Hi all, I’ve been trading forex for some time now and have not been able to make any profit.
This is my trading system, I do a strong and weak analysis each day, 10hours after the forex market opens, and pair the strongest against the weakest, that is I buy the strongest pair, and sell the weakest pair, which seems to be very very logical to me, I also take support and resistance into consideration and I never trade any currency that has a medium or High impact new for the day.
My question is, I don’t understand why I end up loosing most of the time, it’s really frustrating, my strategy seems to be very very logical and flawless to me, I don’t really know what’s wrong.
This makes me wonder if people really do make money from forex trading.
PLEASE PLEASE PLEASE, I NEED ADVICE ON HOW TO BETTER MY STRATEGY, I’VE INVESTED SO MUCH IN THE FOREX MARKET, I NEED TO START MAKING MONEY. I’VE LEARNT FOR OVER A YEAR.
If you are really looking and studying the charts, then you would notice that price doesn’t move straight up and down. It’s going to have drawdowns all the time, and that’s probably how you’re losing your money
Do you use any price action analysis in conjunction with support and resistance, ie candlesticks or patterns?
perfect question. He needs other confluences before making any trading decisions
I take it you’re saying that at the London open plus 10 hours you buy what has been going up since then and sell what has been going down. Then you close your two positions before bed-time and repeat tomorrow?
Who ever made money this way? Or is there more to it?
It’s a strange one, these posts crop up from time to time.
I’ll draw a line in the sand and say where I stand on it, sure people will disagree.
But, if you can’t figure this out yourself then it’s not for you - it takes a certain mentality and ability to not only structure your learning but also to be capable of adapting your learning down the routes that provide you with the greatest leverage. (meaning you don’t need to know everything, some trading concepts carry far more weighting and are considerably more crucial)
You ask many of the [few] successful retail traders and they will say they are either self taught, or they had a successful mentor - which I also agree with. (mentors who are professional traders, who have worked in the city or have been exposed to the entire cycle - not a passive member in forums [to put it kindly])
Adaptive learning can’t really be taught, yet it’s necessary in a game like this where the goal posts are constantly changing. Which brings me to this, being told some fixed rules isn’t a long term solution to fixing your problem (profitability).
This is bloody tough to make money from consistently over time.
Also be mindful that strength analysis is a bit of a lagging indicator, like what @tommor said.
Yes, I use price action to get the strongest and weakest currencies, before I pair them
So what do you you suggest?
You took the words right out of my mouth, but said it a lot nicer than I would have. 
I suggest throw this theory out and start again.
Single-day momentum isn’t a reliable indicator of the next day’s price action. Especially when you’re looking for only the two extreme pairs in the market, i.e. the strongest today and the weakest today, which could well be different pairs tomorrow. The significance of this is that as you rotate between different pairs you lose the impetus to price action which comes from riding a pair which is in a consistent uptrend or downtrend over a longer time-frame.
Add to that, you are effectively doubling your bet by taking directionally opposed trades using the same “indicator”, i.e. on the strongest v’s the weakest pair. Everything correlates with everything else in forex (maybe more maybe less, maybe positively maybe negatively) but in your system, if you lose on one, you probably lose on the other the same day.
I would suggest a simple system which involves minimal TA and holding over longer time periods, using simple price action patterns. The simplest pattern is a trend, and a great way to maximise your capital’s effectiveness is to be able to add to the position that’s riding the trend. Intra-day trends are like mirages, and you can only add to trend-following positions in a limited way intra-day.
I assumed you were using some variation of Dennis’s method.
look to the past to predict the future. That’s what I do, and more. I can go on and on in detail, but I would be typing paragraphs
I still have yet to go through his post from the very beginning to understand that method lol but it seems to be working for him and others, and I’m sure he also uses other confluences before deciding to enter a trade
minimal technical analysis
I agree with what tommor and BaconSandwich said, up above
(and i think both of them were really polite about it)
what you’ve described above just ISN’T a “strategy”
not by any stretch of the imagination
it’s one of those awkward conversations in which anyone trading with any measure of success doesn’t quite know where to start, to answer your question, because it isn’t really a question
you’re asking how to improve a “strategy” but you haven’t got a strategy there (at least, not from what you’ve said) to be improved
I will add some additional comments on what has already been said here.
This is precisely why it doesn’t work. If it’s logical(obvious) then everyone would do it and own their own islands, but that cannot be since for one person to make money another must lose.
You are on the right track here, most traders don’t make money. Most people claiming massive returns will never show you a broker statement, 1099, etc.
@flamingoproxy is right on the money. Most trading strategies involve intuition and a high degree of subjective analysis, which is why it is darn near impossible to teach someone. Get in a demo account and study how the market’s move, act, and re-act. Try to trade that movement with some good trade management rules and you may find an edge somewhere in there.
I do hope you the best.