Making FOREX work for me

As the New Year approaches I recently decided it's time to put my what I've learned into action. I have been staring at charts like a sad case and demo trading for over a year so it's time to see if I can make it work with real money.

I have run the usual course of wanting to make 100% a day from indicators on the 1m to the realisation that I'm not going to give up my day job anytime soon.

So that lead me to the question; How can I make trading work for me?

My plan is to trade and make monthly deposits for the next ten years. I have started with a balance of £1000. When I have made 20% on this, I will start adding £200 every month to the account as extra capital.

My goal is to make 5% per month and compound monthly. I will be doing this by taking 'common sense' price action based trades on the daily timeframe. Most of it will be based on what I have learned in the good PA threads on FF (J16 particularly). I'll risk 2.5% per trade. Profit according to situation, but I will be looking for at least 2.5% back per trade.

Is two correct trades per month really THAT difficult?

I am 31 now. A million before 40 would be nice

I realise there are a lot of threads like this. I'll be posting my trades / progress in here for people to check out, but more than anything, I'd appreciate any advice from any old timers here

Cheers!

I did fund the account a couple of weeks ago, and had increased it a few percent before I got caught with an open position when a 100pip gap went against me on one of the yen pairs last weekend. I was still up on the deposit though. So my balance at the start of the official project start is:

DEC 2012
Total Deposits: £1000
Balance: £1015
Profit: £15

Which Currency pairs are you planning on Trading?

I am interested in knowing your trading strategy

Hi Shryne,

I'm trading USD/GBP/JPY/CHF/CAD/AUD/NZD. All pairs between these.

My stratgey is simply price action, support, resistance, trend lines, fibs - all the traditional stuff. I will explain more later, but essentially it's largely the same as:

http://www.forexfactory.com/showthread.php?t=2331

I'm just looking for nice pin bars / engulfing bars at nice areas with enough space to give me a good risk to reward. I sometimes take touch trades if there is a lot of confluence, but this is rare.

These are my two potential trades tonight: USD/JPY and EUR/GBP

Looking at the EUR/GBP - I can see a nice BEOB at a previous resistance level. Looks good for a short, but it's not too far to the trouble area. Think it's a pass.

The USD/JPY has a very nice pin bar, and a clear run below with the bonus of a previous unfilled gap. I will wait to see what price this opens at before deciding wether to take it....

So USDJPY gapped down. I was hoping it might open higher and I'd have got straight in with a sell. As it happens, we now have a gap north and south.

I've put a sell order in at 85.95. Hopefully will get filled and then head south.

Thanks for the update.

Wishing you lots of success. I mainly trade EUR/USD, trading off the Daily and sometimes the H4 Charts. I use support and resistance, Fibs and Candlestick patterns such as Engulfing, Doji's and Harami.

At the moment I am not trading, due to the thin trading due to the festive season, and waiting to use how the fiscal cliffe situation plans out.

Thanks for the well wishes Shryne, I'm think of this thread very much as a learn while I earn process , and would be keen to hear off anyone trading PA on the longer timeframes. Can I ask, how many set ups you usually get off one pair in a month? In my demo testing (the last 6 months), I was lucky to find one trade in a month on a single pair!

On Average I may find 1-3 setups a month from just trading the one pair, trading the longer time frames. Once I get fully comfortable and profitable trading just from the one pair, then I will add a few others. The good thing about Trading longer time frames is once the trade is executed I don't need to spend much screen time, and the trades can go on for a few days even a few weeks, and this is ideal as I am currently work a full time job

Yeah you are in the same boat as me. I have spent countless hours creating systems on the lower timeframes only to be frustrated in the realisation I don't have the time to trade them!

Well my first trade was a loser. Out of my two potential set ups, I definitely chose the wrong one. It was probably a mistake trading over the christmas break. I have noticed that a higher proportion of my losing trades happen on Monday and after gaps. Something I need to address.

To make things worse, the pair gapped up and due to my minimum lot size, I actually lost 3% on this trade! Which leaves me with this for the start of the month:

Deposits: £1000
Profit/Loss: £-15
Total: £985

I'm not looking for anything tonight as I need to review my previous gap day trades.

Got involved in a short on the cable pin bar last night. Put a sell order on the break as I was still a little concerned about liquidity after getting stung on the usd/jpy previously. At first I was going to give it a miss as I couldn't get my lot size small enough for a stop above the pin high but when I thought about it, I didn't really want the price breaking the 1.63 resistance again and if it did go through there, I'd be sweating it up to the pin high, so decided a stop just above the prev resistance would be best.

It's currently +70. I'm trying to hold on to it until before the trend line - I often get out at FTA, but looking at the weekly GBP/USD, it looks very bearish and has had a couple of clear rejections from that 1.63 level so it looks good to come down some more.

A little something I'm looking at for later. The pound looking weak and this looks like a potential long set up. Small pin bar off the trend line. Will re-evaluate this evening.

So the EURGBP never ended up being a pin bar, but I am wondering what to do with my open GPBUSD position. It's currently +110 after just one day. It's still not quite at my original TP, but I keep looking at the weekly bar and thinking it would be a good short for a longer term position. Just quickly scanning back on the weekly, similar pin bars to this have been good for 500 pips or so.

I've moved my stop loss to break even and I've deleted my TP order. I'm going to keep an eye on it on the 15min TF tomorrow whilst in the office. If it shows no sign of reversing, then I'm going to let it run.

I'm out at 1.062 on my cable short. I toyed with the idea of leaving it due to the huge bearish weekly bar, but I had the words 'stick to the plan' ringing in my ears. I've never traded a weekly bar in my life - only use them for extra confirmation on my daily trades, and I have never done any serious backtesting. Price is now hitting the lower trend line and BRN now and with it being Friday, I imagine a lot of people will be taking profit here.

Ended up around +200 pips. A very nice stress free trade - more like this for 2013 please.

Deposits: £1000
Profit/Loss: £+46
Total: £1046

Put a buy order in on EURGBP last night. Bought it just under 0.812 after the gap had closed. Although there were no real PA bars I thought there was an obvious bounce of the lower trend line and I'd be getting in with the trend. It's the kind of trade I would take on my demo account when practicing so thought I'd give it a go with limited risk.

Although this is currently in profit, I don't think it's a trade I should have taken. I was profitable on my demo account, but the equity curve was eratic due to taking trades like this. I don't necessarily only take strict pin bars and outside bars, but I should be leaving this - especially as there is not much space above until significant resistance.

I am going to remove about 75% risk off this now and see how we get on.

I got out of the EURGBP trade. Price has been knocking around the resistance are for a while now. It wasn't a great trade and I wasn't comfortable staying in it. Out for a few quid.


Deposits: £1000
Profit/Loss: £+8
Total: £1054

Looking at this tonight.

We can see price has already tested the upper trend line and been rejected. Today it has had another pop and once more been rejected - we have a small pin bar forming.

Also in our favour we have divergence with the stochastics and enough room to the FTA to get at least 1:1 if I place my stop above today's high. We'd be getting in with the trend also.

Quite a few plus points

Let's see what the close looks like.

I was just about to place my order and realised the spread on this pair has gone up to 7.2pips. Anyone know if that's standard on this pair? My initial target would be less than 50pips, I'm not too comfortable parting with more than 10% of my target straight away...

The spread on this came down before I went to bed last night so I placed the order. It was filled this afternoon and into profit pretty quickly. I got out at the first trouble area for about 55pips (1:1) .

Deposits: £1000
Profit/Loss: £+19
Total: £1073

Looking at one trade tonight. BigDBHLC on nzdusd. I can just about get my lot size low enough to cover the bar high with my stop loss to risk 2.5% (Of initial deposit), if it opens lower then I'll put my order above the gap. It wont quite be 1:1 return to the FTA, but it's a nice bar. I'm warey trading after the weekend, sp will be looking to decrease risk as soon as possible.