House of Thrill, Joy & Pain

Hello there,
You are all welcome to join me in my way of trading. After years of hard work and having my up & downs now I believe that I'm very near to success. Time will tell how much I'm right or wrong.

I have developed a self made trading system that I will follow here. I will NOT speak about the details as there are lots of systems out there that work profitably and we all know that the trader itself is the important part. It is said & known that with a unique system two traders may have two different results. I will focus on the basis of how my trading system has been developed, different elements of it plus my trading results each month, maintain against psychological issues, money management, ...

My reason for making a public journal is to describe myself as a trader and also to keep a log of my trading history for future references.

Wish you a profitable time,
Take care
Khanderoo

Please note that I will trade ONLY based on a "Trading System". This means that:

 

1. Pre-Known Setups: Before entering a trade my mind is clear about trade direction, entrance level, how much risk, When it is enough (as for loss or profit), When it is needed to switch positions & how to do it
2. VERY IMPORTANT & initial step, First build TRUST; on yourself, on your trading system, on how to maintain to your trading rules. Demo trade the system till you win 3~6 months in a row than move to real money. Before going live you need Self-Confidence meaning NO FEAR WHEN TRADING & Self-Trust meaning knowing what to do and doing with WITHOUT ANY HESITATION.
3. Positive Picturing: Always in different conditions build a positive picture of yourself, where you want to be and what you should do as a trader. Positivity will bring huge energy within.
4. Journal: Keep a journal of your trading on your chart to avoid same mistakes in future.
5. Capital Protection: start with low risk; build profit than risk on built profit exponentially!
6. Specified Target: Trading starts from the start of the month for a specified target. After this target is reached trading will be stopped and there will be no more trades till the end of the month.
7. Time basis for candle formation is GMT so that each candle shows real moves based on each trading session & filter fake pulses.
8. I will ONLY trade EUR/USD. My trading time frame is H4, that is the only chart I will be looking at for trade setups.

I have thought deeply about each part of this trading system. There will be changes to this list in the future as I will learn more.

REMEMBER: Don’t make it personal; when you start trading, what ever happens you stick to the plan.

REMEMBER: Your attention should be focused on the process of trading not single wins or losses.

REMEMBER: At each trading day you should read your trading manual to refresh your trading mind.

Now back to trading,

I have a full time job to do plus I have chosen H4 as my time frame so I will be checking the market each 4 hours and with a GSM Modem & laptop internet is everywhere I want. (This is how I manage my tradings in real life)

Usually the results will appear in the first two week of each month (this is my expectation for trading results).

I have back tested the system for around two years the results were steady. I have been demoing it for around two months the results are as expected. This is the third month of my demoing IF it remains ok than I will with real money from the forth month. (This is my way of building confidence in the system & myself)

For going live I have prepared 500$ as trial account. IF the results were steady in the next 6 months after going live than will add to it. (Having patients, Looking for long term results, Looking at it as a real business)

* I will update this post till the end of Month + All times are GMT*

1) Bought @ 3rd 20:00 | 1.455, T/P 1.465, S/L 1.445 = -100 (hit S/L)
2) Sold @ 5th 12:00 | 1.445, T/P 1.425, S/L 1.4483 = waiting

2) Sold @ 5th 12:00 | 1.445, T/P 1.425, S/L 1.4510 = +200 (T/P hit)

================
Total = +100

My monthly goal has been achieved & I'm done. There will be no trading till next month. Meanwhile I will enjoy the results.

To give a conclusion on my journey till here:

1. From years of testing, trying, loosing & winnings I have made a system that fit my personality. There has been a lot of reading & chart watching in this process. (Have done my homework)
2. Back tested my system for around two years. (Making an initial confidence in system)
3. Have been demoing it till now for three months. All months were ok & had expected results. (Forward testing it to make sure & find any glitch if any)
4. I'm planing to go live in the next month.
5. For the first month of being live I will be using half risk as what I intend to normally do (To keep the emotions as low as possible)

I believe that in trading you need to characterize your mind for each step that happens in the market & a successful trader is the one that do this before it happens. The best trader is the one that is ready for the most scenarios that market will bring up.

That's it.
Regards
Khanderoo

Well the new month is near ahead. I have opened my live account, deposited the initial money into it.

In going live I'm experiencing some thoughts going through my head about what will happen. I hope that the first three months would have good results in order to use those profits as shield against the usual draw downs in trading. In this system it is normal to experience 100~200 pips of D.D for 100 pips of profit. I know it is against Risk:Reward ratio but as for expectancy because the profit ratio is good than it will recover so as long as the expectancy is OK we are OK too.

There is also another thing I have been thinking of it lately: Its about market reaction when you enter a trade. From a technical looking, because my system is completely based on past chart history and also because after you enter market can do anything before it goes in your direction I can not mathematically keep up the expectancy. There is no guarantee for it.

I'm entering based on past history, I expect the future market reaction to be like the past (BUT there is no guarantee for it). So I think there is a huge risk involved even if you calculate everything.

To make a conclusion of what is said:

 

1. At start I need to lower the risk to half of what I'm ready for it to be to control the emotions.
2. I hope to have some profits from the first months of trading live to use it as shield against normal draw downs of the system.
3. From now I think there would be one month that I may get cought by the market because according to probability there would be a month that the market will not act like past or according to the parameters you have considered it would so this would bring these ideas to me:

1. Only risk on money you could lose.
2. Hope that the month that the market will not act according to your perceptions is VERY FAR from now!

Well the new month is near ahead. I have opened my live account, deposited the initial money into it & waiting. Meanwhile:

In going live I'm experiencing some thoughts going through my head about what will happen. I hope that the first three months would have good results in order to use those profits as shield against the usual draw downs in trading. In this system it is normal to experience 100~200 pips of D.D for 100 pips of profit monthly. I know it is against Risk:Reward ratio but as for expectancy because the profit ratio is good than it will recover so as long as the expectancy is OK we are OK too.

There is also another thing I have been thinking of it lately: Its about market reaction when you enter a trade. From a technical looking, because my system is completely based on past chart history and also because after you enter, market can do anything before it goes in your direction I can not mathematically keep up the expectancy. There is no guarantee for it.

I'm entering based on past history, I expect the future market reaction to be like the past (BUT there is no guarantee for it). So I think there is a huge risk involved even if you calculate everything.

To make a conclusion of what is said:

 

1. At start I need to lower the risk to half of what I'm ready for it to be to control the emotions.
2. I hope to have some profits from the first months (at least three months) of trading live to use it as shield against normal draw downs of the system.
3. From now I think there would be one month that I may get caught by the market because according to probability there would be a month that the market will not act like past or according to the parameters you have considered it would so this would bring these ideas to me:

1. Only risk money I could lose & it doesn't hurt me.
2. Hope that the month that the market will not act according to my perceptions is VERY FAR from now! But if it happens soon I'm not surprised

I will update you on the trades as I take it.
Hope the best for all,
Regards,
khanderoo

* This the first month live of the system so I'm taking half-risk for lot size (Trying to gather some house money as shield) *

1) Bought @ 1st 12:00 | 1.4428, T/P 1.4528, S/L 1.4363 = -65
2) Sold @ 1st 12:00| 1.4363, T/P 1.4193, S/L 1.4430 = +170

=====================================================
Total NET results = 105 pips.

Monthly target achieved. This month really ended very soon.

OK, the first month for this system was real quick. Now we are in the forth month of positive results + 1 month of real account.

I'm thinking about this sentence:
"Professional traders look for the risk side of a trade & Amateur Traders look for the profit side of it."

My system calculates the profit & risk of each trade BUT I'm thinking about:

 

1. SHIELD AGAINST DRAW DOWNS: I would need a shield against each deposit I make. Risking half-size for the first month is a good idea. My plan is to move risk to profits I get from market.
2. Looking into other instruments: As explained before because of probability of meeting the month with unexpected results, I'm looking for other instruments that fit my trading system style.

1. The instruments compatible with my trading system: USD/CHF , Oil and Gold
2. Specially in Gold & Oil I'm looking for high R:R BUT will also move S/L to break even as soon as we get R:R=1.5
3. They will be traded only till the risks have been covered by the profits.

It seems that adding these two will make the growth of the account more steady (Without lots of up and down moves) in the long term.

Regards

IF you remember I've told about how market reaction is not really predictable after you open your trades, I want to add this:

Look, IF we accept that market reaction after opening a trade is NOT predictable then we are forced to say that there will be a moment that the market will get you by its unpredictable action (The action that you have not calculated for it in your system when entering) so this will bring the idea that we should ONLY enter the ocean of sharks (the Fx spot market) ONLY when it is necessary.

Now how do we define "When is necessary"?
I do not define it by my needs. For example I don't define it by saying: "Usually I need xxx USD to pay my bills so I will aim for this as necessary time to be trading" No it doesn't work like this. BUT what I do is that I look up in the industry and see what is a good ROI (Return On Investment) per each month. With that in my mind I check that how much is my risk tolerance for that profit before my emotions get bold! When you mix these two you will have a percentage number (This number wary for each person by its character)

Monthly Target is the KEY
To avoid the ocean of sharks when it is not necessary, I will use the monthly target I have achieved from defining what is necessary!! By this way my worries about me getting caught by the market for its unpredictable moves gets to its lowest possible rate & my hope for gathering profit before I meet the giant increases

I think "Monthly Target" is one of the keys to steady growth & this is where you need patients. Patients is the key to long term success.

Regards

Hello to all readers,

We are in Mid-September and still I haven't taken any trades. Frankly speaking I missed my system sell opportunity @ 1.4364 so I waited patiently for the next setup. Now we have it:

1) Bought @ 13th closing of 00:00 candle | 1.3688 SL 1.3619 TP 13788

As always I will have a counter trade (Sell) ready in 1.3619.

Before this setup happens, I had in my mind that 1.365 would be a good support for the falling knife & I waited for my system confirmation. Now we wait and see what happens. Also I will keep a close look to price action because maybe it would be weaker than I think.

Lets see what future will bring to us.
Regards,

Now, I'm in the other side of the trade as price proved that I was wrong:

2) Sell @ 13th in 04:00 candle |1.3615 SL 1.3688 TP 1.3445

Waiting...

Update: Both trades hit SL as the market cleared both sides! I will wait for the next signal.

Last month showed me that the small time frames aren't my style. The side way moves that happen in small time frames makes a lot of noises & cleans the market players.

SO I haven't changed my trading system BUT I have to increase my time frame to: Daily, Weekly & Monthly.

I will keep in my mind that in longer time frames Draw downs are normal and should be looked relatively to their time frames.

I'm continuing to trade, but will not update here as it makes me have unneeded stress. You could follow me at:

http://www.myfxbook.com/members/Free...arksman/190844

Best Regards,
Mohammad

-I started booking it from Nov. 2011 trading according to my system who is a trend follower.