Introduction and trading basics
This forum is quite welcoming, I've found lots of useful posts and good information.
I appreciate it when I see a post by a senior member explaining things in a way that a newbie can understand.
I've traded FX for a few months, obviously unprofitably.
Few things I wanted to put in writing, some learned on my own, some from this forum.
Hope to be a good forexfactorizen.
Over the years Forex Factory has morphed from a valuable learning resource into a purely commercial enterprise with no consideration given to quality of content. Every decision, every change made by FF has been to the benefit of its finances at the expense of its educational value. As such, the most valuable and helpful members have all lost interest and faded away - when I started reading these forums in 2009, a lot of them had already gone.
If you really want to get the best out of this place, go back and sift through the old discussions from 6 - 8 years ago. There is a lot of incredibly helpful information there, buried under several years of rubbish. Search for the old timers like Merlin, diallist, smjones, marejp, dopey, PeterFM, muddbuddha - I spent many nights reading through all their conversations for a long time before I even joined here and learned more then than I have in the years since I joined.
numbnuts, your words make sense. I've read quite a number of posts.. your name's not new!
I thought "why are all these good posts from 2008... 2011.. etc.???" .. and earlier!
Thanks for clarifying this.
Hello Bruzo and Welcome to FF.
Also some others peoples good post that was here are grkfx,Fudomyo,TheRealTruth.
I read that you trade short period timefreams so maybe you whould like Jarros method - thread.
Alsoone more good thread about SR.
just like what numbnuts said, its the old threads that has the gold in it.. and best of luck, Ill be digging in my self as well and look for old threads, the new stuff are a bit too shabby.
Thanks Bogi and jiggz. Will take a good look..
Looks like you're off to a good start..going to second all the posts above and yes, the old ones are the ones with the real info..
Cheers ziggy.. there's so much info to go through. Picking out the gems, while taking each with a grain of salt and mix it with your own experimentation and learning is probably key.
Hi, Bruzo. I would second everything above. After about ten years of dabbling in this with some nice successes and some grand failures, I have to say that what really really matters in trading is the boring stuff: psychology and money management, just like it says in every chapter you skip over in every trading book.
Thanks for dropping in Lizzard, I've noted your points!
I withdrew the remains from a nearly blown account that lasted a couple of months, I am now falling back to studying the markets. I came across some interesting academic work on this subject.
I think trading shouldn't stop while I study but it may slow down however and maybe just demo.
I ran some analysis over my trades which showed that had I employed good money management my draw-down could have been 13% to 20% as opposed to of 60% - that is over a mere 130 trades. Even though the sample size is tiny, the low win rate and low expectancy of effectively a "non-system" strategy liquidated me quickly.
I think I'm starting to see each trade as a little tiny dot in a big stat plot (reminds me of high school maths).. too many in negative will "statistically" destroy your overall positive returns over the long run. Only by keeping those bad dots consistent, with appropriate risk reward, one can increase their overall chances.. one or two greedy trades and you're set back so much.. all of this is obvious, however it becomes very obvious when it happens to your account.
I'm happy I'm in a better place now than I was at the start. Understanding what happened quantitatively is the way to go instead of sitting thinking "trading's not for me". With so many biases in this game we gotta watch out for the "I suck" bias.
I found this cool quote which I stuck on my wall.
"Pips against you are more harmful than pips with you are helpful."
It's great you're consistently logging as a new trader, this is something that I and many other traders struggled with (and probably still struggle with) but is one of the most valuable things you can do. Just a few things:
- Ensure that you're following a strict "setup" or number of "setups" so you can quantify the quality of each. If you have a setup that says, I'll sell when price does X at Y, and you log that consistently over time, no matter if it's a win or loss, you can 100% know if that setup gives you an edge over your sample size.
- When either approving or disapproving of your trades that you log, make sure you quantify their "success" against "Did I follow my specific rules?", not "Did I make money." One thing that Mark Douglas says over and over is "Anyone can make a winning trade, you just have to press a button." That coincides well with my first point.
- Just observe the markets and look for patterns. Do this and develop your own theories about price movement / whether trend is important / other technical factors. What's MOST important is that you decide for yourself what's important, which it absolutely seems like you're doing.
Overall you seem to have made a great start so well done!
Oh one last thing, remember a GOOD TRADE can still be a losing trade. Put a column on your log that says "Did I follow my rules?". If you answer with a YES, then that was a good trade, no matter if it was a winner or loser . Follow your rules for whatever sample size you choose, say 50 trades and you'll know for sure if you have an edge or not over that random distribution!
I am new to Forex.
What should I do to know it better? To read books about it? to learn it by experience?
My own answer to these questions is that it is not smart enough to learn Forex mostly by experience,
generally speaking there must be a book explaining basics of good Forex trading allowing profitable trade.
Obviously nobody knows such book, otherwise it would be very popular and known to everybody like, say, Bible.
Ergo, now the time has come when to became a good smart trader means to write a new book about good trading first.
I mean that all known books about trading are not good enough, the world needs a new book, better than all of the known ones,
and also it seems to me that nobody can write such a book alone, meaning that there should be created a group to write it,
a group of people agreed on the idea that such a book is really necessary.
The next question is 'Do you agree that no a good book about trading is available right now but there is a great need on it?'
May I ask this question to All?
What do you think about it?
Welcome to the world of Forex Bruzo, KyrForex & Jaybroker,
Like you all, FOREX is a world all onto itself. What the more experienced members have told you is a good start to finding your way to profit.
I also blew through a couple accounts, followed all the indicators but the market just didn't go where it should have. Disappointing to say the least.
Read through many threads, looking for that "Holy Grail" where everything would go right. It wasn't until I realized that the "Holy Grail lies somewhere between
your ears and understanding not just price movement but why does the price move like it does. Understanding who you are up against and how they operate is a real eye opener. Then everything will fall into place, not saying all trades go your way....that's almost impossible...but by having 75% successful trades
is the "Holy Grail" or at least as close to it.
Thanks MTPockets. It's a bit like the art of war discussion on fti's thread, know the players, yourself, the terrain..
I took my own advice and went on to learn about the market, how it's structured, who the players are and what they're after. The tiered system of the markets, what central banks do etc. and try to get the 'picture'. There are a lot of pieces to string together.
In FX, so far, all the rivers I've encountered have merged into one big ocean, 'smart money vs dumb money'.
What is crucial is to revisit articles and posts once in a while to re-read them when you have more 'context'. You'll have better questions and maybe an opinion. As a beginner you have no opinion, no context and no background. Learning systems first, IMHO, is a terrible first step.
Been watching the markets, people flocking to the USD in times of fear these days. I assume this will be the case for a while given current geopolitical issues.
As for the analyst question I agree with Kyr, it pays to do your own research. The price level might be re-tested or it may not, who knows?
I would ask the analyst for a price in full notation, or at least a range so that there is no ambiguity.
I've read a handful of books, one from Van Tharp and another one from Mark Douglas, so I won't speak like someone who knows the entire landscape of FX literature.
What you read many have already read. Never stop learning however, and mix it with testing the waters with your own two feet.
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