Ever since I started this thread I’ve tried my hardest to be as honest as possible with the things I’ve thought, with the things I’ve done and the trades I’ve made. But there is a problem with honesty. Because as well as telling everyone who will listen about the successes you’ve had, in the spirit of honesty, you then have to be prepared to hold your hand up when you also make a royal backside of things.
Now this may just turn into the ramblings of some-one licking their wounds from a bad time with the FX market, I don’t know. But what I DO know, is that it ain’t going to be short and I hope other newbies really give it some thought before they start their journey, because this HAS happened to me and illustrates to me, how quickly we can forget our new found “Discipline”.
So here we go:
I started this week with a balance of APPROX $133. I’ve steadily grown this back up from a low of sub $50 trading 1 lot at a time, through a micro account. And over the last few weeks of steady growth, I’ve talked a good game of ‘new found discipline’, ‘better entry points’ etc etc.
But at the start of this week, since my balance was now over $130, I decided to up the ante a little and start trading 2 lots at a time. Y’know, speed things up a bit. Now at first, I was very nervous about trading this increased lot size. Even though, relatively speaking, we’re only talking very small amounts of money, it was nevertheless REAL money, MY money and unchartered territory as far as I was concerned.
In fact, I was so nervous, that the first time I traded this new increased lot size, I closed the trade for 1.3 pips profit. But hey, isn’t this great? Now we’re getting 20 cents a pip instead of 10 cents. And that’s when all the rules just went straight out the window, one in quick succession after the other.
I was only in trades for 5 or so pips now, because in reality, that was 10 pips the way I used to trade with only 1 lot. But since I was only in a trade for such a small amount of pips, why bother with a stop loss? And now, with this scalping mentality, why don’t we up the ante again and trade 3 lots? After all, it’s working a treat?
Anybody starting to cringe yet ??
To cut what could be a very very long story short, by Tuesday night I had increased my balance to $151. A fantastic success I’m sure you’ll all agree. But now, after only two days, I’m trading 4 lots instead of my usual 1, and now i’m not even using stop losses at all. All in 2 days flushed with success.
So then on Tuesday night, I decided to SELL the Euro Dollar at 1-3231 ish. No stop loss needed, but thankfully, for some unknown reason, I only traded 1 lot. So for the benefit of those of you who have been living under a rock in the last two days, or like me, living behind the sofa peeking out every now and again at the computer screen, let me just tell you that when I eventually did find the inner strength to cut the trade, my balance was back down to $125.77.
I’m sure I don’t need to tell a lot of the experienced traders out there how I feel right now, because I’m sure that most people will probably have felt something similar at some point in their trading career. But for the the newbies, for the benefit of the as yet unbruised, it’s crushing. Psychologically it hurts, the disappointment hurts. NOT the loss as much as the MANNER of the loss.
Now I know you could say that on the bright side I’m still solvent, still here, still in the game and at the end of the day I’ve learned another good lesson. But to be honest, I’m now questioning what it is I think I HAVE learned during my whole short trading adventure.
I’ve learned how to hit buttons, I’ve learned what some indicators are and why they do what it is they are supposed to do. But do I honestly feel that I’ve learned anything more than just a fancier way to gamble? No, I don’t.
Don’t get me wrong, I’m not saying I think FX is just gambling. Because I DO believe that done properly, FX can provide a good living. But have I learned to do it properly? NO.
It’s all very well reading through things like the school of pipsology, or similar education articles, and reading what indicators are and what they do. But how, as newbies, do you REALLY learn to trade them? And equally as important, how as a newbie, do you learn to curb that enthusiasm and learn when NOT to trade?
Again, it could be argued that the only mistake was not using a tight stop loss which would have cancelled the trade with only a small loss. But even then, I would still have been sitting believing I knew what I clearly don’t know.
So my quest now is rather simple. Education. I intend to stop trading for a while in search of education. Probably to do the things I SHOULD have done before I started trading. Is my ego bruised? YES. Am I feeling sorry for myself? YES. But am I smart enough to realise that this ain’t gonna happen for real if I don’t get educated about it. YES, I am.
I found the video I posted above the other day while mucking around on different sites. I’m glad I found it because it’s helped keep me positive.
I will keep in contact with this thread, and Nikitafx’s thread ( which I’m enjoying reading ) while I’m not trading. If I find a piece of “Education” which I truly find valuable, I’ll post it here., hopefully for the benefit of other newbies.
I started to keep a record of session highs/lows, and I intend to keep doing that. It HAS helped, even though I was undisciplined enough to ignore it.
Also, if I do make any small forays into the market I’ll let you know. But largely, for now, it’s time to do what I hate doing most. It’s time to READ !! It’s time to get skilled, learn what it is I need to know, learn what it is that affects the currency markets and learn how to stop feeling so sorry for myself just after I’ve had my butt kicked !!
So again for the benefit of other newbies, my first port of call is the ‘Currency Trading For Dummies’ book that has been gathering dust in my cupboard since the day I bought it. Will it turn out to be worth reading or a load of smelly stuff? I’ll let you know. But it’s a start, and we all have to do that somewhere.
So, as a last little piece of inspiration for now, (as the violins strike up) I’ll leave you with 4 quotes. 3 of them come from Mr Will Smith in the above video, and the last one (and my personal favourite) has the author’s title at the end. Talk soon folks
HoG
"There’s no easy way around it. No matter how talented you are, your talent is going to fail you if you are not skilled, if you don’t study, or you don’t work really hard and dedicate yourself to be being better every single day "
Will Smith
"There’s no reason for plan B, because it distracts from plan A"
Will Smith
"Don’t EVER let someone tell you that you CAN’T do something…If you’ve got a dream, you’ve got to protect it. If people can’t do something themselves, they’ll want to tell you that YOU can’t do it. If you want something, go get it. Period !!"
Will Smith
"As long as the number of times you fall on your arse is equal to the number of times you get back up, you’re doing OK."
MY GRANDMOTHER
