8 Years Later - Still Not Winning

Its has been proven you cant win long term with retail Forex by noble prize winners.

Forex trading at retail is for fun just like las Vegas. You can learn and be BETTER TRADER.

There has never been a proven account on this forum ever.

Why?

(ask noble prize winners)

Prize is a random walk. Proven by studies.

No system can be 100% efficient. All the scientist know that. The fact that the market is very close to efficiency doesn't mean it is efficient. But it is very hard to beat thou and requires an enormous amount of discipline.

Here's what works for me.

I believe that markets are a "Random walk with occasional Leve Flight" and I also believe that the entry is the least important part of the trade and they give you no real edge. Your edge comes from trade management, your exit and trading with the trend! Trend of course can be defined in many ways, I use the 200SMA on an M15 time frame, but it's not really that important in the long term what you use. I enter many times a day and loose on most but I define my losses as R (risk) the stop-loss on each trade, and my wins as multiples of R! I tend to target around 7R on each trade or sometimes trail it.
The R value I set as a percentage of my account usually 0.5%, so if my stop-loss is 20 pips I set the Lot amount as 0.5% of account I would loose on 20 pips. So my wins are 7x 0.5% of account 7R and my losses are all measured as 1 x 0.5% or 1R, makes life so much easier than Pips!!

Now I loose many many more times than I win but each win is seven times (or thereabouts) more than each loss and, overtime, I come out on top with hardly ever a loosing month. But you have to keep on trading even when you may have had ten losses in a row, safe in the knowledge that a win will come along overtime!
I do no analysis at all, no trend lines, no support/resistance areas, no indicators of any kind, just the 200SMA for entry direction. Trading is very easy and simple, it's the execution that makes it hard together with your own psychology. So forget entry analysis and trade a pair that tends to trend well overtime (I use EUR-JPY) and just concentrate on trade management and your exit, and you'll be fine.................

Works for me!!!

Well I win overtime ..................

I won 5 million USD as a retailer trader , do you believe on me ??? I don't think you do, neither me.

to reach heaven pass hell...

away of slogans and perfect words that market same as casino even if you look in youtube you will find strategies for casino lol :v
but what i can do? i wasted years of my life thinking that's real business i can't just leave like that so i still gambling :v

I believe it was Winston Churchill that said, If you are going through hell, keep going. It took me 10 years and a blown out account before the light came on. I've learned a few things along the way. First, this is 10,000 times more difficult than people who don't do it for a living would have you think (brokers and system sellers). Second, it takes a Doctor 10 years to make it in his field and make 6 or 7 figures a year. Why would this be so much easier? For anyone with money to burn, but not making a consistent profit (defined as 3 months profitable IN A ROW), trade 0.01 lots per trade until you are making a consistent profit. If you aren't making a consistent profit and don't have money to burn, trade demo until you are consistently profitable. That may take 5 years. Then move up to 0.1 lots per trade in real trading and don't increase size until you are consistently profitable. That might take another 5 years. After that, you'll know what to do. Another point is, you have to love something to be good at it. If you don't love trading, go do something you love. If you do love it, get a day job or open a business or find a way to earn an honest living, and practice when you have time. Know going in, it might take 10 years of your life. It doesn't mean you are stupid because you can't do it after 6 or 8 or 10 years. Dr. Alexander Elder, a recognized expert on trading psychology, said a formal education and very high intelligence is actually a hindrance to trading successfully, but that disadvantage can be overcome. I'm sure there are many very intelligent people who can't sing well after years of trying. Finally, the market will take any amount of money you offer it, so offer it only what you can afford to lose, or even better, offer it nothing at all. Best success. - G

That's fully logical and right about successful trading you've mentioned but one vital and important issue that you must add, is this "Traders must know the real form of trading" it isn't important you are using 0.01 or standard according your balance of course, If you know the real form of trading you'll be profitable at the end of days, weeks so on. I wish one day you got it.

Hi rover.
Agree on the random walk and moments of agreement.these are the times we should be entering the market.they are not or cannot be manipulated unlike 90 % OF the time.
This is a post from my journal 6 years ago regarding this topic. disregard the indicators but relevent to your point on random market and synce market.
Originally the work of a system builder.

good to gather here what I have written elsewhere. Just to make things precise.

The FGDI is the fractal dimension graph indicator (slight upgrade of the FDI fractal dimension indicator).

If the FGDI is lower than 1,5 level that means that the time series are persistent

If the FGDI is higher than 1,5 level than means that the times series are antipersistent

If the FGDI is equal to 1,5 there is a 50/50 probability.

The FGDI estimates the fractal dimension of the times series.
The fractal dimension = 2 - Exponent of Hurst (H)

So if the exponent of Hurst is equal to 0.5 we have a FGDI equal to 1,5.
Exponent of Hurst of 0.5 means that the movement is random without long term memory processes.
Exponent of Hurst > 0.5 - persistent
Exponent of Hurst < 0.5 - antipersistent

This is explained elsewhere and I just remember that basic stuff. The FGDI (FDI) according to me is better than the fractal dimension indicator published by Ehler, and moreover its mt4 implementation is not free but in the elite section of TSD.

The IVAR is similar to the FDI but its scale is different. The center line is 0.5.

The interpretation is the same when it goes below 0,5 the movement is persistent and vice versa, it is antipersistent.

According to the statistical mechanics if the time series are random walk the H should be equal to 0.5.

Hurst has discovered that a lot of natural phenomena follow a "biased random walk" or trend with noise. The strength of the trend can be measured by how the Hurst exponent is above 0.5 (that means FDI and FGDI below 1,5 and Ivar below 0.5)

In fact all those formula are estimating the Hurst exponent. I think that the easiest is to understand the Rescaled range analysis as a method, to understand what is going on. I precise that I have no high education in mathematics and I was able to understand the logic.

The fundamental principle is if the time series are random their range will increase with the square root of time (this is original idea of Einstein in his paper for the Brownian motion). Einstein found that the distance a random particle travels increases with the square root of time used to measure it.

And Hurst decided to make a ration dividing the Range by the the standard deviation of the observations (R/S) R- range S - standard deviation.

So

R/S = (a*N)^H

R/S = rescaled range N = number of observations a = a constant H = Hurst exponent

So we expect to have H=0.5 if the price time series are random. But they are not folks, that does not mean that they are easily predictable either .

All this may seem very theoretical. The exponential moving average is either theoretical but easy to use. This is the same.

I will share now one strategy.


Fractal break -out

Basically the ideal price movement is in a price channel. The price channel can be horizontal (range channel) or directional (trend channel). In fact it does not matter the type. When a price breaks the borders of a chart channel we have a break - out of the channel. If that happens we have a probability that the market conditions has changed and the price will further go away from the channel.


The channel can be regular but it can be irregular. All the classifications of the channels is in fact the technical analysis.

A channel defines a trading range. We have up limits and down limits of the channel. You need at least two points from above and from below to draw a price channel. Then just draw a line connecting the up limits and the down limits of the channel.


Well, but when the prices goes beyond the channel and the gets back to the channel often the technical guys will tell you that you have drawn the channels improperly and you need more educations. When you get more education you will draw the lines properly but again you will see the prices go beyond the channel and get back to the channel. As in the avatar the pilot says before going to battle Ain't that a shit.


This is called a false break - out that happens more often that we want to admit (50 % of the cases ). Ain't that a shit again?


Anyway My idea is to get new details how to trade a Break - out.


1. Use of the volatility probability
We have a break - out probability in periods of increased volatility. So it is necessary to check statistically the volatility. This is well known by the professional players. On the net there are studies with the volatility. Usually we expect a break - out during the open of the European Session and the US session


2. Use of fractal indicators FGDI, IVAR, FDI
We use a fractal dimension graph index indicator (FGDI). When a breakout occurs it is accompanied with a change of the fractal state of the price series.

That means that the graph goes from a state of high fractal dimension to a state of low fractal dimension. We have a shift in the internal structure of the price time series.

2.1 Fractal Break - out
Conditions: We are at a blue zone with fractal dimension greater than 1.5. We move to a zone below 1.5. This is a fractal breakout


This is usually observed after a range (FGDI greater than 1,5)


2.2 Fractal Break - in
We are at a red zone, fractal dimension less than 1,5. The fractal dimension get lower.
I call it so because we are in a red zone of low fractal dimension and the fractal dimension gets lower.

This is usually observed in an established trend when we have a breakout in the direction of the trend


3. A peak in the Hurst Difference
Well this is a kind of measure of the change of the transition of the fractal dimension from one state to the other.
This is a new indicator find in the code base of mql. So the idea is to measure the rate of change of the Hurst Exponent. A high peak means that something is going on.

So when we have a lower fractal dimension the movement is persistent. There is a bigger probability that the next movement will be in the direction of the previous. So when there is a reversal, the reversal tends to be quick and abrupt (Black noise). So that explains how the V tops and V bottoms are formed.

On the other hand when the fractal dimension is higher than 1.5 we have a bigger probability that the next movement will be in the opposite direction.
And the price goes up and down in a lot of oscillations. There we can find pink noise, a lot of whipsaws up and down.


If the price time series were random there would be no correlation of each movement with the previous movement.

I can give a lot of examples of this. This approach is different and independent from the TA perspective so it combines really well with it.

H - Hurst exponent
When H = 0,5 the FGDI = 1,5

Pink noise 0<H>0.5
Black noise 0,5<H<1.0

See chapter 13: Fractional noise ans R/S Analysis
From the book fractal market analysis.


The best use of the system is when there is a low dimension in both two key levels 15 and 30.

If we have red on both 15 and 30 time frame our Persistent Movement Roller Coaster can begin . We will show to the old guys how we can pick tops and bottoms. If we have on both 15 and 30 time frame high fractal dimension that means that the phase space is deemed to be too complex. I call it high phase space singularity. The phase space is so complex that nobody is right. The price goes high and low like crazy.

The theory is that the market is not a signal. What we have is a multidimensional phase space. In those multidimensional space there are fractal attractors. There are many of them there are simple and complex (point attractors, cycle attractors etc.). For example when we see some number of cycles that does not mean that we have a signal with periodicity and frequency etc blah blah blah. The theory is that we have an underlying phase space wherein some attractor produce those cycles.

The fun thing is that the complexity of the phase Space is changing. Sometimes the phase space is relatively simple and sometimes it is really complex with its multidimensionality.

When the phase space is extremely simple we observe a Low Phase Space Singularity. When the phase space is extremely complex we see High Phase Space Singularity.

I call it singularity because the market dynamics start to be different from the normals market conditions.

Low phase space singularity. What is typical of that is that many different algorithms are able to find the same solution simultaneously and act accordingly. Is it an accident that the Brain trend, the ASCTrend stops with digital smoothing, the ASCtrend signal, the Trend magic with or without digital smoothing and the SSAsqueeze find simultaneously the same solution?

You see brain trend had good results, ASCTtrend had good results, Trend Magic had good results. A simple moving average will have good results. The human trader judgement is blown out the statistics may be blown out and we can go against the trend and can be hurt.

The idea is that when we have a relatively simple phase space of the possible solutions the algorithms are able to find simultaneously a solution. The algorithms are able to cooperate, but the humans we do not cooperate (one guy think it is oversold, the other it is overbought, one guy has long term horizon the other has short term).

And if FGDI (FDI) is in red (iVAR below 0.5) at both 15 and 30 m. time frame is a good approximation of the possible Low phase space singularity.

This Low phase space singularity is scary for the public policy makers, because all the market participants start to have the same horizon simultaneously. They are not able to adjust the economies to the market neither to guide the market as efficient as they would like.

They even may not have an idea what is going on and how their direct expensive interventions fail one after another on the Forex market.

Sometimes the Singularity goes into one direction, sometimes we have a series of ping - pong movements. All that is highly unpredictable several movements into the future, try to train a Neural Net to predict those market conditions and you will see, in fact whatever predicting algorithm you try to implement you will fail predicting the low phase space singularity. You have to react as quick and intelligent as possible, and even a SMA is good enough.

The High Phase Space Singularity is exactly the inverse phenomenon. The Phase Space is terribly complex: nobody is right. The market gos up and down up and down. In that type of market conditions the statistical methods are the best. The Gaussian model approximates very well the market during those times.

 

Wow. The above stuff is so far from what I do that it makes my head hurt. Overkill. Really overthinking it. Just follow a trend.

If you want to spend your spare margin, go ahead and throw on a few trades intra-day or scalping (perhaps just to alleviate some of the boredom). However, I don't believe most of that theory and calculation is necessary.


I suppose calculating all this stuff is fine to do while your trades are slowly ticking up pips, but if this is what you do just to get a few pips. Well, that's far too much effort for the return (when it can be done far, far easier than that). IMO.

Haha.
Get your point.its actually far simpler than than that.but I was showing the complexity to make a point of the simplicity in it.

If trades were taken very selectively during low singularity .when the entire market agrees then the whole thing becomes very effective and simple.infact with the information ,,the fundamentals,for example on cable this morning a chart would not be required to have made a very healthy low risk return.just with the information at hand and a overall market value change one could Cleary identify the opurunity to trade with the whole.

There are moments when we should be in the market and a lot of the time when we should not

Ok, I'm glad we agree to some degree. :-)

Granted, anyone with an strong sense of doing what they do as being 'right' (include using fundamentals, which I find interesting but completely unhelpful for trading), then yes, they should continue doing it.

If they are putting in that much effort for trading, then I'd expect them to make 10x or 100x what I do trading. Excellent. Do it more and I wish them all the best. However, I don't think the return will be that much better and hence, doing all that work on a weekly, daily or hourly basis just seems like wasted effort.

What helped me:

-) Stop searching for the holy grail. No strategy, indicator, mentor, whatever is going to predict the market perfectly all the time. Accept that this is a probabilities game and there will be winners and losers. Key is knowing your probability and use proper risk management to make consistent profit

-) Put it in the time, work , sweat and tears. Don't think some magical EA, or signal service, is going to make you millions

-) Stop switching strategies. People tend to find a strategy , trade it and then when they encounter a few losers they start doubting the strategy. So they start looking for the next amazing strategy. Problem here is that you act on emotions, not on facts. you should trade a strategy long enough to have a good set of data before you can tell how good it is. So find one you like and stick with it and measure the results . your strategy will never be perfect, but that does not mean it cannot give you a nice profit in the long run

-) Stick to your rules. Define your entry / exit rules and stick to them. ALWAYS!!! This is i think the main reasons why people are losing.
They trade everything they think they see.. Define 2-3 trade setups , learn them, master them and only trade those and forget about the rest
Be consistent in your trading. Also note that a trade is not related to past trades. After a couple of losing trades human nature gets afraid and starts doubting since 'chances are high that the next trade will be a loser too'' . Don't think like that, treat each trade on its own. If you believe this is a game of probabilities then the same probability of winning/losing a trade happens every time you enter a new trade.

-) focus on risk & money management. This is where the money is made or lost. Are you taking this serious, do you want to be a profitable trader, then this is what you should definitely focus on. Yeah its boring and not so exciting as that new indicator or EA.. but having poor risk/money management will get you rekt asap.

-) Set daily & weekly limits.. For example..
- my max loss for the day is $ xxx. When reached i stop trading for the rest of the day
- my max loss for the week is $ yyy. When reached i stop trading for the rest of the week

-) Log all your trades write down what you did good, and what you should have done better. At the end of each trading sessions you go through your notes and summarize your goals for the next day.

-) Study and measure your trades. Only when you've done > 100 trades trading that 1 strategy and nothing else, sticking 100% to your rules, only then you can tell how your strategy performs.

After those 100 trades you know:
- the winning ratio, expected value , sharpe ratios etc etc from your strategy and it will give you clues on how to improve it
- what mistakes you made and what you should improve
Change small things needed and then the story repeats.. Another 100 trades to see what the results of your changes are..

Been trading for a few years now. Fundamentals and technicals combined, you can catch the trend. No need to overthink. As long as you have a plan, tight on stops, the key only is to keep trading...and build that money roll.

If you think you can you can, if you think you can't, you can't.... by looking for information to further validate why you can't, you wont succeed.
Like any tech or innovation, if people keep paying attention to why this and that is impossible, nothing new will ever be created. its interesting how people that go against the majority really discover new innovations (not all succeed). Trading is not for everyone, so if you can't, and found some smart guy who says the same thing, maybe both of you can't. There are other who can and do it for a living for decades (retail).
good luck

edit: you don't need to be really smart to trade, its about discipline, executions, no attachment. people that have high IQ/smarts don't automatically have high mental state/emotions under control etc.

I do believe it's so difficult to accept that technical analysis gives you no real edge in outcome over the long term, and that your own psychology will govern what you make, profit wise!

Trading with the trend, staying in as long as you can, and cutting your losers short is the way to trade!!

The point I'm making is as intraday traders you are most likely to be to late to join a trend.unless you can establish something far behind an individual pair.there are moments when the market is collectively in agreement and cannot be manipulated .those are the times you should be placing your trades.but they are only relevant in a certain market state.your risk is very low and your reward is extremely high.look at the market in a different way.as a whole not in a singular way.

What about fundamental analysis? have you tried in your trading?

I would have thought it's the psychology of accepting what is being shown by any technical tools to give confidence to get into a trade, at a point where the market does react according to what was being indicated. Therefore confidence in your system and/or technical tools is what gives an edge over just looking at a random chart of prices and making a decision only based on that.

Anyone says you can just trade on what the price shows and doesn't need technical tools is a liar, as a consecutive list of prices over a timeframe is also a technical tool.



Additionally, as has been said otherwise, that you can just trade on Fundamentals and ignore technicals, seems completely ridiculous to me.

Comparison:
- Give someone list of documents, news items, etc. and a single price in UJ. Let them trade from that point. When they are ready to close that trade, they announce it and are given another price (closing price, which is also the current price). Then let them decide what to do. They can't ask for another price until they've decided their next trade...even if its hours or a day later. Fundamentally, they should know what the price is doing based on all their info. (*cough*)

- In another case, give someone whatever technical tools they want and an active price chart, but don't allow any other market, business, trade or news info.

----
I know which one I'd rather do and which one I believe would do far better than the other.