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Do you guys find that forex trading sucks?

  • #161
  • Dec 21, 2011 1:45am Dec 21, 2011 1:45am
Spekitox my man, where ya been...?

All I can say to this whole randomness and pattern type focus is that have you ever stopped to ask yourself wtf you're (traders in general) actually doing?

I think the majority of traders treat the markets like a computer game. The charts will draw random patterns and non random patterns because there is a combination of random activity and at the same time non random activity. There's an argument for both sides, everyone's a winner there.

It's easy to see 3 week patterns happen and believe that you're gonna be a millionaire because it's happened so consistently that you believe (optimistically) it will happen forever... That's when you get those excited guys on the forum telling you they've found the holy grail or whatever.

Fact is that 3 week pattern was probably just the accumulation habits of one particular bank who was in on a certain move and systematically scaled into his position the same way over those 3 weeks.

Heres a good excersise for pattern junkies; stop thinking eternity and start thinking PEOPLE. watch for a repetitive pattern that builds a move in one direction, and when you see the same pattern "unwind" (same pattern but backwards) it's likely the same trader or organization unwinding, so go with it.

People are creatures of habit and the market is essentially people. In my belief all edges should be built around this philosophy but it takes a certain open mindedness to see things this way.

I don't trade like that because it's quite subjective but when you have a good eye for charts you can see these sorts of things. One week the market might be controlled by one event, person, trader, organization. The next it may and will likely be someone/ something completely different, this creates different movements and "patterns".

There are people who can read charts and trade profitably but their skill comes from an understanding that you won't find in a pixel on your computer screen. I guess in a nutshell all you need to understand is who is getting fked when, where and why. If you can acknowledge and understand this, then and only then can your charts provide you with the information you need imo.
Time hides Nothing
  • #162
  • Dec 21, 2011 1:53am Dec 21, 2011 1:53am
Quoting spekitox
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.
You've lost me. Anyways, I simply go by the candles and my interpretation of them. Nothing else. A move is always preceded a particular setup (which is very discretionary and too complex with my limited teaching skills.) It took me almost 6 years of chart gazing to finally make sense of the whole thing and it is an intuitive process.

The moral of my posts is that hard work, perserverence and a good dose of insight plus patience pays off.
The road to pipland is arduous and fraught with challenge.
  • #163
  • Dec 21, 2011 2:22am Dec 21, 2011 2:22am
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 have...
I know of a trader who compounded an account up and over 7 figures. I don't think his is the only one to have done it, i'm fairly certain that many people have done similar and one day, I hope to do the same. I have a lot of trading years ahead of me.

He started with just £12,000 so simply was not used to the sort of money that he had created for himself. Once he got up and over that milestone, he went out to "retire" to a hot country, bought a lovely house and then traded off a vastly reduced account and much longer timeframe charts than he used to make his money. For a man who had no previous great wealth, he's more than content with trading a much smaller account which still gives him a retirement "pension" that most of us could only dream of. He lives mortgage free and plays a great deal of golf. I don't think he has any intention of trying the create amazing wealth, he already has a lifestyle than 99% of the world's population will never have and would do almost anything to have.

I think that is the dream (and the realistic dream) that most traders are chasing. They aren't trying to compound their gains up to mind boggling levels, they just want the freedom and relative wealth that being a great trader COULD provide. I know that's all i'm after. A villa in Spain with a pool and the luxury of time to take great chunks out of the finest courses Espana had to offer will suit me very nicely. I wouldn't stop at £1m but I would certainly slow down my trading massively and alter my risk accordingly.

I think there's an nagging fear that exists in most of us, as irrational as it may be. I trade by "reading the charts". Call in price action trading if you like but I use a combination of wave analysis, an understanding of candles, VSA, S+D/S+R and the tried and tested levels (yesterday's high and low, session highs and lows, pivots etc). I don't use anything that hasn't stood the test of time. I spent good money on Forex tester and have traded 11 years worth of charts to ensure that I can make money in all different market conditions. I can, certainly from a testing perspective. I have everything in my armoury to go forward and make a great life for myself in trading but none of that stops me thinking that one day the whole market could just undergo a seismic shift and wipe me out. The rational part of me know that this is so unlikely it's almost preposterous as I should simply be able to adapt what I know to changing market patterns but that isn't always enough to quash the fears. So it's natural to want to mitigate your risk when you reach certain points. So maybe you take your account to £200k and you drop your risk to 1%, already you are compounding at half the rate as when you risked 2%. Then at £500k you may choose to drop further to .5% so if things do change, you have much more time on your hands to do something about it and thus you protect your hard earned capital. This will now take 4 times longer to compound and the chances are at £1m, you drop that risk further because you simply don't need to be risking so much any more. Also, who, with £1m in their trading account, isn't thinking about buying that nice house with a pool?

These naysayers who say that this, that and the other "isn't possible" with Forex are those who simply haven't worked out how to do it and don't wish to admit their own shortcomings. It isn't the case that anything is possible with Forex trading of course, there are of course sensible limits but those sensible limits are a million miles away from 20 or 30% per anum like some want to make you believe.
  • #164
  • Dec 21, 2011 2:25am Dec 21, 2011 2:25am
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. 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.

.
I saw all the hallmarks of this guy early on. There was a similar thread to this on babypips some time ago and he's used a lot of the same language as the fella who started that thread. I'm almost certain it's the same person.

Call him a WUM or a troll or whatever you like but he gets some weird satisfaction out of this, can't say I can fathom it myself but it's all a wind up. Some folk have far too much time on their hands.
  • #165
  • Dec 21, 2011 2:34am Dec 21, 2011 2:34am
Quoting spekitox
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.
Hello spekitox,

To answer Cindy's question of where have you been I think it's obvious you've been in an educational vacuum.

I can have a monkey draw lines on a piece of paper and some of those lines may resemble chart patterns but so what does that prove. Maybe he's the next George Soros?

The Forex is not randomness and if you think it is then every one of your trades must be gambling. Why in the hell would I draw a Brownian movement on a chart? That's strictly Newb talk so don't quit your day job.

Johnny
  • #166
  • Dec 21, 2011 2:52am Dec 21, 2011 2:52am
Quoting JohnnyBSmart
Hello spekitox,

To answer Cindy's question of where have you been I think it's obvious you've been in an educational vacuum.

I can have a monkey draw lines on a piece of paper and some of those lines may resemble chart patterns but so what does that prove. Maybe he's the next George Soros?

The Forex is not randomness and if you think it is then every one of your trades must be gambling. Why in the hell would I draw a Brownian movement on a chart? That's strictly Newb talk so don't quit your day job.

Johnny
I bought the cable at my signal candle and am 55 pips in credit using this method that apparently does not exist due to the markets randomness. If people aren't prepared to understand this market, they will be burnt badly as it is a minefield of false or weak moves. For every one good move, there are many more I would not touch.
The road to pipland is arduous and fraught with challenge.
  • #167
  • Dec 21, 2011 3:04am Dec 21, 2011 3:04am
the market is moved by people/robots so it cannot be random but it isnt as easy as that to trade to a novice. i was going to make a joke about naked trading but you can leave it to your imagination. and for the record so far this week my trading is down. happy days
SEE LINE,TRADE LINE..PRICE HAS TO GO SOMEWHERE,,, PRICE WILL GO SOMEWHERE.
  • #168
  • Dec 21, 2011 4:58am Dec 21, 2011 4:58am
Quoting billytt
the market is moved by people/robots so it cannot be random but it isnt as easy as that to trade to a novice. i was going to make a joke about naked trading but you can leave it to your imagination. and for the record so far this week my trading is down. happy days
Hello billytt,

When I was a novice I thought this was the easiest game I ever encountered but that idea went out the window in a flash. Trading without knowledge is financial suicide. I knew the fundamentals but greed and over trading lost me my gains. I can fully understand the feeling that the Forex sucks but is it the Forex or is it the trader?

The market is moved by Big Money and their interpretation of the market drives the prevailing trend. The ups and downs are imbalances between buyers and sellers and big money plays the game by their own rules. The giants play with millions and butt heads to add volatility to the market. The Central Banks drop billions with not a care to market direction or who gets taken out of a sudden reversal.

The retail traders are not even a consideration as we collectively can't move the market. We are no more than a flea on a lions back but ride them we must to get a taste of what they're feasting on. All that trade against them get swatted like little bugs.

Trade Well and Prosper,

Johnny
  • #169
  • Dec 21, 2011 6:01am Dec 21, 2011 6:01am
erock has gone quiet all of a sudden after an avalanche of responses to his daft titled thread.

It is clear that his style of trading is not suited to Forex, so I can deduce that he doesn't use the supply/demand based on price action style of trading when trading equities and it sounds like he is more like a LTBH (Long term buy and hold) trader... I could be wrong.

I can also deduce that you are more risk averse, which over the long run is a good thing. Traders like RBlackburn will probably get unstuck one day as he risks all of his account practically on one trade, but there are many who are more like you but can still make 10-20% per month risking just 1-2% on each position. Just because YOU can't do it, doesn't mean that there aren't people out there that can do it... so no Forex trading doesn't suck at all. Maybe you should rename the title to 'I suck at Forex trading... what am I doing wrong?'

Not everyone trades to become millionaires. It is not all about the money, it is also to improve one's quality of life by becoming time rich... think about that for a little while.
  • #170
  • Dec 21, 2011 6:28am Dec 21, 2011 6:28am
I did gave up stock too. No more interesting compare with forex.

Good pips.

Thanks


Quoting Taigen
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.
  • #171
  • Dec 21, 2011 7:14am Dec 21, 2011 7:14am
erock, with all due respect, because you've obviously been around the markets for a long time, you have some really strong, unalterable opinions about Forex and it doesn't seem like you're taking seriously the people who disagree with you.

Forex is more than just currency conversion. Intra-day it largely moves in relation to the S&P. Longer-term, there are slow and there are fast trends based on solid fundamentals, i.e. Interest Rates and related economic conditions.
  • #172
  • Dec 21, 2011 7:18am Dec 21, 2011 7:18am
Quoting erock
I feel I can't make anymore posts here,
Oh what a shame. You will be missed.
  • #173
  • Dec 21, 2011 7:19am Dec 21, 2011 7:19am
Quoting erock
I'm a short term trader and investor, I combine the two. I will trade bonds, equities, futures and derivatives. I use bonds for investment and added income. I trade equities and futures short term with covered options to add income. I eliminate risk by trading and hedging between two different accounts. Hedging is not allowed on one account in the U.S. so I trade between two accounts.

You have to understand forex trading isn't a "financial instrument" forex is mainly large banks and businesses exchanging currency. They are not trading...
The one who doesn't get it is you my friend, what you claim to be 'impossible' is quite possible and being done by many.
Because no one here will bow down to your incorrect beliefs somehow we all don't get it?

It must be frustrating to feel so beaten by something that you have to try to convince others the problem is with the market. Buy a mirror.
  • #174
  • Dec 21, 2011 7:24am Dec 21, 2011 7:24am
Quoting erock
Then, they let a guy like you in. He's got $2,000 in his account and he wants to trade it for PROFIT..
But the ability to do that is one of the biggest advantage of trading foreign exchange.

Quite seriously, anyone who could scrape $25 together could trade with a broker like Oanda, whilst they where honing their trading chops.

New (and not so new) traders lose money, why lose more than you'd need to during this phase ? trading any other market is going to increase those losses.
  • #175
  • Dec 21, 2011 7:50am Dec 21, 2011 7:50am
This is very interesting thread that you've started and it caught my eye while I was heading to the calender portion of the site so I decided to check it out afterwards. I respect your opinions regarding trading Forex but it is quite clear you do not respect the market and it chewed you up a little bit.

Your frustration is quite evident. After a few pages I frankly could not read anymore so I forwarded to the last few posts and it's the same tone as the first. I was expecting to read an entry similiar to you saying good bye to Forex and that your returning to the markets you know and love but your still here. Still complaining but here non the less. So, you either are sticking with Forex and taking your lumps like the rest of us or you are back to trading the other markets full time but just return to Forex Factory to Piss in the pool every now and then.

You clearly have figured out in your mind that Forex is not a tradable market but that is your opinion. Volitility is what Forex traders crave and want. It is how we profit and yes some of us do. No market grants you a profit based solely on it's nature.

Forex is equities on steriods, this is what it is. It makes you either trade at your best or it will break you but to say it should be banned is hypocrtitical. If you had profited from this market consistantly would you still be pointing out its faults at the same time reaping the profits? Most likely not. Either take your lumps or grab your marbles and go home.

Interesting thread though.
  • #176
  • Dec 21, 2011 7:52am Dec 21, 2011 7:52am
Quoting Rob Mondave
erock, with all due respect, because you've obviously been around the markets for a long time, you have some really strong, unalterable opinions about Forex and it doesn't seem like you're taking seriously the people who disagree with you.

Forex is more than just currency conversion. Intra-day it largely moves in relation to the S&P. Longer-term, there are slow and there are fast trends based on solid fundamentals, i.e. Interest Rates and related economic conditions.
Forex is not more than currency conversion, that's what it is and what it's designed for. It's HUGE, there is no investor, hedge fund, mutual fund that can impact that market.

Hear me out, you want to make money when you trade, right? You're trading a market that isn't moved by investors it's moved by basically the world currency, which isn't trying make a profit but serve a purpose of currency conversion.

How you make money trading is based of off investor psychology. You trade markets where people all have the same objective as you, to make a profit.

You guys are trading something where there is no herd, you can't follow the herd. You can take the best trader in the world and he will not make profit long term, say 10 to 15 years trading forex.
  • #177
  • Dec 21, 2011 8:16am Dec 21, 2011 8:16am
If there is someone who heard on the news or seems some idiot that says forex market is a very risky environment then let me show you some interesting stuff.
First this:
http://forexmagnates.com/us-forex-br...fitability-up/
Do you know what this shows? It shows that 30000 us traders make a profit! Don't you fell a little bit stupid to blame the markets rather than blaming yourself when 30000 people only in the us are making a profit from this market?

second this

"dukascopy trader of the month 2011" on youtube.
Check out the videos with interviews and the returns of these winners on live trading accounts. The worst was 90% and the best was 1000% in a month. Seriously man stop the whining and the bullshit about forex. forex is the high liquidity, high volatility,low start-up investment and no gaps . it's the best market that there is.
  • #178
  • Dec 21, 2011 8:21am Dec 21, 2011 8:21am
Quoting erock
You guys are trading something where there is no herd, you can't follow the herd.
Of course there is a herd. How do you explain the obvious HIGH correlations between movements in the currency markets and the S&P, the FTSE, the DAX, Gold, Silver, Oil...you get the idea.

"The Herd" encompasses ALL markets, not just one.
  • #179
  • Dec 21, 2011 8:23am Dec 21, 2011 8:23am
Quoting erock
You can take the best trader in the world and he will not make profit long term, say 10 to 15 years trading forex.
Ok, you're right. No doubt about it at all. You've nailed it. Now what are you going do? Go tell someone else they're wasting their time doing something?

Really, if you're as wise as you want people to think, you should know that you're pissing in the wind.

I never cease to be amazed by people who think they're so fucking clever, yet have very little understanding of how people think and operate.
  • #180
  • Dec 21, 2011 8:24am Dec 21, 2011 8:24am
Quoting erock
You guys are trading something where there is no herd, you can't follow the herd. You can take the best trader in the world and he will not make profit long term, say 10 to 15 years trading forex.
If we restrict the argument to CTA's or fund managers with publically audited track records, there are not many who can put together a run of 10 to 15 profitable years trading any instrument.

Rather shockingly, there's far less of them than there should be simply by random chance

There are forex based funds out there who do have decent track records. I grant you, not the kind of numbers you see bandied about here, but lets not forget, those funds are constrained by drawdown, and by margin, and the practical realities that prevent them trading the way you could trade a 500K account. When you normalise for that, guys claiming 100% per annum using 10:1 leverage arnt really the hot shots they think they are.
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