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Currently Loser, Successful before

Discussion in 'General Forex Talk' started by shooji, Jun 26, 2011.

  1. shooji

    shooji Private, 1st Class

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    I traded in Forex market for last 5 years and I passed many good and bad days.last year I was managing 10 account with 10000 on each account and with Gods help I gained 50% in average in every month for each account. those days was so good and I earned this profit for 7 or 8 month. I didn't change my trading discipline and method but now its about one year that many of these account was called margin and other accounts is in a bad loss. I just need to know is this the time that I must change my trading system?or I must stick to my method yet?can you introduce me articles and books that are helpfull for me or users that have same situation like me?
     
  2. Pharaoh

    Pharaoh Colonel

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    It sounds like you had a profitable system and market conditions changed. Your system needs to adapt when this happens.

    The high profit and deep drawdowns (to margin call in some cases) also indicates that you weren't exercising proper risk management.

    The key to safely making money in any trading environment is first to learn how not to lose money. You must control greed and go for smaller gains so that the corresponding smaller losses during a drawdown period don't inflict too much damage. There's no point in doubling an account today if you wipe it out tomorrow.

    This article will help:

    http://www.forexpeacearmy.com/forex...2272-how-manage-risk-while-forex-trading.html
     
  3. uncletrumpet

    uncletrumpet Private

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    A friend called my phone weeping...he told me with the gain of forex trading he bought a house and made such money... he later got a margin call and lost all his accounts and he later sold his house and used all the proceed to trade forex...he later lost everything...he became broke and bankrupt... I told him the market has changed. Years back Gbp/jpy was very volatile moving over 350 pips daily, before gbp/usd was volatile more than eur/usd bu now eur/usd is more volatile than gbp/usd. Let us understand what the market is saying. go with the flow and read as many fundamental news as possible to know what is happening. I wish all good luck
     
  4. uncletrumpet

    uncletrumpet Private

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    A friend called me weeks back, he said he used the gains of forex to buy a new house and he was rich overnight. Alas; he had margin call in all his live account, he looked for a loan to no avail, he had to sell his news house to trade forex. He eventually lost all the money again and he now went bankrupt... I told him that the market has changed

    Years back gbp/usd was more volatile than gbp/jpy, later gj was more volatile than gu, before gu was more volatile than eu, but now if you watch closely eu is more volatile than gu. Market is a chameleon ever changing, know what is about to happen and follow the trend.

    But please note we have 4 kinds of market depending on the timeframe you are looking at

    1) A Trending Market
    2) A Corrective Market
    3) A Ranging Market
    4) A flat market with no direction

    This is what you can see in any time frame you are watching

    Wishing you well
     
    #4 uncletrumpet, Jun 27, 2011
    Last edited: Jun 27, 2011
  5. RahmanSL

    RahmanSL Major

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    "....You must control greed and go for smaller gains..."

    So, increasing initial deposit to over 178% in 5 trading days is a tiny bitty bit greedy and not a good idea; yah?? : (
     
  6. Pharaoh

    Pharaoh Colonel

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    If you lose it all before you withdraw some profits, yes. ;)

    There is an option for those who just have to take big risks. Control that greed long enough to safely get your initial deposit back. Then go for high risk trading and pull out 50% or so of the profits frequently. If you can last a few months doing this, you will come out ahead. The problem is that most people will want to "let it ride" to increase those crazy profits further and further - until Mr. Margin gives them a collect call.
     
  7. RahmanSL

    RahmanSL Major

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    If you do your homework well before start of trading day, I really don't see the need for setting SL...especially if day trading and scalping/or semi-scalping for profits as market condition changes.

    For longer term trading (for those >100 pips profits with >0.05 lot size), if you have done your research well and have anticipated market movements due to certain economic factors surrounding a particular currencies pair or commodities, you really have no need to set a SL if you have chosen trade entry level carefully based on those economic factors. And, of course, don't just jumped into a trade immediately without first observing market sentiments for at least 15-20 minutes. But then, make very small lot size trade to gauge market movements before going into larger lot size trades.

    After blowing up more than half a dozen Micro, Std, & ECN accounts (high risk with high profits), I have learned that the biggest single mistake is having just too many opened trades (over 15 positions) at one time and risking more than 60% of capital.

    On most normal trading days, the account balance can handle the losses which will turn into profits as anticipated. But it is the unexpected economic happening which will cause mayhem and eventual account wipe out.
    It really is a terrible and horrible gut wrenching feeling to watch that usd5-30k account turned into pennies or nil balance in matter of minutes.

    Yes, I agree 100% that the safest trading strategy is in not risking more than 3-5% of account capital at any one time as the huge equity margin can ride out any initial losses.
    In fact, I would add that only a complete idiot can loss money in such a trading strategy. So, why set SL on those "safe" trades?

    I have seen quite a number of accounts in various websites which suffer losses mainly due to SL being hit. If no SL was set, I am very sure that these accounts would not have incurred 30%, and in a couple instances 98% losses caused by SL being hit.

    It is my conclusion that patience with discipline trading will built up any account over a period of time!

    Seriously, is it really that difficult to make 0.5 to 1 % profit per trading day...or even 3-5%????
     
    #7 RahmanSL, Jun 27, 2011
    Last edited: Jun 27, 2011
  8. FXDM

    FXDM Banned

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    The secret of trading FX is "Risk Management"!

    I was a BIG loser trader before I've found that secret but very simple.

    I recommend all traders read http://www.forexpeacearmy.com/forex...2272-how-manage-risk-while-forex-trading.html
    10 times every days and before you open trades.

    Sooner or later, you'll be an experienced trader!

    Sure!

    Thanks Pharaoh!

    Happy trading.

    FXDM
     
  9. Pharaoh

    Pharaoh Colonel

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    I still recommend a SL unless you are doing super low-leverage trading. Otherwise, your broker might have to apply that final stop loss for you when you get a margin call.

    Even if you are aware of typical monthly trading ranges, even if you know what the highs and lows of the last year are, things can happen that can cause massive spikes way beyond anything expected.

    Things like surprise changes in interest rates. The Fed wrecked my trading day doing this once.

    Things like bank interventions - the SNB loves surprises.

    Things like massive earthquakes. Japan and New Zealand are still putting the pieces back together.

    Even if you have a SL pre-set in your mind, I still recommend putting a hard stop somewhere beyond it. This will help if there is a big market move against you while you aren't staring at the computer or if you lose your internet connection.
     
  10. Johnfa

    Johnfa Private, 1st Class

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    SL is a part of "Risk Management"!:)
     

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