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more knowledge more problems

  • #1
  • First Post: Jan 6, 2007 4:06pm Jan 6, 2007 4:06pm
Hi again,
I just wanted to state that iam getting more and more problems with forex.
The contradictory part is that i have less to look for since as i started with forex.
My problem is that i have nearly tools to analyse the chart. This may sound weird now, but when you take a closer look there are many tools which cant be applied to forex. For example volume is at stocks and futures a very significant part of analysing. But in forex.... you cant use it, because there is nothing than volume, or in other words is useless.
Another thing which you cant use is the statement that you have to follow trends, because a trend in motion is more likely to continue than to reverse until it shows signs of a reversal. In forex though it seems that there are no trends, because its a 24h market and people do not pay attention to the "the trend is your friend" wisedom..

Are there really only resistance, trendlines, chart patterns, and some indicators left?
Is this really everything, or do i forget sth?
Hopefully there will be some response.
Anyway .. Thanks for listening
-mike
I'm getting there ... slowly
  • #2
  • Jan 6, 2007 4:14pm Jan 6, 2007 4:14pm
Mate it sounds like you trying to apply your stock trading style to fit FOREX and your going to find that it not go to work for no more than if you tried to apply your stock methods to futures your optons its a totaly diff beast... I would take a step back and clear my head and take another look at the FOREX totaly open minded.

JohnW said it best "I also now believe that no one can teach another to trade. That's not to say that one can't learn to trade, just that the skill set can not be learned as one might say (and has) "in an hour". This skill set can only be learned by demo trading for months ad nauseum."

turbo

ps JohnW this quote is going to become famous you might want to copyright it..lol
  • #3
  • Jan 6, 2007 4:36pm Jan 6, 2007 4:36pm
yeah, i definately need sleep. Iam just too ambitious..
Thanks anyway
I'm getting there ... slowly
  • #4
  • Jan 6, 2007 4:56pm Jan 6, 2007 4:56pm
Quoting miketoll
Hi again,
I just wanted to state that iam getting more and more problems with forex.
The contradictory part is that i have less to look for since as i started with forex.
=
Are there really only resistance, trendlines, chart patterns, and some indicators left?
Is this really everything, or do i forget sth?
Hopefully there will be some response.
Anyway .. Thanks for listening
-mike
Mike, I've learned for myself, and seen it in many others, that the more they or I learn and then try to apply, the more confused we can become.

To me, this doesn't mean that we have to stop learning or reading books or investigating new methods. What it does mean is that it's important to separate the learning process from the application of the learning. I make the analogy that trying to follow multiple trading systems can be like trying to drive a car with multiple steering wheels. It just won't work. It becomes confusing and it's overcomplicated.

The statemens about stepping back and having an open mind, and about you having to learn for yourself, that was quoted in this thread, are so very true in my experience. Through your own observations, and open-minded (so well put!) interaction with new ideas, and reading, etc, you are going to get an idea of what indicators or methods make the most sense to you.

And then you have to do more than observe -- of course this is my opinion and I am excited to hear what others have to say -- then you have to test the methods that you learn. You go back in time and you apply what you have learned and you prove whether it works or not. You learn whether the method experiences drawdowns that are unnacceptable, or whether it has a great win percentage but a bad average winner to loser size, or whether it requires you to keep an unrealistic schedule that negatively affects your health. This process of learning, making a hypothesis, and then testing that hypothesis, can take a long time. That's why so many traders fail, I think: they realize how much effort can go into "making a system your own" and instead they just start trading again, because of financial pressures, an addiction to trading, or because they simply feel that all that testing is unnecessary.

Once that learning and testing process is complete, you start applying what you've tested in the market. Do you get the same results? Or are they not what you expected based on your testing? You can share your results with a friend or mentor or spouse or people at FF -- someone who cares about your success. They can hold you accountable to apply what you have learned and tested in a disciplined way, and then they can help you stop trading if it's not working, or encourage you to be confident and continue to take the necessary risks associated with trading if the system is working.

All throughout this process, you are emphasizing learning and testing, and making a system "your own", and you are de-emphasizing lots of trading, you are reducing stress about whether you are doing it "right", you are proving to yourself that you can learn and test and implement.

And then as you implement a system that you have made your own, and you are profitable, you can repeat the process with more learning, more testing, and so on. It can be a continuous process that lasts a lifetime.

To bring it full circle, hopefully, one helpful thing for me (which I have seen with others) is that they focus their learning on one or two things at a time, then test, then implement, then hold themselves accountable to others and themselves. And this reduces the confusion associated with looking at so many things, so many systems, so many methods, and not "knowing what to follow."
  • #5
  • Jan 6, 2007 5:40pm Jan 6, 2007 5:40pm
When things don't go right, we always assume that the reason lies in our knowledge of trading, indicators, and etc. It's not about knowing more about indicators and technical analysis. It's always about knowing yourself. Trading forex like the stock market doesn't work. To be honest I think most of the indicators used with stocks are way too slow to be of any use in Forex. The only ones, which seem fast enough, are CCI and RVI. Most of the others are a day late and a dollar short unless you use them unconventionally for divergence or whatever. Everyone seems to use them anyway, and I followed the crowd to start with by adding more and more of them, coming up with several good entry systems, hoping to know where the market was going next. It doesn't work. Indicators cannot relay that information. They can only tell you where the market has been and where it was at the last chart update. Simplify your charts, get in touch with yourself, and trade from your gut. That's the only way to win in Forex.
  • #6
  • Jan 6, 2007 5:49pm Jan 6, 2007 5:49pm
Quoting miketoll
In forex though it seems that there are no trends, because its a 24h market and people do not pay attention to the "the trend is your friend" wisedom..
I disagree with this statement completely. It may be that your application of trend trading which you used in another market needs some adjustment for Forex.....I don't know.

Trend trading in Forex can be extremely successful. In fact, you often see it stated that one of the main reasons some trade forex vs. other markets is because it trends so well.

Don't give up on the trend too quickly.
Secret Identity: Bill Sullivan
  • #7
  • Jan 6, 2007 6:21pm Jan 6, 2007 6:21pm
Yes, I agree. there is always a trend. It just depends on the frame of reference.



Quoting Captain Piptastic
I disagree with this statement completely. It may be that your application of trend trading which you used in another market needs some adjustment for Forex.....I don't know.

Trend trading in Forex can be extremely successful. In fact, you often see it stated that one of the main reasons some trade forex vs. other markets is because it trends so well.

Don't give up on the trend too quickly.
  • #8
  • Jan 6, 2007 6:21pm Jan 6, 2007 6:21pm
Quoting miketoll
Hi again,
I just wanted to state that iam getting more and more problems with forex.
The contradictory part is that i have less to look for since as i started with forex.
My problem is that i have nearly tools to analyse the chart. This may sound weird now, but when you take a closer look there are many tools which cant be applied to forex. For example volume is at stocks and futures a very significant part of analysing. But in forex.... you cant use it, because there is nothing than volume, or in other words is useless.
Another thing which you cant use is the statement that you have to follow trends, because a trend in motion is more likely to continue than to reverse until it shows signs of a reversal. In forex though it seems that there are no trends, because its a 24h market and people do not pay attention to the "the trend is your friend" wisedom..

Are there really only resistance, trendlines, chart patterns, and some indicators left?
Is this really everything, or do i forget sth?
Hopefully there will be some response.
Anyway .. Thanks for listening
-mike

boy needs to chill... forex is a market where it has the most trends. In fact, it's one of the reasons I trade forex. Forex is a very efficient market and in equities, there are still some inefficiencies. I also traded equities before too and you can't let a few set backs disregard a market where plenty of people are making money just because you can't. Remember the fundamentals and strategies come and go.
  • #9
  • Jan 6, 2007 6:31pm Jan 6, 2007 6:31pm
The idea of "paralysis by analysis" is a very real experience. I have gone through the process of trying this indicator or that system and it frustrated the smile off my face. Very basically and in a nutshell I did the following;

1. Increased my knowledge about how the Forex market works fundamentally and technically.

2. I found a very simple high win to loss ratio method on a time frame that suited me. I tested it till it became a part of me and I now own it.

3. I trade it with undying, unshakable, stubborn, dig my toes in the sand discilpline.

4. The education and knowledge gathering continues and is totally separate from my trading.

The attachment was posted by someone else here on the thread but is a great read.

AlexFX

AlexFX
Attached File(s)
File Type: pdf Manthra.pdf   122 KB | 754 downloads
  • #10
  • Jan 6, 2007 6:49pm Jan 6, 2007 6:49pm
Quoting taxgeek
When things don't go right, we always assume that the reason lies in our knowledge of trading, indicators, and etc. It's not about knowing more about indicators and technical analysis. It's always about knowing yourself. Trading forex like the stock market doesn't work. To be honest I think most of the indicators used with stocks are way too slow to be of any use in Forex. The only ones, which seem fast enough, are CCI and RVI. Most of the others are a day late and a dollar short unless you use them unconventionally for divergence or whatever. Everyone seems to use them anyway, and I followed the crowd to start with by adding more and more of them, coming up with several good entry systems, hoping to know where the market was going next. It doesn't work. Indicators cannot relay that information. They can only tell you where the market has been and where it was at the last chart update. Simplify your charts, get in touch with yourself, and trade from your gut. That's the only way to win in Forex.
It is not often that I chime in on a forum. However, I feel a wisdom coming from this quote we do not often see. I have been through the indicators, MA crosses, bounces, breaks and whatever else you have probably seen. After concluding that I was only donating to a cause I did not care to support I went back to basic price action. I would argue that 100% of being successful in the market comes from within. Watch the action and you will know what to do. This comes from many days of observation, but you will know the move to make at the proper time. Get to know yourself. Make the mental corrections necessary and reap the benefits. Not as easy as it sounds, but I believe it would be the only path to success in this market. Just remember, the market has no feeling or remorse. It only is an inantimat entity we can read and receive the profits it allows.
  • #11
  • Jan 6, 2007 6:51pm Jan 6, 2007 6:51pm
ThanksAlex- Good Read

Quoting AlexFX
The idea of "paralysis by analysis" is a very real experience. I have gone through the process of trying this indicator or that system and it frustrated the smile off my face. Very basically and in a nutshell I did the following;

1. Increased my knowledge about how the Forex market works fundamentally and technically.

2. I found a very simple high win to loss ratio method on a time frame that suited me. I tested it till it became a part of me and I now own it.

3. I trade it with undying, unshakable, stubborn, dig my toes in the sand discilpline.

4. The education and knowledge gathering continues and is totally separate from my trading.

The attachment was posted by someone else here on the thread but is a great read.

AlexFX

AlexFX
Trade what you see - Not what you think
  • #12
  • Jan 6, 2007 6:58pm Jan 6, 2007 6:58pm
Quoting miketoll
Hi again,
I just wanted to state that iam getting more and more problems with forex.
The contradictory part is that i have less to look for since as i started with forex.

-mike

Mike,
Your are on a journey and you just haven't reached the crest of the hill. Keep searching, reading, testing, asking and analyzing. Some successful traders reach the crest of the hill sooner than others and by different paths. When you get there you'll know it. Don't give up on your objectives.

Focus on price exhaustion.

Best wishes in '07

.
  • #13
  • Jan 6, 2007 7:28pm Jan 6, 2007 7:28pm
Quoting miketoll
Hi again,
I just wanted to state that iam getting more and more problems with forex.
The contradictory part is that i have less to look for since as i started with forex.
My problem is that i have nearly tools to analyse the chart. This may sound weird now, but when you take a closer look there are many tools which cant be applied to forex. For example volume is at stocks and futures a very significant part of analysing. But in forex.... you cant use it, because there is nothing than volume, or in other words is useless.
Another thing which you cant use is the statement that you have to follow trends, because a trend in motion is more likely to continue than to reverse until it shows signs of a reversal. In forex though it seems that there are no trends, because its a 24h market and people do not pay attention to the "the trend is your friend" wisedom..

Are there really only resistance, trendlines, chart patterns, and some indicators left?
Is this really everything, or do i forget sth?
Hopefully there will be some response.
Anyway .. Thanks for listening
-mike
Less knowledge More problem?... Read the mantra I posted again and again... Stop searching for the next best indicator or system... Trade any simple system that you may have with discipline and with good money management... :o)
  • #14
  • Jan 6, 2007 10:26pm Jan 6, 2007 10:26pm
I totally agree that you can confuse yourself by attempting to apply different methods simultaneously. I have finally realized that I must use one method, alone, and accept its warts in order to reap its profits. If you can't handle drawdown, or think there's a way to eliminate it, you need to quit now. There are ways to minimize drawdown, but minimize it too far and you will avoid profitable trades because of fear.

BTW, Summit, this is a forex forum, not a political one. Nice avatar, I hope you're under 26 and they reinstate selective service...
"The time to act is when others show signs of tire." --W.D. Gann
  • #15
  • Jan 6, 2007 10:35pm Jan 6, 2007 10:35pm
thanks Duke- Why is a racist, backwoods hillbilly offering up comments about my avatar. Perhaps you're right tho. I have 2 stepsons serving in Iraq and hope they come home alive. You probably supported the Vietnam War as well.


Quoting dukeofdents
I totally agree that you can confuse yourself by attempting to apply different methods simultaneously. I have finally realized that I must use one method, alone, and accept its warts in order to reap its profits. If you can't handle drawdown, or think there's a way to eliminate it, you need to quit now. There are ways to minimize drawdown, but minimize it too far and you will avoid profitable trades because of fear.

BTW, Summit, this is a forex forum, not a political one. Nice avatar, I hope you're under 26 and they reinstate selective service...
Trade what you see - Not what you think
  • #16
  • Jan 6, 2007 11:04pm Jan 6, 2007 11:04pm
Quoting linuxtroll
Less knowledge More problem?... Read the mantra I posted again and again... Stop searching for the next best indicator or system... Trade any simple system that you may have with discipline and with good money management... :o)

all of us are saying, don't try to control the market, control yourself. Market is always looking to setup, and take the opportunities it offers. YES, you have to TAKE in this profession. All the analysis, indicators do not let you to control the market if that's what you are thinking.
  • #17
  • Jan 6, 2007 11:20pm Jan 6, 2007 11:20pm
Exactly, Trader, control yourself because you can't control the market! Awesome way to put it! It took a lot of bucks for me to figure that out, but now that I have, I only see success in the future.

Summit, let it go. I didn't bring that sort of politics to this forum, you did with that avatar. There are people who disagree with you out there. I don't need to see that shit here. I have no stepsons, only a dead brother...
"The time to act is when others show signs of tire." --W.D. Gann
  • #18
  • Jan 6, 2007 11:57pm Jan 6, 2007 11:57pm
Trader, you're absolutely right that a man must let the market go where it will, because we do not control that. We have to find methods, statistical or otherwise, that are predictive. Obviously, you can't predict the market. However, you can come up with a predictive model that works, with all its quirks, over time. Now we have to deal with patience and discipline, but that's all up to the individual trader...

BTW, Summit, in the summertime my right arm is usually white while my left is usually red or tan. That's from driving around hanging it out of a pickup truck window. If you want to talk about racism and stereotypes, you're the one being a racist and using stereotypes. Of course, anyone from Appalachia is too dumb to actually trade financial markets profitably, right? We're all retarded and inbred down here, at least by your well-informed analysis. It doesn't have any effect on your manhood that a redneck can make profits at this, too. You must be superior, however, because you're politically correct...
"The time to act is when others show signs of tire." --W.D. Gann
  • #19
  • Jan 7, 2007 2:52pm Jan 7, 2007 2:52pm
boy needs to chill...both of you. To get back on track, I believe I can describe how you are feeling by "more knowledge, more problems". Again, you are precieving trading differently. Let me take a wild guess:

You first started trading off on a really good foot, you had good trades, and you are on top of the world. Nothing scared you, nothing bothered you, you acted instead of thought, you were carefree. You used the market simply as a faciliating medium to make money. Everything was good UNTIL you had a bad trade. That bad trade did incredible damage to you that you are not aware of. Not only were you feeling bad, all the emotions in your head were mixed up, and you precieved the result as pain from the market. At this point, you started looking for information. You started reading fundamentals, studied all the technicals ever existed, and you felt good, not because reading about them is good, but rather you felt you had the arsenal to go one-on-one with the mraket, block the potential pain of trading that supposely the market gave you. A couple of trades later, you were vulnerable to the market, got a few winning trades, but you still lost trades. Then you go back to reading. As you read more and more, you expect to be hurt less and less where in reality, you are going into a pattern of self-destruction.

What is really happening is that your preception of the market changed. The action of reading more and studying is for the wrong reasons. And this shift in perspective is HUGE. In the beginning, you were objective with the market, had no good or bad feelings for the market, but now, as soon as the first bad trade got to you, you were on a mission.

Remember, the market does not OWE YOU ANYTHING. It doesn't owe anyone anything, it is simply a neutral ground to faciliate the process of taking money or being taken from. You have to remember and accept the fact that taking a loss is just like a resturant owner have to dig out of his pocket to buy food for business. Until you take responsibility for yourself and look inside you, then will you have the clear head to trade WITH the market, not AGAINST it.

Read what I wrote until you accept it. Believe my word, I had to pay tons both in money, time, and emotions to realize what I have written here.
  • #20
  • Jan 7, 2007 11:28pm Jan 7, 2007 11:28pm
Quoting AlexFX
2. I found a very simple high win to loss ratio method on a time frame that suited me. I tested it till it became a part of me and I now own it.
Got a Ticket to the Show did you;
Giddonya Alex and welcome to the Grave Train.
For you will now be Ridin' the tracks until you are under them.
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