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  • #861
  • Mar 25, 2016 11:36pm Mar 25, 2016 11:36pm
Hello everyone:

I am really new to Forex trading, so I am not able to say much about my experience so far, but I have learned that making money trading depends more on how the market is going than on luck or any strategy. In a bull market, any trader can make money and how much depends on how long the market stays bullish, but in the present market, the best strategy seems to be not to trade. Just watch the charts and pray for better circumstances.
  • #862
  • Mar 26, 2016 12:02am Mar 26, 2016 12:02am
Quoting JoeNY
The thought of living abroad crossed my mind. US futures will not be available to me if I leave the States.
why not? there are traders here from all over the planet trading futures every day.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #863
  • Mar 26, 2016 7:16am Mar 26, 2016 7:16am
Quoting morrispatman
Hello everyone: I am really new to Forex trading, so I am not able to say much about my experience so far, but I have learned that making money trading depends more on how the market is going than on luck or any strategy. In a bull market, any trader can make money and how much depends on how long the market stays bullish, but in the present market, the best strategy seems to be not to trade. Just watch the charts and pray for better circumstances.
You can make money in all market conditions, however you need to learn how to be more flexible as a trader. You need to know what to expect from the market and adjust your entry/exit and money management rules.
Trading strategy is important, but it's only a small piece of this game. New forex traders usually look for 'holy grail' only. Magical arrow that will make them rich fast, but of course it won't happen this way. My advise is to learn the market in 'harder' way. Find a system that you like (basically you can make money with any method, if you are good as a trader). Do not jump from one method to another, watch and learn one system for at least few weeks. Write a trading plan (entry/exit rules). Set your MM rules (risk appetite etc.). Then trade the system on demo account. If you will be profitable for 2-3months, with low drawdown then start trading micro lots (smal money account).
I wish you good luck and happy Easter!

M.
  • #864
  • Mar 26, 2016 7:47am Mar 26, 2016 7:47am
You know, I lost my mind for a second. Thanks. The CFD products not available within the U.S. threw my thinking off as to what may or may not be available to traders outside of the States. To be honest, you get more bang for your buck trading CFD's with the leverage offered abroad anyway. I would have no problem with that product anyway. We're so handicapped in the States. I could never trade 8 contracts of Light Sweet Crude with only $5000. 5 grand would only allow 1 but with CFD's, 8 units was do-able.


Quoting The Fool
{quote} why not? there are traders here from all over the planet trading futures every day.
SPC * Swollen PocketZ Crew!
  • #865
  • Mar 26, 2016 2:23pm Mar 26, 2016 2:23pm
Quoting JoeNY
You know, I lost my mind for a second. Thanks. The CFD products not available within the U.S. threw my thinking off as to what may or may not be available to traders outside of the States. To be honest, you get more bang for your buck trading CFD's with the leverage offered abroad anyway. I would have no problem with that product anyway. We're so handicapped in the States. I could never trade 8 contracts of Light Sweet Crude with only $5000. 5 grand would only allow 1 but with CFD's, 8 units was do-able.
YEAH, the grass always greener, I guess - but no CFD for the USA is a raw deal. There's plenty things to trade, though & I can't complain too loud....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #866
  • Edited Mar 29, 2016 12:40am Mar 28, 2016 6:12pm | Edited Mar 29, 2016 12:40am
Quoting hanover
Why reversing a losing strategy is not guaranteed to work profitably
Here are some possible reasons:
1. Transaction costs
2. Statistical fluctuation
3. Overleveraging
4. Br0ker mischief
5. Market reaction
6. Psychological issues
7. Can't be reversed
......
Adding to this post, another reason, that I forgot to mention, is:

8. Leverage decay. If you use fixed fraction sizing, i.e. risk X% equity per trade, then it requires (100 - N) / (100 x N) % return to recover from a N% drawdown. For example, if I lose 20% of my $100,000 account, then I need a (100x20)/(100-20) = 25% return on the remaining $80,000 to get back to the original $100,000 -- hence the leverage decay is 5%.
__________________________

An image paints a thousand words, so attached are some equity curves plotted using Excel** simulations, each is over a time period of 500 trades. The blue line represents the P/L before transaction costs; the magenta line, after costs (note the gradual erosion -- I allowed 0.05% for spread/slippage/etc per trade; if the trader is scalping, it's probably a lot more!).The y-axis shows the % equity gain/loss.

Now which system uses the most profitable (simulated) trading algorithm?

The answer is: they are all identical!! Each risks 2% per trade, and operates on a 50% win rate and 1:1 RR. In other words, all have exactly zero expectancy, just like any system that generates completely random entries and exits, or otherwise fails to exploit a real market inefficiency.

That's what I meant by "statistical fluctuation" in point #2 of the previous (quoted) post. Systems might appear to be significantly profitable, or significantly losing, but the reality is that we are likely being fooled by randomness. The blue lines will return to somewhere around breakeven, over an extremely high number (say, a million) trades, for every one of these systems. (You might think that the fourth system -- whose magenta line shows a 90% drawdown after 500 trades -- will be profitable if its signals are reversed, but the reality is that 500 is nowhere near enough outcomes to be statistically significant).

And if we refer to point #3, it's clear that even at a conservative 2% risk per trade there's a good chance that an ineffectual 50/50 system will hit a margin call (especially given the effect of transaction costs), long before a significant number of trades is reached, and equity has had a chance to return to breakeven.

[** Excel's RNG is crap, but any RNG could be used to illustrate the point I'm attempting to make.]

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  • #867
  • Mar 29, 2016 1:38am Mar 29, 2016 1:38am
Quoting mrhigurashi
Anyone who does not think Forex or any other type of investment is gambling needs to get a reality check and understand what gambling means. For example, here is a simple definition: "to risk losing (something valuable or important) in order to do or achieve something" Anything that involves you risking an amount of money to gain something is gambling. Pure and simple. So to say Forex is not gambling is just delusional. yeah sure you can put fancy words like investment around things but its all still gambling by definition.
Exactly.
And some will fool themselves even more by calling it a business
Is gambling a legitimate business ?..
  • #868
  • Mar 29, 2016 1:49am Mar 29, 2016 1:49am
Quoting mrhigurashi
{quote} Well, yes it can be but that then requires luck. All these 1% out there mostly got to where they are because of luck. Not just Forex, almost any business for every 1 person that succeeds there is probably 100's that do exactly the same thing but fail. You hear stories all the time about people who started with nothing and now have a multi million dollar business. But its all bullshit. You never hear the full story. Like the uncle who gave them a few $100's dollars to get started or their brothers wife's father who has connections... You...
No doubt that all the superstars of the business world have been very very lucky...
  • #869
  • Mar 29, 2016 2:07am Mar 29, 2016 2:07am
Quoting mrhigurashi
Anyone who does not think Forex or any other type of investment is gambling needs to get a reality check and understand what gambling means. For example, here is a simple definition: "to risk losing (something valuable or important) in order to do or achieve something" Anything that involves you risking an amount of money to gain something is gambling. Pure and simple. So to say Forex is not gambling is just delusional. yeah sure you can put fancy words like investment around things but its all still gambling by definition.
by this definition anything we do in life is gambling, e.g., you get a student loan to study a degree - there's no guarantee you'll get a job - but you take calculated risk believe that if it pays off and you get a job you will make more than you are currently going into debt for. Or you risk your savings to open an ice-cream shop on the beach in the hope of turning a profit (the risk of losing savings in the hope achieving something, as you define it).

So by your definition every action take is gambling, I am not saying this is not true. But when people say trading is gambling in the negative sense, they mean gambling where this is no edge to be discerned, 100% pure chance, like the flip of a coin. In this case hoping to make money is surely a fantasy that's why most gamblers lose everything. But like Poker and some other activities, if you have skill and knowledge and a system you can make a living and you are not gambling in that negative sense - that is if you approach it with a strategy, but if you just walk up to the table and place bet then you are gambling in that negative sense of relying on pure luck.

So while many traders approach trading really like gamblers, trading in itself is not inherently a gambling activity in that negative definition.
  • #870
  • Mar 29, 2016 2:15am Mar 29, 2016 2:15am
Quoting mrhigurashi
{quote} Oh, i forgot another rule of being successful. Theft also works well, as long as the person it is benefiting has more power or money (Same thing) then the person your stealing from. But i cant complain, thanks to an abundant supply of stupidity in the world i make a fairly decent living from my business.
Do you sell trading systems ? (:
  • #871
  • Mar 29, 2016 3:48am Mar 29, 2016 3:48am
Quoting hanover
{quote} an ineffectual 50/50 system will hit a margin call



I was playing with the concept of reversing a losing strategy and.... WHAT THE.... ?




Seems like I found the best system EVER.




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Hahahaha not really.
  • #872
  • Mar 29, 2016 4:22am Mar 29, 2016 4:22am
Quoting HeyYou
Hahahaha not really.
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It goes straight to 0 as I raise the spread from 1 (which is the minimum allowed by mt4) to 20 even with 0.01 lots.
  • #873
  • Mar 29, 2016 4:42am Mar 29, 2016 4:42am
Quoting mrhigurashi
{quote} Mines better LOL {image}
My backtest was way longer than yours.
  • #874
  • Edited 8:42am Mar 29, 2016 5:05am | Edited 8:42am
Btw it also reaches 0 when I add the spread to the SL.
  • #875
  • Mar 29, 2016 5:58am Mar 29, 2016 5:58am
Quoting HeyYou
{quote} My backtest was way longer than yours.
Guys what you're doing is that you've actually discovered the way to trade forex. It's called "contrarian trading" and it's the only way to win

If you really want to make a success let me know. I'll show you the only way that works. I will probably only break even with my losses in a year or two but I will. Just don't EVER "go with the flow" even in a strong trend - even in a strong trend price can spike against the flow 30 pips or more just to knock out trailing stops and new entrants. It's ALL about knowing where/when to enter, whether you are just scalping or looking for 50 pips or more. And "zone trading" is a recipe for disaster. Don't follow what you read on the boards
  • #876
  • Mar 29, 2016 6:02am Mar 29, 2016 6:02am
Quoting jmtini
{quote} Guys what you're doing is that you've actually discovered the way to trade forex. It's called "contrarian trading" and it's the only way to win If you really want to make a success let me know. I'll show you the only way that works. I will probably only break even with my losses in a year or two but I will. Just don't EVER "go with the flow" even in a strong trend - even in a strong trend price can spike against the flow 30 pips or more just to knock out trailing stops and new entrants. It's ALL about knowing where/when to enter, whether...
Would you buy a used car from this man??
  • #877
  • Mar 29, 2016 6:07am Mar 29, 2016 6:07am
Quoting oztrader79
{quote} by this definition anything we do in life is gambling, e.g., you get a student loan to study a degree - there's no guarantee you'll get a job - but you take calculated risk believe that if it pays off and you get a job you will make more than you are currently going into debt for. Or you risk your savings to open an ice-cream shop on the beach in the hope of turning a profit (the risk of losing savings in the hope achieving something, as you define it). So by your definition every action take is gambling, I am not saying this is not true....
Yes it is very well. But their is a loosers they assumed that everyone is looser.
Trade fearless not careless...
Syed Mohsin Ali Profit This Month: -804
  • #878
  • Mar 29, 2016 6:37am Mar 29, 2016 6:37am
Quoting jmtini
{quote} Guys what you're doing is that you've actually discovered the way to trade forex. It's called "contrarian trading" and it's the only way to win If you really want to make a success let me know. I'll show you the only way that works. I will probably only break even with my losses in a year or two but I will. Just don't EVER "go with the flow" even in a strong trend - even in a strong trend price can spike against the flow 30 pips or more just to knock out trailing stops and new entrants. It's ALL about knowing where/when to enter, whether...
As kind as you are, im not sure devoting the next year or 2 of my life to break even makes much good business sense.
  • #879
  • Mar 29, 2016 7:12am Mar 29, 2016 7:12am
Quoting fxstaton
I have no luck in forex. Initial period I get profit, and few months all profits and capital are gone. I think I am not suitable in forex and will quit all and back to work
Man, is this a joke or what?
How come your thread about quitting FX can extend to 45 pages after a few weeks?
Is everyone trying to persuade you to stay or you're not quitting after all?

Sorry I'm not interested to browse though the thread, but I saw the first few replies by Rtm were excellent. You should quit if you can get a day job. A job is a sure way of recovering your FX losses.

Quoting Rtm
this is a smart choice. Its not what everyone imagines it to be when they first start, everyone starts with the same mindset based on some dream of the end result....reality vs dreams very different.
Quoting Rtm
{quote} Ok, guarantee way to recover it. Work a job and save money and put into savings account. Eventually money will be recovered. Trying to 'recover' your losses in the market is probably the worst thing you possibly do. The mentality, risk profile, just asking for disaster.
When in doubt, HEDGE
  • #880
  • Mar 29, 2016 7:40am Mar 29, 2016 7:40am
Quoting Aich
{quote} Would you buy a used car from this man??

Aich

I'm not selling anything. Where did you get that idea from??

Anyway you're welcome to carry on losing, I think for some it's like a drug - they get high on the "I feel so sorry for myself"!
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