Hello, I’m a noob. I’m the average 9-5er with over 20 years experience behind my desk. Up to this point, I’ve been fairly successful considering I started with only a biology degree. As my skills increased, so did my pay; however, as one gets older, priorities change and perspective changes as well. No need to dig into details, but there comes a point where you have to stop and ask “am I still on the right path?” Does it make sense that I work in public health but my job is so stressful, that it has become deleterious to my own health? Does it make sense that you can “do more with less” with no end in sight without appropriate compensation? At the moment, I work in a high level role that was traditionally a two person job that paid 2x what I make. I need an exit strategy and I’m hoping that trading forex might be the answer. I’m looking not only for education but a support team as well. I’m looking for a game plan to trade for a living in a sustainable way. Not trying to make a million by this time next year. I want to make a living while increasing my pay in a scalable way. Has anyone here been successful or am I wasting my time. If so, please offer your best advice on what works, what does not. Be brutally honest please.
You joined here 6 years ago, what have you been doing fx-wise since ?
Some have, but learning to identify them is no mean feat at all. It requires context-relevant experience and judgment, and of course when you’re a new arrival, you don’t have much of those, more or less by definition.
Impossible to know. If you want a wild guess (which is all that anyone can realistically offer, in these circumstances), my own hunch from your thoughtful post and observations above is that your overall chances are probably significantly higher than average. But that still doesn’t necessarily make them “good”, given the low overall success rates with forex trading.
People can only offer their best advice on what worked [I]for them[/I], really … not necessarily on what’s likely to work [I]for you[/I].
I can try to do that, perhaps, to some extent, by offering you this post (and there’s a link to another, inside it).
It’s overwhelmingly likely to take you a very long time to build up a steady enough income to supplement your income and enable you to think of either career-change or early retirement on that basis, and the proportion of people who achieve it is dreadfully low. I’ve never really understood how people with a full-time job (let alone a stressful one) manage to achieve it - I came to trading via a different route, myself. But if you think it’s something you might enjoy, at the same time, that shouldn’t put you off trying? And to judge by your joining-date, you’ve been potentially interested in it for a long time already??
The “how to learn” and “to whom to listen” problems, though, are substantial and significant.
Apologies if I sound really “negative” (which completely belies the fact that I love trading and have for years made a pretty good living from it): I’m responding in what I see as a statistically realistic way to your entreaty to “be brutally honest”. :8:
And welcome to the forum.
I have not been active at all in FX. I am not a noob to long term investing in stocks. I’ve dabbled recently with options, and I’ve invested in real estate. I’ve never traded FX except with paper trading. I remember joining a while ago, but watched a YouTube video recently that reminded me about this site and thought I would take a closer look. I’m old enough to remember life before the internet, but young enough to take advantage of it. Much more serious and motivated now. Also, just some more insight on me, I don’t usually blog or actively hang out on social media sites. The only sites I haunt at the moment are Reddit to taunt my draw towards entrepreneurs and babypips for the lure of what’s possible.
You CAN do it, but it isnt easy.
I’m in FL too BTW -
I went full time into trading retail forex in 2008, and the journey for me took literally years to figure out all the things to STOP doing in order to STOP blowing up accounts, and then more years to figure out the things TO DO in order to consistently - and safely - earn an income stream. The tough part is finding a way to shortcut that pathway from the 4-7 years it takes the few who persevere and become successful down to something…well, better (quicker) - Its not that there are no learning sources, its that there are too many and 99.9% are useless or even damaging, so filtering is a huge issue.
But to answer your original question -
What DOES NOT WORK: robots and mechanical systems based solely on historical price analysis
What WORKS: comprehensive analysis of multiple uncorrelated data points that ARE predictive for a currency strength (not merely past prices). Also, NEWS.
unfortunately, what does NOT work is easily accessible and available, so many people will hate on me for saying that. And it can work in streaks of luck (only), which give the illusion of “working”. But dont be fooled. Over the long term, what does NOT work will fail.
what DOES work is difficult to obtain and digest and use in a trading platform (but solutions DO exist).
Odysseus, I agree with you in what does not work. I don’t know how many programs I have tried to back test with dismal results. Wouldn’t we all love a robot to trade while we slept? I even learned a programming language that works on thinkorswim trading platform. Fail. I would love to know what DOES work and focus my time and energy there. I’m willing to put the hard work in. I love research and analysis and I have the what it takes to act on that research.
How did you fair during Hurricane Matthew? I like what you said here. About analyzing uncorrelated data points that predict currency strength. Would love to know what data you focus on as most important. Also, “solutions.” You’ve peaked my curiosity. Would you be willing to share more about that?
Sure, would love to point you in the right direction as much as I can. And BTW, Matthew was tough, my area hundreds of wiped out homes, mine fortunately no structural damage just cosmetic - my family was evacuated to GA, could have been so much worse).
But let me give you the easy stuff first:
planned economic news releases. when you can learn to interpret the currency status and environment leading up to the releases, and then interpret and trade with the reactions by the market, that is really the low hanging fruit of active daytrading forex. the drawback to be aware of is that the brokers, knowing this, screw all the retail traders and if you for example try to trade the news releases right on the release spike, you will always be filled at the extreme of a spike and have to withstand massive DD, or else watch and hope for a pullback that might not happen. So it isnt exactly easy either, but it is certainly in my view one of the more manageable ways of active forex trading, so look into that, specifically interpreting market reactions to news releases and entering not on the spike but on a slight pullback (unfortunately, you will still get hosed and never GET a pullback much of the time, you have to develop timing talents to know when to jump in because its as much of a pullback as you are likely to get.
Be happy to share more by PM if you want, but those are the broad strokes of trading successfully NOT using historical prices and technical analysis from an “easy” standpoint - [B]utilize news[/B].
Now, you dont have to ONLY trade news, because of course impactful news sometimes only hits once or twice a week, and even then the news reactions can be nothing if the release data is “as expected” - the best tradable moves are of course surprise data vs expectations/consensus …so if you only trade surprise news reactions, it can be a meager trading schedule and odd hours. SO, again, you dont HAVE to wait for news, you can trade your own schedule and look at non-price based data, stuff like institutional positioning (COT data), small speculator positioning (which is available from small brokers as aggregated data in real time), overall currency strength based on interest rate cycle positioning, and other fundamental data…so the data is there, you just need to decide which items are meaningful based on the time frames of your trades - do you want to daytrade? swing trade? weekly? each would dictate looking at different data, the data thats most meaningful for those time frames…so it isnt an easy answer I can give here. But the one thing I CAN stress here is that all the systems/gurus/robots that use historical prices as their decision on future direction with no sense of context are only accurate SOMETIMES, BY RANDOM CHANCE. This has been proven, sadly. Hopes this enlightens some.
Well, please excuse the argumentative tone (if it comes across that way :8: ) but I really don’t agree with this [U]at all[/U]. In fact, I can honestly go so far as to say that I strongly suspect that absolutely none of the people I know making their livings as independent traders would agree with it.
I agree that they’re only accurate [I]sometimes[/I], of course, but that can be thanks to a little more than “random chance”, otherwise there would be [U]no[/U] TA-only-based methods which could [U]ever[/U] show consistent profit; but that’s [I]clearly[/I] not so - indeed there are people in this very forum making their livings from such methods. (Probably only a very small handful of them, admittedly, but that’s still enough to adduce evidence of the point, I think. Not to mention all the financial institutions paying people six-figure salaries to investigate and develop them.)
“Sometimes” conceals quite a lot of potential interpretations.
For example, one would have to call 55% of the time (but reliably 55% of the time over the course of many thousands of trades), “sometimes”, and you can undeniably make a living from that - subject, of course, to a lot of other ifs, ands and buts!
I dont mind a good argument at all.
But please realize I have literally worked with hundreds of forex retail traders in the last several years as admin and mod of multiple large forums. Im not just tossing out a random opinion.
And I would reaffirm the truth, whether you want to admit it or not, which is:
anyone who is profiting using entirely historical pricing (price@time) is doing so based entirely on money management and random chance. The point being that “technical analysis” provides NO RELIABLE ACCURACY in predicting future direction in and of itself. And those who do profit, and some do, are riding a stream of luck, essentially, and thats fine. Professional gamblers in casinos try to use what are in reality money management wagering strategies to maximize win streaks so they can walk out of the casino with more than they came in with. That doesnt turn it into a game of anything other than chance and probability.
I would challenge you to point to ONE technical analysis based system or EA that has proven to be profitable over the long term - just ONE! And of course dont count martingales or grids, which may avoid small losers in order to blow up at some point. I would submit that you CANT, because they dont exist. THERE ARE some famous forex traders who made profits and are well known, and there are banks and investment houses that trade and profit quarter after quarter, but neither of these is what I am referring to, I was talking about retail forex for the “normal” retail forex day trader. The well known names and stories all used massive leverage and risk for short periods (which some contests still entice people to do - not sustainable nor a business), and the banks and investment houses do NOT use technical analysis hardly at all, and certainly not in their base decision making. The information they DO use is stuff that retail dont have and wont have, and is a part of my point. As a final aside, I am not saying technical analysis is useless, I am saying that in a vacuum, without a context, it has no predictive directional value beyond random chance. There have actually been studies proving this. I use technical analysis myself, but only to help make sure Im buying relatively high/low when I already know the pair/direction.
Curious, then, that some people have ridden that “stream of luck” so consistently for so many decades, and some are paid huge salaries by major financial institutions to do so? 
(I’ve only been observing that at close quarters for most of my life, as my father happens to be one of them, so that’s kind of my “whole background”, really.)
In response to your post, I’m just going to repeat that my opinion is radically different from yours, and that I [I]think[/I] the opinion of everyone I know who trades successfully for a living is also radically different from yours, on that point. (There are many other comments in your post with which I agree, though.)
I’ve been around trading - and trading forums - for far too long to see any mileage in contesting the “Technical analysis has no predictive directional value beyond random chance” argument, so I hope you’ll excuse my lack of interest in responding to “challenges”, and we’ll just have to agree to differ.
Well said, Lexy.
“so many”? really? can you show me ONE? I mean, with such multitudes of available examples, surely you can show us all ONE example of someone who has made consistent profit over a long period using only “technical analysis” to make trade decisions. We all await a myfxbook/fxblue or statement - personal data redacted of course.
And to be clear, I am referring to day trading, so using charts lower than daily. I do feel like daily and higher charts have more technical validity and utility, the higher the time periodicity, the more the chart patterns can absorb and display the results of the factors that drove it clearly, but this is just my own conjecture.
For someone who has been around forums for “SO LONG” as you say, I would have thought you would have realized that the OP posed a question “can I do this?”, to which I replied with what works and what doesnt - IOW I attempted to HELP answer his question. You are free of course to go ahead and argue with me, but if you do it without any kind of backing evidence to support your assertion, then you are being part of the problem I am warning him about - the crowd of people who will give him a false hope of something that does not exist.
Like I already said twice, Im not talking about bank traders, they have different info to trade from. And Im not talking about people that trade on daily and higher charts. Im talking about people who retail day trade forex, using only technical analysis which is what OP was asking about I believe). Show me a long-term success. Just one. Plenty of short term successes, I agree, but as I said those are lucky streaks that will occur in any trade series where the probability outcome is 50% based on random chance.
With all due respect to the both of you but as a newbie and someone who is wanting to learn, reading this thread is very disconcerting.
why is it disconcerting Tay?
odysseus11: To be fair, you haven’t provided any verifiable evidence in this thread to backup your assertions. So it would appear from the outside, using your argument, that you’re also part of the problem you’re warning against?
Yanwoo, I dont understand the point youre making.
The OP asked what I thought was a straightforward question - “can I do this?” and “any tips?”.
My answer was, I thought, equally straightforward - and boiled down to YES you can do this but it isnt easy, and my tips would be: investigate trading news but NOT entering on a spike, and if he is looking to intraday trade, avoid any trading methods that rely on only technical analysis (which is by far the vast majority of them I see discussed/offered).
This page also talks about technical analysis: Why Technical Analysis is 100% Bullshit - F.S. Comeau