98% Fail

[macdonaldavid]

If as I keep being told 98% of traders fail, how can I find out what these traders are doing so I can do the opposite? This is a genuine question. If I were a broker and I noticed that 70-80% of the trades that were hitting my desk were long the EUR, then I'd be sure to go short. Is there any way of finding what everyone is really doing? I'd guess this data is highly guarded by the brokers. I hope some one can help.

 

[cowmadagan]

It's funny you said that, because I just wrote a huge post answering why so many traders lose all of their money. It'll be in the Beginner's forum.
There's something called the COT or commitment of traders report. You can find it on the Chicago Mercantile Exchange site if you poke around for long enough. It'll tell you the number of long and short contracts separated into three groups for most of the big currencies. The three groups are commercial (which actually means farmers, exporters and importers), non-commercial (which means investment banks and large funds), and non-reporting (which includes you me, the 80/90/98% or whichever stat you've seen that lose it all, and the rest of us retail traders that seem like little ant surfers constantly scrambling for our lives to not only get to the surface but also surf the waves to profit that the non-commercial guys make that are buffered by the commercial guys).
My metaphor was deliberate as non-reporting are both a drop in the bucket and usually wrong. It also works because the commercial guys are in the business of protecting profits from their 'real business' and not in market prediction.
Speaking of wrong...the COT report comes out every Friday, and reports only the positions held on the previous Tuesday. That means it's far from accurate as a current picture, but many are trying to get them to act like...erm...a business and spit out the info more often.

 

[ernest8fingers]

If as I keep being told 98% of traders fail, how can I find out what these traders are doing so I can do the opposite? This is a genuine question. If I were a broker and I noticed that 70-80% of the trades that were hitting my desk were long the EUR, then I'd be sure to go short. Is there any way of finding what everyone is really doing? I'd guess this data is highly guarded by the brokers. I hope some one can help.

90+% fail because they give up the fight. I lost money my 1st 3 years trading Forex. I got some edumacation and some skills and hung in there. I am now 5+ years into this Forex gig and loving it(only when I win though). I still hate losing but realize that this is an inevitability. I also realize no matter how much I lose daily-I always seem to make it back in a short time. Rarely a losing week now. I lost the "fear" and this took 3+ years. If you never surrender , the worst you could do is lose the battle-not the war.

 

[macdonaldavid]

Many thanks. This is the first time I have posted anything and to get a reply is fantastic. I'm aware of the COT reports as when I was trying to find the right market to trade I played around with Commodities. I was unaware that currencies were reported. I'll be sure to read your other post.