Help for Newbies (Discussion Thread)

Hi all, sorry for the dumb question, i did try to google it first lol,
I have opened a live account with £2000, for my strategy i set a 20 pip stop and 20 pip take profit, i wish to risk 1% per trade, i know this is £20 and my current broker will allow me to set pip value this way. However i notice people talking about micro lots, mini lots etc. what lot size would i be placing, so i can equate myself when i hear these terms?
thanks in advance, rob

I'm new to this myself but will answer your question. Assuming the base currency of your account is GBP, lot sizes are as follows:

Micro Lot - £1000
Mini Lot - £10,000
Standard Lot - £100,00

Funding your account, you could have 2x micro lots, or a mini lot with 5x leveraging.

Others please correct me if I am mistaken but I would have thought 2x micro lots would be your best option.

If you haven't already read it, you might want to buy "Currency Trading for Dummies". Very good book IMHO.

Thanks for the help Toby, yeah that seems logical now you have explained.
Out of interest, as you are also new to this, i presume you are trading 'basic/simple' strategies, (the most advanced i trade is Moving average bounces lol) it would be good to hear from another newbie any sources you are finding usefull.

P.S i have had time to start to read PETERFM's thread, and what i have read so far has been very usefull, so a big thanks to you.

Thanks Pete! I am new to the forum as well as trading
I just want to say thank you for your efforts you have put in this thread!
Thank you !!

Just wanted to say thanks for the insight in trading that I'm getting from your "Discussion".
I started trading 4x about ten years ago and quickly blew through a couple grand, not a good start, I treated it like gambling and the house won. My job has taken me away from any reliable internet (if any internet at all) which is probably a God sent. So for the last eight years I've been reading blogs and occasionally placing a trade by averaging in and closing on a positive outcome ( I only traded high interest yeilding pairs AUD/JPY). Anyway I'm returning home soon and hope to be able to accomplish what you and the other 5-10% have acomplished in FOREX. Again thank you and all the other traders at FF for sharing your ideas and methods.

Respectfully

I took the time to read it and it worths every word.

I mainly trade the euro/usd.

Have a nice day.

Israel Garcia

Hello, i just want say hello, and ask: have anybody its own forex blog?

PeterFM has created one of the most useful newbies threads, every new trader should read and understand it.

I'd like to suggest a further reading which is completely in line with his references to James 16 thread and is based on daily candles trading:

Beyond the Candles.

This is another Forex Factory thread that teaches to read the markets with no indicator, no crutch, just by studying price and its motions.
I had great benefit by reading it, because it teaches the inner mechanisms of why price does this and that. It's like the James 16 thread but strictly on daily candles basis and strong control on what is being posted (an issue in James 16 is the huge amount of thousands pages with all sorts of tangent posts that make it easy to lose focus). It's also nice because daily candles trading make it easy to calmy analyze the markets and lets you spend 1 hour a day tops, not to spend 8-10 hours constantly gued to the screen, heart pumping, emotions overloading you and making you lose control.

Hi Peter

Thanks for the post. As a newbie, the one anxiety I have is timing the entry on one time chart when the other time charts show opposite signals. Do you wait till time charts are congruent?
Also, in a sideways market I always feel like a little uncomfortable, not knowing whether to trade, especially since i have limited trading time.

Thanks for the great thread

Read the post above for an answer to all your questions including the "limited trading time".

Charts don't show "opposite signals", the higher time frame charts dictate the price on the lower time frame charts so you may want to check the former first and then to only trade when the latter are congruent.

Hello Peter! I am brand new to Forex trading (2 weeks)! Am demoing now and using the Freebie system.

Thank you very much for your thread! Learned a great deal from it.
Quick Questions:

 

1. Do you have a blog or a website?
2. Besides the Jim16 PA thread, where can I learn more about PA (Books, Videos, Threads; anything will do)? I am too much of a newb to understand that thread. So where do I start out?
3. Could you point me towards resources concerning the ZZ Semafor?

Hi, I am newbie in this site. I came across to this site because I was looking for forex forum sites and this has the highest alexa ranking among the others.

Anyway, I just would like to ask if there is a marketplace in this forum for forex sites? Because I am looking to buy Forex Related Sites for my employer.

Hope you can help me.

Thanks,
sstevens

Hi, I have found this thread to be the best price action thread at forex factory http://www.forexfactory.com/showthread.php?t=206723

d

That thread is what I was looking for!
Thanks dazzdude!
Other beginners might want to check it out too, its quite useful.

Hi Peter,

I'm just getting started in forex trading and I stumbled across your thread. It is pure gold. I like to sit down and read through things on paper so I made a PDF version of your thread for easy reading. That way I can print it out, sit down with it and read it without having my eyes glued to the monitor all day.

Anyways I was wondering if I could post it up here for others to use too.

Thanks

Thanks Peter. I will keep your suggestions in mind as I work my way around FX.

Threads like this are gold for a noob. This is my reading list for the day lol Thanks Peter, much appreciated.

many people

Risk management is easy for understanding. You can get a lot of information by typing “risk management” in google search . I will give you an example of my risk management strategy:

300EUR account

1% Margin level

I trade EUR/USD. 0.01 lot = 1000 units

10% of the account is 30 EUR. This means that I can open 0.03 lots

EUR/USD. The free margin is 300 – 30 = 270 free.
The standard pip value for USD-based account and the USD-quoted currency pairs (EUR/USD, GBP/USD, AUD/USD, etc.) is 0.10 USD. Profit per pips may vary for different currency pairs. You can see this at : http://www.forexnewbies.com/pip-value-formula/

Profit per pips for EUR/USD is 0.10 USD. Therefore, the profit per pips for 0.03 lots will be 0.30 USD.

Now target the stop and limit levels. I do this by using Parabolic SAR, MAs, Bollinger or support and resistatance levels. A good strategy is to define the stop level first. This will help you make a calculation how much your account can resist if the price goes in the wrong direction. For example, I see a stop level at -50 pips. Firstly, I calculate the loss : 50 pips x 0.3 = 15 USD LOSS. Now, I can calculate take profit level: 15 x 3 = 45USD profit, which is equal to 150 pips. Let’s take a current rate of 1,40 for EUR/USD. So, 15 /1,4 = EUR 10,71 EUR that makes 3,5% risk capital, which is satisfactory for small account. My profit/loss ratio is 1:3. Basically, it is good to set your stop according to the technical analysis used. Never use integer for stop loss level. Always, follow your strategy and wait wait wait wait]

I fully agree, great thread