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What is the most important question for a new trader?

  • #21
  • Sep 24, 2020 8:49am Sep 24, 2020 8:49am
Quoting Seneca pilot
{quote} This is very important. You cannot completely detach completely from the money. You have to come to terms with the fact that it is part of trading to lose money. The best traders have win rates in the fifty five to sixty percent range. This means that if you are the best you will still lose forty percent or more of the time. To win long term requires learning to think in a probability mindset. You have to accept that each trade has a random outcome even though over a large set of trades you will have a higher probability of winning over...
Yep, it took me some years to be able to accept that how I frame things in my mind is the problem.
About the size, I completely agree, but I also have a type of trouble... I already trade the minimum size of my asset (1 contract of the brazilian future index) and only one trade a day to avoid overreacting to losses. I have money the back my MM properly, but I find very hard to keep trading in the same way after I get into losing streaks (even small ones)
  • #22
  • Sep 24, 2020 8:56am Sep 24, 2020 8:56am
Quoting lonetraderBR
{quote} Yep, it took me some years to be able to accept that how I frame things in my mind is the problem. About the size, I completely agree, but I also have a type of trouble... I already trade the minimum size of my asset (1 contract of the brazilian future index) and only one trade a day to avoid overreacting to losses. I have money the back my MM properly, but I find very hard to keep trading in the same way after I get into losing streaks (even small ones)
Are you profitable with the one contract? Have you considered something like Top Step or one of the other prop firms to help you with capital? Will your method translate to a different market like S&P or Dow futures? Restricting a profitable method to only one trade per day will severely harm your efforts to increase size and make more money. It must be painful to have your one losing trade then watch the market give winning trades later in the day. You need access to more capital if you do have a winning method.
  • #23
  • Sep 24, 2020 9:09am Sep 24, 2020 9:09am
Quoting Seneca pilot
{quote} Are you profitable with the one contract? Have you considered something like Top Step or one of the other prop firms to help you with capital? Will your method translate to a different market like S&P or Dow futures? Restricting a profitable method to only one trade per day will severely harm your efforts to increase size and make more money. It must be painful to have your one losing trade then watch the market give winning trades later in the day. You need access to more capital if you do have a winning method.

For some months now my account is moving sideways. But is clear though that is happening because of my trading mistakes (like making some nonsense entries after being stoped or reentering because of impulses on the same level that I stoped). If I let only the planned trades, I would be comfortably profitable = /

I never considered prop firms (here in Brazil almost all that are available are scams), but I'll be looking for it!
About the one trade per day, my asset rarely gives me more than one good opportunity (which is some previously selected level) per day. Maybe moving to smaller time frames I could get more entries. The big problem is that I found that on the second trades I am very anxious and altered, and almost always I act by impulses

*Edit: About translating it to other markets, yep, the method is based on price levels / order flow. It would only take some time to figure the important ones and the proper MM.
  • #24
  • Sep 24, 2020 9:23am Sep 24, 2020 9:23am
Quoting lonetraderBR
{quote} For some months now my account is moving sideways. But is clear though that is happening because of my trading mistakes (like making some nonsense entries after being stoped or reentering because of impulses on the same level that I stoped). If I let only the planned trades, I would be comfortably profitable = / I never considered prop firms (here in Brazil almost all that are available are scams), but I'll be looking for it! About the one trade per day, my asset rarely gives me more than one good opportunity (which is some previously selected...
If you are not losing money you are ninety percent there. Discipline is key. If you have identified a method that has edge you must be very careful to only take valid entries but also take all valid entries. If your capital doesn't allow you to take all the valid entries you need to seek out more. Look at Top Step Trader and do a demo to see if they offer your market or if your method can work on the markets they offer. Two week free demo.
  • #25
  • Sep 24, 2020 9:33am Sep 24, 2020 9:33am
The simple question of a trader will ask when he will be successful
  • #26
  • Sep 24, 2020 10:02am Sep 24, 2020 10:02am
Quoting Seneca pilot
{quote} If you are not losing money you are ninety percent there. Discipline is key. If you have identified a method that has edge you must be very careful to only take valid entries but also take all valid entries. If your capital doesn't allow you to take all the valid entries you need to seek out more. Look at Top Step Trader and do a demo to see if they offer your market or if your method can work on the markets they offer. Two week free demo.
I hope so = )
My absolute focus right now is on training my mind to be able to build the necessary discipline. It is strange because when I act by impulses it is almost like it wasn't me...

Do you know about some good readings in the mental game areas?

Ps.:I opened an account in Top Step right now, they unfortunately don't have the mini Ibosvepa contracts (winv20), but I will be taking a look at the ES!
  • #27
  • Sep 24, 2020 10:15am Sep 24, 2020 10:15am
Quoting lonetraderBR
{quote} I hope so = ) My absolute focus right now is on training my mind to be able to build the necessary discipline. It is strange because when I act by impulses it is almost like it wasn't me... Do you know about some good readings in the mental game areas? Ps.:I opened an account in Top Step right now, they unfortunately don't have the mini Ibosvepa contracts (winv20), but I will be taking a look at the ES!

Go to Youtube and search Mark Douglas Trading in the zone. There are videos of his seminars. Very valuable.
  • #28
  • Sep 24, 2020 10:19am Sep 24, 2020 10:19am
Quoting Seneca pilot
What is the most important question for a new trader?
1a. Can you quickly exit a losing trade 10 times out of 10?

1b. Do you have the psychological capital (and the actual capital-see 1a. ) to enter trade number 7 after 6 straight losses?

Quoting Seneca pilot
The best traders have win rates in the fifty-five to sixty percent range. This means that if you are the best you will still lose forty percent or more of the time.
I wouldn't say it's that high. The best traders typically lose more than they win. But they make more on their winning trades than they lose on their losing trades. Many of them fall into the "boom or bust" category. That is they will either make x pips (boom) or lose y pips (bust). For example, they will either make 85 pips or lose 15 pips. That's a Reward to Risk ratio of 5.6 to 1. One can take a lot of losses if he is winning almost 6 times as much on the occasions he does win.

So here's the rub which leads to question #2.

2. Do you have the psychological capital to watch the Market move 73 pips in your favor and then turn around and stop you at -15 pips?
Without VSA, you're playing checkers while the Smart Money plays chess.
  • #29
  • Sep 24, 2020 10:27am Sep 24, 2020 10:27am
Quoting HiddenGap
{quote} 1a. Can you quickly exit a losing trade 10 times out of 10? 1b. Do you have the psychological capital (and the actual capital-see 1a. ) to enter trade number 7 after 6 straight losses? {quote} I wouldn't say it's that high. The best traders typically lose more than they win. But they make more on their winning trades than they lose on their losing trades. Many of them fall into the "boom or bust" category. That is they will either make x pips (boom) or lose y pips (bust). For example, they will either make 85 pips or lose 15 pips. That's...
Yes there are great traders with low win rates.

I haven't ever traded a method that regularly produced more than two to maybe three losses in a row. I couldn't. I am with Marty Schwartz on this. I use this to pay my bills. I rarely have a losing week and a losing month is unthinkable.

No, I absolutely cannot take a loss after that kind of win. I know myself well enough to know that I cannot trade that type of style. I actually have a quite high win rate above sixty percent. I need that for my personality. My winners are a bit larger than my losers about 1.4 so I get by.
  • #30
  • Sep 24, 2020 10:34am Sep 24, 2020 10:34am
Good questions and discussions so far. I have some yard work to do so here is my second question for you do think about.

Do you 100% absolutely and completely trust the method you are using to trade?

If you don't, if you are using someone else's method or you really don't trust yours then you need to start over. If you don't trust it, when the real money is on the line you will make mistakes.

Be back later.
  • #31
  • Sep 24, 2020 10:55am Sep 24, 2020 10:55am
Great thread and great questions so far.
I think its helps to approach each trading day with the mindset that "the only thing I have control over is the amount I can lose per trade.
So the question is: How much am I prepared to lose today? How much am I prepared to risk per trade?
  • #32
  • Sep 24, 2020 11:06am Sep 24, 2020 11:06am
Quoting Seneca pilot
{quote} Go to Youtube and search Mark Douglas Trading in the zone. There are videos of his seminars. Very valuable.
Been watching his seminars and reading the Trading in the Zone many times so far, always picking something new from it = )
  • #33
  • Sep 24, 2020 11:35am Sep 24, 2020 11:35am
Quoting michisuperfr
What makes the market move? {image}
In a word: AGGRESSION.

Attached Image (click to enlarge)
Click to Enlarge Name: Aggression.png Size: 56 KB
Without VSA, you're playing checkers while the Smart Money plays chess.
  • #34
  • Sep 24, 2020 2:37pm Sep 24, 2020 2:37pm
I'm surprised the following question hasn't been emphasised as much as I think it ought to be;

"Can you prove you have a profitable system?"

If the question is "Do you have a profitable system?", then a new trader can fabricate any line of flimsy reasoning on why they think they do.
If the question is "Can you sit in front of the computer/follow the rules/put emotions-ego aside/surive x string of losses?", then a new trader can give a wishfully thought up "of course!". But if you ask them to prove it, then, there is no wishful thinking or bs to be had, you can either prove it or you can't. The quality of the proof reflects the quality of the trader's understanding/testing/reliability of the system.

Ultimately I don't think it should be a question at all, rather a statement; "Prove you have a profitable system."
  • #35
  • Sep 27, 2020 8:56am Sep 27, 2020 8:56am
The most important question for a new trader: Will I enjoy doing this enough to have the courage to push through the challenges until I become successful?

Becoming a successful trader is a process with many challenges: But to become successful, you've got to love the process as much as you'll enjoy the prize.
Give the market little, Aim to take a lot!
  • #36
  • Sep 27, 2020 9:11am Sep 27, 2020 9:11am
Quoting Seneca pilot
I'll start: Can you sit in front of a computer screen for one to five hours watching price move and not enter a trade if you don't get a good setup?
True if you're a scalper.

But if a new trader decides to take a swing trading or position trading approach this is not practical.

One can set alerts at key levels/supply and demand zones or when desired setups are identified by a scanner or EA, then access the chart to place a trade.
Give the market little, Aim to take a lot!
  • #37
  • Sep 27, 2020 9:17am Sep 27, 2020 9:17am
Quoting alphaomega
Can you write code? Are you a programmer? If the answer is NO then you should approach trading as a hobby and nothing more. Or even better forget about trading and move on with your life to the greener pastures because otherwise you are going to lose your time and money. You need at least basic math skills, coding skills and a solid understanding of statistics and probability theory.
Not necessary.

If you decide to automate any part of your trading, you can use products already created by others to achieve what you want.

If you can't find the desired product, you can have it created by a programmer.
Give the market little, Aim to take a lot!
  • #38
  • Sep 27, 2020 11:53am Sep 27, 2020 11:53am
Will I win from all of this?

You will, eventually become wise, good at mathematics and problem solving. Trading forex is a good exercise for the mind and you will become better on decision making.
Also you will gain more computer skills like, fast at observing on screen changes and you will also harden your character - become more disciplined.
Looking for profitable short term trades ...|
  • #39
  • Edited 1:59pm Sep 27, 2020 1:47pm | Edited 1:59pm
Quoting Calsimay
{quote} Not necessary. If you decide to automate any part of your trading, you can use products already created by others to achieve what you want. If you can't find the desired product, you can have it created by a programmer.
You can't get far this way. The commercial products will fail eventually. And It's very expensive and inefficient to depend on someone else to do coding work for you. The good programmers will charge you at least 30-40$ per hour and you don't' have guarantee that their code works correctly because you can't verify it yourself. You will have to pay more and more money every time you want something modified, or when you have new better idea. When you add the fact that you will continue to lose money in the meantime from the market your trading adventure as a whole will become one huge money pit in no time.

Learn to code!
Give it 1 year. There is plenty of free and high quality resources online. Today you don't have to pay a single dollar to become a programmer!
Start with C++, and learn the basics. Then move to MQL4 and MQL5.
If you are persistent you will learn very fast, and before you know it you will start to write fully functional trading robots and you will make your own tools and indicators exactly the way you want them.

This will be the best investment in your life! Even if you decide to quit trading in the future your coding skills will help you in other areas of life.
  • #40
  • Sep 27, 2020 2:03pm Sep 27, 2020 2:03pm
Quoting Seneca pilot
I am not sure how much time I will spend on this thread but I do plan to post up a few questions in the coming days to make newer traders and unprofitable traders think about what might be holding them back. Before anyone asks, I am not seriously trading spot forex any longer. Too much counter party risk. I am trading futures. My methods have evolved over the years and I do still trade a little forex but my larger trading is in ES and ZB.
So what is your average daily profit?
Love to talk on Discord: DividendGamer#1324
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