Let's start with a bold statement..
NO ROOKIE, and NO UNSUCCESSFUL TRADER HAS EVER STARTED HERE.
Where is here you ask?
Setting expectations from the start. What are your goals, what you expect to get out of this journey, and also what do you realistically expect trading to be, to feel like, and when you expect to be trading?
I have created multiple approaches to the market and some have even been successful... (I have never blown a real account, and i am in the green profit wise on real accounts) but i am always looking to optimise and be more efficient in the trades i make- this has fundamentally been a terrible approach.
However, i digress...To be clear, this is nothing to do with trading systems. This is nothing to do with when to buy or when to sell. It also has nothing to do with what to trade. It has nothing to do with bankroll management, or trade management.
So what is this about?
Setting realistic objectives and expectations.
It seems a bit strange that I would be talking about this, but i want to because this will save you a hell of a lot of money in the short term... and in the long term.
Seriously, what is your expectation with the Forex market?
Do 10 trades and if it does not work, move on to the next thing?
play the forex markets for 1 month and decide you are onto a winner, so fund your account with $1000 and expect to be a millionaire the following month, a year later...?
Or do you think the New Quantum algortithmic trading EA that you set and forget, with 95% trading accuracy, and 1% drawdown will make you a millionaire for only $95 is really the answer?
Why is any of this important?
Something i have not seen on here before is the expectation setting before you even think about anything else.
Of course everyone wants to jump in and start making trades. People want to see what happens.. people want to be doing, not reflecting, or thinking.
But here is the truth. 99% of people on these forums arrive with the thought that this is going to be easy, or that there is a holy grail, or that there is some secret that they are simply not getting. They give themselves 2 months to see if they can do it, or they will move to something else. They think if they have not got an open trade, then they are leaving money on the table (forget the money they are losing hand over fist because they are always in a trade).
They think that this is going to be easy... and they are right, to an extent. Trading is easy. You click buy, you click sell. That is it. There is no secret formula for how to get in and out of trades, what they soon realise, is that being right about the direction a pair will take is a bit like trying to pin diarrhea to the ceiling. However it can be done... the direction... not the pinning. They cant handle that part of being a trader is losing trades. Yes, we all know we should expect it... but the mental part of the game is FAR harder than the trading aspect.
What is more frustrating for the newbie trader is that the following will happen: They will click sell, and the currency spikes upwards. They get out of the trade, and it rockets down. Or they sell- the currency spikes upwards, and they decide to hold.... and hold.... and hold.... and margin call...
Why is this the case? Because expectations are not being set at the beginning of the journey.
I am not talking about expectations of a currency move... i am talking about the intrinsic expectations of trading itself.
let me demonstrate:
I expect to not be in a trade on any given day. Trading days are the exception, not the rule.
I expect to make small amounts... I am not expecting 600 pip moves. I expect to take 60 pips per trade.
I expect losing trades. I expect to lose just as many as i win- that would be ideal... i will make a profit if that is the case.
I expect to have a positive R:R... even if it is 1:1.0000001. That is my edge.
I expect to have a slow rising account. I don't want 583% gains in a week (current weekly trade explorer leader.. who's account is 43% DOWN)
I expect to lose trade after trade, after trade, after trade. My profits don't come by 10 trades, if they all lose, it is only a small fraction of the amount of trades i will do. 10 trades over a sample size of 1000 trades is nothing.
I expect to find reasons for NOT trading, not FOR trading.
I expect to trade on the 1 hour charts, and NOTHING lower. Trades will trigger on the 1 hour charts every 100-200 bars.. that is between 1 and 2 trades per month on a single currency. They may not be viable trades.
I expect trading to be passive. If I get a signal, i am guessing it will not be viable.
I expect to lose on the 15 minute charts and below- profit margins are smaller (commission is a bigger proportion of the trade... why would you trade on such small time frames - it is pure craziness as a rookie).
I expect to be in the 95% not the 5%. My goal however is to get to the 5%
I expect to try something for 100 trades AT LEAST, any less and the sample size is too small to be given any credence. 100 trades is also a SMALL sample size
I expect EVERY EA to be full of rubbish.
I expect EVERY 'guru' to be full of rubbish (until proven they are not... live trade updates, walks as well as talks the talk)
I expect EVERY person on Forex Factory to be full of rubbish (until they are proved otherwise)
You look at the above statements... the two examples of the newbie trader - take a position and get out or to hold... the expectations i have in the market will dictate how i react. I will react based on my expectations. if i get Stopped out... i get stopped out, if not, it will be a winning trade. That is my expectation - no emotion, just fact.
What expectations do you have of your trading? what expectations as a newbie do you REALLY have? If any rookie says that they are expecting a 1% return in the year, I will say they are full of rubbish... WE ALL start in the same boat. Make a million in the first year, and then see what happens from there....
NO ROOKIE, and NO UNSUCCESSFUL TRADER HAS EVER STARTED HERE.
Where is here you ask?
Setting expectations from the start. What are your goals, what you expect to get out of this journey, and also what do you realistically expect trading to be, to feel like, and when you expect to be trading?
I have created multiple approaches to the market and some have even been successful... (I have never blown a real account, and i am in the green profit wise on real accounts) but i am always looking to optimise and be more efficient in the trades i make- this has fundamentally been a terrible approach.
However, i digress...To be clear, this is nothing to do with trading systems. This is nothing to do with when to buy or when to sell. It also has nothing to do with what to trade. It has nothing to do with bankroll management, or trade management.
So what is this about?
Setting realistic objectives and expectations.
It seems a bit strange that I would be talking about this, but i want to because this will save you a hell of a lot of money in the short term... and in the long term.
Seriously, what is your expectation with the Forex market?
Do 10 trades and if it does not work, move on to the next thing?
play the forex markets for 1 month and decide you are onto a winner, so fund your account with $1000 and expect to be a millionaire the following month, a year later...?
Or do you think the New Quantum algortithmic trading EA that you set and forget, with 95% trading accuracy, and 1% drawdown will make you a millionaire for only $95 is really the answer?
Why is any of this important?
Something i have not seen on here before is the expectation setting before you even think about anything else.
Of course everyone wants to jump in and start making trades. People want to see what happens.. people want to be doing, not reflecting, or thinking.
But here is the truth. 99% of people on these forums arrive with the thought that this is going to be easy, or that there is a holy grail, or that there is some secret that they are simply not getting. They give themselves 2 months to see if they can do it, or they will move to something else. They think if they have not got an open trade, then they are leaving money on the table (forget the money they are losing hand over fist because they are always in a trade).
They think that this is going to be easy... and they are right, to an extent. Trading is easy. You click buy, you click sell. That is it. There is no secret formula for how to get in and out of trades, what they soon realise, is that being right about the direction a pair will take is a bit like trying to pin diarrhea to the ceiling. However it can be done... the direction... not the pinning. They cant handle that part of being a trader is losing trades. Yes, we all know we should expect it... but the mental part of the game is FAR harder than the trading aspect.
What is more frustrating for the newbie trader is that the following will happen: They will click sell, and the currency spikes upwards. They get out of the trade, and it rockets down. Or they sell- the currency spikes upwards, and they decide to hold.... and hold.... and hold.... and margin call...
Why is this the case? Because expectations are not being set at the beginning of the journey.
I am not talking about expectations of a currency move... i am talking about the intrinsic expectations of trading itself.
let me demonstrate:
I expect to not be in a trade on any given day. Trading days are the exception, not the rule.
I expect to make small amounts... I am not expecting 600 pip moves. I expect to take 60 pips per trade.
I expect losing trades. I expect to lose just as many as i win- that would be ideal... i will make a profit if that is the case.
I expect to have a positive R:R... even if it is 1:1.0000001. That is my edge.
I expect to have a slow rising account. I don't want 583% gains in a week (current weekly trade explorer leader.. who's account is 43% DOWN)
I expect to lose trade after trade, after trade, after trade. My profits don't come by 10 trades, if they all lose, it is only a small fraction of the amount of trades i will do. 10 trades over a sample size of 1000 trades is nothing.
I expect to find reasons for NOT trading, not FOR trading.
I expect to trade on the 1 hour charts, and NOTHING lower. Trades will trigger on the 1 hour charts every 100-200 bars.. that is between 1 and 2 trades per month on a single currency. They may not be viable trades.
I expect trading to be passive. If I get a signal, i am guessing it will not be viable.
I expect to lose on the 15 minute charts and below- profit margins are smaller (commission is a bigger proportion of the trade... why would you trade on such small time frames - it is pure craziness as a rookie).
I expect to be in the 95% not the 5%. My goal however is to get to the 5%
I expect to try something for 100 trades AT LEAST, any less and the sample size is too small to be given any credence. 100 trades is also a SMALL sample size
I expect EVERY EA to be full of rubbish.
I expect EVERY 'guru' to be full of rubbish (until proven they are not... live trade updates, walks as well as talks the talk)
I expect EVERY person on Forex Factory to be full of rubbish (until they are proved otherwise)
You look at the above statements... the two examples of the newbie trader - take a position and get out or to hold... the expectations i have in the market will dictate how i react. I will react based on my expectations. if i get Stopped out... i get stopped out, if not, it will be a winning trade. That is my expectation - no emotion, just fact.
What expectations do you have of your trading? what expectations as a newbie do you REALLY have? If any rookie says that they are expecting a 1% return in the year, I will say they are full of rubbish... WE ALL start in the same boat. Make a million in the first year, and then see what happens from there....
