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Trading for a Living - Cliff Notes

  • #241
  • Jul 7, 2009 8:18pm Jul 7, 2009 8:18pm
Quoting jennajameson
The price before reaching 50 pips hits 10 pip indeed, but if there is a price reversal before that, a 50 pip stoploss is a totally different thing over a 10 pip stoploss...

I am a novice trader, and got some question to acu

1. got 4k in my acc... and am starting my first of the 6 months in which i hope to achieve consistency... are enough? i don't plan on withdrawing anything, i just want to build up. Obviously the target monthly might be 2k... but i am not in a hurry, it's more of a goal reward, to the effort put into it.

2. in regard of...
I'm not sure I can find the question in there.

Phil's system seems solid... never tried it.

Again... the key is money management.

If you risk more than 5% on each trade you have around a 20% chance at longevity in this market.

Ask me one question at a time.

Mike
  • #242
  • Jul 8, 2009 3:46am Jul 8, 2009 3:46am
ok, trying to be more clear

if your trading system gives aperfect setup but you don't see the pattern, do y still enter the trade?

can a trading system loose precision and performance over time?

last question: have you any other good system thread you consider a goodread, or should i stick on what i have now, and go training pattern recognition right away?

thank you so much
jj

oh i did 3% and got burnt now i am movig to 1%...
  • #243
  • Jul 8, 2009 5:53am Jul 8, 2009 5:53am
Quoting jennajameson
ok, trying to be more clear

if your trading system gives aperfect setup but you don't see the pattern, do y still enter the trade?

can a trading system loose precision and performance over time?

last question: have you any other good system thread you consider a goodread, or should i stick on what i have now, and go training pattern recognition right away?

thank you so much
jj

oh i did 3% and got burnt now i am movig to 1%...
O_o you only use 3% and still blew up your account?
What did you do?
  • #244
  • Jul 8, 2009 6:35am Jul 8, 2009 6:35am
Quoting AdamN
O_o you only use 3% and still blew up your account?
What did you do?
didnt say i blew, losk 1k and stopped to reconsider, but in 1 week lost 300$ and in another single day lost 700$ i think i was the problem, not the system
  • #245
  • Jul 8, 2009 7:08am Jul 8, 2009 7:08am
Quoting jennajameson
didnt say i blew, losk 1k and stopped to reconsider, but in 1 week lost 300$ and in another single day lost 700$ i think i was the problem, not the system
I see, hmm you surely made lot of loss and $700 in a single day O_o that's big

Btw did you use Stop Loss?
i use Trailling Stops to protect me from big loss, even when i use 40% risk most of the time locking my profits
(i currently testing my SL/Trailling Stop value on 40% risk and see whether i can keep my balance from blown for a long time)
  • #246
  • Jul 8, 2009 7:38am Jul 8, 2009 7:38am
Quoting jennajameson
didnt say i blew, losk 1k and stopped to reconsider, but in 1 week lost 300$ and in another single day lost 700$ i think i was the problem, not the system

Acuman can show you how to trade pivots, and there are a lot of others here on FF that can shown you other methods. Trading is a mental game as much as anything else. The amount of risk you take should be calculated on percentage, but also on the amount of time you have been trading your system. Until you have traded a system for a while (first on demo to make sure you get the rules) you should trade with a very small lot size less than one percent. Once you have the system down you can over time raise the lot size, but don't exceed 3% because no matter how good you get you will have a losing streak.

Don't get in a hury to get rich. It takes less time to go broke, if you want to do something quick.
  • #247
  • Jul 8, 2009 8:04am Jul 8, 2009 8:04am
Quoting acumen
I'm not sure I can find the question in there.

Phil's system seems solid... never tried it.

Again... the key is money management.

If you risk more than 5% on each trade you have around a 20% chance at longevity in this market.

Ask me one question at a time.

Mike
so thats more then 5% lol
  • #248
  • Jul 8, 2009 8:54am Jul 8, 2009 8:54am
Quoting AdamN
I see, hmm you surely made lot of loss and $700 in a single day O_o that's big

Btw did you use Stop Loss?
i use Trailling Stops to protect me from big loss, even when i use 40% risk most of the time locking my profits
(i currently testing my SL/Trailling Stop value on 40% risk and see whether i can keep my balance from blown for a long time)

Are you actually saying that you're risking 40% i.e. betting the farm in a single trade????

Dont mean to be funny but that doesnt sound like a good idea.
Dont know what kind of system and TF you use but even if you're playing extra large TFs with trades being on for weeks, months, even years...unless you're some kind of genius who just cant lose it's very risky to put all your eggs in one basket like that, and even then.

But dont take my word for it try it all out.

Here's and article I saw today that I found very good, I moved from losing to staying BE thanks in great part to reducing my position size and applying proper MM.

http://www.forexfactory.com/news.php?do=news&id=181067
Be like a post stamp! Stick to it until you get there!
  • #249
  • Jul 8, 2009 9:24am Jul 8, 2009 9:24am
Quoting Mary Pippins
Are you actually saying that you're risking 40% i.e. betting the farm in a single trade????

Dont mean to be funny but that doesnt sound like a good idea.
Dont know what kind of system and TF you use but even if you're playing extra large TFs with trades being on for weeks, months, even years...unless you're some kind of genius who just cant lose it's very risky to put all your eggs in one basket like that, and even then.

But dont take my word for it try it all out.

Here's and article I saw today that I found very good, I moved from...
I did say it is a test, i want to know how long i can keep this balance above 0 i need to know the best Trailling Stops value i should use for my trading style

I've test it since monday, made several minor loss and some big profits, after trading for nearly 3 days, i've made about 81% profits and still have floating short GU right now

I was accidentally opening 2 order (because i thought the 1st one was canceled), so i was in hurry closing one of them (the one that doesn't get minus) XD

May be i should write a Journal for this test and see how long it will last ^_^
  • #250
  • Jul 8, 2009 9:48am Jul 8, 2009 9:48am
Quoting knuckledrag
Acuman can show you how to trade pivots, and there are a lot of others here on FF that can shown you other methods. Trading is a mental game as much as anything else. The amount of risk you take should be calculated on percentage, but also on the amount of time you have been trading your system. Until you have traded a system for a while (first on demo to make sure you get the rules) you should trade with a very small lot size less than one percent. Once you have the system down you can over time raise the lot size, but don't exceed 3% because no...
This is exactly what I would have said.

Trade a system on Demo for a while and once you can beat the market for 4-6 months you are ready for real capital.

Then... risk 1% on each trade.

m
  • #251
  • Jul 8, 2009 9:56am Jul 8, 2009 9:56am
Quoting jennajameson
ok, trying to be more clear

if your trading system gives aperfect setup but you don't see the pattern, do y still enter the trade?

can a trading system loose precision and performance over time?

last question: have you any other good system thread you consider a goodread, or should i stick on what i have now, and go training pattern recognition right away?

thank you so much
jj

oh i did 3% and got burnt now i am movig to 1%...
if your trading system gives aperfect setup but you don't see the pattern, do y still enter the trade?

Nope. If it looks bad then I sit on my hands.

can a trading system loose precision and performance over time?

Sure. However... systems based on pivots won't because of the liquidity.

last question: have you any other good system thread you consider a goodread, or should i stick on what i have now, and go training pattern recognition right away?

Firstly... find a system that fits your personality. What time frame do you like to trade? There are some very solid systems on this site. I trade a retrace system that works very well. You are welcome to have it... just let me know.

NOTE: The system is only a very small part of the equation. It's the most over discussed aspect of trading. Take your time and learn how to trade. Learn how to apply pivots and use fibs. Use Stops and Take profit targets. It sounds like you prefer a longer term strategy... the guys at learning markets doing a stellar job long term. Also... read babypips. The single best site on the net for learning to trade.
  • #252
  • Jul 8, 2009 10:08am Jul 8, 2009 10:08am
Quoting acumen
This is exactly what I would have said.

Trade a system on Demo for a while and once you can beat the market for 4-6 months you are ready for real capital.

Then... risk 1% on each trade.

m
I thought it sounded familiar
  • #253
  • Jul 8, 2009 10:13am Jul 8, 2009 10:13am
Quoting knuckledrag
I thought it sounded familiar
LOL.
  • #254
  • Edited 1:51pm Jul 8, 2009 1:11pm | Edited 1:51pm
Quoting acumen
[...]
Take your time and learn how to trade. Learn how to apply pivots and use fibs.
on paper, like knowing the equation behind them, or by using an indicator in MT4? i can do the latter...

Quoting acumen
Use Stops and Take profit targets. It sounds like you prefer a longer term strategy... the guys at learning markets doing a stellar job long term. Also... read babypips. The single best site on the net for learning to trade.
I have read the 4hour Macd thread, so i feel comfortable about trading 4 hours, but i don't fit very well on set and forget type of trading... i am gonna try and if it works is good though...

Another little thing:

In order to do some backtesting, i've done the simulation on MT4, accelerating time and seeing the market tick by tick.
With that method i achieved some very good results, though when on live, i struggled to get the main picture of what was going on, because the market was so SLOW!!!!
Ultimately before taking a break, i was thinking to simulate the last 8-12 hours in order to get to know the market movement before taking a trade... by doing that i could have recreated the environment that led me to success in so many months of backtesting...

is this a good way to go or that simply means i need to move to smaller TF?

Also, following your other thread, it came up a question i don't think it's answered... what's your R:R ratio? i mean it's easy to spot only a 10 pip profit between let's say a pivot point and a psych level, what's your stoploss? equal to the profit? it's a 1:1 rr?



thank you so much,
jj
  • #255
  • Jul 8, 2009 1:26pm Jul 8, 2009 1:26pm
The attached set of guidelines are good ones to internalize. How losing trades are managed, in my brief experience, anyway, has been probably the most important aspect of trading re: healthy account growth (or demise...)
Attached File(s)
File Type: pdf mantra.pdf   122 KB | 581 downloads
"If The Fool persists in his Folly he will become wise." - William Blake
  • #256
  • Jul 8, 2009 2:01pm Jul 8, 2009 2:01pm
Quoting jennajameson
on paper, like knowing the equation behind them, or by using an indicator in MT4? i can do the latter...



I have read the 4hour Macd thread, so i feel comfortable about trading 4 hours, but i don't fit very well on set and forget type of trading... i am gonna try and if it works is good though...

Another little thing:

In order to do some backtesting, i've done the simulation on MT4, accelerating time and seeing the market tick by tick.
With that method i achieved some very good results, though when on live, i struggled to get the main picture...
I have read the 4hour Macd thread, so i feel comfortable about trading 4 hours, but i don't fit very well on set and forget type of trading... i am gonna try and if it works is good though...

Another little thing:

In order to do some backtesting, i've done the simulation on MT4, accelerating time and seeing the market tick by tick.
With that method i achieved some very good results, though when on live, i struggled to get the main picture of what was going on, because the market was so SLOW!!!!
Ultimately before taking a break, i was thinking to simulate the last 8-12 hours in order to get to know the market movement before taking a trade... by doing that i could have recreated the environment that led me to success in so many months of backtesting...

is this a good way to go or that simply means i need to move to smaller TF?

It's what's comfortable for you. I trade off the 15 min chart intraday because I can't sleep with a trade open.

Also, following your other thread, it came up a question i don't think it's answered... what's your R:R ratio? i mean it's easy to spot only a 10 pip profit between let's say a pivot point and a psych level, what's your stoploss? equal to the profit? it's a 1:1 rr?

I don't pay attention to R:R. (I'm guessing it's around 1:1 or less)

I believe hit rate is more important.

Stops are at 50 and I'll close it if I think I made a mistake.

Mike
  • #257
  • Jul 8, 2009 2:02pm Jul 8, 2009 2:02pm
Quoting The Fool
The attached set of guidelines are good ones to internalize. How losing trades are managed, in my brief experience, anyway, has been probably the most important aspect of trading re: healthy account growth (or demise...)
Nice doc sir.

m
  • #258
  • Jul 8, 2009 2:15pm Jul 8, 2009 2:15pm
Also called Disaster Stops, generally you don't let them execute, only in case of a huge fast unexpected move (maybe caused of a news which wasn't announced).

Mike, I'm gonna update the PDF with lesson 12 if you don't mind
Quoting acumen

Stops are at 50 and I'll close it if I think I made a mistake.

Mike
  • #259
  • Edited 2:21pm Jul 8, 2009 2:18pm | Edited 2:21pm
Quoting acumen

I don't pay attention to R:R. (I'm guessing it's around 1:1 or less)

I believe hit rate is more important.

Stops are at 50 and I'll close it if I think I made a mistake.

Mike
But if the position size should match the stoploss in order to achieve the fixed 1% eventual loss...
if you set a 50 stoploss, and you have let's say a 25 pips profit, and that 50 pips stoploss is your 1% that means 25 pips profit equals to 0,5% profit...

i don't know if i am wrong but in order to trade in 15 mins i would:
1. set up an equal stoploss as my mental profit target
2. as price reaches the target, i move the stoploss to b/e, and set a trailing profit.

that is how i would do a normal trade without adding position/sizing prosition.

comments?


[edit] just saw the disaster stop... i couldn't handle with that...
jj
  • #260
  • Jul 8, 2009 3:42pm Jul 8, 2009 3:42pm
Setting TP and SL based on pivots and fibos can be a good option
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