hi guys:
starting today, I start my live & tiny account trading journal which basically helps me track progress and ensure discipline.
I am a profitable 3yr-exp long term invester in stocks;
only 5 weeks newcomer to forex, however spare-time trading and reading average 50hrs/week and total ~ 100 deals past 5 weeks... so... not so new.
[July 13, 2009 edit, old day-scalping plan outdated -> archived in attached worddoc, below is updated new things, main change is to trade on high time/frame]
A. here is the basic rules I set for myself:
1. position size=1x acc size, only 1 or 2 deal in a year allow 10x leverage, allow holding up to 5 non correlated positions
2. trading only daily and weekly time/frame
3. use attached MURREYMATH indicator on H4/daily time/frame as S/R
4. use mt4 default linear regression trend line on daily/weekly time/frame to judge overall trend, add fundamental bias and investor senti reverse indicator.
5. never risk 2% of acc
6. once position opened, analyze price moving range and probability / analyze price action, to evaluate the value center and range
then decide one of reasonable exit strategy below base on real data
i) -2% s/l
ii) b/e exit
iii) take small profit exit
iv) hit t/p
v) trailing stop let profit run
7. things to avoid:
i) do not look at news except if leveraged (position = 10x acc, rare)
ii) avoid use of market order due to slippage
iii) place order in peace market, avoid trying to catch up a fast rise/falling trend
iv) avoid refusal to take loss, accept it
v) avoid using a several week old limit order to trig a position, they may no longer be valid (ranging -> breakout)
vi) avoid rush into a trade, think 3 times on different day before a trade, only jump in if convinced on all 3 days.
vii) combat over-trading
combat over-leverage
combat self-greedy
combat short-term profit dreams
=> focus on steady performance, long term development goal, year over year accumulation, risk control.
B. money management
use money management calculator attached to calc win ratio, t/p and s/l;
follow the turtles money management (learning not start)
avoid over leverage and quick rich stories... no argue, walk away and don't see or hear it.
C.profit/loss goal and live acc growth goal:
1. do not risk >2% per trade, if that is hit, stop for the trade
2. do not risk >30% of account, if that's hit, close the account
3. profit/loss goal, position size, acc size timeline roadmap
1st year: P/L goal= break/even; acc=position size from 100$, 200$, ... till 1000$ by monthly deposit;
2nd year: P/L goal= 2%/yr; acc=position size fix at 1000$ -> micro acc forex, cfd, oil, gold ;
3rd year: P/L goal= 3%/yr; acc=position size fix at 2000$ (by 2nd year monthly deposit 100$ on top of 1k$);
...
10rd year: P/L goal= 10%/yr; acc=position size fix at 9000$;
11th year: P/L goal= 11%/yr; acc=position size fix at 10k$ -> mini acc forex, cfd, oil, gold;
12th year: P/L goal= 12%/yr; acc=position size fix at 20k$ (by 11th year monthly deposit 1k$ on top of 10k$);
...
19th year: P/L goal= 19%/yr; acc=position size fix at 90k$;
20th year: P/L goal= 20%/yr; acc=position size fix at 100k$ -> std acc forex, std cfd, oil, gold
D. long term goal of this fund:
1. grow trading skills and grow acc/position size gradually
2. preserve capital, but don't fear loss, accept loss knowing that statistically loss is cost of this business, in order to profit we must accept loss
but don't blindly take a loss, regard loss as risk to this business, take informed, calculated risk to get more return than risk
3. grow acc size by deposit other income from the day, not by trading
on a winning month, withdrawal numbers above acc size goal, so always trading a consistant & fixed acc size
4. on a losing month, go to work to deposit the loss, do not try to trade to gamble back, still trading a fixed acc size
5. consistantly beat bank interest rate and inflation by diligent work and long term study/practice, looking for money maintainence, not for money growth
6. be responsible, only manage my own hard-earned money, consistant deposit every month, never withdraw for personal use
7. thinking win-win with broker, no matter it's spread or commission, trade in a way that they can profit from me, base on that 'cost' assumption to build my profit model
8. have fun
starting today, I start my live & tiny account trading journal which basically helps me track progress and ensure discipline.
I am a profitable 3yr-exp long term invester in stocks;
only 5 weeks newcomer to forex, however spare-time trading and reading average 50hrs/week and total ~ 100 deals past 5 weeks... so... not so new.
[July 13, 2009 edit, old day-scalping plan outdated -> archived in attached worddoc, below is updated new things, main change is to trade on high time/frame]
A. here is the basic rules I set for myself:
1. position size=1x acc size, only 1 or 2 deal in a year allow 10x leverage, allow holding up to 5 non correlated positions
2. trading only daily and weekly time/frame
3. use attached MURREYMATH indicator on H4/daily time/frame as S/R
4. use mt4 default linear regression trend line on daily/weekly time/frame to judge overall trend, add fundamental bias and investor senti reverse indicator.
5. never risk 2% of acc
6. once position opened, analyze price moving range and probability / analyze price action, to evaluate the value center and range
then decide one of reasonable exit strategy below base on real data
i) -2% s/l
ii) b/e exit
iii) take small profit exit
iv) hit t/p
v) trailing stop let profit run
7. things to avoid:
i) do not look at news except if leveraged (position = 10x acc, rare)
ii) avoid use of market order due to slippage
iii) place order in peace market, avoid trying to catch up a fast rise/falling trend
iv) avoid refusal to take loss, accept it
v) avoid using a several week old limit order to trig a position, they may no longer be valid (ranging -> breakout)
vi) avoid rush into a trade, think 3 times on different day before a trade, only jump in if convinced on all 3 days.
vii) combat over-trading
combat over-leverage
combat self-greedy
combat short-term profit dreams
=> focus on steady performance, long term development goal, year over year accumulation, risk control.
B. money management
use money management calculator attached to calc win ratio, t/p and s/l;
follow the turtles money management (learning not start)
avoid over leverage and quick rich stories... no argue, walk away and don't see or hear it.
C.profit/loss goal and live acc growth goal:
1. do not risk >2% per trade, if that is hit, stop for the trade
2. do not risk >30% of account, if that's hit, close the account
3. profit/loss goal, position size, acc size timeline roadmap
1st year: P/L goal= break/even; acc=position size from 100$, 200$, ... till 1000$ by monthly deposit;
2nd year: P/L goal= 2%/yr; acc=position size fix at 1000$ -> micro acc forex, cfd, oil, gold ;
3rd year: P/L goal= 3%/yr; acc=position size fix at 2000$ (by 2nd year monthly deposit 100$ on top of 1k$);
...
10rd year: P/L goal= 10%/yr; acc=position size fix at 9000$;
11th year: P/L goal= 11%/yr; acc=position size fix at 10k$ -> mini acc forex, cfd, oil, gold;
12th year: P/L goal= 12%/yr; acc=position size fix at 20k$ (by 11th year monthly deposit 1k$ on top of 10k$);
...
19th year: P/L goal= 19%/yr; acc=position size fix at 90k$;
20th year: P/L goal= 20%/yr; acc=position size fix at 100k$ -> std acc forex, std cfd, oil, gold
D. long term goal of this fund:
1. grow trading skills and grow acc/position size gradually
2. preserve capital, but don't fear loss, accept loss knowing that statistically loss is cost of this business, in order to profit we must accept loss
but don't blindly take a loss, regard loss as risk to this business, take informed, calculated risk to get more return than risk
3. grow acc size by deposit other income from the day, not by trading
on a winning month, withdrawal numbers above acc size goal, so always trading a consistant & fixed acc size
4. on a losing month, go to work to deposit the loss, do not try to trade to gamble back, still trading a fixed acc size
5. consistantly beat bank interest rate and inflation by diligent work and long term study/practice, looking for money maintainence, not for money growth
6. be responsible, only manage my own hard-earned money, consistant deposit every month, never withdraw for personal use
7. thinking win-win with broker, no matter it's spread or commission, trade in a way that they can profit from me, base on that 'cost' assumption to build my profit model
8. have fun
), basically got kicked out break/even by adding more order
