What is your hardest-learned lesson in FX?

What is your hardest learned lesson in FX?

I ask this question as I would be very interested to see what hardships some traders here have gone through to learn something the hard way.
I have recently started my long and winding road in taking the first steps towards my albeit, hopeful future of being able to be a self-employed FX trader.
Already in the first 2 weeks of being live I have come across such obstacles I will be sure to remember for the rest of my life.
Personally for me, the hardest lesson I have learnt so far is to respect the market and take what it gives, as well as to not ask for more than what you can't have as a result of being unrealistic, and in all truths greedy. I have taken this as some great advice from a fellow FF member and buddy who's words spoke out to me deeply after I had been very fortunate enough to enter a trade which had increased my account size by 100%. Upon this in all the excitement I thought it would be a good idea to move my SL to BE and let it sail risk free in the hopes of making even more by the time I woke up the next morning. Of course, regretfully that morning I was only met by the absence of any new found profits to my trading account and an amazing opportunity missed because of thinking I knew better. Although I lost the money that I could have just taken, I feel that even so I have learned something far more valuable, and that is a lesson well learned to remember in the future and a mistake never to be repeated again.
I hope that perhaps my mishaps could help prevent somebody else from going through the same anguish as I did and I would also really like for this thread to be able to turn in to an abundance of other traders mishaps and experiences shared so that together we can all learn from each other.

That would be " Take the profits when you have them"-Never let a winner turn into a loss. Better take those 10 pips than to have the market fall below the entry price while still in the trade.

It took me years to finally accept that the market will never dance to my beat, I have to dance to its

i say accept not realise.

That's exactly right, definitely will be remembering that from now on..
I say those who don't make mistakes aren't learning.

This is something I can relate to as well, very true, there aren't any secret rabbit holes in this game.

all i wanna do is dance

Hi All,
I have learned many things from FX market while trading.
But the core point to trade in the forex market is to have a big investment. Small account blow up within very short time.
The other interesting learning is about Martingale strategy. Only this strategy works in every market conditions. The actual interest of this strategy is Price must re-trace. For example, you have opened a long position for any kind of pair. Price going down. No problem. Use SL. When hit the SL open another new long with double lot size. Price must retrace after 200-800 pips. Then take profit. Of course this cause a huge investment as I said earlier only big investor can do very well in the FX market. Very few small account survives.---------- This is my opinion.

Regards.

Never believe what you see -Think beyond it with logic

its patience for me. whenever i'm impatience to enter a trade before the confirmation candle closes, i have been met with disappointment result most often than not.

It's possible to trade with an almost 100% accuracy (and any inaccuracy is invariably to do with tiredness or not concentrating) but the commitment to understanding candles completely is mind boggling. If anything in my journey was the hardest, it was an unremitting almost 5 years of 18 hour minimum days, 7 day weeks, contemplating what each candle signified.

I wouldn't recommend that road to anyone unless you are prepared to be completely focussed to the exclusion of all else. Find a reliable system and stick with that.

I have learnt that the FX market is one of the most complex markets out there as it relies on so many factors that affect demand and supply, factors such as:

1. Interest rates
2. Monetary policy
3. Fiscal policy
4. Currency competitiveness through its economy - you have to understand how the economic engine works and its affects on a countries domestic currency
5. Government stability and policy towards its citizens and its policy towards foreigners
6. Rules and regulations placed by the government on its financial sector
7. The perception of all of the above by speculators and banks that trade currency markets.

If you want to know what moves the FX market, you have to know how the people mentioned above think and the basis they make their trades on. You then have to determine whether they are right or wrong in their buying or selling decisions. If you determine that they are right to buy what they do, then you follow them through a trend following system. This form of buying is a low risk/profit method, because your entries are when the markets already reflect their correct thoughts and is already efficiently priced, hence the low opportunity of making a profit through a mispricing. This approach is inductive.

If however you determine that they are wrong, then you time your entry in the opposite direction when your system indicates when to buy. Buying when they are wrong is a high risk/ high profit strategy because your potential for profit is massive due to the inefficiency of price. As price corrects to reflect your correct assumption, you make a ton of money. This approach is deductive.

FX markets of course that are trending based on a correct perception of the 6 points mentioned above, could continue trending longer than they should. markets continue to trend even if obvious factors contradict the move, and this is mainly due to psychology and the power affect of the herd. It takes a strong catalyst to falsify the trend and pays to be deductive when this catalyst appears as it is the perfect opportunity to invest, which brings me to my next point, FX markets are cyclical with the cycles being predictable.

To conclude, the main lesson learnt is that FX markets are moved by people. People who base their decisions on many variables. These people could be wrong or right, they may send prices to extremes on their right or wrong decisions. People are also highly affected by psychological factors which play an important role in their decisions to buy or sell. Being a contrarian at the right time when fundamentals don't reflect reflect price and when psychology plays a major role in people decision making is what separates the billionaires from everyone else because they are contrarians when it's in their favor, they are early to buy or sell and that gives them the profits they deserve for identifying value and picking up bargains. Simply looking at price with or without indicators isn't enough to make you an elite.

It's not a case, for me anyways, of being an elite member. It's more a case of making this work with minimal stress, like a regular job. It can be done as I don't follow the news other than to know when high news are coming up.

But like I said, it's a horrendous road to that perfection. Pretty hard on you, your relationships and just you as a rounded person. Fortunately, I managed to juggle all these things but they were close calls.

If you can make the journey fit in, well and good. If you have heavy commitments, find a good system that works with your life and stick with it whatever that may be. Don't start on the price journey unless you are prepared to make the sacrifices it will demand.

Obviously dear, if we allow our profits linger around then we should be in for a shocker!

Trading is like a treasure hunt, many will get lost, only those who can decode or interpret the map (Chart), and follow it would find it.

The misperception for me was that fx trading will be a quick (but rapid) learning curve. It turned out to be the same as a new business venture or starting a new career. Entering a new career entail patience and years of exposure to gain confidence and experience to operate to a level where you are comfortable (would hate to use the word comfort zone). After burning my first couple of trading accounts and realising the above, all started to fall in place. Emotion - I never take decisions at work based on emotion, why then do it in fx trading. Patience and greed - I do not ask my boss for a pay increase every month, why then expecting an increase in profit every month in forex. Time and Money - I invested a substantial amount of time and money in my career training (studies), why not do the same for forex. And lastly, my biggest hurdle - have realistic targets. I did not become a director at the company that I work for after my first day at work. It has been a long 5 years but worth it !

Good analogy.

complete opposite, taking small profits is pure fear trading, a 10 pip win will never generate enough profit and if you couldn't afford the trade to lose then should never of taken it in the first place. The fact the market was in your favour for a bit bears no relevance.

Let all your entries run, when the market decides it wants to go your way you will reap massive wins the early closers never ever accomplish.

Rule# 1: Cut your losers short.

Rule #2: You don't have to win on every trade to win this game.

Keep your positions as small as possible.

Close your position even if in a loss if u want to sleep well

cutting losses short is very important and i have learned hard way .