with no emotion, you trade succesfully...
Easy to say but how do we block emotions...?
Having a solid money management plan that you very much stick to, as i didn't today and an average or specialised method that you like to use, doesn't have to be great even a 50/50 system works when you have good money managament...

Since starting to day trade i have won 6 trades and lost 8, but i've made money, figure that one out.

When i trade, i try not to feel good or bad about a trade, no sweat or tears - thats called gambling... I don't care if i lose a trade, my money management and plan is in place and i'm confident in it so i don't have to worry.

You probably won't listen to me and make the same mistakes but heres the 'Ultimate amazing secrets' of trading;

Low risk, 1-5% per trade.
Reach for 1:2 risk reward at the least, unless you have the holy grail of systems or are experienced with your system to an extent you win 70%+ of the time, which you and i i hope will get to that stage
No emotions; achieved through having a business plan (This is something you may never understand and you'll come back and back again asking why you lose and its because your doing it for entertainment subconciously rather than having a business plan that guarantees success, you take each trade, shouting 'Come on you greennns' but ultimately businesses don't jump up and down when a customer walks in and buys a coffee.

Thats it. Thats the secret to successful trading. Its harder to follow than it seems, i'm struggling to follow it but very much getting there.

Have an average method and money management - stick to it and you'll make cash.

You probably won't listen though....

 

[shadowninja]

Ah, the demon takes thee. Been there, done that. Not lost that much, mind. That is shocking.

Stick to the 1% rule and only take the right signals; don't chase and trade just to make back losses. Each trade has no bearing on the last.

 

[HaloTrader]

Ah, the demon takes thee. Been there, done that. Not lost that much, mind. That is shocking.

Stick to the 1% rule and only take the right signals; don't chase and trade just to make back losses. Each trade has no bearing on the last.

^^ Very good advice... Follow that and you'll skip alot of the training, but i suppose the journey to understanding that yourself is all part of it.

I see you around these forums Shadow and i always agree with ya ^^
Thought i will tell ya ....

 

[shadowninja]

You're right about the journey to understanding. I guess it's the same with anything in life. People with more experience will say something but we always do it anyway and have to go through the experience.

 

[craigd]

Thanks for the support everyone. I have had a much better day today, I made few mistakes earlier which cost me a few USD but over all I traded longer time frames, using smaller ones for timing. Risk reward was alittle low at just under 2:1 but not much (1.7 and i will work on this) but that was partly due to a slightly higher entry thatn i initially wanted. But at least I know what the RR figures are now. loool

Over all did three trades at a maximum of 100K and i am up 286.95 USD on the day. A small dent in the loss but who ever has that in the bank is just keeping it warm for me. :clap:

 

[arabianights]

I think what happened to you is very normal when you switch to real money. It certainly happened to me.
Trade real money but minimum stakes til you get your confidence back. If you go back to demo you will not get over it.
Good Luck

2nd this advice, it's something I've started doing when I'm getting confused by a market, gets your confidence sorted pretty quickly and if you're still confused you don't lose much - heck I did a tenth of my normal clip size on one trade a couple of days ago when I got completely baffled.

Scratched it too...

 

[new_trader]

I am not a big fan of the 1% rule, I risk less than that. But many people will say it’s utterly impossible and ignore me. I also don’t talk ‘timeframes’.
Anyway, for the absolute minority, here are my main rules, derived from bitter, bitter experience, $1000’s in losses and many 1000’s of hours of study and practice. They have been valid for years now and I see no reason to change any of them.

1) ALWAYS trade with a STOP placed close to your entry, ALWAYS.
2) DO NOT enter a trade unless you are ABSOLUTELY certain the market is going to move immediately in your favour.
3) ONLY enter trades with MARKET orders.
4) DO NOT trade unless your REASONS to enter are ABSOLUTELY clear.
5) Make only 1 trade per day or less, Yes, 1 trade per day or less.
6) Study your losers to find out what you did wrong.
7) Study your winners to find out exactly what you did right.
8) STUDY, STUDY, STUDY,STUDY
9) NEVER move your STOP unless it is to REDUCE risk, I repeat, NEVER move your STOP unless it is to REDUCE risk, I repeat, NEVER move your STOP unless it is to REDUCE risk, I repeat, NEVER move your STOP unless it is to REDUCE risk, I repeat, NEVER move your STOP unless it is to REDUCE risk.
10) Try NOT to break the above rules too often.
11) NEVER, EVER, EVER Break rule number 1 or 9.

If everyone did this they would last long enough to become proficient and profitable. But, I’m sure that the words ‘STUDY’ will immediately put most people off. After all, study is what you did at school to get a real job isn’t it? You hated study and entered into trading to make easy money!

 

[rathcoole_exile]

2) DO NOT enter a trade unless you are ABSOLUTELY certain the market is going to move immediately in your favour.

which, since it is 100% IMPOSSIBLE to be 100% CERTAIN would mean you never place a trade ?
Sure, you can use statistical probability combined with Momentum to give you confidence but the split second you place a trade, it could just as easily go tits up as succeed

4) DO NOT trade unless your indications to enter are ABSOLUTELY clear.

you are riding a motorbike, sat at a T-Junction waiting to turn right.

A car is approaching you from the right, but CLEARLY INDICATING that he intends to turn left into the side road from you are exiting.
So it's safe to pull out in front of him ?
because a) you trust indicators and b) the indication is very CLEAR

or
c) you don't trust indicators, you file away a mental note of what it is telling you, but you wait until the movement of the vehicle (price action) has confirmed the driver's intentions before you take action ?