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Newbie Traders: Trading Advice from Someone With Balls

  • #21
  • Dec 31, 2009 7:35pm Dec 31, 2009 7:35pm
Quoting kenkomo
Why would a professional trader take money from their students? A good question.
To stroke the ego? probably yes. But I think the top reason would be to make sure that only serious people joined. The worst thing for a mentor is to have a dickhead who wants to fight and disagree with everybody else in the group.
Tried to PM you Kenkomo,could you pm me ,cheers
  • #22
  • Dec 31, 2009 11:00pm Dec 31, 2009 11:00pm
Quoting tonyb1911
If you want to be a mechanic you don't hook up with other "wanna bees" and try to go fix a car. You hook up with a mechanic and become an apprentice. Same in trading. Many, attempt to day trade Forex,..Forex is not a daytrading market.
I firmly agree that when you ask for advice in how to trade successfully, you need to get that advice from someone that is as successful as you would like to be, not someone trying to get there the same as you. They may be giving you the most help they can, but it really needs to be from someone actually making money consistantly on full size lots on a live account.

However, don't be so quick to say that a certain method is wrong or a style of trading is bad. Apparently I do most of the things that all the "successful" people here say not to do: I daytrade currency. I risk more than 1%. I don't use a stop loss for anything other than an emergency (such as loss of power or internet). I trade 400:1 margin. I use indicators. And I am very successful at it.

I feel it is much easier to make 10 pips at a time several times a day than to get a setup for 100+ pips over a longer period. Very few of my trades last over an hour, with majority less than 30 minutes. I daytrade stock/index options, too, and have been told that won't work, either. But when you trade 100 contracts at a time, a $0.10 move in the option price is $1000 profit (minus commissions). Again, much easier for me to find a $0.10 move on an option than look to find a $1.00+ move.

But it doesn't matter if you trade futures, stocks, options, or currency...if you get into a trade and just hope for the best, you will not stay successful in the long run. Traders need to be able to predict the direction of the price of whatever venue they are in with a relatively high degree of accuracy for the timeframe they trade. If you get good at predicting a 10 pip move intraday, you will make lots of money. If you get good at predicting a 100 pip move intraweek, you will make lots of money.

People need to develop their own style of trading rather than jump from one method to another because such-and-such method got more hits on the forum than all the others over the last few days. Even with a mentor, a person needs to find what is comfortable to them. I could not mentor someone who had it in mind that the daily charts were the only charts worth using.

I think good traders will continually look at ways to improve, because the bottom line is to make money. I look at different methods all the time to see if I can pick up anything that will help me, even just one little nugget. I read a book on the Ichimuku indicator and watched a couple of uTube videos and decided to modify the indicator to the way that I trade and now it is a very important indicator I use for forward looking support and resistance. Not how the book or videos were using it, but who cares? It now helps me make more money.

I agree with you that education is a huge key to success. But so is the ability to think for yourself and not blindly follow other people's advice.

Happy New Year and I hope everyone has a prosperous 2010!!
  • #23
  • Jan 1, 2010 9:43am Jan 1, 2010 9:43am
Quoting tonyb1911
But there is one that I know where they actually know what they are doing.
Here we go again...? How long will it take the messages to stack up? Oh wait, they already have... time to flag the thread and send this packing to "commercial".

Quoting tonyb1911
Price mfing Action
.
Of course, because we all know that patterns of past price movements, in candle form, aren't "indicators". You should have just said what came after these three words and left it at that.

The only way to trade is extremely simple, which you do touch on. Buy lower than what the actual value would more often than not be considered to be. The problem is that there an incredible vague feeling to FX, which a veteran like you should know. I have yet to find a real good fundamental reason for at least 3/4s of all the movement out there. I stopped looking and focused entirely on a single indicator to help guide me through the markets... I started making consistent gains. Go figure.
The market is my nation. Traders, my family. Hello, brothers and sisters!
  • #24
  • Jan 1, 2010 2:43pm Jan 1, 2010 2:43pm
Quoting StockKJay
The only way to trade is extremely simple, which you do touch on. Buy lower than what the actual value would more often than not be considered to be. The problem is that there an incredible vague feeling to FX, which a veteran like you should know. I have yet to find a real good fundamental reason for at least 3/4s of all the movement out there. I stopped looking and focused entirely on a single indicator to help guide me through the markets... I started making consistent gains. Go figure.
What is the indicator that you are using?
  • #25
  • Jan 1, 2010 3:56pm Jan 1, 2010 3:56pm
Quoting cyberfx
What is the indicator that you are using?
That doesn't matter, its how I focus my efforts around it. I trade better with a guide dog by my side, others can get around perfectly fine without one, or, a different breed. You can use just about anything, a trend line, a "line in the sand", price action patterns, etc etc. I just always get a kick out of posts like these that infer that trading is some one dimensional thing, if not done that way, then you haven't a clue. I also liked the subtle hint of a trading mentor, which I still believe was the motive for this thread, to sucker people in. Of course, I have been wrong before.

But, since you asked, I use a 317 SMA Envelope with +/- ~.5% on a 4hr chart. It doesn't make me money though, I make me money, though I do consider it a good partner. I could dump it and use trendlines or horizontal lines... but I like what I have got. Of everything that I put up on my chart, all the mess going back to 2005, this is what was up there when I started doing well... so it stays.
The market is my nation. Traders, my family. Hello, brothers and sisters!
  • #26
  • Jan 1, 2010 6:51pm Jan 1, 2010 6:51pm
Quoting StockKJay
But, since you asked, I use a 317 SMA Envelope with +/- ~.5% on a 4hr chart. It doesn't make me money though, I make me money, though I do consider it a good partner. I could dump it and use trendlines or horizontal lines... but I like what I have got. Of everything that I put up on my chart, all the mess going back to 2005, this is what was up there when I started doing well... so it stays.
How long have you been using this indicator exclusively? And what is its ROI ?
  • #27
  • Jan 1, 2010 6:54pm Jan 1, 2010 6:54pm
Quoting fxtradergirl
I like this post. But I don't like the title. The advice should be the same whether you have balls or you don't. I don't. And I don't want them. (But they are nice to play with)
  • #28
  • Jan 2, 2010 6:51am Jan 2, 2010 6:51am
Some interesting responses. Someone mentioned about being vague.....my initial post is not to teach anybody how to trade. My whole premise is of the many people who try to learn how to trade on messageboards, youtube, etc. I'm a lawyer by trade, and trading is much more difficult. Trading is simple not easy.

But if one can find imbalances between supply and demand....manage risk.......they will clean up. I learned from a trader who used to work on the floor of the CBOT. He didn't read any books, hadn't looked at any charts, didn't know anything about trading at all.

But he used to handle institutional order flow and worked in the Japanese Yen pit. By looking at order flow he could see where price was getting ready to go. He could see dumb money who would start buying because of some new event at a certain amount.........and then see all these orders for smart money to sell. Of course price was going to go down.

Once he left CBOT he looked for these things on a chart. Not the conventional technical analysis that will get you crushed. Like, Head and Shoulders.....for example. If you follow what the books say.......you are buying or selling way too late. Many focus on the candlestick patterns....or Mac-D.......RSi.....things you don't need to focus on. All the oscillators and indicators are just deriavitives of price. Any many can give you the wrong signals if you don't know how order flow works.

I don't use MA's but they can be used to an extent to tell if you something is overpriced or undervalued. I only trade at the extremes of the market......most focus on the middle of the market. Where price is most at equilibrium........and where most lose their money. But most traders don't have patience and feel they need to be in the market.

I'm not saying that someone can't make money daytrading in Forex. I do it once in awhile at extremes. But I do believe to take full advantage of Forex you need to trade with the trend and be able to find market turning points.

I don't trade "breakouts".......I don't believe most consistently profitable traders do either. Most do......and most lose. A lot these novice traders become "trapped money" in either bull or bear traps.

One good book in my opinion to read....which i'm sure some on here have read is Stan Weinstein's.....Secrets For Profiting in Bull and Bear Markets. The main thing to focus on in that book is the 4 stages of the market. The way that institutions buy and sell.....also known as the business cycle. Staying on the side of the primary trend which is not found on a 15 min chart. Counter trend trading when the market is buying or selling.

Figuring out if you are a swing, position, or trend trader. I swing, buy weakness and sell strength.

My only point is that the markets aren't designed for the majority to make money. It's designed for the majority to lose and the few to succeed. Remember when Jon Stewart went off on Cramer.....crying because most don't know about the real market. No Sh*t, that's the way the it's suppose to work.
  • #29
  • Jan 2, 2010 8:09am Jan 2, 2010 8:09am
Quoting tonyb1911
I normally only come on to Forex Factory for the calendar, which is pretty good.....
Some of the most successful managers in the hedge fund world disagree with you.

They use mechanical systems putting millions into their pockets
  • #30
  • Jan 2, 2010 7:19pm Jan 2, 2010 7:19pm
Quoting tonyb1911
I don't use MA's but they can be used to an extent to tell if you something is overpriced or undervalued....
I am trading the same way, but i had never thought about using the MA to show that a price is overpriced or undervalued. An interesting idea to think about.
  • #31
  • Jan 3, 2010 8:28am Jan 3, 2010 8:28am
Salvador,

Those "Mechanical Systems" are mechanical rules. Which every successful trader uses (i.e. your trading plan.) Hedge fund or not. But you are correct, mechanical rules that you follow over and over and over are key to succeeding.

Mechanical rules that tell you what to do in every situation so that emotion doesn't get in the away. Almost all of my entries are limit orders with set stop losses and profit targets. This helps eliminate the emotion involved and keeps me from interferring with the trades. A good way to cut losses short and let profits run.
  • #32
  • Jan 4, 2010 11:03am Jan 4, 2010 11:03am
I can't agree more with your comment on education. There is no way to be a successful trader without it. Let's face it, we are going to get educated one way or another. We can lose money until we figure out how to win or go to a good teacher or mentor who is already a successful trader, even if it cost you a little, it will more than likely be less than you'll lose trying to figure it out on your own. There are some out there who want to make a living teaching us how to do it and will keep you coming back for more for as long a they can, they are best avoided.

As far as indicators go, if it were as easy as trading when one told you to, everyone would be rich.

I don't agree that forex is not for day trading. I am doing pretty well for a newbie and haven't carried a trade longer than a few hours. But that's just me.
  • #33
  • Jan 4, 2010 6:54pm Jan 4, 2010 6:54pm
Quoting moneymaker2
Traders need to be able to predict the direction of the price of whatever venue they are in with a relatively high degree of accuracy for the timeframe they trade. If you get good at predicting a 10 pip move intraday, you will make lots of money.
Hi MM2, I agree with your post and am highlighting this comment because it resonates with me.

To jump back: I've been a full-time trader for a few years and a part-time trader for years prior to that. Currently, I make my living in shares but due to the sheer available potential, I have spent considerable time trying to develop a workable strategy in FX. One thing that I agree with in the OP is that sites like this are primarily noise. One actually needs experience to be able to sift the wheat from the rubbish in the multitude of opinions. How many participants on this site are actually consistently making a living from trading? Those are the people that one has to find and listen to; but too many ego-driven wannabees flood the forum with noise. For that reason, I gave up reading here not long after I joined. The noise is just too confusing. My only real reason for being here is the calendar. I check the forums occasionally (but never to read trading systems) and your post resonated strongly with me...enough to post myself.

I spent a lot of time trying to translate very successful share trading ideas to FX and just couldn't find anything that worked. However, my continued interest in George Soros and his concept of reflexivity finally provided the clue I personally needed to develop a successful FX strategy. I admit I have a bias for wanting to be right so a high prob. system with lots of small wins and a few small losses appeals to me way more than a low prob. system with lots of small losses and fewer large wins (where the majority of profit is made from only a few trades). I want to be consistently making small amounts of pips, rather than being exposed for longer periods of time waiting to make large chunks of pips. Hence, my resonance with your above-quoted comment. In Soros' philosophy I found an idea that translated into a short time-frame strategy with an extremely high degree of predictability such that even the trades that go against me can be easily traded out of ie. very few losses. I only use a naked chart to establish basic trends and from there, it is all about the order book, reading the flow. My average trade is a few minutes with several less than 30 secs and my longest being 1.5hrs.

So I agree with your sentiment: it's vital to distance yourself from the herd and spend the time to create an idea that suits you and your personality. The herd running to and fro from new thing to new thing are sadly, no different to the animals in a slaughterhouse.

Cheers.
  • #34
  • Jan 5, 2010 10:21pm Jan 5, 2010 10:21pm
I don't think any senior member of this forum are going to take your posts seriously after this thread.

Your probably addicted to porn because you can't get a gf and ofcourse its harmful to america along with the rest of the world.

And you claim its not necessary to read books...LOL! ofcourse reading and understanding how other great traders were a success is useful to any new trader.

Ive come across a lot of idiots and negative posters on this forum, and your the first to incite a negative post back from me, do something productive with your time and grow up.
The greatest force on earth is compound interest.
  • #35
  • Jan 6, 2010 8:31am Jan 6, 2010 8:31am
Quoting sebastionay
I don't think any senior member of this forum are going to take your posts seriously after this thread.

Your probably addicted to porn because you can't get a gf and ofcourse its harmful to america along with the rest of the world.

And you claim its not necessary to read books...LOL! ofcourse reading and understanding how other great traders were a success is useful to any new trader.

Ive come across a lot of idiots and negative posters on this forum, and your the first to incite a negative post back from me, do something productive with your...
First, the porn thing is a joke. Secondly, I could give a damn what anyone else thinks. I'm in the market to make money.....that's it. I don't even do this posting thing to be a Senior member.

Obviously, you are a failed trader. Someone who cares what others think. If you think that reading books by people who don't actually trade is going to help you make money in the market........I know you are a loser.

For example, the fool who writes all those candlestick books was put to test on actual trading. He failed miserably and lost people money. I know CMT's who can't trade. If the books worked.....More than 95% would be making money. Most books teach people to be "break out jockeys" the fools who lose money time and time again.

Eat some Caramel "Ball Sacks" and get off mine. If you don't like my post or agree with it fine. But don't come to me with this "Peer Pressure" nonsense.

The best books on trading you can read are thos pysch books.......Even the "Turtle Traders" had a horrible strategy......

So get your *ss out here and climb in a Senior Member's lap.
  • #36
  • Jan 9, 2010 7:11pm Jan 9, 2010 7:11pm
Quoting fibonator
I can't agree more with your comment on education. There is no way to be a successful trader without it. Let's face it, we are going to get educated one way or another. We can lose money until we figure out how to win or go to a good teacher or mentor who is already a successful trader, even if it cost you a little, it will more than likely be less than you'll lose trying to figure it out on your own.
.
After a lot of reading and searching about jacko of the internet, I joined Jackos second group. After reading his private blog almost non stop for the last 36 hours, my trading education has taken a quantum leap.
Reading all his thoughts and reasons in the lead up to each trade and why he takes the trade, then seeing all his trades, and then reading all his reactions to the outcome of each trade (both wins and losses) has been a massive education in how to trade. It is 180 degree different to how I was trading.
For those of you who do not want to join, then read the pdf here. It is a good outline of the system.
  • #37
  • Jan 23, 2010 9:12am Jan 23, 2010 9:12am
I read the first post and couldn't agree more:

New traders don't need posts created by losing traders. They need to push themselves to learn and never stop pushing themselves.

I wasn't profitable until I practiced for 14 hours a weekend before the trading week.

Trading is hard work...if you wanted to be a doctor, you wouldn't read message boards all day to learn how to do it.

Message boards are good for this - give you a little trading knowledge and tips and share some stories every now and then, but trading skills and profit comes from practice.
  • #38
  • Jan 24, 2010 3:31pm Jan 24, 2010 3:31pm
Quoting rendezvous65
After a lot of reading and searching about jacko of the internet, I joined Jackos second group. After reading his private blog almost non stop for the last 36 hours, my trading education has taken a quantum leap.
Reading all his thoughts and reasons in the lead up to each trade and why he takes the trade, then seeing all his trades, and then reading all his reactions to the outcome of each trade (both wins and losses) has been a massive education in how to trade....
hallo rendezvous65
I did the same thing. I joined as a Xmas present to me . a good present. I am determined to be a professional trader within 12 months.
  • #39
  • Jan 24, 2010 5:19pm Jan 24, 2010 5:19pm
Quoting rendezvous65
After reading his private blog almost non stop for the last 36 hours, my trading education has taken a quantum leap.
Do you realize a 'quantum' is the smallest possible increment allowed by nature?
The breaking of a wave cannot explain the whole sea.
  • #40
  • Jan 25, 2010 5:44am Jan 25, 2010 5:44am
Quoting Craig
Do you realize a 'quantum' is the smallest possible increment allowed by nature?
forex is not natural, so perhaps it fits?
Congratulations ScalaFX for coming out of the closet!
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