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Do you guys find that forex trading sucks?

  • #141
  • Dec 20, 2011 3:20pm Dec 20, 2011 3:20pm
because of the inconsistency. I have finally have a strategy that brings me consistent returns. I have a weekly target of 10% (2%/day) and a monthly target of 50% which have have met for the last 3 months. That includes this December so it is not necessary for me to trade till January. I did position in today. My win/loss is about 20/1. I have no confidence in Wall Street.
Taigen Profit This Month: na
  • #142
  • Dec 20, 2011 3:32pm Dec 20, 2011 3:32pm
Porkpie it was self defence, the dude tried to attack our principle so i took him out simples so i aint actually a knucklehead just a handy bodyguard lol. and yes erock i trade to live i have also managed to buy a house in north london out of a couple of big trades and i got it at a decent price it just needs to be refurbished. and i honestly think i'll keep trading until i drop or be dropped as its a simple way to trade. happy days
SEE LINE,TRADE LINE..PRICE HAS TO GO SOMEWHERE,,, PRICE WILL GO SOMEWHERE.
  • #143
  • Dec 20, 2011 4:23pm Dec 20, 2011 4:23pm
Quoting smittens4212
......low-risk, high-reward,....
Doesn't exist.
  • #144
  • Dec 20, 2011 4:50pm Dec 20, 2011 4:50pm
Ha ha if you hate the volatility just enter and trade when the market is quiet.
Personally I HATE those boring quiet times, I LOVE the volatility of forex.
It's forex's volatility that makes it worth trading!
  • #145
  • Dec 20, 2011 5:55pm Dec 20, 2011 5:55pm
Forex trades like any other market, it isn't harder than the indices or stocks etc.

And of course you can do all sorts of option strategies in FX, too.
FX futures are almost 100% identical to spot fx, they have to be since spot FX is controlling the currency futures, not the other way around. I hate to be blunt but Erock, you don't really know what you are talking about.

Whether you trade crude oil, pork bellies or the S&P, it's all the same $hit imho. Granted, some market trend more than others but that's about it.

The only "disadvantage" in FX is that you cannot see the volume. Since I don't pay attention to volume, it doesn't matter to me.
  • #146
  • Dec 20, 2011 6:07pm Dec 20, 2011 6:07pm
Quoting CindyXXXX
I think the biggest boundary (assuming the edge isn't the problem) is a psychological one, as the lot sizes increase so does the fear and reality of money. Suddenly you're not risking the equivalent of a cheap night out anymore, but weekly wages, holidays, cars. We're only human after all and money is hard to simply ignore. Why do you think we're all here in the first place?

Of course this is a destructive way to view trading risks/ losses. It's a great skill to be able to keep things in perspective and think always in %, but again, we're...


Spot on!

Quoting smittens4212
And the thing is, any time someone makes the claim that they can earn 100% (or any other % figure, really), there will always be people jumping out of the woodworks to "prove" that this simply isn't possible, otherwise some magic trader would've done it already-- all the while ignoring all practicalities of the situation.
  • #147
  • Dec 20, 2011 7:36pm Dec 20, 2011 7:36pm
Quoting erock
If you compound higher returns at shorter time frames you won't make as much money as longer time frames with smaller returns.
Hello erock,

I think your tongue got wrapped around your eye tooth and you couldn't see what you were saying. LOL. This doesn't make any sense whatsoever. Just trading the smaller time frames (less than Daily) will net you more pips. Screen time becomes a huge factor as nobody can look at a screen 24 hours a day so trading the Daily becomes more profitable if your screen is limited. If you're trading with an automated system then the smaller time frames will net you many times the Daily net.

You say the Forex is not profitable and I see posts about huge amounts of money and 100% returns. I doubt very much if you're trading equities and compounding profits into millions so why would you ask anybody here if they are doing it. All investing is about controlling risks and the gamblers usually die a fast death.

I'm not at all surprised you've lost money in the Forex after only one year. The Forex is the most demanding of all the investing medians. You can trade equities with little knowledge and survive. Trading the Forex with little knowledge and no edge will get you a margin call.

Wall Street hires Harvard Grads and puts them through two years of training before they're allowed to trade. Why would you think you'd be any different or smarter. The answer is you are not and neither is anybody else. There are trading systems here on FF that can make you money and a few new traders have stumbled upon these. If they wander from those trade rules of those simple systems they get hammered because they possess little knowledge. These systems net them little bags of pips but fail to get the whole gold mine.

For every good system there are a hundred bad systems. I've seen the Martingale systems of the not so bright traders being used here to cover their bad trades and know it's just a matter of time before their luck runs out. Some of these traders have been here for years and will never change as learning is not their game. They trade to trade much like the vast majority of people in a casino play to play. Only the Professional is there to win.

The Forex game takes the same mind set as the professional gambler. You must know your game and have extreme patience. He does not win every hand played but his goal is to win enough to take all your money. Trading the Forex is a little different in that respect although there are many that will debate this next statement. You need not lose one trade trading the Forex. You may not hit your target and not make as many pips as you planned but you can always make money. The key to winning is to eliminate your losing trades. This may seem very obvious but it truly isn't and the evidence is written countless times on FF and everywhere else. It is true in gambling but trading should not be gambling and the two should never cross paths on the Forex. Thinking that losing is acceptable and saying it's the cost of doing business is like saying I'm too stupid to learn not to lose.

Trade Well and Prosper,

Johnny
  • #148
  • Dec 20, 2011 7:51pm Dec 20, 2011 7:51pm
Hi Erock,

My thoughts on spot forex.

Great for intraday trades.
Good for get in get out.

Not so good for longer term.
If you wanna do longer term, you must have a very solid edge and the discipline to execute them.

Severely lacking in information. Unlike stocks/futures/options, there aren't that many things that can help you in your analysis. For example, we don't have fear indicators, open interest etc etc. Even volume is not really volume.

But on the other hand, if you are a major player, you will love forex. You can throw millions into it and nobody will know anything. In fact just a few millions might not even move the market. How nice! It all depends on perspective and preference.

If you need to rely on any of these information to get your trade going, then you won't like forex so much.
  • #149
  • Dec 20, 2011 8:04pm Dec 20, 2011 8:04pm
Don’t you just love these specious arguments, full of rhetoric but lacking in any real substance?

How do you counter the argument that forex sucks and futures are king.
With an open mind, data and facts, I guess.

Charts tend to be pretty factual, so I have compiled a chart with 3 panes (attached images).
The top pane is of EUR-USD with GBP-USD and AUD-USD as comparative symbols.

The middle pane is of GBP-USD (black line) and a comparative symbol G6B-057 (white line) which is the GBP currency future.

The bottom pane is of the YM-057 (magenta line) which is the Dow Jones 30 stock futures index and the comparative symbols are ES (S&P 500), TF (Russell 2000), GX ( German DAX), ZX (British FTSE 100).

There are 4 charts 1) weekly timeframe 2) Daily 3) 60 minute 4) 15 minute.

Firstly look at the middle pane on all 4 charts, notice the GBP-USD black line is hidden virtually all the time by the white G6B futures line. This means the price for both forex and futures is identical.

It is true to say that the forex and futures move pip for tick, simultaneously, for the vast majority of the trading day and that applies for all currency pairs that have tradable futures contracts.

It has to be that way otherwise the market would present continuous arbitrage opportunities. And that is the last thing the exchanges want to do.

Fact, all the currency futures move tick for pip with the forex throughout the majority of the day, so if a setup to buy or sell appears in the forex it is equally valid and tradable in the corresponding currency future and vice versa.
If anyone thinks otherwise they are deluding themselves or have not done their homework thoroughly.

Peruse the attached charts.
It does not take superhuman powers of observation to reach the conclusion than the forex market, currency futures and stock index futures markets are anything other than highly correlated and are moving in tandem.

The correlation is so high, that on occasions a spike upwards in one of the indices can be a precursor to a spike in the forex ( and currency future), because the index tends to lead the forex by a short period of time. The reason why they do so is a closely guarded secret. So I obviously cannot reveal it (think robots).
The bottom line is, if something moves and is tradable then trade the setups that work for you.
Tonkar
Attached Image(s) (click to enlarge)
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  • #150
  • Dec 20, 2011 8:16pm Dec 20, 2011 8:16pm
Trading is not something that you may learn in a book or reading, all indicators is just a guideline. There are more thing you might need to read and understand to trade forex, it is not just a stock market in a country, it involving global market and issues. Indicator never tell you what is going to happen. Only understanding the global situation; Debt in Greek, due date, financial/ employment... status of a country/ region will help you on you trading decision... Indicator always is just a guideline to know trend change, when in, when out, where is support... Fundamental will be more important if you are not scalping.

Professional gambler, we are consider them as investor or trader because they manage risk. Gamble with luck is just a looser...
  • #151
  • Dec 20, 2011 8:33pm Dec 20, 2011 8:33pm
Quoting JohnnyBSmart
Hello erock,

I think your tongue got wrapped around your eye tooth and you couldn't see what you were saying. LOL. This doesn't make any sense whatsoever. Just trading the smaller time frames (less than Daily) will net you more pips. Johnny
I trade the 5min tf and wouldn't trade anything higher whilst I am building up my capital to a point where I can afford to trade less frequently and move to another level of capital accumulation.. This is a fairly self evident truth to me.
The road to pipland is arduous and fraught with challenge.
  • #152
  • Dec 20, 2011 8:48pm Dec 20, 2011 8:48pm
The main reason that almost nobody can compound small accounts into the millions -

Imagine somebody suddenly handed you half a million dollars. What would you do with that half mil? Would you dump the whole lot in a forex account knowing the risks involved? Of course you wouldn't be that silly, right?

But that is the dilemma faced by successful forex traders. To turn a small account into a million, at some point in time you WILL have $500k in your account. At that time you will face the decision described in the previous paragraph - you have half a million dollars to your name, and to have it all in a trading account knowing the risks involved would just be silly. Actually, you would face the same decision at $100k, $200k, $700k etc. etc. And it wouldn't just be a one-off decision required of you to keep that money in a trading account - it would nag at you all the time. The first thing you think of when you wake up every morning is all that money you have to your name, and the risk factor threatening it.

The only people with the nerves to keep that money in a forex account long enough to compound it into a seven figure sum, are people with significantly more money than that safely tied up elsewhere.

If a six-figure sum in your trading account represents most of your wealth and you are willing to keep it there at risk, you are a gambler and probably couldn't have earned that money in the forex market in the first place. The people who do succeed in forex are not the kind of people who would leave most of their wealth in a risk exposed trading account to compound infinitely.
si hoc legere scis nimium eruditionis habes
  • #153
  • Dec 20, 2011 9:14pm Dec 20, 2011 9:14pm
Quoting numbnuts
The main reason that almost nobody can compound small accounts into the millions -

Imagine somebody suddenly handed you half a million dollars. What would you do with that half mil? Would you dump the whole lot in a forex account knowing the risks involved? Of course you wouldn't be that silly, right?

But that is the dilemma faced by successful forex traders. To turn a small account into a million, at some point in time you WILL have $500k in your account. At that time you will face the decision described in the previous paragraph - you...
Thats assuming that a competent trader who has compounded a modest sum to $500k will need to use all or a big portion of it or feel the need to.
The road to pipland is arduous and fraught with challenge.
  • #154
  • Dec 20, 2011 9:17pm Dec 20, 2011 9:17pm
Quoting JohnnyBSmart
......... Just trading the smaller time frames (less than Daily) will net you more pips....
Theoretically.

In practice highly unlikely.

For every scalper that makes big bucks there are 10, no probably 50 or more, that make it on daily/swing trading basis.

Not a single hedge fund that I know of trades the short timeframes predominently.
  • #155
  • Dec 20, 2011 9:21pm Dec 20, 2011 9:21pm
Quoting SunTrader
Theoretically.

In practice highly unlikely.

For every scalper that makes big bucks there are 10, no probably 50 or more, that make it on daily/swing trading basis.

Not a single hedge fund that I know of trades the short timeframes predominently.
I trade the 5 min tf but don't scalp. I tend to catch the whole move within a days direction...anything from 30 to 150 pips (and more sometimes). So the assumption that small timeframes equate to scalping is not always true.
The road to pipland is arduous and fraught with challenge.
  • #156
  • Dec 20, 2011 10:42pm Dec 20, 2011 10:42pm
Quoting Noloqy
I also discovered his track record the other day, very impressive.
I was more shocked to be honest...lol. He's already withdrawn 200% of his initial deposit in 12 weeks trading, so I guess in a way he's already "won". But all the talk of what's possible and what's sustainable on this forum, it will be interesting to watch over the 6 months - a year.

I was watching last night as he shorted the NZD/USD at 100 lots on an 11K balance. That gives him a leeway of about 100 pips before that 11k is Kaput. . All that would take is for a EUR member or central bank to fart the right way, or perhaps a trader in a bank to hit Billions instead of Millions. He was targeting a 20 - 30 pips profit if I recall

Anyway I think his trade explore (and sorry to "him/her" for putting herm in the limelight) would be an interesting one to watch, and well in the theme of the current discussion on this thread. At 11K my risk management would allow for about 10 standard lots at the most. I guess some people are happy to take 25% draw downs. Not this little homie haha

High risk = High Return but that mutha fkers a double edged sword, excuse my french.

All that said there's many possibilities other than the ones we're quick to assume like this could just be his gambling account. He might be diversified in other markets, etc etc. Who knows. Good entertainment anyway
Time hides Nothing
  • #157
  • Dec 20, 2011 10:51pm Dec 20, 2011 10:51pm
Quoting SunTrader
Theoretically.

In practice highly unlikely.

For every scalper that makes big bucks there are 10, no probably 50 or more, that make it on daily/swing trading basis.

Not a single hedge fund that I know of trades the short timeframes predominently.
Hello SunTrader,

Go ahead and put your money into a good hedge fund trading the Forex. If you can even find a good one the returns are nothing to write home about. So what does this tell us? They trade the Daily because it's the easiest and most I've seen trade using only the RSI and try to figure out the fundamentals which to me is the sign of a newbie trader.

Even the equities hedge fund managers are mostly idiots. Look at their results for the last couple of years. I wouldn't let them trade a penny of my money.

It all comes down to one fact and that is the only one interested in making you money is you, period.

Johnny
  • #158
  • Dec 21, 2011 12:10am Dec 21, 2011 12:10am
If I understand erock correctly he is claiming that price movements are random, and all 'patterns' in forex are part of a random walk. If that is true then trading profitably long term is impossible and everything he is saying is right - except his maths, which still horrifies me.

If trading profitably is at all possible there needs to be at least an occasional directional bias in play, a force pushing prices up or down which is strong enough to overcome randomness.

Take a look at the daily chart of USD/CHF for the period June 2010 until August 2011 - a steady drop of 4,000 pips. There is plenty of random activity occurring on lower timeframes, but the larger trend is clear. It is possible for such a trend to be created by a random walk, but highly unlikely. When we look at other trends such as the sweeping moves of late 2008 and the rise of AUD, then coincide these with global macroeconomic happenings, the odds of all this being part of a random walk are ludicrously low. Clearly there are strong directional biases at play, at least some of the time.

This then leads to two obvious ways of trading profitably and theoretically beating randomness - the first is to understand these directional biases, predict their effect on currencies and trade them. The second, the one which I personally use and I know works, is to identify possible future price movements which are extremely unlikely to be part of a random walk, and make sure we are in the market if price reaches those levels.

As for people trading lower timeframes and using indicators, I cant really comment. All I can say is I couldn't do it and I am rather skeptical of those who claim to be doing it profitably too, but that doesn't mean its impossible.
si hoc legere scis nimium eruditionis habes
  • #159
  • Dec 21, 2011 12:58am Dec 21, 2011 12:58am
Quoting numbnuts
If I understand erock correctly he is claiming that price movements are random, and all 'patterns' in forex are part of a random walk.
The markets aren't random, well forex anyways. I am no authority on the others. I will enter a move on these particular forms. After that, I will wait for a reversal or another spurt after a period of consolidation or retracement.
The road to pipland is arduous and fraught with challenge.
  • #160
  • Dec 21, 2011 1:21am Dec 21, 2011 1:21am
Aren't they? I'm wondering how many of you guys actually took the time to draw a brownian movement on a price chart to see how randomness looks like.
You'd be surprised, it's very much like forex charts, with recognisable patterns, fibs, indy signals, you name it - the only thing that's definitely missing from random charts is the pulse, the heartbeat, the pumping ... the rhythm that makes the market alive .. put an ATR 24 on a M30 EURUSD, zoom it out and that's what I mean.

Quoting traider
The markets aren't random, well forex anyways. I am no authority on the others. I will enter a move on these particular forms. After that, I will wait for a reversal or another spurt after a period of consolidation or retracement.
forget about tomorrow, just steal away into the night
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