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14 Year Old Forex Trader's Lessons

  • #2,341
  • Oct 12, 2011 8:15pm Oct 12, 2011 8:15pm
Quoting traderjai_inhi
incorrect. You might want to look around for an excel lot size calc to help you out.
hey traderjai
Yes, saya indonesian!
apa kabar?



figured it out. 1% hit.
Have I got something on my face, SOLDIER?
  • #2,342
  • Oct 12, 2011 8:20pm Oct 12, 2011 8:20pm
Trading psychology is the most important aspect of a trader's success. This may surprise some readers, specifically those that are new to trading. However, the psychological makeup of a trader is more important than market knowledge, market analysis, and even money management. The reason psychology is so important is that even the best information can be distorted by a poor mindset.

Most new traders think the key to profiting in trading is knowing more about the market. For instance, most new traders clog their screens with every indicator they can find, read up on European GDP trends, and feel that pro traders have some sort of secret knowledge. However, this inevitably does not provide the lofty results the novice trader expects to achieve.

After realizing that excessive market information doesn't help (and may hurt) results, the next moment of truth most traders have is money management. Instead to trading 1 lot every time, or even trading the maximum lots their account will allow, these traders realize losses will happen no matter what. When you realize that everyone loses on occasion, it is easy to see why money management is necessary. This is a big step, but does not ensure success.

Now, don't get me wrong, you need to have some form of analysis and some form of money management to profit in the long term. In other words, you need an edge that when applied with proper money management leads to positive returns over the course of many trades. Great money management with no edge will only mean you lose your money more slowly. A great strategy without money management will lead to an inevitable blow up. However, without the proper mindset, it is nearly impossible to continue to get good results in the long run.

The bottom line is that a poor mindset can sabotage even the best trading strategy or money management strategy. I could write about this at great length, but we will look at one key example for now. The biggest test in trading psychology occurs during a drawdown. This occurs when a trader gets in a "slump" and has bad results for a given period of time. Usually the most devastating drawdowns eliminate a significant amount of a hard earned profit.

Keep in mind, draw downs are completely normal. Everyone has them on occasion. However, the key is reacting properly to drawdowns. This is why trading psychology is so important. The natural reaction during a drawdown is to change your strategy. Sometimes traders will even take trades for no reason whatsoever except for a desperate chance at a profit. Assuming you believe your methodology is sound, there is no reason to change anything during a drawdown. In fact, that is the most important time to follow the basics. Think about a baseball hitter in a slump. Sometimes they will change their stance, but usually they keep the same basic stance and swing. Instead, they focus on the fundamentals of keeping their head still, keeping their hands back, and so on. For some reason traders tend to panic in this situation and change everything up. This leads to a larger drawdown, which usually ends when the trader reverts back to their primary strategy.

In conclusion, the steps above illustrate the general process a trade takes on the road to achieving consistent results. Virtually all traders only become successful after they able to put together a strategy that gives you an edge, money management, and proper trading psychology.
It takes a lot for me to IGNORE you, but you can try.
  • #2,343
  • Oct 12, 2011 8:28pm Oct 12, 2011 8:28pm
Quoting bumapatria
Mla, capitally speaking we are all alright. I dont think anyone's equity is hit big, but we are in a streak of losses bigger than wins now, and that in itself is a sign to re-think. I'll think this out mla, thanks. why would i even think of live now if i cant do this on demo at least perfectly yet? next month then. i am depositing $1000, with micro lots of 0.01 trading. a 100 pip loss is only 10% hit to equity which is roughly 10 bucks. rescues will be performed with a wince larger lot, but will not perform as often.

No one asked for it to be...
Because there is huge(massive) difference between live and demo, HUGE, HUGE. CAPITO? Your ego will came to play.

If you do place $1000 in your account next month, that will be to much pressure on you. You should not worry about the money, you should learn how not to loose it first. $25 will be enough for you to learn, now you are not learning, you are just playing.

If you loose $25, that will be ok, but you should not loose it if you use proper MM. WHen (if) you get to 50 from 25, you can add another 50, when you double that you can add another 100, then you add 200, 400 and that is how you get to 1000. If you do that you have learned how to trade, before that nothing is sure. (there are many reasons why people will get in trading and mostly are hidden reasons)

This is what I think and sorry if I have been a bit raw, but sometime is needed.

Your mate
mla
"The Heart is the hub of all dances; go there and chill out"
  • #2,344
  • Oct 12, 2011 8:28pm Oct 12, 2011 8:28pm
Quoting Erebus
Trading psychology is the most important aspect of a trader's success. This may surprise some readers, specifically those that are new to trading. However, the psychological makeup of a trader is more important than market knowledge, market analysis, and even money management. The reason psychology is so important is that even the best information can be distorted by a poor mindset.

Most new traders think the key to profiting in trading is knowing more about the market. For instance, most new traders clog their screens with every indicator...
I thank you for recoognizing this, and even more for posting it in my thread, i hope everyone can read this, this is absolute truth in form of words, i appreciate Erebus for doing so, and i vouch him as a token of my thanks, and as a sense of wisdom i have for him. That baseball analogy is great, and you;'re right. Its not the strategy/system i have to change, its the mindset of different situations i need to change. Basic stance is there, i just need to focus on the ball, the timing of my bat, and im sure to hit it. Maybe not home runs, but ill hit it

thanks erebus, your kindness and wisdom will not go un-thanked for

Buma
Have I got something on my face, SOLDIER?
  • #2,345
  • Oct 12, 2011 8:29pm Oct 12, 2011 8:29pm
Quoting traderjai_inhi
incorrect. You might want to look around for an excel lot size calc to help you out.
... thought maybe a typo, $100 account perhaps?

And consider adjusting POSITION SIZE per trade also, a 100 pip stop while trading a 5 minute chart is not always the most logical.

Rather than fixed stops, look to the swing high, don't try to pick the top, wait for reversal, pullback, lower high, then if the high is 33 pips away, then the position size can be adjusted to 0.03 BUT the RISK for the trade remains the SAME at $10

Put the numbers in this calculator to confirm, but USD based pairs are easy!

RISK & POSITION SIZE CALCULATOR
It takes a lot for me to IGNORE you, but you can try.
  • #2,346
  • Oct 12, 2011 8:32pm Oct 12, 2011 8:32pm
Quoting Erebus
Trading psychology is the most important aspect of a trader's success. This may surprise some readers, specifically those that are new to trading. However, the psychological makeup of a trader is more important than market knowledge, market analysis, and even money management. The reason psychology is so important is that even the best information can be distorted by a poor mindset.

Most new traders think the key to profiting in trading is knowing more about the market. For instance, most new traders clog their screens with every indicator...
Erebus

Nice input.

Welcome back.

mla
"The Heart is the hub of all dances; go there and chill out"
  • #2,347
  • Oct 12, 2011 8:37pm Oct 12, 2011 8:37pm
Quoting mla
Because there is huge(massive) difference between live and demo, HUGE, HUGE. CAPITO? Your ego will came to play.

If you do place $1000 in your account next month, that will be to much pressure on you. You should not worry about the money, you should learn how not to loose it first. $25 will be enough for you to learn, now you are not learning, you are just playing.

If you loose $25, that will be ok, but you should not loose it if you use proper MM. WHen (if) you get to 50 from 25, you can add another 50, when you double that you can add another...
you do realize that 25 is... overleveraged. a lot. ill need leverage of 1:50 or larger for initial position sizing, and leverage is one hard killer in this market mla, and i have felt it good on me, and the bad. honestly the bad was larger. I dont think it would be good for me to do this. 1000 with 1:10. thats final im sorry mate. if i only risk 1% of the account, and thats already 100 pips thats good enough for me. Please understand that THIS is Money management. I cant deposit 300s and 100s anymore mla, its over-leveraged, margin calls happen, and its not a nice feeling that say you have $100, and your leverage is 1:50 just say. you trade 0.01 so thats $0.10 per pip movement on euro/usd, and losing 100 pips is 10% of account equity. its much more risk than having 1000. $25! that is... a no no for me. if i was 90% profitable why not, but i am 67% profitable to be exact. so therei s a possiblity of 6.7 wins out of 10.
25 with say 1:50 leverage. A loss of 100 pips on fiber $10, would mean 50% of equity!!

i hope you understand why im depositing 1000.

Mla what is your horoscope?

Have I got something on my face, SOLDIER?
  • #2,348
  • Oct 12, 2011 8:38pm Oct 12, 2011 8:38pm
Quoting Erebus
... thought maybe a typo, $100 account perhaps?

And consider adjusting POSITION SIZE per trade also, a 100 pip stop while trading a 5 minute chart is not always the most logical.

Rather than fixed stops, look to the swing high, don't try to pick the top, wait for reversal, pullback, lower high, then if the high is 33 pips away, then the position size can be adjusted to 0.03 BUT the RISK for the trade remains the SAME at $10

Put the numbers in this calculator to confirm, but USD based pairs are easy!

[b][url="http://www.earnforex.com/risk-reward-calculator"]RISK...
well of course erebus, i was giving an example, please read my reply to mla, and i dont use dollar stops anymore, its amateur, and it shows how much I WANT to risk, and I WANTS in this market dont usually go far.
thanks for the calc, will check it out
i analyze and trade based on whats there, but thats in question for past 2 days..

Have I got something on my face, SOLDIER?
  • #2,349
  • Oct 12, 2011 8:44pm Oct 12, 2011 8:44pm
Quoting bumapatria
you do realize that 25 is... overleveraged. a lot. ill need leverage of 1:50 or larger for initial position sizing, and leverage is one hard killer in this market mla, and i have felt it good on me, and the bad. honestly the bad was larger. I dont think it would be good for me to do this. 1000 with 1:10. thats final im sorry mate. if i only risk 1% of the account, and thats already 100 pips thats good enough for me. Please understand that THIS is Money management. I cant deposit 300s and 100s anymore mla, its over-leveraged, margin calls happen,...
If I am not mistaken 1 microlot is 1000 unit, 10 cents for pip, with some brokers that I know you can trade 1 cents per pip, meaning if you want you can trade only 1 unit.

mla
"The Heart is the hub of all dances; go there and chill out"
  • #2,350
  • Oct 12, 2011 8:48pm Oct 12, 2011 8:48pm
Quoting mla
If I am not mistaken 1 microlot is 1000 unit, 10 cents for pip, with some brokers that I know you can trade 1 cents per pip, meaning if you want you can trade only 1 unit.

mla

I dont have that with my current broker mla, and i think i will do well, as long the mindset is well... thanks buddy, you always here for me i appreciate it.

erebus here is example of how i trade using stop. basically on swing high or rejections really.

this is a gold short, taken right about now after rigorous attempts like u said trying to make profit, and in between, i saw something. It was my normal mindset again taking trades with no emotion, almost automatic. Thats how i should be, and any losses should not stop me from doing so
Attached Image
Have I got something on my face, SOLDIER?
  • #2,351
  • Oct 12, 2011 9:06pm Oct 12, 2011 9:06pm
Hi guys know why my Take profit isnt hit?

strange... stop losses on gold work, but not take profit?
Attached Image
Have I got something on my face, SOLDIER?
  • #2,352
  • Oct 12, 2011 9:06pm Oct 12, 2011 9:06pm
Quoting bumapatria
I dont have that with my current broker mla, and i think i will do well, as long the mindset is well... thanks buddy, you always here for me i appreciate it.

erebus here is example of how i trade using stop. basically on swing high or rejections really.

this is a gold short, taken right about now after rigorous attempts like u said trying to make profit, and in between, i saw something. It was my normal mindset again taking trades with no emotion, almost automatic. Thats how i should be, and any losses should not stop me from doing so ...
What is your spread at the moment with eurusd? and try to be precise.

mla
"The Heart is the hub of all dances; go there and chill out"
  • #2,353
  • Oct 12, 2011 9:09pm Oct 12, 2011 9:09pm
got out with 350 pips, trailing stop caught.
Have I got something on my face, SOLDIER?
  • #2,354
  • Oct 12, 2011 9:11pm Oct 12, 2011 9:11pm
Quoting mla
What is your spread at the moment with eurusd? and try to be precise.

mla
2 pips always.
fixed spred.
Have I got something on my face, SOLDIER?
  • #2,355
  • Oct 12, 2011 9:19pm Oct 12, 2011 9:19pm
Quoting bumapatria
2 pips always.
fixed spred.
mine at the moment is 1.2, during the London Time is about 0.8. Now you do math.
Let say mine is 1.

If we make 5000 pips each in a year, trading standard lots. what will be the difference in money between 1 and 2 pips?

wait for your calc.

mla
"The Heart is the hub of all dances; go there and chill out"
  • #2,356
  • Oct 12, 2011 9:27pm Oct 12, 2011 9:27pm
[quote=


the killer variable in our trading is that we dont know WHEN. hell right we know WHERE a possible setup can be, but time in its own is not easy to predict, and many who knew about such a method were very secretive of it.


ill try spot something here. and post.[/QUOTE]


this is very dangerous mindset BUMA, you are thinking like a newbie.

secret technique? what kind of b/s is that?
you will decipher the mystery?
perfect trading system?

buma, this is one of those times i have to set you straight



MONEY COMING IN, MONEY GOING OUT, that is all this is.
work on RECOGNIZING when the force of buy orders are more prevalent, and when more selling pressure occurs.

i wanted to be precise and erred, pivot and ATR are effective but without recognizing the orderflow everything is sunk.

here is what you need to focus on, do less not more, keep it simple.

Gan fans, and fibos, predicting exact turning point and some how this mathematical mumbo jumbo will help you predict market movements? i highly doubt it.


i am going back to simple price watching and analyzing money or money out.
do you think GAN would have predicted what happened yesterday or monday?

if he was alive i would call him full of BS some one was buying, we were selling. simple as that, we blinded ourselves to recognize money coming in.

so you predict a turning point at a fib, or gan mathematical algo, and China comes in and sells dollars to repostion the value of the yuan, or the back door injection of euros then what Gan mathematically predicts these events?
fibo, ATR, S/D can tell you ?

most tools are used to detect when something is not acting right, not to predict what it will do, here is where i got ego and showing off, being the know it all lion got me in trouble, where was i when price was moving? being to busy b/sing than watching

mla and his trend lines.

do you know why they work? time and speed a break in trendline signals a loss in momentum and change in speed and direction, i bet mla was not predicting.

NIMBLE means observe and recognize just watch what price gives you and buy or sell according to what is presented to you.
AVT INVENIAM VIAM AVT FACIAM
  • #2,357
  • Oct 12, 2011 9:32pm Oct 12, 2011 9:32pm
Quoting mla
mine at the moment is 1.2, during the London Time is about 0.8. Now you do math.
Let say mine is 1.

If we make 5000 pips each in a year, trading standard lots. what will be the difference in money between 1 and 2 pips?

wait for your calc.

mla
youd obviously make more than me. say 0.10 lots, so basically $1.00 per pip, so say that 5000 is inclusive with spread, so you beat spread and say 5000/300 trading days is 166.666, so lets say its 170 pips u make per trading day, and inclusive with spread. so net profit actually is 168 pips for me, and 169 for you. making me earn $168, and you $169. Multiply that by 300 days of trading $50,400 for me, and $50,700 for you. Say we make it reallistic that is gross profit, and gross loss is about 1000 pips that year, so 1000 pips loss is same, no spread calcullations, so its 1000 loss for me, and 1000 for you.
Final result is $49,700 for you, mla
$49,400 for me.

$300 in difference.
Have I got something on my face, SOLDIER?
  • #2,358
  • Oct 12, 2011 9:35pm Oct 12, 2011 9:35pm
Quoting the redlion
this is very dangerous mindset BUMA, you are thinking like a newbie.

secret technique? what kind of b/s is that?
you will decipher the mystery?
perfect trading system?

buma, this is one of those times i have to set you straight



MONEY COMING IN, MONEY GOING OUT, that is all this is.
work on RECOGNIZING when the force of buy orders are more prevalent, and when more selling pressure occurs.

i wanted to be precise and erred, pivot and ATR are effective but without recognizing the orderflow everything is sunk.

here is what you need to focus on,...
; sorry red, i was fucked up mind then im all okay now back to normal mindset lol. forget that crap i said, i was in some sort of question haha. im back in business. profit rolling in
back to usual sup/dem psych levels, no more b/s. i was dissapointing then... thats what happens to bad emo intelligence in loss, but i realized it after erebus' post, so i went back to the assassin, rather than being the one who got assassinated,


and yes we are all flawed there is no holy grail but ourselves,

lol red, sorry dude, i was f-ed up again lol.

and thank the heavens for you reminding me verbally, dude. thank heavens world is back to normal, redlion is still my superior, he is still my mentor still has a mane... and the assassin still off killing

it would suck if we just stuck in losses and blast our accoutns.

good now that we REALIZE, now ADAPT, dont go bi-polar and change, just AdAPT, you will survive
Have I got something on my face, SOLDIER?
  • #2,359
  • Oct 12, 2011 9:42pm Oct 12, 2011 9:42pm
Quoting bumapatria
youd obviously make more than me. say 0.10 lots, so basically $1.00 per pip, so say that 5000 is inclusive with spread, so you beat spread and say 5000/300 trading days is 166.666, so lets say its 170 pips u make per trading day, and inclusive with spread. so net profit actually is 168 pips for me, and 169 for you. making me earn $168, and you $169. Multiply that by 300 days of trading $50,400 for me, and $50,700 for you. Say we make it reallistic that is gross profit, and gross loss is about 1000 pips that year, so 1000 pips...
I am not good at math, but I think you got it wrong, a standard lot is 100.000 unit and it should be $10 a pips.
$10x5000= $50000

mla
"The Heart is the hub of all dances; go there and chill out"
  • #2,360
  • Oct 12, 2011 9:44pm Oct 12, 2011 9:44pm
Quoting mla
I am not good at math, but I think you got it wrong, a standard lot is 100.000 unit and it should be $10 a pips.
$10x5000= $50000

mla


no one can solve the math because you never mentioned the important part.... how many freakin trades it took to get to your end dollar amount. it's not going to be all wins from 0 to 50000 which you can then derive the spread cost and then by extension modify this to a "what if the spread was" scenario.
Congratulations ScalaFX for coming out of the closet!
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