Beginner's Disaster!

Beginner Questions
1

HI Everyone

I am new to FX and new to this site, but let me waste no time in telling you about my very brief, very disastrous foray into the world of FX.

I recently opened a micro account with FXCM with $400. Within the space of 8 days I have successfully manage to convert that $400 into $150. Luckily. however, I have realised that right now, I shouldn't be allowed within 200 yards of a live trading account. ( only cost me $250 to learn that !! ) Now since I believe honesty is always the best policy, let me tell you my mistakes so far as I see them.
  1. Read a couple of things about MACD, Bollinger and Stochastics and decided I knew it all.
  2. Didnā€™t know it all !!
  3. Came home from work at night and thought I could just sit down and get on with it. Paid no attention to economic events or news.
  4. Started chasing to regain losses by using bigger and bigger lot sizes. Just lost more.
  5. DIDNā€™T use stop losses.
  6. Probably didnā€™t start with enough money, but then in this case that was probably a blessing in disguise.
  7. Pure and simple, didnā€™t, and still donā€™t, have the education to be messing around with FX.

All that said, my account is still sitting at $150. I wonā€™t touch it now until I have learned a whole lot more. As you probably know, micro accounts only deal in 10 cents per lot Eur/Usd, so at the very least, when I DO learn some more, Iā€™ll start using it again to see how I get on.

 Last thing I would add is this. I understand why all FX education sites tell people to start with a demo account. But believe me, it is NOTHING like the same as using REAL money, regardless of how small the amount. I was once losing $23,000 in a demo account, but hey, not real money so no panic. I let it ride and ended up making $6000. Easy this FX !!

 But you try being down $1 of REAL money and you're reaching for the panic button.

My advice ?? Get educated first !! Start with a micro account and play for pennies.

Sorry for going on and on.
Love to you all from Scotland .
The Home Of Golf .

2

St Andrews yesā€¦ Glasā€™gee perhaps not? Iā€™ve been there in the wee hours! LOL!!!

Good for youā€¦ nothing like getting stomped on for a reality check! :slight_smile:

3

It takes a little while to stop shanking trades off into the gorseā€¦

Go back to the practice range, get a little more experience with the wedges, and stop taking the driver out.

When you go back out for a real round, use your putter from tee to green by using the smallest lots possible.

If you have a micro account, depending on your broker, you may be able to trade nanos as well. I would highly advise doing that.
Those are only a penny a pip to be wrong, and it would take a long time to slice through $150 at a penny a pip.

One of these days I want to make my way over to the home of goff.

I wonā€™t be partaking of any haggis though.
But I WILL drink more than my share of Lagavulin :smiley:

4

And therein I confront my nemesisā€¦ MTā€¦ you sound more than conversant with the ā€˜batsā€¦ errā€¦ sorry clubs? in the trunkā€™ type of thing. Golf yes I 've tried it but the bill for returfing the entire 18 holes is just too high! Iā€™ll stick to Rugby! LOL!!!

5

Rugby?

Bahā€¦ Rugby is for girlie men.

:smiley:

I grew up in Hawaii, and playing rugby there is almost a death sentence.

The game there is played by rather stout Polynesian he-men with less than full sets of teeth, and rather insidious grins looking at the new guy.

Who said anything about me actually playing golf?
I wound up carrying the golf clubs to protect myself:p

6

QUOTE=Master Tang;258688]Rugby?

Bahā€¦ Rugby is for girlie men.

:smiley:

I grew up in Hawaii, and playing rugby there is almost a death sentence. :18:

The game there is played by rather stout Polynesian he-men with less than full sets of teeth, and rather insidious grins looking at the new guy.

Who said anything about me actually playing golf?
I wound up carrying the golf clubs to protect myself:p[/QUOTE]

Girly menā€¦ Iā€™m outraged! LOL If you donā€™t come off the field in a body bag you haveā€™nt played the game! American footballā€¦ PAHā€¦ whats with all this body armour? Nambie pambies! And on that ā€˜French word I can never rememberā€™ā€¦ somethingā€¦accordā€¦ LOLā€¦ I wish you a good night! :18:

7

youā€™re lucky I lost much more on my first contact with forex

8

I think most newbies have been here. you open a demo, get lucky a few times and think its easy. from then a few things can happen.

-you continue to overestimate your ability and open a live account or- unfortunately, this was the OP.
Or
-you start to take some big losses (more than you made) and suddenly reasses the situation.

  • from there, you will either think
    "this is too dangerous, might as well be gambling, sod this Im off to go work for the man.ā€œ
    or
    "ok, I know money can be made here, but Iā€™ve got to sort myself out.ā€

the next step is to:

  • open a demo account that has the same amount as you would be using initially with a live account. You may need to open many.
  • start to read up on any/everything FX.
    -spend the next couple of months finding the right strategy, and cutting away all the fat that newbies still have like bad trading habits
  • spend the next couple of months practicing.

I would say I am still at the strategy testing/finding and fat cutting stage.

9

From 400 to 150? Thatā€™s great! Your glass is now (almost) half full! :smiley:

The goal of the game is NOT to make money quick. The goal of the game is: How long can you stay alive in a small nutshell out in the ocean with a bottle of water while sharks trying to get you. Here you go. Almost half full! Just try to keep that until land comes in sight. Even if it is a no mans island you can see that men can manage to survive, like Robinson Crusoe did. :wink:

10

HoG!, Awesome man! I did nearly the same exact thing when I opened my first account. I started with 500 and tanked it down to 240 in just about the exact same time. I withdrew cash and went back to demoā€™s for another few months before I tried again. Thing is, I started back with $200 and I have now made that last for almost 4 months now and 300 trades later. Thing I have learned is risk/money management, which has kept me alive quite well now.

fi

11

It is very interesting-why we all do the same mistakes?
I opened my first forex book only after i have lost my first 100$))))
Only after this i understood that this is not the computer game where you can restart again and again, it is my money, and if I donā€™t want to lose everything I have to traing more and more, read different books and analyse everything in this market happens.

12

It could have been worseā€¦

you could have come home drunk and bought 7 million barrels of crude.
City firm PVM Oil lost Ā£6m after drunk broker bought 7m barrels of crude | Mail Online

13

Great read! Grip it and let it rip!

14

Love the ā€œGlass is half fullā€ outlook Buckscoder. So positive !! I think another problem that newbies face, and Iā€™m sure a million newbies have faced it before me, is impatience. Weā€™re just itching to pull that trigger and trade when more than likely the best trade is no trade at all. I imagine, for the most part, itā€™s a matter of waiting til the trade shows itself to you, rather than going trade hunting. Thanks for the reply. Home of Golf

15

Hi R Carter,

 If Glasgow in the wee small hours made you nervous, then spare a thought for me. I'm a cabbie in that fair city and God you should see it from my side !! Why do think I'm trying FX ? LOL !!
16

Thatā€™s right. Overtrading is a big issue. Then as I said. Donā€™t aim for profits first. They will come if time is due. Aim for keeping your account alive. Thatā€™s always first goal! You donā€™t wanna slaughter the cow. You want the milk from it regularly!

17

And that right there will take you farther than most in this racket.

Just because you trade doesnā€™t mean you have to trade ALL THE TIME.

Lack of patience, and bad money management, will cost most far more money than they will ever earn.

19

Treat your initial amount of deposit with the same money management you apply to your trades.

Say you have $5,000.00 that you are willing to commit to trading.

Open an account with $100.00, and size your lots accordingly.
Set your risk and money management up with the same thought in mind.

Then, see how it goes.
If you see some consistent earnings over 6 months, then add some.

Maybe another thousand.
That way you wonā€™t be intimidated by the inevitable losses, and youā€™ll learn to manage things in a much more conservative, and responsible way.

Plus, your nest egg is safe if it doesnā€™t seem to be working out for you.

20

Hi ITtrader

Even as a newbie forexer ( just made that word up, didnā€™t know what else to use :smiley: ) myself, thereā€™s something about that question that just plain worries me. Iā€™m not saying itā€™s a bad question, far from it, because I believe there is no such thing as a bad question if you donā€™t know the answer. but it does worry me nonetheless.

If I had started with $40,000, instead of my $400, ( to be more " AFFECTIVE " ) and then made the trades that I made, I would have lost $25,000. And it doesnā€™t matter which way you slice that up, my wife wouldnā€™t call that affective, she would call that justification for performing the ā€™ home castration ā€™ as I slept peacefully in my bed !!

At OUR stage, and I say OUR because I am still learning too, it is the trades you make and the analysis you do BEFORE you make those trades that make you AFFECTIVE, not the amount you throw at it. If I was to take ANY positive from losing my $250, it would be learning that one lesson.

We should learn to walk before we challenge Usain Bolt to a race. God knows weā€™d all like to be millionaires, but impatience will kill you in every endeavour in life my friend.

Like St Sarah said above, " Itā€™s interesting how we all make the same mistakes." The point is you WILL have losses, you WILL make mistakes. But itā€™s better to make little mistakes than life changing ones. So itā€™s the old cliche, ā€™ only use what you can afford to lose ā€™

Hopefully in the years to come, you and I will be able to tell the stories of how we made it big, but for now, have the patience of a saint.

Hope this helps, HoG.

21

From complete newb to street savvyā€¦ you should realistically give yourself 1-3 years at this (in all honesty, probably the latter). But with the right approach, something which you seem now to have adopted it most certainly can be done.

By the wayā€¦ your a cabbie in Glasgow right? Have you seen the guy driving around in that Bugati Veiron? I mean thats just taking the ā€˜P*SSā€™ LOL!!! An Ā£8,500,000 car and he actually drives it around Glasgow!!! LOL!!!