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What I learned after losing $300,000 trading forex

  • #1,001
  • Edited 1:57am Sep 2, 2020 12:34am | Edited 1:57am
Guys, let's think/create a script/logic how to determine the %
For example we assume that for EURUSD step is 0.25%, then how to make it for US500? As I see for US500 0.25 is good too, but for DE30 0.5 seems good. For BTCUSD 0.75 at least.

Any ideas how to auto set it correct?
Observer effect
  • #1,002
  • Sep 2, 2020 2:19am Sep 2, 2020 2:19am
This is the exact reason I don't like to trade mid-week...price just dances around hitting stop losses

Sticking with wolfe waves for midweek.
The impossible is possible
  • #1,003
  • Sep 2, 2020 4:15am Sep 2, 2020 4:15am
Quoting Teerexteerex
This is the exact reason I don't like to trade mid-week...price just dances around hitting stop losses Sticking with wolfe waves for midweek.
You just identified a good project for probability analysis.

Comparison of Daily Price Range by Day of Week for Selected Forex Instrument

When you complete the study, please make the write up available on this thread. You might even have something worthy of submission to a financial publication.
To free Gazans of Hamas, use whatever it takes.
  • #1,004
  • Sep 2, 2020 4:21am Sep 2, 2020 4:21am
Quoting Teerexteerex
{quote} Haha...made the same mistake yesterday tbh....USD was supposed to be rising yesterday...just happened today. I ignored my stoploss zone with usdchf and let the trade run lower. Eurchf, audchf moving right...still watching usdchf...any lower and I close with little profit
This is why LAGGING indicators are so powerful. They do not anticipate but rather show you that a move is ALREADY underway, giving a much higher likelihood of price continuing in this direction than if "supposed to" is used for direction.

It is similar to saying that price entered the overbought zone, so I will start selling instead of waiting to see that price has moved DOWN out of overbought zone so I will start selling.

Which of the two scenarios do you think will give more good sell entries?
To free Gazans of Hamas, use whatever it takes.
  • #1,005
  • Sep 2, 2020 4:47am Sep 2, 2020 4:47am
Quoting DrDave
{quote} This is why LAGGING indicators are so powerful. They do not anticipate but rather show you that a move is ALREADY underway, giving a much higher likelihood of price continuing in this direction than if "supposed to" is used for direction. It is similar to saying that price entered the overbought zone, so I will start selling instead of waiting to see that price has moved DOWN out of overbought zone so I will start selling. Which of the two scenarios do you think will give more good sell entries?
If I were to use indicators they would be lagging indicators cuz they are safer but it's not my thing.
Price action says buy from a pinpoint price...if it goes lower then close. Indicators make you stay longer with a chance of larger losses that's why I don't use them.
I open much larger trades than I would be able to also with indicators even though it's not so safe...losses are controlled though.
Usdchf hit a resistance zone on Monday and even though I knew the dollar was weak I still bought. it crossed I closed then opened again when it came back.
Eur usd seems to have hit the wall of an equidistant channel and also a resistance area..could also be a wolfe wave in the making. Plus gold is rising again. Chances of a buy being successful is higher my only worry is the dollar seems to be ready to rise. If it crosses lower then I close again confirming dollar strength.
That's how I prefer to trade. I don't use indicators at all.
The impossible is possible
  • #1,006
  • Sep 2, 2020 6:52am Sep 2, 2020 6:52am
Quoting DrDave
{quote} This is why LAGGING indicators are so powerful. They do not anticipate but rather show you that a move is ALREADY underway, giving a much higher likelihood of price continuing in this direction than if "supposed to" is used for direction. It is similar to saying that price entered the overbought zone, so I will start selling instead of waiting to see that price has moved DOWN out of overbought zone so I will start selling. Which of the two scenarios do you think will give more good sell entries?
I thought the whole game of trading was about being ahead of the curve, not behind it.
When you see it, BET big.
  • #1,007
  • Sep 2, 2020 7:21am Sep 2, 2020 7:21am
Quoting Rennaissance
{quote} I thought the whole game of trading was about being ahead of the curve, not behind it.
That would be correct for the profit curve. But for the price curve, because we do not know where the inflection point of the curve is before it occurs, "getting ahead of the curve", i.e. being able to determine at what price the inflection point occurs and placing a trade based on that information, is less likely to produce the expected outcome than if the inflection point is actually seen and then a trade placed in that direction.

Hence, the lagging indicator, that is putting you BEHIND the curve (after the inflection point), that indicates "inflection point has been detected" tends to give an edge.
To free Gazans of Hamas, use whatever it takes.
  • #1,008
  • Sep 2, 2020 7:29am Sep 2, 2020 7:29am
Quoting AnRan
{quote} There is no crappy price. i like this word crappy. But, have you ever tried to fill 40 lots on a live account? I have, you get crazy slippage. And I'm talking like you buy long and your price is filled 15-30 pips above. When your institutional get above those ranges, you'll have something called bulk ordering, its a tech that happens behind the scenes for larger players that may still use MT4 for market execution. But I highly doubt anyone here is producing a yard...
i dont know which broker and pair you traded, but with EU 40 lots should be no problem in the hours from london open to close.
trading is like dancing, don't think and just listen to the music!
  • #1,009
  • Sep 2, 2020 7:41am Sep 2, 2020 7:41am
Quoting BWilliam
{quote} I don't think my post said that. Retail traders give too much credit to bank traders. One fact of the banking industry is the attrition rate of such bank traders is much higher compared to other jobs. One of the main reason is boring job with no prospect for career advancement. Not meeting targets is a big reason too. If anyone have spoken to bank insiders he will discover it's not that pretty as retail traders paint it. This "professional" image given to bank traders to mean superior traders is misleading. To my knowledge most of these...

There are actually two different types of "bank traders" I know this because my mentor is a bank trader at a very large investment bank.

There are desk traders that just take orders and fill them and then there are divisions in the bank (usually separate offshore companies) that are profit centers for the banks that make money by exploiting price movements.

The order takers get salaries starting in the range of 100k plus bonuses based on the average fill price that get within the parameters of the order they are filling.

Example: He gets an order to cross 100 million EUR to USD and the current price of that cross is 1.3000 the bank gave the client a rate of 1.3100 so now the desk trader has to make money for the bank and any fill he gets will determine his bonus. So if he gets a fill of 1.3050 the bank just made 50 pips.

The proprietary bank trader is not an order filler he is given a certain amount of money and his job is to exploit the market the same way we do BUT he has much more information then we do. He can see the entire order book of not only his investment bank but the whole intra bank system of banks around the world.

Both of these traders must get good prices or they both get fired.

I know this as a fact because my mentor who also happens to be my brother in law has been an investment bank trader at a proprietary trader dept for many years.
  • #1,010
  • Sep 2, 2020 7:50am Sep 2, 2020 7:50am
Quoting CeeSo
{quote} There are actually two different types of "bank traders" I know this because my mentor is a bank trader at a very large investment bank. There are desk traders that just take orders and fill them and then there are divisions in the bank (usually separate offshore companies) that are profit centers for the banks that make money by exploiting price movements. The order takers get salaries starting in the range of 100k plus bonuses based on the average fill price that get within the parameters of the order they are filling. Example: He gets...

not trying to catch you out or anything but why did it take you to lose 300k before getting his help?
  • #1,011
  • Sep 2, 2020 7:50am Sep 2, 2020 7:50am
Quoting Viktory
{quote} Hi CeeSo, Just wondering why you blocked one of the very few most knowledgeable and honest FF members still active on the forum, before at least checking out his profile and valuable contributions over time (also backed by statistics, as you like). Only for expressing a different opinion in one little post? Come on, constructive discussions with good feedback is what we need here... {quote} Sorry, but such FXCM data is actually very misleading. It may be a "good enough" sample for you, but it's only from one broker. I mean, is it externally...
I warned earlier that this thread was going off-topic too much and if people insist on debating me about simple factual math I would be ignoring them.

I did not invent the numbers nor are they my opinion they are just numbers that I collected and anyone else can collect.
  • #1,012
  • Edited 8:02am Sep 2, 2020 7:52am | Edited 8:02am
Quoting Tuk786
{quote} not trying to catch you out or anything but why did it take you to lose 300k before getting his help?
Because I met my current wife recently. I am only here now because of pure LUCK and knowing my new brother in law.

BUT I do not want to mislead you guys into thinking that all of those losses were a waste of time. I learned a tremendous amount during the time that I lost all that money.

Things that still help me to this day are things like market profile, orderflow, fundamental, and sentiment analysis. all of these things are still useful but they all have missing pieces.

The big concept differences that made a big difference for me after I met my brother in law, I have presented in this thread.
  • #1,013
  • Sep 2, 2020 7:54am Sep 2, 2020 7:54am
Quoting CeeSo
{quote} Because I met my current wife recently. I am only here now because of pure LUCK and knowing my new brother in law.

aah k fair enough
  • #1,014
  • Sep 2, 2020 7:54am Sep 2, 2020 7:54am
Excellent Post CeeSo.
Looking forward to more from you
  • #1,015
  • Sep 2, 2020 8:21am Sep 2, 2020 8:21am
Quoting CeeSo
There are actually two different types of "bank traders" I know this because my mentor is a bank trader at a very large investment bank. There are desk traders that just take orders and fill them and then there are divisions in the bank (usually separate offshore companies) that are profit centers for the banks that make money by exploiting price movements. The order takers get salaries starting in the range of 100k plus bonuses based on the average fill price that get within the parameters of the order they are filling. Example: He gets...
That's what my post describe the 2 types of bank traders.

Following your story about your brother-in-law as your mentor, the extension means all bank traders are good mentors for retail traders ?

I disagree with such a view, a no brainer. Perhaps your brother-in-law is one of the better traders.
That's your private story that's got nothing to do with bank traders as a whole.
Careful when you tell private stories on internet. Many other old thread OPs did such a similar thing.
Know what you trade
  • #1,016
  • Sep 2, 2020 8:22am Sep 2, 2020 8:22am
Quoting CeeSo
{quote} Because I met my current wife recently. I am only here now because of pure LUCK and knowing my new brother in law. BUT I do not want to mislead you guys into thinking that all of those losses were a waste of time. I learned a tremendous amount during the time that I lost all that money. Things that still help me to this day are things like market profile, orderflow, fundamental, and sentiment analysis. all of these things are still useful but they all have missing pieces. The big concept differences that made a big difference for me after...
interesting story. great that you shared it with us.
first i didnt see the value, because i know similar concepts with ADR. but after a few days i realized that its something completely new that you showed us here.

and i like that most of the people (followers) here dont understand this value, not because i want to see people lose, but because this is a confirmation, an indicator that someone has come a very long way. most people cannot see this at all, it is practically invisible, because they are (still) running after other unimportant things like indicators or outcome of single trades or trading days.
trading is like dancing, don't think and just listen to the music!
  • #1,018
  • Sep 2, 2020 8:58am Sep 2, 2020 8:58am
Quoting CeeSo
{quote} Because I met my current wife recently. I am only here now because of pure LUCK and knowing my new brother in law. BUT I do not want to mislead you guys into thinking that all of those losses were a waste of time. I learned a tremendous amount during the time that I lost all that money. Things that still help me to this day are things like market profile, orderflow, fundamental, and sentiment analysis. all of these things are still useful but they all have missing pieces. The big concept differences that made a big difference for me after...
@CeeSo, Firstly I just want to thank you for a very insightful, honest and candid thread which has been a complete revelation to me. Somehow I think you have provided the glue for a lot of personal learning for me. It has changed my trading in a matter of days, and I would like to point out why. We all have a view on position sizing, and risk/reward and we know the methods that can be applied in order to manage those. But I have always missed having a view of the probability of the scale of movement which traditionally I have relied on ADR/Pivots/Trendlines etc to try and gauge or indeed the +ve expectation of the entry trigger. However I have never found these to be consistent enough and granular enough to help a great deal here, and the reason your mathematical approach works is because it is obvious, it is simple probability. Lets not forget, as traders we are taking positions based on probability so as for those questioning these statistics and the value of them, I don't understand how they can, it is another view/potential edge.

I have seen and tried all sorts of position sizing and R:R, and you see it all the time in forums, people with massive stops and 5 pip TP, or the inverse - and we all know what happens over time and how that affects win rate (typically). But position sizing and measuring R:R is only part of the story, understanding where price currently is in relation to probable final outcomes and measuring the R:R in relation to the probability of reaching those outcomes is the missing part of 'Managing Risk'. It is no good going long, aiming for a round number/pivot/yesterday high/whatever and setting a decent stop and position size for that 20 pip gain if actually that probability of getting there is very low. If price is unlikely to travel there, the position size and stop location (in isolation) only form part of the risk management equation, without understanding how likely it is to travel to your TP they are of limited value. Equally valuable is how likely it is to travel towards the SL !

Having said all that..... I have also learnt that just because it feels right to me, it may not to others and that is human nature. I also realize that there are traders that have other mechanisms for having a more complete view of risk management. But that is what you have done here, help me get closer to that complete view.

So thanks again for probably changing the course of my trading - time will tell.

One question, was trading Forex and the $300k loss your first trading experience ? I mean to stick at it from that point takes some balls !
  • #1,019
  • Sep 2, 2020 9:29am Sep 2, 2020 9:29am
Buying eurchf to 1.09030 hope this works...my analysis were poor today
Eur usd to 1.2080
The impossible is possible
  • #1,020
  • Edited 10:01am Sep 2, 2020 9:46am | Edited 10:01am
Quoting rogerha
{quote} @CeeSo, Firstly I just want to thank you for a very insightful, honest and candid thread which has been a complete revelation to me. Somehow I think you have provided the glue for a lot of personal learning for me. It has changed my trading in a matter of days, and I would like to point out why. We all have a view on position sizing, and risk/reward and we know the methods that can be applied in order to manage those. But I have always missed having a view of the probability of the scale of movement which traditionally I have relied on ADR/Pivots/Trendlines...

You are most welcome and I am very happy to hear that the thread has been helpful to you.

To answer your question. I traded stocks and options for a long time before attempting Forex with some success but I found that after the Fed started to do QE the stock market was really difficult to trade so forex "seemed" like a good idea. Don't ask me why I thought that because the FED affects currencies more than stocks but for some reason, I thought there are inverse pairs and I do love to short the market.

I have one of those personalities that is a "never surrender type of attitude" and once I started losing in FX there was no way I was ever going to stop.

This was of course just my EGO.

I wish I was just some newbie trader or just some average guy talking sh!t in these forums but everything that I am sharing in this thread I had to learn the hard way and it was extremely expensive, long, painful, and difficult.
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