A year and a half experience and still facing difficulties

10,000 hours?! That's just too generic...Trading is not that easy...You don't just get good at it by increasing your practice time....It's more complicated than that...It's a combination of factors...
Persistence at the top of the pyramid, passion and willingness to learn from your mistakes and being humble. Letting go of your ego, courage to act in front of fear and panic.. Discipline to execute your plan efficiently in your worst days. All of this doesn't even get close to sum it up. Trading is a very unique experience.

I'm not saying you're wrong -- everybody is different -- but my experience has been the complete opposite of yours.

I wish I could find a long term profitable method based solely on MM (scaling in/out, grid, martingale etc), because then writing a profitable EA would be child's play.

There are certainly some described (for commodities, not for forex, but the principles are similar) in Van K. Tharp's book Trade Your Way to Financial Freedom, and I think there are also some referred to in Tushar S. Chande's book Beyond Technical Analysis.



Unfortunately not. For quite a variety of factors explained by the above and other authors. Such methods tend not to last indefinitely, and to trade comparatively rarely, as well. Automation is not the answer. It feels, intuitively, that it "ought to be, in principle", but market realities predicate overwhelmingly against it.

In choosing to trade for a living, we're choosing to compete directly against some of the world's most intelligent, most analytical, most highly experienced, best trained and top-performing professionals. If you could come up with "a profitable EA", then so could they. The reality, of course, is that they don't: that isn't their fundamental approach at all, and there are reasons for that.

If you are referring to a mechanical trading system then I don't see why a retail trader couldn't create a profitable one and stick with it into perpetuity.

I disagree with Xela...The introduction of algo trading to the markets has changed market structures dramatically...Alot of professionals/institutions went algo or at least hired someone who could do the job for them...Of course not all pro traders are algo traders...But there were several articles on Business insider and Bloomberg talking about the influence of algo. trading in modern markets.

" As of 2009, studies suggested HFT firms accounted for 60-73% of all US equity trading volume"
Source: Wikipedia/algorithmic trading

So you can imagine the significance of algo trading in financial markets...In Forex algo. trading takes less than 40% of the daily market volume, but they still have a big influence over the Intraday arena

A statistical edge doesn't necessarily need to last forever, but a few years is more than enough to make good money and then you can find another edge if markets changed. A statistical edge that's based solely on MM do exist in Forex, but they're quite rare...During 8 years of trading the markets I've encountered 2 of them...After trying 1000s of strategies and ideas and reading 100s of books over the years...I just found two. So, you can imagine the struggle. But I confirm that they do exist.

I recall Dr Tharp's book with some fondness as it was the first trading book I ever purchased, and I still have my copy -- somewhere!! I've commented on his how-to-profit-from-random-entries-using-an-ATR-based-trailing-SL ideas before.

Agree 100% with your rationale about automated systems. Moreover, trading is a highly nuanced enterprise, and all of the retail EAs that I've seen are neither intelligent nor adaptable enough; given enough time, they eventually break down. After several years of reading trading forums I've reached the conclusion that there are as many "amazing new ideas" for EAs as there are lazy hopefuls looking for a short cut to forex riches.

That's for sure.



That's your prerogative, of course. But for the record, I don't disagree with anything you've said, here. (I disagree only with your inference that it rebuts any of the facts I stated above that! )

The random entry system used by Dr Tharp is a version of Welles Wilder's Volatility System. Concepts like this are more than 3 decades old and are still a lot more robust than what most people come up with today.

Understood...Thank you for the open-mindedness. It's really a pleasure talking to an intelligent lady

In my opinion in a good and stable long term profitable system the importance of the entry signal become lesser and lesser.

But i'm not a croc that traded 5 times in a year . I trade a lot of currencies with my ea. So yes, we all different.

But MM have so much more opportunities as a simple signal, so that's the way that i go.

I must admit I have continuously swayed between the discretionary and fully automated approaches to trading. The problem with discretionary approaches is that there is no statistically valid way to determine whether or not the approach has a quantifiable edge, and furthermore there is no sure way to transfer those skills to others in a way that ensures the results can be exactly replicated. The only track record you have to demonstrate the efficacy of a discretionary approach is your PL which rarely or never is released for public viewing. Retail traders are therefore dependent on heresay and opinions as the only guide which is inevitably full of human biases.

One of the reasons I have faith in the fully automated approach is that we have a verified track record from the fund management industry who use 'black box systems' of between 20 to 30 years (and in particular the Commodity Trading Advisors) that is hard to ignore.

The only other verified track records I am familiar with and can rely on are those of fund managers such as the 'Deep Value Investment managers' whose investment decisions are based on a specialised knowledge of fundamental asset underpinnings and those fund managers representing the traditional 'Buy and Hold Camp' who may be technically or fundamentally orientated.

What all these records show is that 'an edge' can only be truly quantified over a very large sample set and that portfolio diversification is an essential component to any investent/trading strategy to manage risk and allow for opportunities to be taken when market conditions present themselves as opposed to attempting to predict when these conditions occur.

Unfortunately as retail traders, we simply do not have the resources to buy into this space where a valid quantifiable edge exists as our trade capital is extremely limited, we don't have the time/expertise/systems and ability to diversify to the necessary extent required to capitalise on any 'real edge' that can be obtained in the market. As a result we inevitably make complicated strategies that attempt to squeeze that last dollar out of any short term price moment that may or may not be just a random jitter. We also tend to overtrade as our livelihoods depend on cashflow. In short we tend to trade the 'illusion' as opposed to the 'reality' that is only evident through the Law of Large numbers. In general a retail traders lifespan is simply not long enough to determine whether or not they do have a quantifiable edge for the long term.

As retail traders we don't have the patience required to sit out extended periods where conditions are not favourable and drawdowns eat into capital. Drawdowns are a feature of any investment/trading technique and are a necessary evil in order capitalise on performance through volatility but given the retail traders ambitions and circumstances, only a very few have the cohonas and persistence to tolerate them. As a result, the system is simply thrown away and we try a new approach to reap those illusive 'millions'.

The thing about games with a high component of chance is that there are always some winners....but whether or not those winners are simply a random probability or those few that have found a statitical edge can only be determined over an extended sample set. Inevitably that means that as you extend the sample set, less and less traders survive to tell the tale. What we interpret as 'market conditions changing' may simply be a feature of randomness as opposed to a statistically valid rationale.

I think we as retail traders just need a really good dose of reality by digging into the statistics. It is only then that we can step back, take a breath and look at ways to capitalise on those statistics with realistic expectations. Unfortunately however then it becomes an investment game as opposed to a trading game....but what we really just want is an adrenaline rush or to live the illusive dream........ right. C'mon admit it. What we should be doing is investing in shoe companies as the more we click our heels together and repeat our mantras, the closer we get to needing new shoes :-)

I recommend reading the interviews of Ed Seykota, Larry Hite, Billl Eckhardt and Tom Basso in the Market Wizards series. You might not only be convinced of the systematic approach, you may even come to believe its the best way to trade.

Well have you tried changing your broker? I have also faced same difficulties for 2 years and changed many brokers due to this until I found my current broker which helped me a lot to make money in Forex.

The 5 Steps to becoming a trader

Step One: Unconscious Incompetence.

This is the first step you take when starting to look into trading. you know that its a good way of making money because you've heard so many things about it and heard of so many millionaires. Unfortunately, just like when you first desire to drive a car you think it will be easy - after all, how hard can it be? Price either moves up or down - what's the big secret to that then - lets get cracking!

Unfortunately, just as when you first take your place in front of a steering wheel you find very quickly that you haven't got the first clue about what you're trying to do. You take lots of trades and lots of risks. When you enter a trade it turns against you so you reverse and it turns again .. and again, and again.


You may have initial success, and thats even worse - cos it tells your brain that this really is simple and you start to risk more money.


You try to turn around your losses by doubling up every time you trade. Sometimes you'll get away with it but more often than not you will come away scathed and bruised You are totally oblivious to your incompetence at trading.

This step can last for a week or two of trading but the market is usually swift and you move onth the next stage.

Step Two - Conscious Incompetence

Step two is where you realise that there is more work involved in trading and that you might actually have to work a few things out. You consciously realise that you are an incompetent trader - you don't have the skills or the insight to turn a regular profit.

You now set about buying systems and e-books galore, read websites based everywhere from USA to the Ukraine. and begin your search for the holy grail. During this time you will be a system nomad - you will flick from method to method day by day and week by week never sticking with one long enough to actually see if it does work. Every time you come upon a new indicator you'll be ecstatic that this is the one that will make all the difference.

You will test out automated systems on Metatrader, you'll play with moving averages, Fibonacci lines, support & resistance, Pivots, Fractals, Divergence, DMI, ADX, and a hundred other things all in the vein hope that your 'magic system' starts today. You'll be a top and bottom picker, trying to find the exact point of reversal with your indicators and you'll find yourself chasing losing trades and even adding to them because you are so sure you are right.

You'll go into the live chat room and see other traders making pips and you want to know why it's not you - you'll ask a million questions, some of which are so dumb that looking back you feel a bit silly. You'll then reach the point where you think all the ones who are calling pips after pips are liars - they cant be making that amount because you've studied and you don't make that, you know as much as they do and they must be lying. But they're in there day after day and their account just grows whilst yours falls.

You will be like a teenager - the traders that make money will freely give you advice but you're stubborn and think that you know best - you take no notice and overtrade your account even though everyone says you are mad to - but you know better. You'll consider following the calls that others make but even then it wont work so you try paying for signals from someone else - they don't work for you either.


You might even approach a 'guru' like Rob Booker or someone on a chat board who promises to make you into a trader(usually for a fee of course). Whether the guru is good or not you wont win because there is no replacement for screen time and you still think you know best.


This step can last ages and ages - in fact in reality talking with other traders as well as personal experience confirms that it can easily last well over a year and more nearer 3 years. This is also the step when you are most likely to give up through sheer frustration.

Around 60% of new traders die out in the first 3 months - they give up and this is good - think about it - if trading was easy we would all be millionaires. another 20% keep going for a year and then in desperation take risks guaranteed to blow their account which of course it does.


What may suprise you is that of the remaining 20% all of them will last around 3 years - and they will think they are safe in the water - but even at 3 years only a further 5-10% will continue and go on to actually make money consistently.


By the way - they are real figures, not just some ive picked out of my head - so when you get to 3 years in the game dont think its plain sailing from there.


Iv had many people argue with me about these timescales - funny enough none of them have been trading for more that 3 years - if you think you know better then ask on a board for someone who's been trading 5 years and ask them how long it takes to become fully 100% proficient. Sure i guess there will be exceptions to the rle - but i havent met any yet.


Eventually you do begin to come out of this phase. You've probably committed more time and money than you ever thought you would, lost 2 or 3 loaded accounts and all but given up maybe 3 or 4 times but now its in your blood

One day - im a split second moment you will enter stage 3.

Step 3 - The Eureka Moment

Towards the end of stage two you begin to realise that it's not the system that is making the difference. You realise that its actually possible to make money with a simple moving average and nothing else IF you can get your head and money management right You start to read books on the psychology of trading and identify with the characters portrayed in those books and finally comes the eureka moment.

The eureka moment causes a new connection to be made in your brain. You suddenly realise that neither you, nor anyone else can accurately predict what the market will do in the next ten seconds, never mind the next 20 mins.


Because of this revelation you stop taking any notice of what anyone thinks - what this news item will do, and what that event will do to the markets. You become an individual with your own method of trading


You start to work just one system that you mould to your own way of trading, you're starting to get happy and you define your risk threshold.

You start to take every trade that your 'edge' shows has a good probability of winning with. When the trade turns bad you don't get angry or even because you know in your head that as you couldn't possibly predict it it isn't your fault - as soon as you realise that the trade is bad you close it . The next trade or the one after it or the one after that will have higher odds of success because you know your system works.


You stop looking at trading results from a trade-to-trade perspective and start to look at weekly figures knowing that one bad trade does not a poor system make.


You have realised in an instant that the trading game is about one thing - consistency of your 'edge' and your discipline to take all the trades no matter what as you know the probabilities stack in your favour.

You learn about proper money management and leverage - risk of account etc etc - and this time it actually soaks in and you think back to those who advised the same thing a year ago with a smile. You weren't ready then, but you are now. The eureka moment came the moment that you truly accepted that you cannot predict the market.

Step 4 - Conscious Competence

You are making trades whenever your system tells you to. You take losses just as easily as you take wins You now let your winners run to their conclusion fully accepting the risk and knowing that your system makes more money than it looses and when you're on a loser you close it swiftly with little pain to your account

You are now at a point where you break even most of the time - day in day out, you will have weeks where you make 100 pips and weeks where you lose 100 pips - generally you are breaking even and not losing money. You are now conscious of the fact that you are making calls that are generally good and you are getting respect from other traders as you chat the day away. You still have to work at it and think about your trades but as this continues you begin to make more money than you lose consistently.

You'll start the day on a 20 pip win, take a 35 pip loss and have no feelings that you've given those pips back because you know that it will come back again. You will now begin to make consistent pips week in and week out 25 pips one week, 50 the next and so on.

This lasts about 6 months

Step Five - Unconscious Competence

Now we’re cooking - just like driving a car, every day you get in your seat and trade - you do everything now on an unconscious level. You are running on autopilot. You start to pick the really big trades and getting 200 pips in a day doesnt make you any more excited that getting 1 pips.


You see the newbies in the forum shouting 'go dollar go' as if they are urging on a horse to win in the grand national and you see yourself - but many years ago now.

This is trading utopia - you have mastered your emotions and you are now a trader with a rapidly growing account.

You're a star in the trading chat room and people listen to what you say. You recognise yourself in their questions from about two years ago. You pass on your advice but you know most of it is futile because they're teenagers - some of them will get to where you are - some will do it fast and others will be slower - literally dozens and dozens will never get past stage two, but a few will.

Trading is no longer exciting - in fact it's probably boring you to bits - like everything in life when you get good at it or do it for your job - it gets boring - you're doing your job and that's that.


Finally you grow out of the chat rooms and find a few choice people who you converse with about the markets without being influenced at all.


All the time you are honing your methods to extract the maximum profit from the market without increasing risk. Your method of trading doesnt change - it just gets better - you now have what women call 'intuition'

You can now say with your head held high "I'm a currency trader" but to be honest you dont even bother telling anyone - it's a job like any other.


I hope youve enjoyed reading this journey into a traders mind and that hopefully youve identified with some points in here.


Remember that only 5% will actually make it - but the reason for that isnt ability, its staying power and the ability to change your perceptions and paradigms as new information comes available.


The losers are those who wanted to 'get rich quick' but approached the market and within 6 months put on a pair of blinkers so they couldnt see the obvious - a kind of "this is the way i see it and thats that" scenario - refusing to assimilate new information that changes that perception.


Im happy to tell you that the reason i started trading was because of the 'get rich quick' mindset. Just that now i see it as 'get rich slow'

If youre thinking about giving up i have one piece of advice for you ....

Ask yourself the question "how many years would you go to college if you knew for a fact that there was a million dollars a year job at the end of it?

Take care and good trading to you all.

One of the best observation.
Tnx buddy