so i've lost half my capital | Forex Factory

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so i've lost half my capital

  • #1
  • First Post: Sep 24, 2009 3:13pm Sep 24, 2009 3:13pm
Im new in forex. I traded for 6 months using demos, with satisfying results, so i moved to a real micro account.

i opened a micro with fxcm depositing $400. I trade using 5 min candle sticks and a 24 EMA. I take with trend trades, when pa is near the ema, or countertrend trades when i see a double top/bottom. I open 10 lots with 10 pips SL and take what the market gives me (around 10-30 pips).

So today i lost $330. I know its not a big amount but considering my equity was at $480 after 3 weeks of hard work, it was a devastating blow to my psychology.

I have serious trouble with overtrading, and because i overtrade, i lose alot of stupid trades that i shouldnt be in, in the first place. Although i usually make a good 30 to 60 pips per day, when im lucky i'll only get to keep 20 pips, when im unlucky, ill close the laptop with a 20-40 pips loss, meaning i havent had a stable progress and i am unable to keep steady profits.

I overtrade because im greedy (hence my nickname), too greedy for my own good. I was doing fine trading daily candlesticks taking my time, but i wanted more, so i started trading intraday.

Now my moral is all blonw into pieces, i am not willing to add more capital into a micro account i blew away, and im starting to look at setting some ground rules which i should not brake no matter what. So im thinking that i will only trade EURUSD, only 1 position per time, and only 5 micro lots per position. Untill i can make my capital go back to the initial $400 and more importand, keep a steady growth.

Any advice, feedback or input ?
Is it so hard to discipline your selfs when trading ?

Please don't bother dissing, you can go boost your ego someplace else.

Cheerio!
  • #2
  • Sep 24, 2009 3:22pm Sep 24, 2009 3:22pm
Quoting GreedyPIPs
Im new in forex. I traded for 6 months using demos, with satisfying results, so i moved to a real micro account.

i opened a micro with fxcm depositing $400. I trade using 5 min candle sticks and a 24 EMA. I take with trend trades, when pa is near the ema, or countertrend trades when i see a double top/bottom. I open 10 lots with 10 pips SL and take what the market gives me (around 10-30 pips).

So today i lost $330. I know its not a big amount but considering my equity was at $480 after 3 weeks of hard work, it was a devastating blow to my...
Trade a demo parallel to your live acccout. do the overtrading on the demo.
on the live account trade only one micro lot per day as a rule.
The real trading is done on 4h timeframes, watch for trendlinebreaks
/ ... clarifying decisions ... /
  • #3
  • Edited 3:45pm Sep 24, 2009 3:24pm | Edited 3:45pm
Quoting GreedyPIPs
Im new in forex. I traded for 6 months using demos, with satisfying results, so i moved to a real micro account.

i opened a micro with fxcm depositing $400. I trade using 5 min candle sticks and a 24 EMA. I take with trend trades, when pa is near the ema, or countertrend trades when i see a double top/bottom. I open 10 lots with 10 pips SL and take what the market gives me (around 10-30 pips).

So today i lost $330. I know its not a big amount but considering my equity was at $480 after 3 weeks of hard work, it was a devastating blow to my psychology.

I...

stick to dailly and go in small, u have no chance with the amount u have to go in on 5 micro lots....build and gain confidence....also goto j16 thread and read...

then u can thank me later once u started making money....

good luck man! ...
  • #4
  • Sep 24, 2009 3:33pm Sep 24, 2009 3:33pm
let me clarify, 5 microlots at 10 pips SL, so $5 risked capital per position... rouhy %4,5 risk of my $150 capital that is left.
Reason i wanna stick with 5 min chats, is because i thats the way i want to learn. I know its harder...
Ive read j16 thread. Read lots of books. I think its experience and discipline im lucking...?
  • #5
  • Sep 24, 2009 3:40pm Sep 24, 2009 3:40pm
Quoting GreedyPIPs
Im new in forex. I traded for 6 months using demos, with satisfying results, so i moved to a real micro account.

i opened a micro with fxcm depositing $400. I trade using 5 min candle sticks and a 24 EMA. I take with trend trades, when pa is near the ema, or countertrend trades when i see a double top/bottom. I open 10 lots with 10 pips SL and take what the market gives me (around 10-30 pips).

So today i lost $330. I know its not a big amount but considering my equity was at $480 after 3 weeks of hard work, it was a devastating blow to my psychology....
First of all, no matter what anyone tells you, we have all been there and done that at some point in our trading life. then....

1. Open a 1k demo account.
2. Put standard bollinger bands on EURUSD (lowest spread usually)
3. Price must enter the bollinger band buy zone.
4. Price should close within the buy zone to trigger a signal.
5. Check that there are NO (pending) major economic statements for the currency pair.
6. Enter a buy trade.
7. Place a stop at the bottom of the entry bar.
8. If the trade moves in the right direction, then exit only when the price closes below the buy channel.

Just reverse the above from point 3 onwards for a sell trade. Try this for a couple of weeks using a 15M timeframe, when you have mastered this, then, if you wish, switch to a 5M timeframe.

Goodluck.
  • #6
  • Sep 24, 2009 8:22pm Sep 24, 2009 8:22pm
Can you tell me what's wrong with your own statement below?

Quoting GreedyPIPs
...with 10 pips SL ...

...ill close the laptop with a 20-40 pips loss...
  • #7
  • Sep 24, 2009 10:05pm Sep 24, 2009 10:05pm
Quoting walb99
Trade a demo parallel to your live acccout. do the overtrading on the demo.
on the live account trade only one micro lot per day as a rule.
The real trading is done on 4h timeframes, watch for trendlinebreaks
Good advice , overtrading is a problem for all beginner trader.
I also agree with real trading on 4h , even I prefered 1D
  • #8
  • Sep 25, 2009 12:02am Sep 25, 2009 12:02am
My experience of your post is that you know the problem is your greed but your not wanting to put in the work that is gonna be neccesary to beat that. Go ahead and blow the rest of this acct and get it out of your system. Your first post says "Please don't bother dissing, you can go boost your ego someplace else." LOL - you need dissing-- but not by me - by yourself. You need to kick yourself in the @$$ and decide if you really want to be a trader.



Quoting GreedyPIPs
let me clarify, 5 microlots at 10 pips SL, so $5 risked capital per position... rouhy %4,5 risk of my $150 capital that is left.
Reason i wanna stick with 5 min chats, is because i thats the way i want to learn. I know its harder...
Ive read j16 thread. Read lots of books. I think its experience and discipline im lucking...?
In trading, there is no bullshit. You either make money or you don't.
  • #9
  • Sep 25, 2009 12:19am Sep 25, 2009 12:19am
Quoting GreedyPIPs
let me clarify, 5 microlots at 10 pips SL, so $5 risked capital per position... rouhy %4,5 risk of my $150 capital that is left.
Reason i wanna stick with 5 min chats, is because i thats the way i want to learn. I know its harder...
Ive read j16 thread. Read lots of books. I think its experience and discipline im lucking...?

I would also venture a good dose of money (risk) management....
Nihil inimicus quam sibi ipse Marcus Tullius Cicero
  • #10
  • Sep 25, 2009 12:42am Sep 25, 2009 12:42am
With 5min TF you will be taking multiple trades each day...putting 4.5% risk on each trade is overleveraging I think. It will be better if you lower you position size to around 1% risk on each trade. win formula = (many small win + some big win)- many small loss.
The only way to get smarter is by playing a smarter opponent.
  • #11
  • Sep 25, 2009 1:12am Sep 25, 2009 1:12am
Position Sizing is key to your capital preservation.

Try keeping your Risk at 1-2% Account balance. This will become your R (risk). Recalculate R before each trade, since your account balance changes. Stop loss placement(size) can be variable based on volatility, entry point, strategy, etc... Change your position sizing so that your SL equals R and retains the SL size that your system/strategy requires.

Having a positive Expectancy of your trading system will also provide confidence.

Expectancy = (win%)(Avg. profit in R) - (loss%)(Avg. loss in R)

Example;
A system may show to produce a 70% win, 30% loss ratio. Average wins result is .85R, and average losses result in 1R.

Expectancy = (.7)(.85) - (.3)(1)

This produces a .295R expectancy (Which is still a positive expectancy!). I suggest coding the formulas into a nice Excel sheet.
  • #12
  • Sep 25, 2009 2:20am Sep 25, 2009 2:20am
First of all i want to thank Tekademic for his clear and sound explanation. This is what i had been trying to do, risk only 2% of my capital per position, but i got lost in the game and opened too many positions too often, efectively risking more than 10%.

The expectancy formula could prove helpfull..

mrgreen, blowing off my account would only make it worse because i would go into thinking that this is a game where i can restart at any moment. I am not going to blow it away, nor add any more money in it, i'll take the hit, and work with what is left in the account ($150 lol).

zen, 10 pips was my sl per position. 20-40 pips loss was what i averaged as a loss on a bad day. Now im thinking that 10 pips sl is too tight, i will have to lower the lot size and increase the sl.

I guess i have to fight my inner deamon now.

thanx for the insight guys
  • #13
  • Sep 25, 2009 2:47am Sep 25, 2009 2:47am
How would one usually know that he/she is overtrading? It sounds lile starting out is really difficult in trading.
  • #14
  • Sep 25, 2009 3:41am Sep 25, 2009 3:41am
Quoting mrgreen
My experience of your post is that you know the problem is your greed but your not wanting to put in the work that is gonna be neccesary to beat that. Go ahead and blow the rest of this acct and get it out of your system. Your first post says "Please don't bother dissing, you can go boost your ego someplace else." LOL - you need dissing-- but not by me - by yourself. You need to kick yourself in the @$$ and decide if you really want to be a trader.

sometimes u have to be cruel to be kind.....job welldone id say if that doesnt get him to think about nothing will...
  • #15
  • Sep 25, 2009 7:08am Sep 25, 2009 7:08am
hehehe
i think losing 2/3 of my capital was enough of a kick in the aR$e....
but yeah, u guys r right.
IT seems like whenever im thinking what ive done wrong after all positions are closed, everything seems crystal clear.

However when theres money at stake, i cant think straight.

Is something wrong with me ?
  • #16
  • Sep 25, 2009 7:19am Sep 25, 2009 7:19am
Quoting arcane83
How would one usually know that he/she is overtrading?
When you lose most of your money. I seriously doubt anyone who trades a lot and wins more than they lose ever says, "Gee, I'm really making too much money, I'm overtrading and I really should make less trades."
  • #17
  • Sep 25, 2009 8:10am Sep 25, 2009 8:10am
Maybe this will be of some help.... Money Management Position sizing
Same Whore .... Different Dress
  • #18
  • Sep 25, 2009 12:36pm Sep 25, 2009 12:36pm
I'm not picking on you - but since you asked. Yes there is something wrong. Your thinking like a 'loser'. You believe that one big win is gonna get you out of this hole. When you get yourself in a hole the first thing you do is - "STOP DIGGING".
You have attached an importance to money and tied your self worth to it.

(I always love when I have an opportunity to quote from my fav trading book ROASO ~Edwin LeFevre
The speculator's chief enemies are always boring from within. It is inseparable from human nature to hope and to fear. In speculation when the market goes against you you hope that every day will be the last day—and you lose more than you should had you not listened to hope—to the same ally that is so potent a success-bringer to empire builders and pioneers, big and little. And when the market goes your way you become fearful that the next day will take away your profit, and you get out—too soon. Fear keeps you from making as much money as you ought to. The successful trader has to fight these two deep-seated instincts. He has to reverse what you might call his natural impulses. Instead of hoping he must fear; instead of fearing he must hope. He must fear that his loss may develop into a much bigger loss, and hope that his profit may become a big profit. It is absolutely wrong to gamble in stocks the way the average man does.

Trading is a path to self awareness,. If you really do not want to work on yourself and your issues then you are just donating to the other traders account.


Quoting GreedyPIPs
hehehe
i think losing 2/3 of my capital was enough of a kick in the aR$e....
but yeah, u guys r right.
IT seems like whenever im thinking what ive done wrong after all positions are closed, everything seems crystal clear.

However when theres money at stake, i cant think straight.

Is something wrong with me ?
In trading, there is no bullshit. You either make money or you don't.
  • #19
  • Sep 25, 2009 12:51pm Sep 25, 2009 12:51pm
Again, thanx for the insight mrgreen, very appreciated. It might be just what i needed.
  • #20
  • Sep 25, 2009 1:04pm Sep 25, 2009 1:04pm
Something that may help --

Clearly define r:r each potential trade; not the statistics necessarily, just your choices. Emotions included.
You've already defined how you're doing now:
Quoting GreedyPIPs
IT seems like whenever im thinking what ive done wrong after all positions are closed, everything seems crystal clear.
Reward.
Quoting GreedyPIPs
However when theres money at stake, i cant think straight.
Risk.
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