AHA moments in your trading career

the article is not important it enlightened me it may just blow over your head. but i suggest going to james16s thread and also clockwork71s silent servie method thread and read you will learn alot.

damien

When I was able to perceive a glaring mispricing staring at me in the face and had the knowledge and skill to take advantage of it.

Finding where true support and resistance could be found.

i had an ahha moment yesterday when i had the daily, 4hour, and 1 hour 1 min eurojpy up and 1 could see how all the time frames fitted together like russian nesting dolls and could switch from trading 1 timeframe to the next as opportunities in different timeframes appeared.

support and resistance evryone has a big AHA on that i think i did ther comes a time you spend hours looking for it then something clicks and you dont even need to draw the lines anymore. also leverage i had the AHA on that to lol in a big way well not big big but i learnt my lesson. also psychology the main part of trading overlooked one of the biggest parts needed without strong will you aint going very far.

regards damien

True. Once you gain experience and finally learn how to trade; there is no way you will allow a crippling drawdown to occur in your account. That can only come with experience though. If I see that there is a major breakdown in a play, I will get out immediately....no questions asked. Early in my trading career, I had a very hard time believing that another, more lucrative, play would become available in the near term. So instead of cutting my losses and moving on, I would somehow try to ride it out. I believe part of that mentality came from trading equities and embracing the concept of averaging down. If you average down on a losing FX position you will get crushed.

Not really a a-ha moment,but finally knowing that the way to winning was me.Best indicator is your mind and experience that you accumulate over the years.I know how prices will move just by watching,that being said however doesn't mean that money management isn't number 1.

It's been 1.5 years and no Ah-Ha moment. I will continue to trade, read, and learn something about Forex everyday.

they will come evry trader ive met has had 1 or 2.

regards damien

That markets are inefficient.

Here's four:

1. When I realized the power of reasonable leverage applied to the carry trade; Einstein said that compound interest is the eighth wonder of the world.

2. No one's eaten the blueberries yet on the path less traveled. While everyone's looking at the Euro Pound and Yen, I'm looking at Hungary, South Africa and Turkey.

3. If trailing stops make sense for exits, then they make sense for entries too.

4. Limiting losses is essential, but limiting profits is not.

this is like a to do list for newbies lol

regards damien

When I realized not all randomness is created equal.

1- trends last months not days or weeks (patience)

2- you have to let winners run

3- you have to cut losers quick

4- you HAVE TO be willing to lose to win

When I figured this out and understood them, in tandem with a few other things, I became profitable.

One of the bigger aha moments I've had was when I saw that fishing with a net catches a helluva lot more fish than with a pole.

The other aha moment was to never base a trade on another person's opinion. If your system/method says buy/sell, then do it. Don't go looking for validation from anyone else.

And the biggest aha moment for me was to finally just let go. Let go of the money, the ego, the desire to be right, the desire for glory or whatever. I trade for the love of it. The rest is just baggage.

i'm waiting for someone to write the EA

Realising that 99% of the things people on forums say are stupid, the 1% which aren't won't work for you and that 100% of it is bullsh*t, and it's bad for ya.

First principles ftw.

Right On


Before Enlightenment: Chop wood, carry water; (Believing I can do it with a little doubt!)
After Enlightenment: Chop wood, carry water. (Knowing I can do it with peace!)

Best Pip Wishes!

that 1 day i thought i understood the euro / usd market. made 220 pips on 1 trade. day after getting bitten in the ass so i understood that it was luck after all

it felt like i went fromheaven to hell. that said i still managed to squeze 12 pips out of the whole 2 days trading on the euro/dollar.

so it still felt somehow of a victory over my stupidity

I've had a lot of them along all these years.
I'll only list the "technical" aspects, as the personal and psychological ones are way too plenty and would collapse the thread, lol).

As a newbie:
Understanding channels and "trends within trends". That was really a revelation, so magical that I even forgot to place trades, watching the price evolve back and forth.

First year:
Trading is not that easy! (after 8 months of consistent 80%+ average monthly returns in a beautifully ranging market, and the bad timing of an unexpected and long power / connection issue that coincided with march/april 2006 longwinded uptrend start)

Second year:
(after painful 7 months trying to unhedge a totally absurd "nedge" made when I "only"was 25% in the hole, and after a near margin call, ending with a 90% loss)

"I should have listened to the advice of more experienced traders. Hedging is no solution to recoup a loss."

(yes but... I love challenges, so... )

Third year:
(after a small account margin call)

"What did I say before? HEDGING IS NO SOLUTION TO RECOUP A LOSS !!!"

(old habits die hard though...)

Fourth year:

Then, another small account hedgely blown while other two were paradoxically steadily and successfully increasing and the sudden light (and, yes, those don't allow hedging the same currency pair, BTW... ):

"Undercapitalization (with the resulting over-leverage) is a NO-NO!"
AND...
"WTF ARE YOU DUMBBBB! I said: NEVER, EVER, HEDGE! Ok, let's drop it."

And, definitely (because I know that I would still attempt to take a contrarian hedge if allowed, I closed all the MT4 live accounts - still testing for a way around and blowing some demos here and there, lol... Am I stubborn... ("I said: DROP IT!")

Last year:

(after dropping all the testing of possible versions of other people's systems, indicators and whatnots, applying the initial understanding of micro-trends to a multi-timeframe approach, spotting the cycles of price action (with a big thanks to James16 for the spark that lead to further investigation) and creating my own actual and evolving strategy that suits my personality)

"It's ok to be a scalper. A pip is a pip."

"Hey, it works! Sound MM rules, ideal position sizing and tight discipline on losses are indeed the key".

After a few months of steady performance:

"Trading is boring".

A few days after this (and having lost some interest):

"Oooh... if I am so bored, maybe I've "graduated" to the next level of experience?"
Checked the screen time, indeed I had more than the legendary 10000 hours
"I now can understand how the markets move!"

And that didn't make me feel any emotion. Like, so what? I really know nothing, lol.

Finally, last thursday:

The MARKET "cracked" MY code!

After 16 months feeling that my system, though steadily performing and growing without interruption, was still lacking something I couldn't define, I got rid of one if the biggest stereotypes that were blocking a further advance.

1. PROPER STOPS (and FIXED!) are a MUST !

2. Averaging down can be useful for a while but in the end it's a false positive: you can end up, even if well-planned, losing precious time (and swaps) and added stress on longwinded ranging markets... now THAT is boring! Having to make 5 times the trades to recoup the losses of 1 single set, sooo unfair and disheartening, even if it only happened four or five times in the period. I'll pass.

I didn't use stops for the greatest part of my trading life. I later on started setting stops at BE+1 and use trailings, but never in the negative. In fact I hated losing so much that even when having to partially close a losing stale trade, I had first to make the needed pips and then close half the equivalent (so I could fool myself and think this was a no-losing day, lol).

Peak to trough DD is in fact (I think) to be taken trade by trade... I was evaluating it day by day.

Now I am starting a new cycle of my strategy (the same one because all the rest seems to be working) with this new challenge. And I have automated all the entry process because I know myself enough to predict I would most probably fall again into the old habit of averaging down... lol. At least now I really know that I don't know. And it makes me feel totally peaceful!

Sorry for the long story and dumb humor bothering. It's saturday.
Have a great week-end!