Super new to forex, using an Android App "Forex Games" and playing on a demo account. Clicked "Buy", clicked "Sell" and went from $1000 to $1800. 100% luck, I don't know what I'm really doing. I always think its good to jump two feet first if no harm is done, figure stuff out and then start learning the fundamentals, etc.
Long story short, on Sunday night I was thinking to Buy EUR/USD and Sell USD/CAD. 48 Hours later, EUR/USD is -$500 for me, USD/CAD -$1000 for me. Had I picked the opposite, I would be covered in some serious dough right now! I mean, just thinking about it from the real money point of view… Someone I’m sure doubled their money today in about an hour of work (read: “waiting”)
I’m attaching two screen shots here.
So here is my question: Most days it goes +/- $200 (I think this app is 1:500). Today it goes to -$1000 which is HIGHLY IRREGULAR in my opinion. So my question is… Were everyone aware what would happen to EUR/USD and USD/CAD today since the jump was so massive and everyone made a killing? Or were as everyone surprised as I am? If I can go back in time 48 hours ago, where should I have looked to form my opinion differently to pick the opposite of what I’ve picked?
You obviously dont understand fundamentals and how sentiment works. Also you probably dont have a strategy otherwise you wouldnt be asking why you lost. you dont know about risk management. You were short on usd on both pairs so if you were wrong you were going to lose big. You make $200 and then lose $1000, not very good risk to reward. Lastly, you dont know where the momentum is and how to follow it no matter what your bias. You need to go through the babypips course… again if you’ve already done it.
@AlexFourEx no worries. We’ve all been where you are now. I don’t understand fundamental analysis either and I don’t think sentiment moves the forex markets by even a single pip. Other than that what Rickster said is mostly true.
I suggest observing a few pairs and making trades in your demo account. Don’t worry about blowing it. That in itself will teach you quite a bit.
Do go over the course a couple more times. As you continue to play in your demo account you will find that you will grasp more of the core concepts from the course. Make a list of questions and look for the answers as you iterate through the course material. Post any remaining questions in the forum and someone will provide answers.
Be curious and have fun with this. Enjoy this learning period. Figure out what you need to learn to be a successful trader.
Thank you for both of the replies, however my one question that I have asked wasn’t answered. Was wondering if someone else can please help me out? Since I’m sure in a few days everyone will forget about this and move on to the next thing.
Hi, sorry, I guess I have to be more clear, very sorry, my fault.
My question is: On average, the money moves around 10% a day one way or another. This is if I blindly pick a trade and go with it. 2 days ago it changed by 50% which is INSANE. My question is if this is something that other people have predicted that would happen? As in, they knew that the pips will move WAY MORE then a usual day, or was it a surprise to everyone? I want to make sure (or try my best) to be a head of the game next time something like this happens.
I think you’re focusing on the unrealised gain too closely and letting this drive your trading decisions.
The usual measure for how much a price moves per day is ATR, Average True Range. For example, ATR20 is the average of the high-low distances over day for the last 20 days.
Your unrealised gain is actually a measure of your exposure to price movement, not price movement itself.
When unrealised gain moves so much as this in a short time it indicates that you are heavily exposed to price movement. As has been pointed out you had a double short exposure to USD. This increases risk which is not necessarily a bad thing as long as you have risk control measures in place - a stop-loss plus an underlying system that is consistently profitable such that you are prepared to ride out such gain reversals when they happen. But they will happen. It happened to me this week as I also had multiple exposures to the same currencies across 18 open positions.
Continuing this line, another issue is that you bought EUR/USD and sold USD/CAD. EUR/USD was pretty much ranging right now but its price has been falling. There’s only a weak trend here but you went against it.
USD/CAD has risen strongly from mid-July. Its is well established above the 50EMA, which is sloping upwards. So again you went against the trend. This is a much stronger uptrend than the EUR/USD’s sketchy downtrend so its no surprise this position carried a larger loss when price moved more energetically with the trend but against you.
As far as money management is concerned, the fact that you went down -$1000 on USD/CAD should suggest that your total account capital is very large - $50,000 or more. A large percentage of traders will only risk 1-2% of their capital per trade when their stop-loss kicks in, suggesting you either have a big account or you are taking on excessive risk per trade on a smaller account.
Because the price moved 10% today, it is not guarantee that it will move 10% tomorrow. That is called volatility. Some days price don´t move more than a few pips up and down (20 to 50), other days it moves 180 or more. It depends on many things, financial indicators, news, etc. Also, I see you didn´t set any Stop Loss. If you don´t know what it means, I highly recommend you to read about it and use it to set how much you are willing to risk on each trade.
Forex Games on Android doesn’t offer anything at all. It just offers BUY or SELL and that is it. You cant place any indicators, you cant place any stops at all. It really is a dumbed down version of what forex is all about. The game (I think, it doesn’t say) runs at 1:500, which I know is nuts, but that is how this game runs. You can’t change it.
Thank you so much for everyone who replied here, unfortunately I still didn’t find the reply I was looking for.
So in this game, you start with $1000, once you “BUY” or “SELL” you go all in. The only way to stop it, is if you actually stop it. Otherwise it will go one way or another. Here is how it went fo rme
Day 1: Start with $1000, end wth $1244 = $244 difference
Day 2: Start with $1244, end with $1300 = $56 difference
Day 3: Start with $1300, end with $1564 = $264 difference
Day 4: Start with $1564, end with $1802 = $246 difference
Day 5: Start with $1802, end with $425 = -$1377 difference
Notice how on day 5 the difference was WAY MORE than all the other days? (doesn’t matter if its plus or minus, its just the difference was massive). My question is where did this difference come from? Did some news report came out or something and that is what caused it? This happened this Wednesday. So did any news came out on Wednesday that affected this? If the answer is YES, does that mean if I can go back on time on TUESDAY, I could have read the news that stated that the market will move sooooo much? That way I could have picked the “other option” and made +$1377 instead of losing it?
You’re still in shock from these massive changes in account balance. You’re in so much shock you have not properly thought about and processed and then accepted what you have already been told. The problem is in your choices, not the market’s newsflow.
If you can’t set stop losses on Forex Games on Android, stop using Forex Games on Android.
The fact that markets may have moved a smaller amount recently compared with this move means nothing - it is just an average of what has been, not what is to come.
The FX market is huge and relatively free of regulation, therefore when there is little new input the moves are small whereas whenever something major or unexpected occurs then the move can be huge.
There are many different types of traders and investors in all these markets and with very different purposes and durations and expectations, but it is mainly the speculative element that causes the fast and deep moves.
So you can be assured that if it had been possible to broadly anticipate this move beforehand then it would already have been priced into the market beforehand and would not have resulted in a sharp move at that time.
It is worth noting that there are also traders and automated systems that watch these markets in ticks and fractions of seconds. Any significant move (such as exceeding an average range) will cause traders and systems to jump into the direction and create even more pressure, and the move extension can become exaggerated and self-fulfilling in the short term.
But in the USDCAD I don’t see anything exceptional in recent daily moves. Here is a daily chart for this year. You can see the types of daily variation in ranges and there is nothing exceptional in recent moves.
Afterall, the entire market is not going to grind to a halt at a certain point just because otherwise the daily average pips will be exceeded.
You keep saying no one has replied to your question but I think you’re not reading the answers. I have already answered it. And I ended with do the babypips course again. It is clear you have not done that.
Why did the market move so much? You obviously know nothing about fundamentals or sentiment.
Why did I lose so much? You obviously have no strategy or understand risk management
Did some news report come out? You know nothing about fundamentals… if you did you wouldn’t be asking if it came out
Where did this difference come from? Momentum
Can I go back on Tuesday and trade it? Probably not- as you are not aware of fundamentals. If you know the news so does the whole world who read what you read. Theres no secret article just for you. If you know the news, you dont know if it will be good or bad and then you don’t know if it’ll rise or drop the currency and then what about news that come out on the day which no one can predict. There is no news that tells you how much a market moves… back to you know nothing about momentum or sentiment.
Lastly, trading is not a game so get off that app. Good luck with this.
