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The Biggest Challenge: What will YOU do?

  • #1
  • First Post: Aug 23, 2007 9:57am Aug 23, 2007 9:57am
Guys... This is the first time that I'll be honest with my secret shame. After reading all your posts, I realized that I need not be embarassed about what happened to my account.

I started trading last year. I started with an $8K standard account. I had no idea about trading. Therefore, I asked a friend who works at this forex brokerage to trade for me. As it turned out, he is also just new to the business and even lost his $4k mini account a few months before we got acquainted. He traded for me and he almost blew up everything. I always fell below margin levels. He just floated every position. In short, I invested a total of $20K already due to almost weekly margin calls and infusions just to support my position. See, I really know nothing before. While it happened, I did some self-learning, researches and demo practices. Finally, last month I had decided to cut my locked/hedged losses in the sterling, start anew and trade myself. Since then, I have learned a lot about proper risk management, entry/exit points, discipline, technicals and fundamentals. Sadly, I have no more positions and I only have $4k in capital. The rest was just gone, literally.

What can I possibly do? Any suggestions? I feel like I have the biggest problem in the world. Is it possible for me to recover this slowly but surely, with my remaining equity?

What would you do if you were in my shoes? I hope somebody reads and responds to this. I'd be forever grateful for any suggestion you can give me.

Thanks guys in advance...

http://www.forexfactory.com/images/misc/progress.gif

  • #2
  • Aug 23, 2007 10:01am Aug 23, 2007 10:01am
Quoting IMQTtrader
Guys... This is the first time that I'll be honest with my secret shame. After reading all your posts, I realized that I need not be embarassed about what happened to my account.

I started trading last year. I started with an $8K standard account. I had no idea about trading. Therefore, I asked a friend who works at this forex brokerage to trade for me. As it turned out, he is also just new to the business and even lost his $4k mini account a few months before we got acquainted. He traded for me and he almost blew up everything. I always fell below margin levels. He just floated every position. In short, I invested a total of $20K already due to almost weekly margin calls and infusions just to support my position. See, I really know nothing before. While it happened, I did some self-learning, researches and demo practices. Finally, last month I had decided to cut my locked/hedged losses in the sterling, start anew and trade myself. Since then, I have learned a lot about proper risk management, entry/exit points, discipline, technicals and fundamentals. Sadly, I have no more positions and I only have $4k in capital. The rest was just gone, literally.

What can I possibly do? Any suggestions? I feel like I have the biggest problem in the world. Is it possible for me to recover this slowly but surely, with my remaining equity?

What would you do if you were in my shoes? I hope somebody reads and responds to this. I'd be forever grateful for any suggestion you can give me.

Thanks guys in advance...

http://www.forexfactory.com/images/misc/progress.gif

read Jim's Price Action Thread
Good Luck
  • #3
  • Aug 23, 2007 10:06am Aug 23, 2007 10:06am
Since it sounds like you where always over leveraged I would look into to see if your so called friend was getting a rebate off every trade he did for you. Sounds to me he might have been churning and burning.
  • #4
  • Aug 23, 2007 10:07am Aug 23, 2007 10:07am
Peter,

I will definitely read your post. Thank you for being the first to read and reply to my 'plea'. You are doing many people favor because of your posts. Thank you. I am waiting for the next trader to give his own advice or suggestion.

God bless you!
  • #5
  • Aug 23, 2007 10:10am Aug 23, 2007 10:10am
Turbo, thanks for taking time to read my post. Is there any advice you can give me? Is it possible for any trader to recover losses (100:1 leverage, 4K equity) such as mine assuming that trader is professional and experienced.
  • #6
  • Aug 23, 2007 10:47am Aug 23, 2007 10:47am
Quoting IMQTtrader
Turbo, thanks for taking time to read my post. Is there any advice you can give me? Is it possible for any trader to recover losses (100:1 leverage, 4K equity) such as mine assuming that trader is professional and experienced.
This is an individual matter, but I recommend a margin to be used on each trade that ranges between 0.25% to 2.00% in most normal trading situations. Managing risk is the most important thing for long term success as a forex trader and using to much margin can be fatal for your account.
  • #7
  • Edited 1:36pm Aug 23, 2007 12:38pm | Edited 1:36pm
Hi IMQTrader

As you and I are both discovering, there are no real short cuts to learning profitable Forex trading. Forex is not a “get rich quick” scheme. Just as it takes many years training to become a successful doctor or lawyer, it takes many years of dedicated learning to become a consistently successful Forex trader. A main reason why a large number (95%?) of traders lose is that they have “get rich quick” expectations, and are unwilling to persevere with the learning process. Eventually, the seasoned veterans happily take all of their money.

Read and learn. Test in demo. Then read and learn some more. That is the only way.

Profitable trading is about having all three of these areas sorted: mindset, money management, a positive expectancy method. If your method doesn't have a proven edge, you’re really only guessing, and luck is not sustainable indefinitely. In this context, these posts are worth a read:
http://www.forexfactory.com/showthread.php?p=206698
http://www.forexfactory.com/showthread.php?p=205799

Most profitable methods amount to some variation of either (1) trading breakouts through confluent or strong support/resistance/Fibo areas; (2) entering at pullbacks in trends ("oversold" in an uptrend, "overbought" in a downtrend), when the dominant trend looks to be re-establishing itself; or (3) look for reversals at support/resistance/Fibo areas through candle patterns (e.g. hammers or shooting stars) or something similar.

Mindset is about your ability to implement the method. It takes great patience to wait for the high probability setups. Having confidence in your method is imperative; confidence can only come from knowledge and experience. Stay in demo until you have completed enough trades that you’re 100% confident that your method is profitable. Then move to a small account; size positions small to preserve capital as long as possible, and play only with money that you can afford to lose. But I guess you already know that......

Here are some suggestions:

1. Read through the babypips school of pipsology. Unless your fairly experienced, then you’ll likely learn a significant amount here (I did!): http://www.babypips.com/school/

2. Read the sticky threads at the top of the Beginner’s Q&A forum here at FF. PeterFM’s thread Help for newbies. What can you learn on FF?, in particular, is superb. http://www.forexfactory.com/forumdisplay.php?f=56

3. Try to obtain copies of the following books:

a) Trading in the Zone by Mark Douglas. This classic is an excellent read in terms of developing the right mindset toward trading. Keep in mind that you need to have a consistently profitable method, also, however. (see points 4,5,6 for suggestions).

b) Bird Watching in Lion Country by Dirk du Toit. Chapters 1 thru 6 provide good insight as to a general approach to forex trading, developing a system, and pitfalls to avoid. Can be obtained here: http://www.goforex.net/forex-trading-explained.htm

4. Jacko outlines his method in the first 10 posts here:
http://www.forexfactory.com/showthread.php?t=27286
I haven’t tried Jacko’s method personally, but here’s a comment from somebody who’s apparently been mentored by him:
http://www.forexfactory.com/showpost...8&postcount=21
Jacko emphasizes the maxim "trade with the trend".

5. Read the James16 Chart thread here:
http://www.forexfactory.com/showthread.php?t=2331
Then decide whether you want to subscribe to the James16 private forum (costs $129 per month), which takes all of this material a significant step further. There are videos there now, too. I have just re-subscribed following a 6 month absence due to ill-health. For more information:
Comments from FF members here: http://www.forexfactory.com/showthread.php?t=8173
More than 35 independent reviews here: http://www.forexbastards.com/public/...mes16group.com
Testimonials: http://www.james16group.com/Testimonials.html
If you decide to subscribe: http://www.james16group.com/

6. There are systems on the “Trading Systems” forum here:
http://www.forexfactory.com/forumdisplay.php?f=71
I believe the Fozzy method (http://www.forexfactory.com/forumdisplay.php?f=87) has a large following, but haven’t used it myself, hence I invite you to seek out comments from those who have. I would also suggest that you check out systems there that have a large number of posts/views, have been around for a long time, and haven’t been modified (optimized) too much during that time. The Cornflower system (http://www.forexfactory.com/showthread.php?t=26205) may be a case in point. Phillip Nel's systems appear to have a wide following also.

7. Apart from Jacko, some of the most successful traders on the forum include: Merlin, James16, Darkstar, SMJones, Fijitrader, Bemac, Diallist, TheRealThing, Moneyma$ter (and probably many others whom I’m unaware of). Read and absorb their posts.

8. Brokers: to understand how the different types of broker operate:
http://www.gracecheng.com/forex_trad...x_Brokers.html
http://www.forexfactory.com/showthread.php?t=7484
Independent broker reviews:
http://www.forexbastards.com/public/...broker_reviews
http://www.topforexreview.com/brokers.htm
Some points to keep in mind when reading the reviews:
http://www.forexfactory.com/showpost.php?p=1491670

[Edit:] One final thought. If you're considering purchasing an automated system, or trading signals, be sure to perform due diligence - find independent reviews - before parting with your money. Again, the following may be helpful as a starting point (use Google also):
http://www.forexbastards.com/
http://www.topforexreview.com/
http://www.forexfactory.com/showthread.php?t=11822

Good luck
David
  • #8
  • Aug 23, 2007 1:00pm Aug 23, 2007 1:00pm
Quoting hanover
Hi IMQTrader

Here are some suggestions:

Good luck
David
That's some helping hand, maybe I can get you to ghost write my Newbie thread
If I may I would like to post a link to this message later on in the thread. OK?
  • #9
  • Aug 23, 2007 1:05pm Aug 23, 2007 1:05pm
Quoting PeterFM
If I may I would like to post a link to this message later on in the thread. OK?
Peter, you're most welcome to. I only just discovered your newbie thread the other day (I've been totally "buried" by so many things!). It's magnificent!

Best wishes
David
  • #10
  • Aug 23, 2007 1:08pm Aug 23, 2007 1:08pm
Quoting IMQTtrader
Peter,

I will definitely read your post. Thank you for being the first to read and reply to my 'plea'. You are doing many people favor because of your posts. Thank you. I am waiting for the next trader to give his own advice or suggestion.

God bless you!
We all take, and give back, all the time. The folk around here have a generosity of spirit which gives hope for the future of mankind.
Anything written by Hanover and Turbokaos contain more wisdom than 95% of the mindless chatter going on 95% of the time.
Read their stuff as well as all the other links that Hanover posted (my only reservation is forex bastards).
Don't be afraid of asking for advice. Most of the responses you get will be like these, ie constructive, any other replies you can ignore so don't take offence at them.
  • #11
  • Aug 23, 2007 1:52pm Aug 23, 2007 1:52pm
Quoting PeterFM
Read their stuff as well as all the other links that Hanover posted (my only reservation is forex bastards).
Peter, I've never tried Felix's news trading method - hence I'm not commenting on it. And (assuming I understand him correctly) he believes it's virtually impossible to profit by using TA alone. Again, I won't comment unless/until I'm in a position to prove this to be right or wrong.

I suggested the forexbastards site simply because it contains the largest number of independent reviews on forex brokers, education, signals, systems, etc that I've encountered. While it's probably true that some of the reviewers have an ulterior motive, sifting judiciously through the comments can give one a feel for which vendors might actually be offering something better than snake oil. There are so many crooks and failed traders selling systems that I'd rather perform some investigative work before parting with my money.

If you're aware of other review sites, please feel welcome to add them to the list.

David
  • #12
  • Aug 23, 2007 2:02pm Aug 23, 2007 2:02pm
Quoting hanover
Peter, I've never tried Felix's news trading method - hence I'm not commenting on it. And (assuming I understand him correctly) he believes it's virtually impossible to profit by using TA alone. Again, I won't comment unless/until I'm in a position to prove this to be right or wrong.

I suggested the forexbastards site simply because it contains the largest number of independent reviews on brokers, education, signals, systems, etc that I've encountered. While it's probably true that some of the reviewers have an ulterior motive, sifting judiciously through the comments can give one a feel for which vendors might actually be offering something better than snake oil. There are so many crooks and failed traders selling systems that I'd rather perform some investigative work before parting with my money.

If you're aware of other review sites, please feel welcome to add them to the list.

David
It's hard to express the nuances of language when typing, so I apologise if my response offended you. It was more a case that as I read around the forum, the consensus is that his site is not as unbiased as he would have us believe. I'm not sure I've ever read a complimentary review (to quote Jacko -- I may be wrrooonng ). I did get his signals, once, but don't think I ever acted on any of them, mainly because I don't trade the news.

With regard to other sites, I only inhabit this neck of the woods, so live a very sheltered life.
  • #13
  • Aug 23, 2007 2:11pm Aug 23, 2007 2:11pm
Thanks for the thread QT!
Lots and lots of us are learning
from it. The advice that you're
(we're) getting here is from some
of the best! Thanks all!
  • #14
  • Aug 24, 2007 1:03am Aug 24, 2007 1:03am
Guys (so far...peter, 'legendary' turbo,hanover, fxsurfer)

I read all your responses to my thread. I can feel the sincerity of your messages, and I appreciate them so much. However, up to now, lots of things are going on in my mind and I really can't decide what to actually do. My situation is far more complicated than what I posted but I believe it would be quite depressing for every1 if I posted them here.

It would really be best if someone could actually give me a CONCRETE suggestion of what I should do with my situation (assuming I really want to recover my losses through forex and I still have enough to feed myself). Again, I only have about 4k in equity (i don't plan to add anymore...it's suicide already). My broker only offers 100:1 leverage.

Now, what would you do guys, if you were stuck with the same problem?

I need all your suggestions guys... I've got nobody else to talk to. (at least someone who understands the situation I'm going through - from a trader's perspective). God bless everyone! Keep those replies coming please... I'll be forever grateful.
  • #15
  • Edited 1:40am Aug 24, 2007 1:27am | Edited 1:40am
before I forget, I just want to thank hanover for the comprehensive reply he made. It was definitely a big help. also, to peter for showing genuine concern. Hope others would be encourged to do so. I hope every viewer of my thread will realize that to the world you may only be one person, but to one person (someone as deperate as me) you may be the world.

Still, thank you all. I hope to encounter more hanovers or peters or even turbos in my thread. It means a whole lot!
  • #16
  • Aug 24, 2007 6:00am Aug 24, 2007 6:00am
  •  zinc6
  • | Joined May 2007 | Status: don't just do something, sit there! | 54 Posts
Quoting IMQTtrader
Guys (so far...peter, 'legendary' turbo,hanover, fxsurfer)

I read all your responses to my thread. I can feel the sincerity of your messages, and I appreciate them so much. However, up to now, lots of things are going on in my mind and I really can't decide what to actually do. My situation is far more complicated than what I posted but I believe it would be quite depressing for every1 if I posted them here.

It would really be best if someone could actually give me a CONCRETE suggestion of what I should do with my situation (assuming I really want to recover my losses through forex and I still have enough to feed myself). Again, I only have about 4k in equity (i don't plan to add anymore...it's suicide already). My broker only offers 100:1 leverage.

Now, what would you do guys, if you were stuck with the same problem?

I need all your suggestions guys... I've got nobody else to talk to. (at least someone who understands the situation I'm going through - from a trader's perspective). God bless everyone! Keep those replies coming please... I'll be forever grateful.
Hi IMQtrader,

I'm fairly new here and have only been seriously learning fx since March but the above post really worried me, so I thought I'd better post my advise here which has little to do with how to make money at fx but hopefully you (or someone) will find it useful.

From what I can gather from your posts (correct me if I'm wrong)so far you have invested $20K in fx and only have $4K left. From the above post is seems that you believe that there will be a way of not only increasing your account back up to $20K from $4K and generate yourself some income at the same time. Income part aside what you are looking for is a return of 500% on your current account...

Even really experienced profitable traders are not making this sort return and I think what you are hoping to acheive (either through fx or any other legal means) is absolutely impossible in the short term, so my advise is that you need to sort out the "complications" of you situation by some other means.

I am really worried that these complications you refer to mean that the money you lost was borrowed and if this is not the case please disregard the advise below.

1. Close your fx account and immediately pay the remaining funds back to the lender.
2. Make a budget and work out how much you can afford to pay off the debt every week/month. Make this amount realisitic and sustainable.
3. Contact the lender, explain truthfully what has happened and what you can afford to pay them every week/month. Remember the lender wants their money back and will work with you to acheive this.
4. If the debt is of a short term high interest nature and you have a steady job and clear credit rating it would probably be a good idea to "consolidate" the debt into a lower interest bank loan with a longer term for repayments. But again be realistic about how much you can afford to pay and don't borrow anymore than you absolutely have to.
5. If things are really out of control I would recommend seeking the assistance of a Financial Councellor.
6. If you are still interested in trading fx then start the excellent training plan hanover has provided for you set up a demo and practise, learn & develop your trading. If you persevere you may well eventually take more than the $16K you are currently looking for from the market but fx is not a solution to your problem and if you attempt to trade your way out you will only end up digging a deeper hole for yourself.

Hopefully this is not your situation... but it may be useful to someone.

best of luck ...

zinc6
  • #17
  • Aug 24, 2007 6:59am Aug 24, 2007 6:59am
IMHO every new trader should read Jacko's thread and start trading the Cornflower system. Over time you will improve.
  • #18
  • Aug 24, 2007 12:03pm Aug 24, 2007 12:03pm
Quoting zinc6
Hi IMQtrader,

I'm fairly new here and have only been seriously learning fx since March but the above post really worried me, so I thought I'd better post my advise here which has little to do with how to make money at fx but hopefully you (or someone) will find it useful.

From what I can gather from your posts (correct me if I'm wrong)so far you have invested $20K in fx and only have $4K left. From the above post is seems that you believe that there will be a way of not only increasing your account back up to $20K from $4K and generate yourself some income at the same time. Income part aside what you are looking for is a return of 500% on your current account...

Even really experienced profitable traders are not making this sort return and I think what you are hoping to acheive (either through fx or any other legal means) is absolutely impossible in the short term, so my advise is that you need to sort out the "complications" of you situation by some other means.

...

zinc6

Thank you zinc6 for your deep concern for my situation - i can actually feel it. But to clarify things.. No, the money wasn't borrowed. It came from my own savings fund. It was not my risk capital either. Sadly, the remaining equity had to be considered as one, just for the sake of finding a way to recover this hard-earned money.

I understand that you are advising me to withdraw the money and learn some more of trading this risky market. honestly, I had considered this a gazillion times but I can't seem to accept just letting go of those losses without putting one more fight. Do you think it would be insane of me to risk all and GIVE IT ONE LAST SHOT? I've done this in my demo account with still 4K of equity. Now, it's almost 10K. WOULD ANYONE ADVICE ME TO DO THIS? COME ON GUYS...

If you were in my situation, would you give it a try? would you? pls. keep those advices coming... it's the first time I found such a comforting and understand community here, and i feel lucky at least for this discovery. after all, we do have similar experiences. but mine is really devastating.. you can just imagine.

so again, to those who haven't sent their suggestions yet, pls. do.

love, QT
  • #19
  • Aug 24, 2007 12:27pm Aug 24, 2007 12:27pm
Quoting IMQTtrader
Thank you zinc6 for your deep concern for my situation - i can actually feel it. But to clarify things.. No, the money wasn't borrowed. It came from my own savings fund. It was not my risk capital either. Sadly, the remaining equity had to be considered as one, just for the sake of finding a way to recover this hard-earned money.

I understand that you are advising me to withdraw the money and learn some more of trading this risky market. honestly, I had considered this a gazillion times but I can't seem to accept just letting go of those losses without putting one more fight. Do you think it would be insane of me to risk all and GIVE IT ONE LAST SHOT? I've done this in my demo account with still 4K of equity. Now, it's almost 10K. WOULD ANYONE ADVICE ME TO DO THIS? COME ON GUYS...

If you were in my situation, would you give it a try? would you? pls. keep those advices coming... it's the first time I found such a comforting and understand community here, and i feel lucky at least for this discovery. after all, we do have similar experiences. but mine is really devastating.. you can just imagine.

so again, to those who haven't sent their suggestions yet, pls. do.

love, QT
NO!

refrain from making another trade until you know how to trade and make consistent returns.. and believe me you will know when you are ready.. I do not recommend taking the money out of your account, but do not trade until you have a decent education under your belt

Do what you want! You will do it anyways, BUT im telling you now if you just "go for it" or "give it another shot" you are gambling and I suggest two options that might make your life easier

A) Goto Vegas and bet everything on Red

or

B) Send your money to my paypal account, you are going to lose it anyways if you just "go for it" so it might as well go into my trading account where at least I have a well thought out trading plan backing each of my trades.


...I am not trying to sound discouraging, but I do not want to see you lose your last 4k, which if you take the proper steps to become a successful trader you could easily recover what you have lost and then some..
  • #20
  • Aug 24, 2007 12:34pm Aug 24, 2007 12:34pm
Quoting IMQTtrader
Thank you zinc6 for your deep concern for my situation - i can actually feel it. But to clarify things.. No, the money wasn't borrowed. It came from my own savings fund. It was not my risk capital either. Sadly, the remaining equity had to be considered as one, just for the sake of finding a way to recover this hard-earned money.

I understand that you are advising me to withdraw the money and learn some more of trading this risky market. honestly, I had considered this a gazillion times but I can't seem to accept just letting go of those losses without putting one more fight. Do you think it would be insane of me to risk all and GIVE IT ONE LAST SHOT? I've done this in my demo account with still 4K of equity. Now, it's almost 10K. WOULD ANYONE ADVICE ME TO DO THIS? COME ON GUYS...

If you were in my situation, would you give it a try? would you? pls. keep those advices coming... it's the first time I found such a comforting and understand community here, and i feel lucky at least for this discovery. after all, we do have similar experiences. but mine is really devastating.. you can just imagine.

so again, to those who haven't sent their suggestions yet, pls. do.

love, QT
STOP TRADING!!! Pick up a few books, read this forum front to back and write down your trading plan!. Read about psychology of trading (i.e Mark Douglas "Trading in the Zone", Alexander Elder "Come into my trading room"). Spend some time to pick out a trading system that you find appealing. Read about money management thread in the beginner's section. READ READ READ!

Seriously man, you are on the verge of becoming a gambler and your are establishing a very bad habit if you think risking all your equity is a good idea.
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