From 10k to 1 million...

Sick again... I've got high temperature... Will continue on monday I guess.

I've decided to stop using that pure mechanical approach and trade this account like my main account - completely discretionary. Might be more interesting.

hi Xaron,

sorry about you being sick again.

You will be glad hearing I will start a pure mechanical journal:

Journal related to: Advanced Inside Bar (IB) Trading
http://www.forexfactory.com/showthread.php?t=152419

Keep at it Xaron,

I really enjoy your journal on here as well as Oanda. I know you will come out of this downturn and will succeed.

Maybe it would help if you explain to us why you make the trades you make? I would like to hear your thoughts.

Peace to you.

Xaron,

Are you trading with a real money account? Or is it a demo account?


Topgun

Down 10% already, nice one buddy, tried to help you but you told me my indicators are bullshit right? the letting profit run and cutting losses is a myth you say? let me tell you, alot of exagerrating on forums i know, but with the system i tried to explain to you before my indicators got called out as bullshit, i am on a 75+ day winning streak( with well over 50 fills daily), again i wish you the best into blowing your account -80% value, and i hope THEN you will have that god moment.

Estrader, I don't want to distract from this thread, but with such a long winning streak I'd be interested in you starting your own thread and sharing in more detail what you do to be successful

I second that

Indicators are bullshit.

That´s no myth. That´s the only way to success. That´s why I don´t like fix TPs. They cut your winning potential short. But entries based on indicators can never be perfect, because indicators can never be as good as price action as they´re limited due to fact that their calculation is based on a fixed period of time, whereas a move could contain 200, 20 or 5 bars. The human eye can see that, an indicator can´t.

That´s why indicators are bullshit and Xaron´s system would have a much higher potential of success if he wouldn´t cut his winners short.

The average velocity (measured by the pressure exerted by the atoms on their container) is proportional to temperature. This is a fundamental law of chemistry. So while you may not be able to know if a particular atom will exert a particular force, you can certainly know that the odds are high or low based on the temperature of the system.

Do I need indicators to know that or are indicators just made for people who can´t read a naked chart?

I stick to that: Indicators are bullshit.

Guys, I'm just back from hospital - caught a pneumonia. Will continue in march with my discretionary trading - of course without indicators.

And Estrader: It's always easy to point to someone's mistakes. Show me that indicators are working and start your own thread. Do that not only for 1-2 months but for 4-5 years at least. Of course you can have a strategy that work for you with indicators. Good luck.

Xaron ... sorry to hear you had caught pneumonia. I hope you're doing ok now.

As for the indicator debate, I agree that indicators are worthless. Indicators are fools gold; they seem like they will lead you to the gold, but instead they leave you frustrated, grasping at thin air. They are lagging. They just tell past history: that of what has happened, not what is relevant to what is happening now. Maybe a few people can manage to be consistently successful with them somehow, but for the average person indicators are a waste of time and energy. And even for those few people who are successful while coincidentally having indicators, my guess is most of them would be successful WITHOUT the indicators. I think the indicators are mostly a crutch for these people, sort of a tool of "comfort".

Now, on to the topic of "taking profits here and there and letting your losses run." As disillusioned as it is to believe indicators are a great thing, it is also an equal fallacy - if not even more of a fallacy - to believe in the idea that taking small profits and letting your losses run is the way to go. The ONLY way that could work is if you had a very win percentage ... maybe something like 90% or more. You said in a post on the first page of this thread that risk/reward is what is important, not wins or losses. Well isn't the definition of good risk/reward that of having bigger winning trades than losing trades? I don't know how letting your losses be larger than your winners is good risk/reward. Even a risk/reward of 1:1 cannot be considered a "good" R/R.

Ok, I have now given ammuntion for both you AND Estrader to come after me!


Topgun

Are you near a millon ?

It's nice to see you back Xaron, I thought I'd miss one of the rare real money journal.

Why indicator are bullshit?? lagging?? any other reason beside those assumption.

indicator? what else do we have?

We only have

* past price action and current price (on which indicators are build around)

* fundamental (which some would argue are already to some extend in the price action)

* maybe market psychology (which some would argue are already to some extend in the price action)

* ......


??

Have 10 years already passed by?

Ok guys, regarding indicators: I just don't like them. Maybe there are guys out there who really work with them. Personally I don't know a single trader who has used them in the long run - with the exception of some moving averages and such stuff. For me(!) they are useless, so sorry if I was some rude.

MJ: My discretionary trading is a mix of technicals (simple trendlines) and fundamentals. I mainly trade EUR/USD, AUD/USD and USD/JPY sometimes some exotics as well.

Currently I have two long positions in the Aussie, one at 6570 the other at 6394, both have a size of 10k units:

http://www.xaron.net/dl/fx/2009/ib/audusd_210209.png

I think the fundamentals for the Aussie are great. The RBA did some intervention to keep the Aussie above the 0.60 handle. Plus the dollar will weaken in the future - there is no other option.

Can you elaborate on that! what made you think that the RBA is intervening in the fx market? And why should the dollar weaken in the near future?

Thanks,

IMFx

I had loads of questions to ask the other people above me who piped in with their two cents and waffled on about indicators and why "naked charts" are somehow better than indicators etc etc. But my post got deleted before I could post it (Stupid google chrome ) And I actually could not be bothered writing it out again.

I will address the thread starter, I have been lurking here for a while. I like you, I like the fact that you are honest enough to come and basically post your account. I like honesty.

Xaron - I wish you a speedy recovery from your recent illness, Godspeed.

Now firstly I will address the Inside bar trading method you had at the start of the thread which you have since abandoned because of 10% drawdown which is or is not (depending on the system) a very bad sign.

This is from only 7 months of data, I normally test whatever I am doing for several years. If I was back testing a 1HR system I would test it over the course of about three years to check how it performed in different market conditions.

Originally Posted by zinc6
PLEASE NOTE: This was based on Oct 07 - Apr 08 NF data - 7 months of data is most likely NOT statistically significant ... but as I said above it was a quick test to see if DIBS was viable as an entry method and 7 months is all I could easily export from MT4 at the time.

TEST PARAMETERS:

Pairs: EUR/USD, GBP/USD, USD/CHF & USD/JPY
Times: All IB's 0600 GMT - 1600 GMT ... also 0500 GMT if an IB
Daily Open: 0600 GMT
Entry: Bar High +1 if above daily open, Bar low -1 if below daily open - spread included (oanda)
Stop: At bar low/high as applicable.

As this was a quick mechanical test all I tested was what the maximum % profit reached prior to being stopped out.

RESULTS:

Pair__ ____#T __1:1__1:2_1:3_1:4_1:5__1:10___%1:1
EUR/USD - 137 - 66 - 41 - 29 - 25 - 23 - 17 ------48.1%
GBP/USD - 125 - 72 - 52 - 43 - 32 - 26 - 12 ------57.6%
USD/JPY - 139 - 61 - 37 - 27 - 23 - 19 - 7 --------43.8%
USD/CHF - 138 - 57 - 35 - 27 - 23 - 21 - 14 ------41.3%

In essesence 50% of trades reach at least 1:1 R prior to being stopped out.

Using the above numbers you can "optimise" a % based TP ... but this varies from currency to currency and given the short time period of the test to base any system on this would be "curve fitting" and almost certain to lose money.

Another thing worth mentioning is the trend (based on weekly) had little noticable effect on stats other than the average maximum %profit reached ... and this was due to a few extream trades that managed to stay in for the whole run netting well in excess of 100% ... could this be the point???

My conclusion was that as a mechanical entry system it shows alot of promise ... the "secret" to making it profitable comes down to trade selection, management and exits ... and of course practise practise practise

What this all means is that you have no edge on the market if you are getting out of the trades at 1:1. You either need to focus on being a longer term trader, and take half off at 1:1 and let the rest become "free trades" or you need to find another edge (Of which there is many) in the forex markets.

Maybe the 10% loss does not mean anything to you because you are a well off individual, that is fine. The 10k you initially deposited is a lot larger than is in my account. But you honestly have not done enough back testing on the idea, or forward testing for that matter. You already would have discovered if 10% drawdown was a feature of this method and would have accepted it and started trading the method next week again.



As for your current idea of "discretionary" trading . . . I am a discretionary trader myself, very discretionary. I do think that people can trade literally anything successfully, if they simply put in enough work at it. I think fundamental analysis is the hardest of forex's quadrivium to conquer. I personally think that all fundamental analysis has been done ages ago by people far smarter than me and with greater amounts of capital at their disposal.

This fundamental analysis manifests itself in the form of Candlesticks,I will interpret them and then trade.

On another note I am bearish towards the USD in general next week considering the USDX charts of late.


As wierd as it sounds and I think I rambled a lot on this post, I do NOT want to see you lose your money. And you seem to me as a man who has not yet found a methodology to suit him, you are quickly jumping from one idea to the next. Hoping the grass is greener, without putting in any work in the form of backtesting or forward testing. If I were you I would focus on getting a methodology that suited me down and test it like crazy to see how it does.

I am not saying forex trading is easy, it's damn hard. Anything that is worthwhile doing in life . . is hard.

Basically what I am trying to say is you need to re-evaluate your strategy in the forex market.

Inside bars can be EXTREMELY profitable, I know people who trade the DIBS method and are profitable with it in the long run because they understand the nature of both the bars, their place within forex, and the edge required to be profitable.

This discretionary trading thing is honest to God super hard in my opinion, I for one enjoy economics and fundamentals but do not consider them in my trading, trading the Charts alone is hard enough heh . if you decide to stick with it . . I wish you all the green pips in the world.

Actually whatever you do I wish you all the green pips in the world

Godspeed
Jig