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How to start like a pro? - afraid to open trades

  • #61
  • Aug 5, 2015 4:11am Aug 5, 2015 4:11am
I'm fascinated by the financial experiments done on monkeys. They always go for the safe bet. In other words, if they were forex traders, they would take profit too soon for fear of going into draw down. Holding on to winning trades is the hardest, most counter intuitive thing to do, especially when they reverse on the lower time frames.

The best way to make money in this game is to ride the trends (just see how hedge funds do when trends break down). If you can join a trend on the lower time frame with low leverage and then adjust your mind set to the higher time frame trend you are going to do well in a trending market. This is easier said than done. Monkeys can't do it.

Opening a trade is a very similar psychological barrier, if not the same one. A few have suggested risking what you could happily lose. Try that after a row of losses!

Confidence is the key. You need to know expectancy based on the previous experience of your method. Build confidence by working hard at this. There is no substitute for doing the work. Look at a good brick layer. He knows what he's doing. How did he get there?
Gone to a better place
  • #62
  • Aug 5, 2015 4:18am Aug 5, 2015 4:18am
Oh yes, another good idea is to trade with very large margins. Do I mean large or small? Anyway. Find a broker (like Oanda, for example) who will let you trade nanolots. Now your losses can be tiny, but you can build your account using your profits rather than your own money...
Gone to a better place
  • #63
  • Aug 5, 2015 1:28pm Aug 5, 2015 1:28pm
think of your wins as a percentage.

start a small $100 account with mini lots. Give it 6 months. See what your percentage win or loss is? say you loose 20% (you only lost $20)

analyse what you did e.g. Did you trade one style or switch about? which was best?

Repeat...this time take your analyses into account.

again 6 months later analyse and Repeat..When can say 'you wouldn't change a thing' then go bigger.
  • #64
  • Aug 7, 2015 4:30am Aug 7, 2015 4:30am
i have the same problem, i trade well in demo, but when it comes to real money, it feels like there is a knot in my stomach when price doesnt go the way you expect you close out the position just to see it go back up and hit TP, i guess the fear of losing money is greater than your ambition to make money, i read that somewhere here on FF and its true, im now trading smaller lots on my real account just to get my confidence up, i would suggest trading only a month on demo, and than move to a real account and trade really small lots, well this is for other newbies and not OP
  • #65
  • Aug 8, 2015 4:12am Aug 8, 2015 4:12am
Quoting hamedmohd
i dont know how to start this thread but i can till you that i do my home work about the currencies and how to trade. how to use leverage and trade in demo accounts i put a full staratigy that really it is gain more that it lose (not perfect but good one) but i find very hard to open any trade in live account also if i open some for 2 days i close all of it (with profits) and not open any more i dont like to open any positions any more in live account i dont know may be because i afraid i may lose some money ??!!! i try to put a targets,trading...
This fear that you have is totally normal.
Every trader will have it.
Some start with this fear and others get this fear later when they start too confident and the market eats their accounts.
Thats why theres so many books out there and so much advice out there just on emotional trading and how to trade without emotion.

The market moves with fear and greed.
We are coded with fear and greed.
We close too early because we fear the market might turn even though our trading plan says to leave it open.
we will trade huge lots with small accounts because we are greedy and want to get rich quick.
we leave our trades to run in huge loses hoping it will turn.
We scared to take trades coz we fear of losing
we scared to lose our hard earned money in the market.

The big guys prey on all of this.
No matter how good of a system we have fear and greed will always be there.
we cannot get rid of it but we can tame it.

Firstly i can tell you that you are scared coz thats your hard earned money that you trading with.
thats why you are scared to take trades.
most of us here start with hard earned money here. even though they say not to do that.
but thats the reality.

fear for us traders mainly comes in because we take the trade we think that what if i take it and it turns and i lose.
to minimize this fear you have to have a solid trading plan .
when i sya solid trading plan thats means you have to know everything you going to do when you in a trade.
before you enter a trade you must know where you already going to set your SL. this for me is the main thing.
if you know where your sl must be then this will make you already comfortable and confident.

When you set the SL it musnt be guesses on every trade. you musnt guess and say on this trade the sl looks good to set here and next trade you say the sl is good to set there.
to me the sl must not vary.
it must be at a certain pint all the time.
thats means if my sl is taken out then i was wrong.
it must not be that i keep moving sl during my trades.

Also your entry is very important.
find an entry point that keeps happening all the time.
and if it does not happen then i wont enter in the first place.

It must be that when i enter either im right or wrong and thats it .
dont try to bend the trade otherwise it will break you and your confidence.

This is my advice to you.
X-man the legendary conqueror of markets
  • #66
  • Aug 9, 2015 5:45pm Aug 9, 2015 5:45pm
if you are afraid to open trades, you are probably trading with too large lot sizes, you should learn Money management and lot sizing and risk to reward. losing is a part of the game, there is no trader on Earth that Always have winning trades, keep your losses small and your Winners large, this will give you Peace of mind. and when you lose a trade this will not even affect you because you know that in the long run you will be a Winner
Bulls are stupid Animals!especially when Im short!
  • #67
  • Aug 26, 2015 6:15pm Aug 26, 2015 6:15pm
Hi there!

That's good that you experienced demo before opening live account. I guess it makes you more confident?

Well start from small sums of money and analyze your results after each position closing. As it has been mentioned in one of threads, start slowly and move your way up step by step. Good luck to you!
  • #68
  • Sep 24, 2015 1:39am Sep 24, 2015 1:39am
Hi All,

I want to become succesfull trader (just a rookie with one month of live trading under my belt) and one piece of advice that i i commonly read on ff is to have a mentor. Now thats what I am looking for. I am willing to share all my (live) trade history for analysis, am a fast learner, dedicated and determination. I am 38 years old and a familyman. I love to hear from guys.
if my cat was a cow....
  • #69
  • Sep 24, 2015 2:46am Sep 24, 2015 2:46am
Quoting Waxy
Hi All, I want to become succesfull trader (just a rookie with one month of live trading under my belt) and one piece of advice that i i commonly read on ff is to have a mentor. Now thats what I am looking for. I am willing to share all my (live) trade history for analysis, am a fast learner, dedicated and determination. I am 38 years old and a familyman. I love to hear from guys.
I believe that before one sets off to become a trader he should know the answers to these questions:
- Why do you want to become a successful trader?
- What do you view as 'trading success'?
- Are you absolutely committed and passionate about what you conceive as 'trading'?
- Can you afford the risks that come with trading?

Each person will have a different answer to these questions. If you know yourself, your journey would be much easier.
  • #70
  • Sep 24, 2015 3:13am Sep 24, 2015 3:13am
Hi Atokys,

Thank you for your reply. Those might be rhetorical questions, however for my benefit I like to answer them anyway publicly.


Why do you want to become a successful trader?
Gain financial independance. Proof to myself I can be part of the so called 3% if willing to follow the right steps.
Succeeding were lots of others failed is part of the challenge
I always been hard worker, I believe if I apply that same hard work to trading I will succeed.

- What do you view as 'trading success'?
Being able to continue the learning process until the point i achieve my goals.
I am not a believer of "get quick rich" but I will not deny that if all by myself i will probably fall victim to "greed"

- Are you absolutely committed and passionate about what you conceive as 'trading'?
yes, having spend quite some time on the demo, quit my (well paid) job to persue this.

- Can you afford the risks that come with trading?
Yes, saved enough to tackle this trade for a reasonable amount if time.

Each person will have a different answer to these questions. If you know yourself, your journey would be much easier.
if my cat was a cow....
  • #71
  • Sep 24, 2015 7:36am Sep 24, 2015 7:36am
Well, I guess the next step would be to do some research and design a trading strategy with a positive expectancy.

Live by these rules and you can't go wrong:
1. Cut losses
2. Ride winners
3. Manage risk
4. Follow the rules without question
5. Know when to break the rules
  • #72
  • Sep 24, 2015 9:31am Sep 24, 2015 9:31am
Hi,

Thank you for the suggestions. However,as imentioned in my first post, am looking for someone willing to spend some of his/her time to mentor. Someone I can discuss my trades with, motivate them and take advice from.

Kind Regards,
if my cat was a cow....
  • #73
  • Sep 24, 2015 9:58am Sep 24, 2015 9:58am
Quoting Waxy
Hi, Thank you for the suggestions. However,as imentioned in my first post, am looking for someone willing to spend some of his/her time to mentor. Someone I can discuss my trades with, motivate them and take advice from. Kind Regards,
Hmm. I actually disagree with the effectiveness of that kind of mentorship.

Trading is entirely a function of your beliefs. If you are satisfied with the reasons behind your trades then there is nothing to discuss. If someone else finds a fault that you don't he probably doesn't share your beliefs.
  • #74
  • Sep 24, 2015 10:24am Sep 24, 2015 10:24am
Hi Atokys,

As part of me looking into Forex, having a reliable mentor came higly recommended. Ofcourse it has to be a match and it has to fullfil a function. I am spending long hours in front of my screens and although I try to follow a lot of threads on multiple forums, I feel too green to really participate. Having belief (being it justified or misguided) is part of my personal pitfall. Not knowing if I hv made a good trade because of "skill" or just plain luck. Before I enter a trade, I always think it is the right one, I find justification and then execute. However, without interaction, how do I know it was a good one. How do I know if I follow the same reasoning, there will be the same outcome.

I consider myself lucky to have had a mentor early on in my working career and I found that it shorten the learningpath significantly. I see no reason (lets say downside) of getting one now.

I admire your selfbelief and respect your position but I do not agree that forex is a path you have to walk alone.

Kind regards
if my cat was a cow....
  • #75
  • Sep 24, 2015 2:51pm Sep 24, 2015 2:51pm
You fear only when you are not sure, so instead of trying to get rid of this fear, it is better option that we get knowledge which itself is the way to success and getting rid of the fear.
  • #76
  • Sep 24, 2015 9:52pm Sep 24, 2015 9:52pm
Quoting Waxy
Hi Atokys, As part of me looking into Forex, having a reliable mentor came higly recommended. Ofcourse it has to be a match and it has to fullfil a function. I am spending long hours in front of my screens and although I try to follow a lot of threads on multiple forums, I feel too green to really participate. Having belief (being it justified or misguided) is part of my personal pitfall. Not knowing if I hv made a good trade because of "skill" or just plain luck. Before I enter a trade, I always think it is the right one, I find justification...
I wish you good luck in your search then.

I would still like to continue this discussion though. To me, whether a trade resulted in a win or loss says nothing of the validity of entry. You will never have the same outcome because markets are always changing. But lets just say that you spent several years honing your trading skills over a very large amount of trades. Your results still are not an accurate indication of future expected return. If there was one correct approach to trade markets we would all be doing it now but there isn't. Success in trading has a lot more to do with your beliefs about the market than anything else.
  • #77
  • Sep 25, 2015 4:46am Sep 25, 2015 4:46am
Hi,
Again you speak the truth, but I do think is not complete. To be consistent is not only a result of belief (imho) but also a result of some skill. How else to explain the fact that a small group of retail traders are consistently succesfull but the majority isnt. The pop sample is so large that i think it is save to say that at least 50% of retail traders do believe they read the market correctly and execute their trade being convinced it is a win. Results/stats show that they are still wrong.
I believe that skill (being it TA, discipline, access to info,...) combined with selfconfidence is the key. Skill can be learned until some level and I think learning from a mentor (someone who has those skills) make it just much faster and more fun.
I am happy with your interrest in the subject and love to continue the discussion. To others that might read this, feel free to join.
Kind Regards
if my cat was a cow....
  • #78
  • Sep 25, 2015 5:11am Sep 25, 2015 5:11am
Quoting Waxy
Hi, Again you speak the truth, but I do think is not complete. To be consistent is not only a result of belief (imho) but also a result of some skill. How else to explain the fact that a small group of retail traders are consistently succesfull but the majority isnt.
How do you define consistency?

I always thought that the idea of a retail daytrader today making a consistent number of pips per day was a myth. If you know someone who is able to achieve this please share. The edge in short-term trading is hampered by transaction costs and market noise. There are several examples of great traders who have faced down periods lasting years before getting a large out-sized payoff. Nothing about the game seems 'consistent'.
Quote
The pop sample is so large that i think it is save to say that at least 50% of retail traders do believe they read the market correctly and execute their trade being convinced it is a win. Results/stats show that they are still wrong.
So how would you ascertain that the outcome of a trade is due to skill or luck? If trading profitability was due purely to analytical skill there would be a lot more profitable traders.
  • #79
  • Sep 25, 2015 5:21am Sep 25, 2015 5:21am
Hi,
Allow me to quote you from a few posts earlier:

"Well, I guess the next step would be to do some research and design a trading strategy with a positive expectancy.

Live by these rules and you can't go wrong:
1. Cut losses
2. Ride winners
3. Manage risk
4. Follow the rules without question
5. Know when to break the rules "

knowing when to cut losses, when to ride winners, how to manage risk, what rules to follow and when to break them, would u base that on skill or intuition? Would it be able to integrate (quantify) them into a strategy or is it just instinct.
Allow me to havr my lunch and I will try to answer your question about consistency.
if my cat was a cow....
  • #80
  • Sep 25, 2015 5:32am Sep 25, 2015 5:32am
Quoting Waxy
Hi, Allow me to quote you from a few posts earlier: "Well, I guess the next step would be to do some research and design a trading strategy with a positive expectancy. Live by these rules and you can't go wrong: 1. Cut losses 2. Ride winners 3. Manage risk 4. Follow the rules without question 5. Know when to break the rules " knowing when to cut losses, when to ride winners, how to manage risk, what rules to follow and when to break them, would u base that on skill or intuition? Would it be able to integrate (quantify) them into a strategy...
You can and probably should translate them into a quantitative strategy. Implementing such a strategy would not demand much skill other than managing your own emotions. On knowing when to break the rules; it comes down to your understanding and beliefs about markets. That rule originated from Ed Seykota, based on its context he was most likely referring to the emotional interplay between the trader and his system.
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