(binned per thread starter's request) The big... IF

Have you ever wondered whether you can make enough in the forex market to quit or replace a day job? Did you stop to figure out how much money you would put down, and if you were to do this then by approximately when you would need to have doubled that stake?

I can tell you that the timescale is almost glacial.

There are a few on the Factory who appear to do well. There are more who loud their success, but often the real data is lacking or maybe the negative aspects are quietly overlooked whilst the impressive positive achievements are allowed to dazzle. Sure there are some big winners, checkout the broker pages where these achievers are listed - and they deserve their accolades. Now check out how often they are listed, I have yet to see anybody appear twice in the same year.

At the opening of this journal I have taken the bold move. With two accounts loaded with roughly equal amounts one will run low-leverage trades intended to last weeks, the other will take higher-leverage positions of shorter duration. The long time-frame account will keep me focused on real market behaviour so that my higher-leveraged trades, where I will be aiming for the yield, will be protected from impetuous behaviour. That is the plan at least.

I need to average 2% weekly, and compound that over nearly a year. Using 10:1 trade leverage that amounts to just over 31-pips per week. If I can average 3% then I get to afford time off from trading, or a slightly shortened glacial time frame. In 2 years my reserves will be depleted but I will be able to draw a reduced salary at that point.

Surely 31-pips a week is a tiny target?
Watch this space.


edit #1: 6 Dec 2013 Precis of what happened so far.....
The original plan failed. I put myself under way too much pressure and eventually became afraid of losing. Here (http://www.forexfactory.com/showthread.php?p=6331133#post6331133) I changed my trading plan and switched to longer term, low-leverage, bigger pip-target trades with less money in the account. My beer-fund. The result has been a consistent gradual improvement in my second trading account. Along the way I learned to plan my trade entries better. Some times I had some seriously underwater positions to the tune of a few hundred pips, but this allowed me to watch objectively, kind-of, and see whether I could convince myself that the trades were going to work. Most did work, a couple I swallowed a significant loss but nothing too account damaging. After a year and as a result I am opening a new account with more funding to trade my recent approach on a larger basis back with an ECN, or as near as I can find. This second episode, a complete year trading a smaller account, has seen an account growth of 67%; a promising result.
supplemental: Jan 2014. Phase-3 begins here (http://www.forexfactory.com/showthread.php?p=7195901#post7195901) with two accounts. One smaller Beer fund with lesser funding, and another account with 2600 ante-. I am working on an appropriate name for this account....

edit #2: October 2015
Three years down the road I arrived here (http://www.forexfactory.com/showthread.php?p=8545382#post8545382), some success along the way and some failure. My understanding has moved up a level but my execution has been poor due to lack of self-discipline. However, my naivety has gone and I notice a change in my mentality, that is a positive thing.

As I look back I can see that I would have benefited from some training. Not the kind of training which deals with looking at a chart particularly, but the kind of training which gives insight into what is driving the market and who are the players.

Happily my stocks portfolio is up 140% over this same time frame, on an un-leveraged account. This situation is characteristic of the stock market, the recovery after the disaster of 2008/9, and something which I have been good at exploiting in the past (1998 and 2003/4). However the opportunity window is closing again on the stock market, a situation which is normal, and soon there will be another crash ... the when is the difficult part.

Price goes, price goes down. Same with volatility.

Based on the size of your trading account(s) you determine how often and how aggressive to trade.

But in the end the market determines how much (dollar amount or percentage) you can possibly make.

Opening balance GBP6656, which at the moment is about $10650 - but that will change.

That is certainly the truth!

Two frustrating days in a row!

Yesterday I walked away from the computer with a trade on, and it went against me majorly. That was a sharp slap which has change my view on stop-loss. ....yes it was my fault.

Today I was ahead 1.3% until the rumour about some Greek banks being refused business by the ECB (or similar). My close request was rejected on one position which had a TP order against it. I was in EurAud but those of you watching/trading today saw one of the fastest spikes on EurUsd that I have ever seen. So after some frustrating waiting I closed for Gbp 9 in profit.

At least the trading fees should be going down soon. So far I have done about 1.3m volume in 3 days.

The week ended with a light recovery, but I am still bruised from Tuesday's loss. Ending balance £6402.

I have been away from the market until recently, so I feel that my thought process has been re-aligned. My self-discipline has been too lax at times and I must pay more attention to setups and local price action - or else de-leverage and trade longer time frames.

With a recent top-up I start the week at £7105, ...now off to read about the G8 and everyone else's misery.

Subscribed! GL Exy!

I am still suffering from my old problem of getting-in too early. Having reached more than half my target I pretty much gave it all back today.
It seems my almost-normal method of trading is to open a crap trade and then spend the next hours digging my way out of it again.

Thanks, and you are welcome.

I don't know whether to quit now for the week, or have another go on Friday. After a hectic and initially promising start I screwed-up yesterday and dumped all my profits and more.

After an insightful last trade today I recovered all the losses to finish one GBP ahead of Sunday night's starting position. The feelings of relief are indescribable.

My broker is as pleased as punch. I made 26 trades, paid GBP 69.51 in commission, and shifted 2.6million in volume (assuming an open and a close count separately towards the volume). ...looking forward to my notification of reduced commission charges based on traded volume.

I also discovered that the cheapest pair to trade is AudUsd (there may be a cheaper one that I haven't found yet). Earlier I closed two or three trades using the M1 chart for around 3-pips each. An interesting high-adrenaline trading technique which feels like it might go badly wrong at any minute. In fact if my internet connection vanished it would go badly wrong!

At least I will get a good sleep tonight

This statement tells me that you aren't ready yet imo. You phrase this in a way that says that you don't know if you can hit it; whereas, you ought to be saying that you have a backtested strategy (if you use indicators) or that you have records from your trading journal showing that you can make these pips.

It seems that you have things backwards. You have set out with a profit target, divided it by a time frame and then determined how many pips you need to make; as if making pips is just a job and the longer you sit at your computer the more you will make.

I think you should start from the other end. How many pips on average are you making at the moment (per month or per week)? How much % profit do you want to make per week/month? Now calculate the leverage required to make that profit. Based on your past trading results, would your largest drawdown have destroyed your account by trading at that leverage?

If the answer to the last question is yes then you have to admit that your profit target is unrealistic!

30 pips a week... wow, what're you worried about?

You should be able to get 30 pips a day standing on your head. Maybe you're overleveraing or something.

Very constructive!

I missed out the part where I quit my day job. This is no longer a game.

I don't use indicators any more, except RSI sometimes - but like all indicators it is unreliable. I use fibs and S&R levels, channels and flags. I have MACD to make me feel at home, but I am gradually realising that it is only for decoration.

Edit: I forgot to mention setups.

Like the guy with the journal entitled $2000 to $2,000,000, one purpose of this thread is to keep me honest and true to myself about good and bad performance.

I agree that 30 pips is a small amount, and that encouraged me to try. In the past I have never had a total account wipe-out (except when somebody else was trading for me), but I have experienced the highs and lows of spectacular success followed by mediocre under-performance. Psychology is a major part of trading and yesterday I proved to myself that I can overcome the oppressive feelings that accompany negative events - such as losing the profits from earlier in the week.

Anyway, this is distracting me from the market, good trading to you.

I think you've probably got the right trade setting attitude, but not the right money management attitude.

From what you say you are using Price Action basically. Price Action works on pretty well any timeframe... so if you are after 30 pips a week, in my opinion you are probably trading off 5 minute charts with very tight stops.

Try the same Price Action on 1 hour charts using stops of 35 to 50 pips and lot sizes to risk just 0.5% based on your stop.

I think you'll be surprised at how many pips you can get. Its not difficult at all to get 20 pips per trade on an hour chart if your selection method is sound. As soon as your trade is about 25 pips in profit, close half the trade and move the stop to break even on the other half.

OH, and... ONLY TRADE WITH THE TREND

I have two problems that require more self discipline; the first being that I do not delay entry until the most favourable point, the second being that I do not close out a bad trade soon enough - although this is improving. I have seen so many trades come back just after I have closed them that occasionally I just hang on too long. Even the one that bit me on Wednesday came back to my original TP ...eventually.

No, I am trading off 15-minute charts with expected trade duration of anything from a minute to an hour, usually an hour. Also I check trend, channels and fibs on the 1H and 4H charts.

On that basis, and if I am interpreting you correctly, I would need to score 160 pips a week to make 2%. If the SL is set at 40-pips for a 0.5% loss then a 20-pip win would be 0.25%. That is a trade leverage of approximately 2:1.

I might try that in my other account since it fits the set-and-forget criteria.

I finished with GBP 7110. A pathetic profit but hey, at least I am ahead.

Better this week, so far I am ahead of target. I have to say that just to see if I am still ahead of target by the end of the week.

It has taken a surprising amount of time to re-install the correct mindset. Occasionally self-doubt creeps in and upsets things.

Finished for the week now. A week of mixed feelings, I made a bit - and watched some huge opportunities pass by. Mostly that was due to looking in the wrong direction, and I missed a couple of glaring setups on cable which would have been rather lucrative.

I should really be trading larger contract sizes than the 50k I am using, however I do feel comfortable at this level and I shall defer increasing my trade size until the end of next week. My minimum pip count to reach my target is greater because my trade leverage is reduced, but I have not had trouble reaching my target this week.

Account growth this week is 3.3%. That is generally pleasing and takes me back to within a few GBP of where I started.

I referred above to some setups that I missed in GbpUsd, so here they are for those who want to see. The main reason for missing them is that I was not looking at the 5M chart. The patterns are visible on the 15M chart but nothing like as obvious - or maybe somebody brought me lunch.....

Sell A is the easiest to spot. It follows the classic ball bouncing down a step pattern which I have mentioned in another thread. It also corresponds (almost) with the 50% fib from the closest previous down movement. Target TP for that short might have reasonably been 1.5470, but some might have closed half their position and left the rest to ride for about 100 pips. I really should have taken that short.

Sell B is a little less obvious. It kind-of follows the 'Sell A' pattern except that there is a preceding up-trend where I have drawn the support line, and before that there is a lift-and-retrace which is preceded by a similar up-trend. The only thing going for 'Sell B' is that it hits the 50% fib of the previous movement. Probably I would not have taken that short.

Another salmon day, except this time I finished ahead - and finally recovered all my losses since the start of this thread.

Positive attitude, ...and press-on.