Morning all.
We have had 1 of the 7 remaining positions [now 6] close.
It was the GBP/CAD and it closed at a nice 405 pip profit, hopefully this will have banked some of you really good money.
Stay tuned.
Ive had some questions via email and thought id write this in relation to them;
When somebody asks you what you do for a living, Its very interesting when that person knows little or nothing about the currency markets.
First of all you give them a brief summary, a basic understanding, just enough to see their eyes start to glaze over with slight confusion.
Then, normally, they want to know more and finally sooner or later most people all end up in the same place, best described in an article I read online about speculating for a living and these three emotions; Disbelief, fascination, contempt.
Its funny really, because often the reactions of people to the act of making money from speculating tends to have a direct correlation to the emotions the trader can have toward the markets.
I think most traders, newbies to hardened professionals will agree, that trading in all its forms trading can be like nothing else when it comes to provoking an emotional response. This however is one of the most important and unfortunately [or fortunately depending on which way you look at it] most difficult aspects to master. The ability to control ones emotions is arguably essential when trading. The market doesn’t care whether you’ve had a bad day, or whether you thought that might happen or even that your profit limit is only 6 pips away!
The only thing a trader can do is trust his system, control his emotions and practise great discipline at all times… that or have a god given gift [ I bow down to you Mr Soros. ]
…or of course, actually find that crystal ball everyones looking for!
Morning all,
Always nice when the day starts with some pips for breakfast!
The AUD/USD position has closed at a 556 pip profit [some of you may have got more, if you performed a late entry], leaving the remaining 5 open positions all in profit and at a collective profit of over 1000 pips as I type this.
Stay tuned.
Hello hello,
Ive had some more question via email and my website about my short term / intraday trading system.
The questions were generally along the lines of, ‘how does it work’ etc.
I dont give access to my short term trades as they can be very short in duration and giving access to them so that they are accurate is difficult.
I will however do my best to answer any questions on here and my website, you have about trading in general, but more specifically short term / intraday trades and systems.
Fire away, im all ears…
Wow, nobody wants to ask a professional trader any questions???
Ok, well has anybody spotted the lovely long term trade on the USDOLLAR INDEX?
Hi Moto
Please, what broker you use for trading USDOLLAR INDEX?
Thanks
Michaela
Hi michaela,
I use FXCM, dont really have any complaints about them, they have been very good for me for many years.
Regards.
Move usd/cad stop loss to break even.
Ok, I’ll go for it…!
Hi motormadj,
My first post here, because I’m at the bottom of the learning curve and to be honest don’t have anything useful to add yet!
Your thoughts on managing a long(ish) term position would be much appreciated (I usually just scalp)…
I’ve just taken a short on audnzd after seeing it bounce of it’s 2012 highs from March and May. My plan is for a long term position to follow it down to it’s next major low, and I want to move the stop on the way down to protect some profit but without it getting taken out by a short lived retracement, which is what always happens to me!
Do I just wait for 100pip profit then set stop to break even and leave it there?
My target is the 61.8 fib from 2012 high/low @ about 1.27450, but what to do when (if) it gets there? Do I just close it and consider opening a new one, or somehow try following it lower with a trailing stop?
Hope that’s a valid question!
thanks
motormadnick 
Hello Nick and welcome.
I am too rather suprised that others havent asked more questions! lol
Yes, that is indeed a valid question[s].
One of the best resources by far for newbies is the babypips school on here, so I would strongly suggest going through it all, if you haven’t already?
With regards to scalping, in my opinion, its very advanced and not suited to everyone, so don’t be disheartened if its not gone well. With scalping your brokers spreads are especially important, ie you need very low spread, to avoid constantly fighting against them.
I would say for newbies probably the best time-frames to trade off of are either intraday time-frames like the 15m or say longer like the 4hr, with trades being held for possibly as short as minutes or as long as weeks. OR what I would consider a medium to long term time frame like the daily, with positions being held for weeks or even months.
With the longer time frames/trades there is less negative effect from unpredictable price movements ie unseen fundamentals. [news in general…, elections, disasters etc etc]
With regard to your AUD/NZD you will see that I am actually currently long in that pair, although that doesn’t mean that your trade is necessarily incorrect. It is my opinion that medium to long-term, the AUD/NZD will be going up [the AUD getting stronger], but its entirely possibly to make money selling in a bull market, as price always pulls back at some point.
However, assuming that I’m right [tempting fate here! lol], its possible but not probable a short would be successful. What i mean by that is, I believe that FX is all about probability, the long-term trend should, in my opinion, always be taken in to account, whether your trading off a tick chart or a daily chart… why stack the odds against you?
The way in which your stops, limits and entries should be chosen and executed should be due to validity and that ALONE!
I’ll elaborate, and this is in no way meant to sound like a criticism, because its not, everyone is learning, even professonal traders!! When you say ‘Do I just wait for 100pip profit then set stop to break even and leave it there?’, this doesn’t make any sense [in the nicest possible way. lol] a numerical value that is chosen by a person for any reason other than the valid price action itself is useless.
The markets don’t care weather you have a 100 pips stop or a £1000 at stake etc, those numbers aren’t relevant. Stops, limits and entries should be based on price action,… what the price has done, is doing and then hopefully will do. The decisions will come from what ever your trading system is based on [it generally takes years to create a profitable system], ie support and resistance, Fibonacci, Ema’s etc etc.
As an example, when you looked for you trade certain things may have been considered, like a trend downwards [which there has been] or lower highs and lower lows looks like a reasonable bet to most for a short? How ever is this just a retracement/pullback in a much larger, much more powerful, much more important trend upwards??
Either way, once the entry is decided then a stop and limit should also be decided. These may be done at the same time or after. If after, they could invalidate the entry, ie the position turns out to be a false economy/bad risk to reward, so in fact taking the positions isn’t a good idea because you are fighting the odds. However a ‘good’ risk to reward is not necessarily a risk to reward of 1-10, because its useless if actually it never works!
Generally price action works in trends and retracements so often denoted a risk to reward of similar, IE. 1-1, 1-2, 1-2.5 etc
Once the entry is taken and the stops and limits are placed [would should be predetermined] then once the position has moved positively the stop may be pulled up or trailed once price action has achieved criteria set in your tried and test PRACTICE trading system. ie. it has completed 50% of the position, it has past an Ema of significant, it has done some many candles, days etc etc, what ever gives results. This is something that only testing, generally over years can achieve.
You are Right in looking at 52week high lows etc, these ARE significant…so you are learning, not everyone does.
I hope at least some of that makes sense. lol
If you have anymore questions email me at; <[email protected]>
Kind regards,
Josh
Thanks Josh, great answer.
You’re right, the 100 pip thing doesn’t make sense, it’s just a nice round number, that’s very naughty of me! From your explanation I’ll look at any developing soft resistance and ema’s. My entry stop was set with a bit more consideration - just above the 3 previous highs of this year at 1.30600, and this is also a little further above my entry point than the biggest retracement during the previous downtrend of may-june. I think is the kind of assessment you’re suggesting.
I think understand where your long position comes from, and I will probably join in on that one in the near future, but my reason for short was the rising wedge that’s formed over the past 5 months - I’m looking at the retracement to the rising support of this wedge (which isn’t at 61.8, that’s where the previous support was, I guess I forgot what ‘rising’ means!!!). To me this looks valid, and it’s only a very small lot size so there’s not much to lose… feel free to disagree, I can take being told I’m wrong by someone who knows better!
As far as scalping goes, it’s gone well but I accept that’s maybe down to luck so I’m leaving that behind for now and looking for trends to jump on.
Thanks, you’ve been very helpful
Hi Nick,
I have to say, you are very knowledgable for a newbie and do appear to be learning quickly and most dont.
With regard to your AUD/NZD, like I said previously, you may well be correct and make money shorting it, it depends on how large the position is and when it was taken really. The fact that you have taken into account over 5 months of price action is good, a lot of new traders often dont look at enough data/price action to make an educated decision.
If you were making money consistantly for a reasonable period of time, ie weeks or months scalping, then I was say definatley continue to do that as well, as thats very impressive for a newbie.
If you have anymore questions please email me; <[email protected]>
Thanks,
Josh
Afternoon my FX friends,
The NZD/USD long has just closed at a 569 pip profit.
Always a nice way to end the week!
Stay tuned.
PS. if you like the thread please rate it 5 stars! Thanks!
Hi M
My question is, how do you find out what is a low Risk entry, apart from looking to the main Trend, to minimize drawdown.
Do you have any information about how much drawdown is technically sound, apart from looking to your Account size.
I would Love to Hear your opinion, since these are difficult for me to determine. I am Not a complete beginner but try to finetune my Way to become better.
I am impressed about your Way of keeping trades Open for soo Long, this is my goal 
Mike
Great Trade.
Thanks Scorpiock, please rate the thread 5 stars if you like it.
In response to your question Mike, generally it’s advised that 1-3 percent of an entire account balance (cleared balance not equity) is used per trade/position (so the stop would equal 1-3%, however the profit limit maybe higher as this does not risk any current balance).
With regard to drawdown ie exposure to whole loss, eg the maximum amount a trader can lose at any one time (the sum of all open trades closing at a total loss), say a second large finanical crisis [if we ever get out of this one. lol], world war 3, etc, this is more of a personal decision.
Some professional traders I know will have a drawdown of as little as 1-2%, basically a single position, as they enter and exit positions frequently eg scalpers. Others will have considerably larger drawdown limits such as 30% or more as their positions are much longer term and are at realitively less risk when condered against the macro picture ie. all risks considered.
I’m currently writing this on my iPhone so it’s possibly not the most I depth answer.
Kind regards.
Josh
Thanks for the rating PatrickJC!
Thanks for the rating Scorpiock!
Morning all.
Ive had a few questions via email and my website regarding trading frequency and thought I would post up one of my previous website blog posts, as I think it will be useful.
[U][B]
Over-trading[/B][/U]
Over-trading is a very real issue for the majority of forex newbies. Below are some of the problems FX beginners exhibit;
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IGNORING OR SECOND GUESSING A PROVEN SYSTEM!! Obviously newbies will try many different methods of trading and rightly so. The issue is when a ‘trader’ finds something that works and can’t stick to it.
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Feeling the urge to place a trade within five minutes of opening a forex chart.
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When you’re away from your forex trading platform, you feel like you’re constantly missing trades.
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You think that trading more often will make you more money.
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You can always find a way that your bad trade would have gone well, if you’d done this or this, it would have been great, however this new found knowledge will make no difference to your future execution.
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Your urge to trade means you cut short your weekend so you can always trade on Sunday evenings. In fact, you find the whole ‘weekend’ concept very inconvenient since you’d much rather be trading on Saturdays as well.
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You have a history of being addicted to things and forex is the latest. This is no joke - there’s a very real high to be had from trading, so if this is the case keep that strongly in mind.
They are just several of the signs/issues of over-trading. The reality is that some people will trade very frequently and be profitable, this isn’t over-trading. Over-trading is like an addiction and an addiction is doing something regularly to the point of detriment ie. trading all the time but losing money.
Hi motormadj!
I am interested in investing in forex, but while I learn i would like to start quickly with real money following professional signals, like you offer.
What amount do you think [U]necessary [/U]to start with?
thank you for your answer.
Patrick