Why is it that you can only see things in hindsight?

Beginner Questions
1

I make a trade based on the information available. a couple candles later I’m 30 pips in the hole. I look at the chart and it’s pretty obvious it was going to go that way. How come I can’t see it before I make the trade? The same info is there. The only thing the two candles after the fact have done is confirm what I should’ve seen.

Is this a common problem for newbies?

there are so many different variables to making a trade and I think I miss 1/3 to half of them (depending on the situation) every trade I make. It’s only in hindsight that I say “Ya, why didn’t I look at that?”.

Forex in some ways is so easy. the information is all there. But it can be so hard to make good decisions. Please tell me it gets better with practice!

A lot of things end up comming back my way, but I miss so many pips in between!

Is this really better than gambling?

2

It is better than gambling, because if you follow a good trading system through, your odds of long term profits should be higher than 50%.

The reason you don’t notice some patterns is because you may want to believe price will go one way and you subconsciously discard any information that tells you otherwise. After the damage is done, the “haze curtain” falls, reality checks in, and you start seing clearly again, but then it’s too late already.

Another reason is that you actually couldn’t know exactly where the price was going! The best you can do is to make a guess that has high chances of materializing, but don’t beat yourself if your guess ends up being wrong, remember, you’ll [I]never[/I] be right all the time.

3

It might be helpful if you put in a new rule. Sometimes when the market is crazy I wait 3 minutes when I see a trade coming up. That is to say I wait 3 minutes AFTER I saw where I would have entered. This way I might lose a few pips, but I can be sure that the market is moving in the direction I thought it was. Hope it helps, Happy Trading, Raven

4

I have a discretionary trading system as well and I did/do run into that problem however I’m getting better, much much better.

When I follow my system I listen to what the market is telling me in whole, and generally speaking I’m right, the few times that I’m wrong is usually a timing issue (I didnt listen to when I should have entered or it was just not going to happen) but most of the time, most of the time its me, if it is me, and hindsight says its me, I try to tell myself to look harder, or relax, etc… Sometiems I get emotional (fear/greed) but again I’m getting better.

When my system tells me to do somthing and I loose and I realise it was the systems fault I pay no attention to it, I did what was right and I will stand by it, because I know I’m just that much closer to a winning trade that at the first TP level will be more then my SL… well usually.

When I started I only saw what I should have seen after the fact, always but I kept doing it, poor demo took a beating, then I got better went to real money (only $72-$73 or so) and got worse again, then got better… So stick in there, but dont beat yourself up if you lost but you followed your system. You could try a point system, dont go for profit go for points, points you get(or loose) when you dont follow your systme reguarldess of the outcome…

5

A lot of things end up comming back my way, but I miss so many pips in between!

there are hndreds of trade opportunites, so if you miss 1, no worries, there will always be another 1.

Dont feel bad, cause i think we all suffer from that! I know i do

6

I so like the idea of a discretionary trading system better than picking a system and following it to a T. I suppose once you understand the mechanics a few different systems or disciplines, your in better shape to work with what you have - as opposed to waiting for Jupiter to line up with the sun, or even worse, making something out of nothing. I want to have a firm grasp of [I]currency trading[/I], not just using someone else’s system.

Much like anything else worth doing life, time and practice brings experience and wisdom. Sometimes I feel like trading is closely related to gambling. I hope it’s not because I don’t like to gamble.

Thanks for all the replies!

7

That’s a great sentiment there. Since its a slow day, I just wanted to briefly speak on it as I feel many newbies get into the Forex world with false expectations.

Let’s all remember that trading is a skill, and to reach a high level at any skill doesn’t happen overnight. Period. For example, how long does it take to become a doctor, musician, or sports figure at the professional level? Years right? I’m pretty sure Michael Jordan (the greatest basketball player ever, IMHO) wasn’t championship material the first time he picked up a basketball, was he? I don’t even think he was good enough to play on his varsity basketball team, but he had the drive and passion to learn and master the fundamentals, practice, improve and learn/practice some more. And after seven years of hard work in the NBA he won his first of six championships…Even then he never got comfortable and continued to learn new skills to add to his arsenal. Same thing with musicians and doctors. How many hours do you think Miles Davis practiced the same bebop scale to perfection, or a surgeon cutting into cadavers to hone their technique? Probably countless.

Success in anything, especially trading is the same thing. You’ve got to learn, practice, and make the efforts to improve. And the reason why I compare trading to these different fields is because I see it as an art - where its not an exact science and every moment is different. Micheal Jordan didn’t play against the same 5 guys his whole career, nor had the same teammates. Every song Miles Davis played didn’t have the same chord progression or melody. And every patient in some way or another is different than every other patient a doctor may see in their career.

This is why it is important to learn and master the fundamentals of trading. Learning and mastering the fundamentals will help you create a plan that you understand and works for you, and it will help prepare you to quickly react and adjust to the infinite amount of situations the market will throw at you. And it doesn’t matter your style of trading is (discretionary, systems, fundamental, technical analysis) as the environment is constantly changing meaning you will have to make adjustments to your system or methods periodically.

So, like Edacsac said, “Much like anything else worth doing life, time and practice brings experience and wisdom.” Forex trading is worth doing, just have to have the patience and drive to consistently improve, no matter how small, day by day. Put in the work and over time you will see success…

Sorry for the long post, just my thoughts. Take care and good trading to everyone.

8

This [B]NEEDS[/B] to be a sticky! This one post will answer alot of newbies questions. You should really consider adding this as sticky in the newbies section titled “What you need to know before you start trading”

9

Great suggestion! I’ll get one of the techies to show me how to do that…haha!

That’s just basically what I said in the lesson that can be found in the School of Pipsology called: “Lazy Forex Trader’s Way to Riches”

I go little more into depth about what it takes, but my post above was the gist. I hope it helps shift expectations to what lies ahead in ANY endeavor worth doing, not just trading… enjoy!

10

I have the same problems you do and feel completely the same way. I’d like to develop my own discretionary system…but right now I’m just trying to develop ANY sort of system, just to test myself on what I have learned thusfar…