Finding successful forex strategy

It’s not about finding, it’s about working out successful trading strategy, it’s not the EASIEST thing to do, but if we are dedicated and if we are really serious then it can be done. For me, it’s the only way to reach our ultimate destiny of success; I always practice hard to get to that. I have been doing well in recent times but I like to do even better, it’s not easy but still something that is fairly doable thing.

Some strategies based on indicators should be changed or re-optimized.

The two things often overlap because it’s possible to earn a lot from studying other systems and understanding why they have an edge.

The only strategy that works, in Forex Trading, is changing strategy from time to time, we need to understand that if you wanna become successful, you need to have lots and lots of practice and select the strategy which is beneficial for us.

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I think trying to combine a bunch of losing trading systems to come up with a winning system makes no sense.

If you want a winning system, here it is:

  1. Identify a trend
  2. Trade the trend
  3. Let a winning trade run and become more profitable set a trailing stop
  4. Cut losers short as early as possible

There you go, a winning system. Now there’s more than a few details left out but I think people make this whole “trading system” far more complicated than it needs to be with a bazillion fancy indicators and trading on ridiculously short time frames.

Stop thinking about what you’re doing as “trading” and instead start looking at it more like “investing”

I think that will help you pick your head up and consider longer time frames and longer holding times for your positions which gives them time to mature and become actually profitable.

My .02

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I have worked as a floor trader on some exchanges, and all i can say is that I have seen millionare scalpers, and millionaire long term traders. Some take the tiny pips on offer daily over and over, and some take a 5 year view on the market. Depends on your personality. Choosde the system that matches your personality. Best of luck!

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Thank you, Jeffrey! I’ll look through

When I first started trading, I was always looking for the answer to, why do most people fail in trading. Well, one conclusion that people can come to, is, it must be someone’s system of trading that makes them fail. I think that one of the biggest keys is to learn that it probably is not the system that makes traders fail. Here is the natural tendency of most traders. When they start to lose, they let the trade run, hoping that it will come back. They are afraid of losing, and they want to try to find a system that will never loses. This fear of losing causes them to hold losing trades hoping that the trade will come back. When they get into a trade that works, they cut the trade off early in profit. They are afraid of ending up losing the trade, so they don’t hold onto it. These actions in trading result in people ending up with a very bad risk to reward ratio. In other words, their losses are much bigger than their wins. Now, go do some math. If someone has a 1 to 0.001 risk to reward ratio, what percentage of trades do they need to win to make a profit. Answer: they need to win almost every trade they ever will take. This proves impossible, and they fail trading. Fact: no matter what strategy you use trading, you will lose trades. Answer: plan for losses. Your biggest goal in trading is to get to the point where you can make more on your wins on average than you lose on your losses. If you see yourself getting to that stage, you will have a lot easier time making money. After that, successful traders simply find a strategy that has an edge. What does it mean to have an edge? Having an edge means that you believe that your system will win more than 50 percent of your trades over time. Successful traders usually use a simple trading system. Knowing they will lose and planning for losses allows them to simply exit losing trades, and they are not upset. The key here is to understand that your system will not make you make money. All systems lose trades. Create a trading plan and plan for losses within it. Try simple systems, and seek to get a good risk to reward ratio. Eventually, create your own system, and trade your plan.

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You cannot rely on a single strategy, you need to learn many of them, in order to change it when it is not yielding you enough in certain market condition, You cannot rely on one strategy for varied market situations.

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So what does this mean?

Are you talking about times when the market does not trend, or something else happening?

What I want to says that there is not a single strategy in Forex, that could be perfect to earn with Forex each and every time. We have to modify our strategies in such a way that we could make the most of it.

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I imagine floor traders have a huge advantage over retail traders, esp scalpers.

I wonder how many retail millionaire scalpers are out there.

Could you give more details about the Floor Traders? I would like to know how it works, and would definitely wanna pursue the same if found profitable.

Good day JeffreyTA, I am interested in knowing the title of Al Brooks book, thank you.

tommor, some strategies work best in trending environment than they do in ranges, I think thats whats they mean.

The optimization process is the same for everyone. We’re all finding ways to better predict trend direction, avoid missing out, and improve timing. Because we’re all working on the same problems, the optimal solutions are the same. The more time you spend optimizing your strategy, the more it will start to look like the strategies of those that are ahead of you in the development process. Once fully optimized, it will be virtually identical to the strategy of the top traders in the world.

I know that is common sense but most people trust popular conceptions over their own judgement. Some know and don’t want to accept it because they are lazy bums. If my saying that turns you off then good because you shouldn’t be wasting your time pursuing something you’re not going to put the full effort into. If, on the other hand, the truth inspires you, then you know what you need to do. This is the true psychological battle in this game. Believing that you can develop a fully optimized world class system and having the discipline to invest the time and effort. Every time I see aspiring traders talk about trading psychology its always performance and execution issues being discussed. Performance psychology is a discussion you must earn by conquering development psychology.

Its not about applying different strategies in different environments. Its about developing the best strategy you can, one that accounts for the variations of every single price attribute. Its possible.

Find Strategy > Discretionary Execution (Improvisations Based on New Information) = WRONG
Develop Strategy > Almost Trust > Discretionary Execution (Improvisations) = WRONG
Develop Strategy > Fully Trust > Execute = CORRECT

I’ve addressed these misconceptions in Discipline vs. Greed and Fear

John
We don’t count on luck.

Yeah, there is not a single strategy in the Forex Trading, which could work in each and every market condition. You need to understand that if certain strategy is not yielding you enough money, you need to change it before you face lots of loss.

Your statement is a counter-intuitive misconception. Your intuition is telling you that you need to develop one strategy you can rely on, a strategy that can handle anything the market throws at it. But you believe what you read in a book and online over your instincts.

These popular misconceptions are traps for people with poor work ethic. We’re used to answers being so readily available that having to diligently grind through every single question doesn’t seem necessary. If you’re thinking you shouldn’t have to reinvent the wheel, you’re being naive. The market favors traders that read charts, not books.

You must follow up the resourcefulness with thorough backtesting. If something is not 100% clear to you, don’t stop until it is. None of that cloudy understanding, full of gaps. You must not fear failure and face those mysteries head on. A man knows how to admit when he doesn’t fully understand something. There are things you’ve mastered and things you haven’t. You know the difference right? Suddenly you forgot how to tell the difference or think that somehow that doesn’t apply to trading because its so complex. Trust me, clarity is possible. So if something is still unclear to you its not because there is no understanding it. Its because you have an incomplete perspective.

You must be humble, open minded, and relentless during the R&D phase of your career. Until something is undeniable, you don’t commit to it. A lot of times I would work all day on one thing and finally figure it out in the 20th hour. Because until that point I knew I didn’t have the full clear understanding. Sometimes I would work three 120hr weeks mastering a single concept. I learned early on not to let a single idea come and go. Every single one was captured and tested against historical price data. Every single idea someone else came up with was captured and tested just as thoroughly. Every single one.

The research and development phase is the toughest part of the journey. Once you have a strategy you fully trust, the next step is to become mission oriented. A man on a mission cannot be influenced, by childish arrogance, to go off script. The rules of my strategy were configured by me at my best. Ultimately I am trusting myself by not breaking the rules. If you break the rules it means there are still unanswered questions. Accept that and get back to work. Confidence is a privilege granted to those that have dedicated years to developing a trustworthy method.

Most people fear investing the time. I had this fear for the first 6 months of my career, then I decided to dedicate my life to this game. I became obsessed with the challenge and willing to sacrifice myself to succeed. Suddenly I had all the time in the world at my disposal and spending it on other things became the risky move. If you aint ready for that type of commitment, you don’t stand a chance against me. Make no mistake, its a zero sum game. No one will ever spill the secrets in those books you’re reading. The real answers come from within, as a result chart analysis, brainstorming, testing and collaborating with peers with the same passion and objectives.

John
We don’t count on luck.

@ _bob

you’re in a funny mood on this post. How is the trading system that you were working on a little while ago, seemed to have v good results.

Greetings, not sure how long you have been trading but there are many approaches that can be long term profitable.

It would depend on your particular skill set and therefore the approach you decide to take that draws on your main skills.

I think the easiest reliable way to make money would be to get in on the trends on import political news, that approach would be more suited to capital growth long term than a fixed income from trading.

I would say pick a simple system and find out what the main features for success with that system are, then find a way to predict if the market conditions near term will have those success conditions.

It’s simple but hard at the same time.