examine yourself and be honest as to why you got margin called. were you over exposed?
did you not obey your trading rules?
did you try to convince yourself the market was telling you to stay in?
ive got a great book for you to read it will help with the psychology of trading and I suggest you read it and try to understand what it is saying.
it is trading in the zone and it is a book to help get your thinking right so you can be apart of the elite few who are and remain profitable
All of us have blown an account and some have lost some real serious money. Alll this means is you have to learn from this and Im certain a 16,000 lesson isn’t one you will soon forget.
Trust me Ive been margin called 3 different times before I start to see consistant profits. You will to don’t give up!!!
If you are just step in forex trading , trade with 1 pips for $1.00 , if you trade with 1 pip for $10.00 . You are in high risk when trade goes agaist you . If you just step in into forex trading , you are adviseable to trade small lot rather then to trade big lot . At overbought , the currency look for support and you set a very tight stop loss which end of lost of trade.
To add to that, indicators… like stochs… that show over sold/bought conditions are really only good when price action is in a range. When price action is in a trend, they are very misleading which is why I don’t use them because you never know exactly when a range ends and a trend starts with them until it’s in it, which is a little late when you’ve got a trade on in the wrong direction.
Sounds like you need to focus a little more on money management and keeping your pip value proportionate to your account balance.
This means if you have a $20k account, 2% is $400 max loss therefore,
1 standard lot ($10/pip) would be a 40 pip loss (40 pips x $10/pip) or in your case a 208 pip loss would have been $2080. A 10% risk is a bit steep, but if you’re a risk taker, so be it.
However, if you lost $16K with 208 pips, then you’re waaaaay over that. :eek:
Sounds like you don’t know much about risk management or money managment.
Ok, first things first. You have to figure how much of your account you want to risk per trade. Lets say you have a 1K account. (honestly if you are new to trading and started an account with +16 live that was not bright, start micro when new even if you can afford more)
Lets say you have a 1K account. Lets say you only want to risk 1% on any one trade. 1000 x 1% = $10.00 10.00 is NOT Your pip value or your lot size. That is how much you are willing to risk on any ONE losing trade.
Ok, so next you have to figure your trading strategies needed breathing room. That is how many pips will you allow a trade to go negative. Or, what is the point of no return. How far can a trade go against you until it is no longer likely to come back. The only way you are going to learn this is to trade your strategy a lot on demo and then test it live with very small amounts. Your risk shouldn’t determine the trades breathing room. You spread the risk out over the trades breathing room.
Ok, so lets just say you have found that -20 pips is the point of no return. You know at this point the trade is loser so you might as well set a SL for that point.
So you want to risk only 10.00 on a trade. $10.00 / 20 pips = Pip value of $.50 cents.
Also, important. If you only want to risk 1% and are doing three trades at a time, you have to divide your 1% by your three trade. Otherwise you are effectively risking 3% of your account. Honestly, if you are new, you shouldn’t be entering multiple trades at once. If you can’t learn to be consistent doing one trade at time, doing three at a time isn’t going to make your more consistent, it’s going to lose your money faster.
also, “All indicator told me not to sell now because the currency was averbought.” Don’t know if you misstyped, but if the currency is overbought that IS the time to sell. Overbought means their is possibly no buyers left, so the selling is about to take place and price may drop. However, don’t pay a whole lot of attention to overbought and oversold indicators like stochastics. They help give you clue, but by themselves can get you in trouble. The stochastics can ride in an overbought or oversold position for quite a long while while climbing or falling, and if you bought at that position looking for a reversal you would be in trouble. IMO, they are best used as a filter. Also, overbought/oversold indicators can be set differently. So what it means on one persons chart might be different on yours. Best thing you can do with indicators is just study them as price moves and see how the indicators reacts.
Best things you can learn is to to pay attention to price it’self, candles and a tick chart. Price is the only thing you can put on your chart that isn’t lagging behind what is actually happening, because it is what is actually happening.
As far as risk/reward ratio that is in relation to your trading strategy. You have to work it out yourself. So, say you’ve found that for your strategy your stop loss should be -20 pips. You’ve likewise found that when the trade goes in your favor you can on average get +60 or more. -20/+60 is your risk reward ratio.
If you let losses run or disobey your own trading rules or take trades outside of your trading strategy it makes the ratio pretty much meaningless.
P.S. if nothing else you’ve learned one of the most important noob lessons the hard way. That is, don’t let losers run hoping they will come back. Get out without prejudice or emotion, there is always another trade.
P.P.S. It sounds like you are trading way to much with emotional involvment. Get this book, “Trading in the zone,” by Mark Douglas.
well i just hope that was DEMO, cause it sounds like you lot to learn. If it was well then a simple lesson would be to use a stoploss (no margin call is not a stoploss) and secondly use smaller lot size… Once you apply those two simple rules then you can begin to learn a trading strategy that suits you, and then keep on practising on improving that, and stick with the one strategy cause it will take YOU time to master that and it wont be the strategies fault if you dont.
Now if that was real money in the $16,000 i will firstly say WTFAYD!, and then secondly i would say walk away - try online poker perhaps
Yes, it was real money. And no, I wont sleep tonight.
I wont touch forex for the rest of the week either, too much report coming up and I really don’t know where’s the price gonna go, again…
Let’s just say ThePhoenix is right. Too much emotion. I went short because of two thing, first, a resistance, second, all my indicators, like I say, were told me the price was overbought.
The think is, the europeen market did REALLY good that day, so the CAC40, the DAX, the MIB30, the CIBEX35… They went all up 3% all the sudden. They were all losing a average of 1/4points for some time and then 3% up!
That’s why the EUR went so high.
Like I told you I was short on it. So I really wanted the price go down… I had a little hope for a moment, and then it went up again.
All the time I was sure the price would go down soon and I was sure that was a question of minutes.
No. After the margin call, it went up even more.
Today, I lost 16 000$ REAL dollars. The thing is, I work hard for that money, that wasn’t forex money.
Now, more then ever, I want to understand this business.
ThePhoenix, do you use the “tick chart” on MT4? If yes, where can I find it and where can I install it?
Just pick yourself up and dust yourself off…If you still willing to get back on the horse after getting “bucked” off…I commend you. Apparently this happens to some and that makes you 1 of 2 kinds of traders…those it’s happened to and those it hasn’t…lol.
I have just started trading live 2 weeks ago. Started off ok, but made a dumb mistake myself, which luckily wasn’t too serious, but it still shook the psychie a little and I went back to demo for a week to test out the stoploss feature of my platform. Now I’m tentatively trying again :o.
I don’t use the standard issue indicators but I do use indicators that are more support and resistance in nature like horizontal/trend lines, chart patterns, and some custom indicators to tell me news times, pip ranges, etc. Then I watch for big pip moves and trade a reverse/retrace when they exhaust, or small pip moves and trade an eventual breakout of them.
If you’re interested, I suggest this thread…301 Moved Permanently from the first post.
Then try the methods using “micro” sized lots while you practise.
Sorry to hear about your loss but I have attached the system I use. A majority of us long term traders are using it. This month we are up about 643 pips. The system file I attached below is called contains the core system called forexandroidversion3 you can do a Google search on it. A lot of people are using it and this will keep you from blowing your account. It will generate the trades for you then present the detailed trading information of where to enter and exit. Also this system sends the information to your cell phone and email. It takes like 40 seconds to set up and you do not have to configure anything else ever again. It does it on its own. This is the most high tech system out there. Also another system you might want to check out is something called forexringleader they have never had a losing month. And this is for money managers only but just don’t tell them you�re new to forex and I�m sure you can get service. It�s not cheap but it�s better than losing 16k. I have been using android for about 5 months and forex ringleader for about 2 years. Both work great. If you�re serious about being a real full time trader. This is your best chance at getting your money back. This stuff was built by traders who have been at this for years, why re-invent the wheel and learn the hard way just do what the big boys do. And stay away from indicators and mt4 they will always let you down.
Bummer :(. The best advice I can give you is to turn off the trading platform for a week or so, have many beers in between and then come back with a trade idea.
I agree with you that a demo won’t simulate the pressure of trading real cash, but if you keep the position size smaller and in line with 1% of your total fund size, it should be less stressful taking the hits.
If there’s anything that has kept me profitable given some of my daft trades is good money management.
Rule #1 for a forum…Never trust the first post of a new member…especially when offering something that sounds to good to be true. Now prove us wrong bp43!
