Silent Service Method

It's like some kind of sick joke.....should have seen this coming.

Did you take it?

Since I'm on the 2 week PB, I'm aiming to the last swing low (just above 0.96)

USD Index, It's amazing how does RN works to the pip .

78.0 acts as support (at least for now), will buyers come again at this level ?

2pips

Of course not, this is what is so sick about it!

Oh I see, English is not my primary language so it takes me times to "catch" things.

2pips

My thoughts on the GBP/CHF

Hey Chris,

I want to share something with you that "bugs" me a lot.

I always hear people that trade for a living saying that they go to BE very quickly or take half position off the table (like James16 is doing @ FTA), they say that it's a business and as such you can't be in a profit trade and let it go against you (let say it retraced 50% of the move). When I say I do it in order to catch a bigger move they just get pissed even more.

I want to ask you, what do you think about it, would have you trade like that if you were trading for a living?, whould you change anything in your trading plan in such a case?

Do you know any traders that trade for a living who trade like me & you?

I would highly appreciate your thoughts on that one.

thx,
2pips

I know that this answer will probably spark some kind of ridiculous debate yet again on this forum, but in order to answer your question honestly I am going to have to be a little bit blunt with my response.

Traders that move their stops to break even right away fall into a couple of different categories. The first group of these traders would be scared money. Scared money tends to move to break even quickly, because they are afraid of taking any losses. When they place a trade, their pulse quickens as they are heart races because of the fear of the trade itself. Traders like this ultimately end up losing money. The reason being is that they get stopped out at break even quite often, crushing what would be profitable trades frequently. On the flip side of that coin, is the fact that they take the full loss of their initial stop loss. If you think about it, the math makes absolutely no sense.

To answer the question about whether or not I would trade differently with a larger account, I would ask a question back at you:

"Why is 1% different if your account is larger?"

The answer of course, is that it isn't. Anyone that tells you that you need to change your trading habits with a larger account obviously either isn't making money, or doesn't have the psychology of trading down - which means they likely aren't making money. Either way, not a good thing. I would be very wary of someone who gave you this advice.

As for myself, I seem to be at a crossroads of sorts when it comes to my "Forex career". Recently, I have been writing articles for several different sites as well as doing videos. I have been trading for a firm in the United Kingdom, but only as a demo trader as I am "trying out for the job", and I can assure you that from everything I've been told they will risk a fixed amount no matter what size account you are trading. In fact, they like to see 1/2% risk at the most on each trade. Most of these accounts are in the millions, and not some personal size account, and I can assure you that if their accounts were smaller and maybe only worth $50,000 - they still wouldn't want me to risk any more or less than that. It's called being a professional.

What I am about to say next could possibly cost me subscribers to my private forum. But again, I have come to the point where I don't worry about these things anymore because I have found that I have a certain set of skills that different people were willing to pay for, and in various forms. But at the risk of killing the "mystique" of bring an educator - I came to a conclusion a while back that I would never be able to make a living trading my own account. If a "guru" (myself included) were to be honest with you, they would tell you that trading can put a few extra dollars in your pocket, and possibly be a great hobby. Very few of you reading this will ever have the capital to trade for a living. Your problem is the same as mine: you lack sufficient start up capital. And by sufficient capital - I mean half a million of more. Forex can however, be a nice addition to your investment accounts.

So while the Forex world is full of people willing to teach you who have made an imaginary million dollars or more trading this market, all I can do is be honest. I still work for a living, my account brings in some money - but the biggest thing that I intend on doing with it is buying a house someday. A lot of my trades are still for just $1 pip, and I am not some philanthropic millionaire that is just trying to "give back to the community". This approach never ceases to amaze me. On what planet does a multimillionaire Forex genius decide to sell his amazing secret for $100? (Or better yet for free, but needs to charge to cover expenses. I have 5 websites - a total cost of about $250 a year.) This gets people over and over. If anybody has made millions of dollars from some type of secret or system, they will not sell it to you. I'm sorry to break it down like that, but it's the truth. People who sell multimillion dollar making systems, sell them to places like Goldman Sachs and firms around the globe that you have never heard of. They are not going to sell it to you for a few bucks.

One of the things that I try to do is pound a sense of realism into the heads of the people who ask me questions. I think that if Forex was marketed for what it really is, it would save a lot of people a lot of pain. It's not that Forex can't be profitable, but the odds are that the type of person who comes to Forex isn't willing to be patient enough to get the same type of returns they do in their 401(k). The truth is, a "supercharged" return yearly might be something like 30%. In fact, get 30% gains two years in a row, with reasonable risk taken, and I can get you a job trading for someone that can make it a career for you.

To give you an idea of my benchmark for this "try out", they are asking that I get 2% a month for three months in a row before hiring me. They have also given me six months to do this. So it appears that the multimillion dollar fund is expecting a lot less than the inexperienced and under capitalized trader. Knowing this, I think that says a lot about the Forex world.

The reason I bring up my crossroads and the situation that I'm in at the moment is that I have gained a unique insight into the trading world that many of you never will. I have been a student, I have been a trader, I have been a teacher, a journalist, and now possibly a professional. The one thing that I have seen on every step on my journey is that how ridiculous most people really are in the trading game.

I have been a lot of things in my life, one of the sleaziest things without a doubt was being a guitarist for a heavy metal band in the late 80s and early 90s. I dealt with the absolute scum of the earth on a daily basis back then. Getting ripped off by club owners, bottles thrown at you by random drunks while on stage, and never really knowing where you're going to sleep the next night while going on small regional tours were all part of the norm. I have to admit that I never thought I would see a group of absolute scum like that again. I was wrong, all it took was for me to get involved in the Forex world! The amount of scams and borderline criminals is mind boggling. The real Forex world is something that most of you have never seen. It's really not as exciting as the Internet would have you believe.

The truth is most traders lose money. There is even a story breaking recently that questions the "profitability" figures of the various brokers. Some of them reported quite high results in the form of trader profitability. But it appears that this could be some kind of accounting gimmick. My look into the financial world has made me realize that most of what constitutes wealth is just that, an accounting gimmick.

While I'm not trying to depress anyone, I just wanted to be honest. The truth be known, I think that the Forex world is changing rapidly. With the recent regulations being introduced in the United States, I think that more people will be trading foreign currencies - but in a passive way. You may begin to see Forex being traded in retirement accounts on a much larger scale than presently being done.

To be honest, I think they're going to suck the excitement right out of this market.

Congratulations on your progress Chris!

There's really no one else like you on all of FF and that's a huge compliment!

I hope people understand the wisdom of your post, cause there's a lot of it in there.

Chris, awesome post. I have never considered going live full time trading, unless I could consistently make at least 20% a year and had half a million dollar account.

Brilliant post , couldn't agree more.

Great post Chris, especially about the profit expectations of large funds. The reason so many lose is because "they didn't get into forex to make lousy 2% a month".

Thanks mate.

This shows a certain amount of maturity that I wish more traders had. Besides, I can tell you from experience - sitting at the computer all day trying to make money absolutely sucks ass! Seriously, it's no way to make a living. Make enough to buy a car every few years - sure, but to do it for a living would suck, and in a big way.

To be honest, if I had enough in my trading account to live off of my Forex trading, I would rather do it with fixed investments - because in theory I would get a guaranteed return without the stress.

I cannot tell you how many times I have been laughed at for making a "pathetic" 2% a month. These obnoxious a-holes will make a lot of noise on the forums for a while - and then suddenly disappear. Wonder what happens to them?

LOL, I have been programming computers for nearly 11 years. Some days sucks, some not. But I know I would rather do it without the fear of losing my job and losing my entire life.

True. But you are not piling on the added stress (and therefore misery) of needing to have a good day as often as possible. Programming is different, you get a paycheck.

When trading is your job - it can cost you money. Big difference.....but I hear ya brother. Point taken about the sitting in front of computer bit. lol

So.......anyone else think this might be a touch overextended?

Of course, I have learned that trading and reality have little to do with each other. :-)

Great post Chris - should be required reading for all newbies.

That's strange, most big traders from j16 (indluding himself) trade like that. One I know personally that do very well (and I think he does it for a living).


It's not the size of the account that matters it's the point that they do it for a living so they can't see profit turning into a loose, they will take small profit, move to BE "hoping" to get a nice runner. I just wanted to know if you think it's good to act like that when it comes to trading for a living.


Even if you had the equity for that?


Capital is not my problem, how to move my SL and handle the trade is. I don't know if to trade like james (moving to BE, taking partial gain, looking for runners) which I don't believe in or trade like you and let the market take me out, for good or bad. I'm planning to do that for a living in the future and I learned this stuff for the past 2 years and I don't know in which road to go. all I hear from those traders is not letting a winner trade go into the negitive zone.

thx,
2pipsfx