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Logical way to Trade Forex

  • #1
  • First Post: May 18, 2017 6:19am May 18, 2017 6:19am
Hello all thread visitors!!!

I'm Aazish, final year student of Finance and Accountancy. I started trading 3 years back and have much acquaintance now with forex trading ways, methods and systems. Also, joined 2-3 trading courses and training sessions. But I'm still confused which is the more logical way to trade forex as I want to start it now as career but also want to practice a logical and long-live way of trading. I know more logical way of trading is that makes you profitable. I don't want to choose/trap in wrong direction, so doing request to all experts please guide me in right direction, so that I can grab related ways.

Thanking you all in advance.

Aaz
  • #2
  • May 18, 2017 8:34am May 18, 2017 8:34am
Well, I was also confused when I was an active trader on demo then I focused on mainly indicator based trading strategies! Whatever, learn more about technical and fundamental analysis, technical means Price Action strategy nothing else! Besides, know news trading with details! In this forum, you’ll get enough threads on these two market analysis, use all of them but sincerely! All the best!
  • #3
  • May 18, 2017 8:57am May 18, 2017 8:57am
Quoting aazishhunain
Hello all thread visitors!!! I'm Aazish, final year student of Finance and Accountancy. I started trading 3 years back and have much acquaintance now with forex trading ways, methods and systems. Also, joined 2-3 trading courses and training sessions. But I'm still confused which is the more logical way to trade forex as I want to start it now as career but also want to practice a logical and long-live way of trading. I know more logical way of trading is that makes you profitable. I don't want to choose/trap in wrong direction, so doing request...
1) Open your chart.
2) Insert a moving average.
3) Insert an OB/OS oscillator.
4) Find a trend.
5) Trade the pullbacks.
6) Manage your money.

Cheers
The funniest, is that nobody takes me seriously.
  • #4
  • May 18, 2017 10:37am May 18, 2017 10:37am
Quoting FairTrader
{quote} 1) Open your chart. 2) Insert a moving average. 3) Insert an OB/OS oscillator. 4) Find a trend. 5) Trade the pullbacks. 6) Manage your money. Cheers
7) Go broke
  • #5
  • May 18, 2017 1:32pm May 18, 2017 1:32pm
Quoting GeorgeBaile
Well, I was also confused when I was an active trader on demo then I focused on mainly indicator based trading strategies! Whatever, learn more about technical and fundamental analysis, technical means Price Action strategy nothing else! Besides, know news trading with details! In this forum, youll get enough threads on these two market analysis, use all of them but sincerely! All the best!
Quoting FairTrader
{quote} 1) Open your chart. 2) Insert a moving average. 3) Insert an OB/OS oscillator. 4) Find a trend. 5) Trade the pullbacks. 6) Manage your money. Cheers
Thank you mate!!!
  • #6
  • May 18, 2017 1:33pm May 18, 2017 1:33pm
Quoting feline207
{quote} 7) Go broke
Start again
  • #7
  • May 18, 2017 1:33pm May 18, 2017 1:33pm
Quoting feline207
{quote} 7) Go broke
Friend, do you know any other way of trading???
  • #8
  • May 18, 2017 1:34pm May 18, 2017 1:34pm
  •  hak444
  • | Joined Aug 2016 | Status: knowing is not enough,we must apply | 41 Posts
Quoting feline207
{quote} 7) Go broke


@aazishhunain....whtever system ur using and whtever analysis ur using... fundamental / technical or both,
1: do some back testing on a particular pair that u like to trade or that which suits best your trading strategy. After back testing you will have confidence that your method will work if u can flawlessly execute ur strategy. So back testing is good for building confidence in ur system and how u can set stop loss and take profits.
2: After this do forward testing on demo account. Now before anyone tell you that demo is useless just read this to the end then pass any judgements.
Forward testing is really important because trading is about execution, doing back testing is very easy, but executing trades on live market is totally different ball game. So forward testing will help u with that.
Here using demo account is necessary because you still lack the skills of how to execute/implement your system without any errors. You can use real money also but its better not to waste your money on this stage.
Note: Use the same amount of capital in demo account that your going to deposit in live(real money) account
3: Once u have the skills to identify the setup(signal) that your method gives u and u can execute it on live market without any errors, your good to go.
Now you can trade real money. At this stage your looking to build emotional discipline, which includes lots of things....one of them is handling losses, which is very important.

This is just a brief over view of wht you have to do...as u said u want to trade logically, without back testing and forward testing your just gambling, Why?
because u don't know whether the odds are in your favor or not, The concepts of probability and the outcome of a single trade can not be predicted but over a series of 10-20 or 30 trades u will know through back/forward testing that the odds are in your favor, so the two emotions that traders talk about a lot greed and fear, u will be able to handle them with ease and they wont bother you anymore. All these things are required for making the process of trading much easier....u can try the hard way also, losing thousands of $ and then come to this logical path or you can just start with this and sticking to few simple rules which will help you not get hurt emotionally or financially.

I read somewhere that trading is about 3Ms

1st M is "method" (your strategy, system or edge)
2nd M is "money management"
3rd M is "managing yourself" (emotional discipline)

There r many traders here on FF who know a lot about technical or fundamental analysis and systems that will put the odds in your favor, its your job to find the system that suits you best. So 1st M is easy to find if your looking with proper perspective. 2nd M is based on the type of trader u are and the system u r using ...3rd M can be difficult, this is where many traders have to work a lot.
Other then that forex trading should be considered as a business as well, like any other business it takes time to get it running...so same laws apply here.

Peace
I can accept failure but i can't accept not trying. (Michael Jordan)
  • #9
  • May 18, 2017 2:01pm May 18, 2017 2:01pm
Quoting hak444
{quote} @aazishhunain....whtever system ur using and whtever analysis ur using... fundamental / technical or both, 1: do some back testing on a particular pair that u like to trade or that which suits best your trading strategy. After back testing you will have confidence that your method will work if u can flawlessly execute ur strategy. So back testing is good for building confidence in ur system and how u can set stop loss and take profits. 2: After this do forward testing on demo account. Now before anyone tell you that demo is useless...
Make Sense.... Thank you!!!
  • #10
  • May 18, 2017 2:24pm May 18, 2017 2:24pm
Quoting aazishhunain
Hello all thread visitors!!! I'm Aazish, final year student of Finance and Accountancy. I started trading 3 years back and have much acquaintance now with forex trading ways, methods and systems. Also, joined 2-3 trading courses and training sessions. But I'm still confused which is the more logical way to trade forex as I want to start it now as career but also want to practice a logical and long-live way of trading. I know more logical way of trading is that makes you profitable. I don't want to choose/trap in wrong direction, so doing request...

1. Find a real job first so that bills are paid.

2. Trade small money in live accounts until you learn money management and master your own psychology.

3. If you still fail in step 2 even after 3 to 5 years of trading, better quit for good.
  • #11
  • May 18, 2017 2:40pm May 18, 2017 2:40pm
Quoting TradeGraph
{quote} 1. Find a real job first so that bills are paid.
true

Quoting TradeGraph
{quote} 2. Trade small money in live accounts until you learn money management and master your own psychology.
true

And, forget all the shit about buying ferrari's, trading from the beach, working 2 hr and then party all day long, living the dreammm .. trading is a job that require a laserlike focus and a lot of time, all the succesfoul trader that i know have dedicated, in a way or in another, their life to their job, so be prepared, there is a huge price to pay, and ask yourself if trading is what you really want.
Sometime the horizon disappear. Twitter: @_whiteout
  • #12
  • May 18, 2017 7:31pm May 18, 2017 7:31pm
Hello. Finally a student of Finance!! Welcome.

I use a hybrid model of linear regression and quantitative analysis. I group candles into sample sizes and then use standard deviation to find when price points become outliers. The outliers are commonly known as break-outs. However, you will see the reaction of all trades, not just break-outs. I simply mention them because this is your major profit pocket. It is hybrid because I make my regression line curvilinear, or dynamic, so it can move with the "live" market as it ranges up and down.

It is similar to calculating the profit/loss equilibrium of a business. In this case, under the line the market is selling and above the line, the market is buying. Simple stuff. Good Luck.
You cannot be extraordinary by being normal
  • #13
  • May 18, 2017 11:14pm May 18, 2017 11:14pm
Azish.. There are many ways to skin a cat. So I'd not comment on the method to use.. but I'd like to mention a few points from my experience.

You need to understand clearly that there is not a single person in this world, who can exactly predict what's gonna happen to EU in the next few mins. You can only assume... and sometimes you are right and sometimes you are wrong. So..

1. Your win will come ONLY from a series of trades, not a single one. So your trade positions should be proper enough to withstand a series of losses. Even a 10 or 20 losses in a series shouldn't damage YOU (mentally) or your ACCOUNT (financially).

2. You should have the discipline to take a 'series' of well evaluated trades, on a regular basis. Irrespective of the time frame you choose, you should have the stamina in terms of money and also in terms of longer duration in the market.

3. Keep your mind open. Always find time to learn new methods or knowledge in the field.

If you are able to do these things, You are a WINNER for sure... just like any other jobs in the world. All the best.
  • #14
  • May 18, 2017 11:46pm May 18, 2017 11:46pm
Quoting dkrock
Hello. Finally a student of Finance!! Welcome. I use a hybrid model of linear regression and quantitative analysis. I group candles into sample sizes and then use standard deviation to find when price points become outliers. The outliers are commonly known as break-outs. However, you will see the reaction of all trades, not just break-outs. I simply mention them because this is your major profit pocket. It is hybrid because I make my regression line curvilinear, or dynamic, so it can move with the "live" market as it ranges up and down. It is similar...
I study business finance but have idea of these terms. I would try to apply them on trading too.... Thank you sir!
  • #15
  • May 18, 2017 11:48pm May 18, 2017 11:48pm
Quoting vinforex7
Azish.. There are many ways to skin a cat. So I'd not comment on the method to use.. but I'd like to mention a few points from my experience. You need to understand clearly that there is not a single person in this world, who can exactly predict what's gonna happen to EU in the next few mins. You can only assume... and sometimes you are right and sometimes you are wrong. So.. 1. Your win will come ONLY from a series of trades, not a single one. So your trade positions should be proper enough to withstand a series of losses. Even a 10 or...
Thank you Sir. I'll keep these points in mind....
  • #16
  • May 19, 2017 4:08am May 19, 2017 4:08am
Quoting RondaRousey
{quote} LOL. You are going to use logic to trade? When you are really good at trading you will find it is an art.
We would be eternally grateful if you would show us your "art".
Or will it be asking too much?
The funniest, is that nobody takes me seriously.
  • #17
  • May 19, 2017 5:25am May 19, 2017 5:25am
Quoting RondaRousey
{quote} LOL. You are going to use logic to trade? When you are really good at trading you will find it is an art.
I mean to say, way to trade that makes logic, not fancy indicators to whom we follow for setups signals.
  • #18
  • May 19, 2017 6:21am May 19, 2017 6:21am
The best method to make consistent money:
gauge the bias and trade always with momentum.
No charts needed.
  • #19
  • May 19, 2017 6:38am May 19, 2017 6:38am
Quoting vinforex7
... Even a 10 or 20 losses in a series shouldn't damage YOU (mentally) or your ACCOUNT (financially). ...

While this is true, I doubt there are many traders even among the consistent successful ones who wouldn't be mentally damaged after taking 10 losses in a row. Because 10 losses in a row means most of the time something is wrong with your system and you're missing the edge.

In numbers, if you have a system with 35% success rate (VERY low imo) your chance to have 10 losses in a row is still less than 50% (42.6%).

So, be realistic.
  • #20
  • Edited 9:20am May 19, 2017 9:01am | Edited 9:20am
Quoting hak444
{quote} I read somewhere that trading is about 3Ms 1st M is "method" (your strategy, system or edge) 2nd M is "money management" 3rd M is "managing yourself" (emotional discipline) There r many traders here on FF who know a lot about technical or fundamental analysis and systems that will put the odds in your favor, its your job to find the system that suits you best. So 1st M is easy to find if your looking with proper perspective. 2nd M is based on the type of trader u are and the system u r using ...3rd M can be difficult, this is where...
very good post. i agree with your conclusions.
but i think its impossible to become a good trader without losing. a trader must have felt and understood the pain of losing. its like you want to become a great fighter but never bleed and never have taken a hard punch. a great fighter must know how bad it hurts. he must have taken thousands of stabs and punches and after that, if he is still alive, he will be better than most others... you cannot defend yourself effectively from something you do not understand and have not experienced. of course not as simple as that. just keep losing over years is not going to make you profitable by itself. But losing money is experience. The whole forex market is about losing money. If you do not understand losing money, better to stay away. so as some sort of conclusion - imo losing some small amounts is healthy for traders to some point. losing money does not mean you are a loser. making money does not mean you are the winner. it keeps your guard up and your feet on the ground. but it is very hard to stay rational and know how much is too much.. as they say - losing is part of the game. Does Real Madrid always win.. no. but they are all millionaires. if they were bitching about every game and how they should never lose, they better play golf with grandma.
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