2000 posts later - what have i learnt?

Beginner Questions
1

Dear readers,

I have now reached my 2000 post mark on this forum and I thought I would give a little input.

What have I learnt?
What have I seen?

I have seen expert traders.
I have seen trolls.
I have seen newbies ask the same questions over and over again.

The most frequently asked repeat question on this forum is…
“Who is the best broker?”

I have seen great contributions.
I have seen much utter nonsense.

I have seen many arguements and many disputes.
I have seen a whole number of people banned for various reasons.

[B]But the biggest thing I have seen is shown in the following picture >>>[/B]


By tymen1 at 2009-01-16

The above picture is truely reflected in this forum.
I have seen so many posters simply come and go.

That does not mean that they all have stopped trading.
But if traders are anything like me, they will keep in contact with this forum in between their many trades.
And if traders are winning well, then they may get excited about it and post again on this forum.

However, that is not what I see.
There are only two Honorary FX Members that have been here longer than me, namely [B]Rhodytrader [/B](John Foreman) and [B]Dpaterso [/B](Dale Paterson).

So many great contributors I do remember - who are now long gone.
Are they still trading - who knows?
I have seen some return from nowhere, such as [B]Ramrocket[/B], who was here in the early stages of this forum.

2

[B]What else have I learnt?[/B]

Well, in my final years on this earth, I have learnt that money is not everything.
There is a lot more to life than just making money.

If my facts are correct, one of the richest men on this earth, the husband of Jakie Onassis, died a very unhappy and lonely man.

People are at their most fullfilled when they are helping someone far less fortunate than they are.

2 years ago, I came across a woman who owned a flashy Mercedes Benz.
She had a minor car accident and a tiny dent was knocked into her front bumper.
She made much of the matter, sued the other car driver, and got a brand new bumper.

I know people can spend much money putting on a second storey on their home. (mansion).
But are these the best priorities?
With prayer for someone less fortunate, having no home at all, you can move whole mountains!!
And that with no money.

The woman with the Mercedes Benz can sleep well at night - knowing that her Mercedes has a nice new bumper, all shiny too.
But I am sure her heart is empty.
Now a person who prays and gives to those less fortunate can sleep even better - knowing that a great Creator is in control.

For you who have money, or are successfully making money at forex from knowledge gained from this forum - you have an added responsibility.

[B]Give 10% to the worthy causes or the poor.[/B]

Do that before tax.
God is before the taxman, not the other way around!!

What comes around goes around.
The materialism of this world should not be your main priority.
People are more important than things.

When you are helping others who have little, life is at its best, and you have the greatest satisfaction.

[B]This is the greatest lesson I learn as I make money trading forex.[/B]

:slight_smile: :slight_smile: :slight_smile: :slight_smile:

3

As a mark of 2000 posts, I am now going to present the [B]finest trading [/B][B]method [/B]ever posted on this forum!!

Look for it in the forum posts!!

4

i think you will find that the traders that ‘make it’ are more inclined to follow this paradigm whic has been around for years which highlight the 5 levels. I first came across this in the late 80s. Lets hope you can climb the next level before you get to 3000posts!

[B]Step One: Unconscious Incompetence.[/B]This is the first step you take when starting to look into trading. you know that its a good way of making money because you’ve heard so many things about it and heard of so many millionaires. Unfortunately, just like when you first desire to drive a car
you think it will be easy - after all, how hard can it be? Price either moves up or down - what’s the big secret to that then - lets get cracking!
Unfortunately, just as when you first take your place in front of a steering wheel you find very quickly that you haven’t got the first clue about what you’re trying to do. You take lots of trades and lots of risks. When you enter a trade it turns against you so you reverse and it turns again … and again, and again. You may have initial success, and thats even worse - cos it tells your brain that this really is simple and you start to risk more money.
You try to turn around your losses by doubling up every time you trade. Sometimes you’ll get away with it but more often than not you will come away scathed and bruised You are totally oblivious to your incompetence at trading. This step can last for a week or two of trading but the market is usually swift and you move onth the next stage.

[B]Step Two - Conscious Incompetence[/B]
Step two is where you realise that there is more work involved in trading and that you might actually have to work a few things out. You consciously realise that you are an incompetent trader - you don’t have the skills or the insight to turn a regular profit.
You now set about buying systems and e-books galore, read websites based
everywhere from USA to the Ukraine. and begin your search for the holy grail.
During this time you will be a system nomad - you will flick from method to method day by day and week by week never sticking with one long enough to actually see if it does work. Every time you come upon a new indicator you’ll be ecstatic that this is the one that will make all the difference.
You will test out automated systems on Metatrader, you’ll play with moving
averages, Fibonacci lines, support & resistance, Pivots, Fractals, Divergence, DMI, ADX, and a hundred other things all in the vein hope that your ‘magic system’ starts today. You’ll be a top and bottom picker, trying to find the exact point of reversal with your indicators and you’ll find yourself chasing losing trades and even adding to them because you are so sure you are right.
You’ll go into the live chat room and see other traders making pips and you want to know why it’s not you - you’ll ask a million questions, some of which are so dumb that looking back you feel a bit silly. You’ll then reach the point where you think all the ones who are calling pips after pips are liars - they cant be making that amount because you’ve studied and you don’t make that, you know as much as they do and they must be lying. But they’re in there day after day and their account just grows whilst yours falls.
You will be like a teenager - the traders that make money will freely give you advice but you’re stubborn and think that you know best - you take no notice and overtrade your account even though everyone says you are mad to - but you know better. You’ll consider following the calls that others make but even then it wont work so you try paying for signals from someone else - they don’t work for you either. You might even approach a ‘guru’ like Rob Booker or someone on a chat board who promises to make you into a trader(usually for a fee of course). Whether the guru is good or not you wont win because there is no replacement for screen time and you still think you know best.
This step can last ages and ages - in fact in reality talking with other traders as well as personal experience confirms that it can easily last well over a year and more nearer 3 years. This is also the step when you are most likely to give up through sheer frustration.
Around 60% of new traders die out in the first 3 months - they give up and this is good - think about it - if trading was easy we would all be millionaires. another 20% keep going for a year and then in desperation take risks guaranteed to blow their account which of course it does.
What may suprise you is that of the remaining 20% all of them will last around 3 years - and they will think they are safe in the water - but even at 3 years only a further 5-10% will continue and go on to actually make money consistently. By the way - they are real figures, not just some ive picked out of my head - so when you get to 3 years in the game dont think its plain sailing from there. I’ve had many people argue with me about these timescales - funny enough none of them have been trading for more that 3 years - if you think you know better then ask on a board for someone who’s been trading 5 years and ask them how long ittakes to become fully 100% proficient. Sure i guess there will be exceptions to the rule - but i havent met any yet. Eventually you do begin to come out of this phase. You’ve probably committed more time and money than you ever thought you would, lost 2 or 3 loaded accounts and all but given up maybe 3 or 4 times but now its in your blood One day - im a split second moment you will enter stage 3.

[B]Step 3 - The Eureka Moment[/B]
Towards the end of stage two you begin to realise that it’s not the system that is making the difference. You realise that its actually possible to make money with a simple moving average and nothing else IF you can get your head and money management right You start to read books on the psychology of trading and identify with the characters portrayed in those books and finally comes the eureka moment.
The eureka moment causes a new connection to be made in your brain. You
suddenly realise that neither you, nor anyone else can accurately predict what the market will do in the next ten seconds, never mind the next 20 mins.
Because of this revelation you stop taking any notice of what anyone thinks - what this news item will do, and what that event will do to the markets. You become an individual with your own method of trading
You start to work just one system that you mould to your own way of trading, you’re starting to get happy and you define your risk threshold.
You start to take every trade that your ‘edge’ shows has a good probability of
winning with. When the trade turns bad you don’t get angry or even because you know in your head that as you couldn’t possibly predict it it isn’t your fault - as soon as you realise that the trade is bad you close it . The next trade or the one after it or the one after that will have higher odds of success because you know your system works.
You stop looking at trading results from a trade-to-trade perspective and start to look at weekly figures knowing that one bad trade does not a poor system make. You have realised in an instant that the trading game is about one thing - consistency of your ‘edge’ and your discipline to take all the trades no matter what as you know the probabilities stack in your favour.
You learn about proper money management and leverage - risk of account etc etc - and this time it actually soaks in and you think back to those who advised the same thing a year ago with a smile. You weren’t ready then, but you are now. The eureka moment came the moment that you truly accepted that you cannot predict the market.

[B]Step 4 - Conscious Competence[/B]
You are making trades whenever your system tells you to. You take losses just as easily as you take wins You now let your winners run to their conclusion fully accepting the risk and knowing that your system makes more money than it looses and when you’re on a loser you close it swiftly with little pain to your account You are now at a point where you break even most of the time - day in day out, you will have weeks where you make 100 pips and weeks where you lose 100 pips - generally you are breaking even and not losing money. You are now conscious of the fact that you are making calls that are generally good and you are getting respect
from other traders as you chat the day away. You still have to work at it and think about your trades but as this continues you begin to make more money than you lose consistently.
You’ll start the day on a 20 pip win, take a 35 pip loss and have no feelings that you’ve given those pips back because you know that it will come back again. You will now begin to make consistent pips week in and week out 25 pips one week, 50 the next and so on. This lasts about 6 months

[B]Step Five - Unconscious Competence[/B]
Now we�re cooking - just like driving a car, every day you get in your seat and trade - you do everything now on an unconscious level. You are running on autopilot. You start to pick the really big trades and getting 200 pips in a day doesnt make you any more excited that getting 1 pips.
You see the newbies in the forum shouting ‘go dollar go’ as if they are urging on a horse to win in the grand national and you see yourself - but many years ago now. This is trading utopia - you have mastered your emotions and you are now a trader with a rapidly growing account.
You’re a star in the trading chat room and people listen to what you say. You
recognise yourself in their questions from about two years ago. You pass on your advice but you know most of it is futile because they’re teenagers - some of them will get to where you are - some will do it fast and others will be slower - literally dozens and dozens will never get past stage two, but a few will. Trading is no longer exciting - in fact it’s probably boring you to bits - like everything in life when you get good at it or do it for your job - it gets boring - you’re doing your job and that’s that.
Finally you grow out of the chat rooms and find a few choice people who you
converse with about the markets without being influenced at all.
All the time you are honing your methods to extract the maximum profit from the market without increasing risk. Your method of trading doesnt change - it just gets better - you now have what women call 'intuition’
You can now say with your head held high “I’m a currency trader” but to be honest you dont even bother telling anyone - it’s a job like any other.
I hope youve enjoyed reading this journey into a traders mind and that hopefully youve identified with some points in here.
Remember that only 5% will actually make it - but the reason for that isnt ability, its staying power and the ability to change your perceptions and paradigms as new information comes available.
The losers are those who wanted to ‘get rich quick’ but approached the market and within 6 months put on a pair of blinkers so they couldnt see the obvious - a kind of “this is the way i see it and thats that” scenario - refusing to assimilate new information that changes that perception.
Im happy to tell you that the reason i started trading was because of the ‘get rich quick’ mindset. Just that now i see it as 'get rich slow’
If youre thinking about giving up i have one piece of advice for you …
Ask yourself the question "how many years would you go to college if you knew for a fact that there was a million dollars a year job at the end of it?

5

Yes, I am very familiar with this script outlining 5 levels.

It was first posted on this forum by Pipgod (Superior Master Contributor and Member) several years ago.
I remember reading it then, and decided that I would save the document to my favourites section where I have it now.

There appears to be little that I have not seen before.

But post anyway!! :slight_smile: :slight_smile:

6

Congrats Tymen. Not sure about the smiley orange though!

7

Hmm, waiting to see the finest trading method. I am interested by that. :slight_smile:
In babypips, I see most of the traders concentrating on small timeframes. While forex factory most of the traders are influenced by james16 and jacko, doing higher timeframes. :slight_smile:

8

There is a reason for this orange smiley [B]Tonymand[/B]!! :smiley: :smiley:

You will see in the coming posts!!

9

Great to know you are interested.

You will find it rewarding.

It will handle any timeframe, long or short. :smiley: :smiley: :smiley:

10

Nice post Tymen.

The orange smilie is kind of creepy, lol.

11

Good!! :smiley:

It is meant to be creepy!! :smiley: :smiley: :smiley:

12

Nice post tymen.

I’ve seen that pie chart and the 5% qoute over and over again.

On it’s surface, to people who don’t think deeply, it implies that only 5% succeed because trading is hard and it’s the markets fault.

I’d like to comment on what I feel is the reality of that 5% figure. It isn’t that it’s so hard only 5% can succeed.

Over my few months at babypips and using all the posts I’ve read as an average of all traders, (which is damn near the whole forum) I’d have to say it’s just that the qeneral quality and quantity of people who take up trading guarantee a high percentage will fail.

Now that might sound like I’m putting a lot of people in the forum down. And I guess I am. But, the reality of trading forex, what with micro accounts and home computer order execution, is that the entry level is EXTREMLY LOW. I’d have to say in all of my home business endeavors the things you have to learn and the money you have to put into it, to start, trading Forex is extremely easy.

The real trick is getting experience and skill. Most businesses don’t work like that. For instance I do website design on the side, as one of my home businesses. I even lived solely off of that for 3 years, when their was a time website design wasn’t so cut and paste and template orientated. To get into that I had to go through a learning curve of learning coding and design, before I actually got to the business part of doing it for money. With trading, you can jump right into the buinsess end of making money, within days of discovering the concept of trading forex. With MT4 placing orders and placing charts is rediculously easy, everything is point and click.

So, with this entrance threshold being so low it just about guarantees anyone with $25, that thinks for a second about the possibility that trading forex can make them money can jump in very easily.

What this leads too is the types of people who believe get rich quick infomercials, and people who think it’s possible to trade a $25 dollar micro account to a million inside of a month. In other words people who look at it like buying a lotto ticket, but they think it has more chance of happening.

It also leads to a good percentage of people, (and I’ll probably be thought less of for saying this), who quite simply are very, very, stupid, and have no business getting off the short bus. Going over babypips forums and other noob trading forums, it struck me that there was a good percentage of posters that asked extremely stupid questions. (sure you have to ask questions, but some are just outright moronic) Or, worse yet couldn’t even type out a coherant post. English was their first language, but they made it seem as if they had just learned it.

There, I said it, plain and simple, I believe a big percentage of people who delve into trading forex (and fail) are simply stupid and or lazy. Stupid & lazy = worse combination for any type of endeavor that takes self initiate and responsibility. They have no business trying to run a trading business. The failure was their own fault.

If that pie chart was labled correctly, it would read: 1% & 4% reasonbly intelligent and learned the skills they needed and mastered them and kept going every time they failed and examined everything they did (also great amounts of self determination & self reliance.

5% still learning, reasonably intelligent, might not quit and learn enough to go to the 4% level.

36% quitters & Gamblers & lotto ticket buyers AND people who can’t or refuse to learn things from failure and keep trying. And or, people who give up on endeavor when it gets just a little bit hard or frustrating.

54% Flat out too stupid, or just don’t have the personality traits required to run anything resembling a home business. Or, they are stupid and have poor personality traits.

13

I agree with just about everything you wrote. Another way of analysing the 1 and 4% would be to say that only 5% of people who enter forex have the combination of at least average intelligence along with strong enough discipline.

Good and brave post Phoenix

14

It certainly is. I did enormously admire your choice to use your actual portrait. I thought about it myself, but decided against it. Anonymity is pretty nice.

Waiting with great anticipation for the promised post(s). Although I suspect that it might be of a more philosophical nature than many hopeful newbies would want.

15

Yes I agree with this. Consider if some universities threw their law, engineering, business or medical courses open to all comers it is obvious that quality would dive and pass rates would fall. However also note Seans comments that even when people are screened and offered first class training they dont necessarily do that well and there was a failure rate in the Turtles experiment

Stupid is however too harsh. I think it fairer to say that people are naive and simply do not understand what they have to learn and who they are really up against in the professional trading sphere. They are also lazy. More than once have I seen posters asking for a mentor to turn their trading and lives around - oh, but cant afford to pay anything for that - but they will be extremely grateful!

16

[B]Phoenix[/B],

Superb post. Your points needed to be made, whether or not some people feel like their toes have been stepped on.

(But, “the short bus” ? — that was a bit cruel!)

[B]mh[/B],

Regarding your comments: I didn’t realize that Tymen was now using his actual portrait as an avatar — in which case,
“creepy” doesn’t begin to describe it.

As for your anonymity, you are so anonymous that I don’t even know how to type your screen name, let alone pronounce it.

[B]Tymen[/B],

I’m joking with you, brother. Looking forward to your forthcoming [I]Finest Trading Method Ever Published.[/I]

[B]tonymand[/B],

I don’t think Phoenix’ use of the word “stupid” was too harsh. “Stupid” implies the inability to learn. And that inability is on display almost daily on this forum and on every other forum — in fact, wherever newbies congregate in the forex world.

I would add “ignorant” to the description. “Ignorant” implies lacking knowledge. And I’m not referring to a lack of forex knowledge. I’m referring to a lack of the basic knowledge that used to be called “civics” — before our public education system was hijacked by liberals, with their politically-correct dogma.

The general population is so ignorant of simple economics, that the average person on the street cannot answer the most basic questions. Such as, What do you know about supply and demand?, What is inflation?, What is a speculator?

And yet, this same person will watch a late-night informercial for 4xEasyMoney, or some such thing, and actually believe the sales pitch: “anybody can do this”.

Here in the U.S., one of our popular radio talk-show hosts says that ignorance is the most expensive commodity we have in this country. To that, I would add that when ignorant people dabble in the forex market, it can become very expensive [I]for them[/I].

There. I’ve vented, and I feel much better.

Clint

17

Very insightful comments, some might be a little vain but very true indeed. It seems to be built into our society to be either dependent on somebody or something else. Its obviously ingrained into people’s mentality to find the fastest way to one’s goal. Be it losing weight through the latest fab diet or getting rich through some scam on late night Tv , the fact is that there will always be those that want what they will not work for. But those that do will need the tools by which they can achieve their goals and this forum is definitely one of those tools.

18

Fair enough but it actually means lacking intelligence or common sense (Oxford English Dictionary). Whilst this may be so with some I dont think the majority. Nevertheless I dont disagree with the general thrust of these posts. One only hopes that by reading on boards like this some people get the idea there is a lot more to this than they perhaps realised and in some way maybe we have saved them from themselves (oops there goes that flying pig again!)

19

I agree with ThePhoenix quite a bit.

Sheep get slaughtered.

22

I guess I’m in the category of the “Quitter”.
However there are two reasons for this:
[B]1st.[/B] I’m in college and finishing my college degree has a bigger priority right now. I simply can’t go to school and sit behind my pc at the same time.

[B]2nd.[/B] After weeks of demo trading (multiple times in the last 2 years) I realized something that has always been in the back of my mind, but just didn’t want to believe it…[B]FOREX trading is just as risky as gambling![/B]
You might make a couple dozen of pips one day only to lose them the next day.

Trading systems are an illusion. It’s nothing more then your mind desperately trying to find a pattern in the chaos.
You religiously try to stick to your system, but in the end your balance is still declining…just like gambling.

I don’t even believe anymore that there are people out there actually making consistent profits (besides banks).
Not even some of the honorable members here on this forum or the mythical 5%.
Ask live-traders to show there backlogs/trading success and not one will show it to you, which is of course because not one has had success trading the FOREX.

I’ve lost hope in FOREX trading, because I have yet to see anyone have success at it, so I’m now planning to invest in the stock market which seems like a far better place to make use of my money.

If you don’t agree with what I am saying are you then able to show me your trading success?