How I became a consistently profitable trader

Beginner Questions
7

…If you do not find any significant (at-least over 60%) winning rate, that strategy is useless. Find another and try again.
…

Great post!

I agree with you that finding and having confidence in a statistical edge is very important. However, strike rate is just one component of a statistical edge. It is not necessary to win 60+% of the time to have a statistical edge. You can win 33% of the time and if your wins, on average, are more than twice your average losses, you have a statistical edge.

1 Like
8

Yes, ofcause, you are dead right.

It totally depend on your TP and SL ratio. I should had considered that at the time of writing. Thanks for bringing it up.

11

Welcome back. Interesting thread and good to hear from an old babypips member. Few questions:

  1. What prompted you to recently join babypips after 4 years out?
  2. I disagree with your statement above unless you give your crown jewels to the big boys. Us retail traders or small fish won’t ever have enough strength to move the market
  3. What time frames do you use, I assume it isn’t on the daily from what you say
  4. How long have you been live with your trading strategy
12
  1. As I mentioned in my first post, I’m trying to return the favor to babypips as this was the place I started. I avoided all forums & chat rooms related to forex for about 2 years while I was mastering my trading strategy.
  2. That’s true, we small traders won’t have enough strength to move the market. But after about 25 years if few million traders use the same strategy, it could have an impact. I know it’s a impossibility, but why take chances. :wink:
    3):27:
  3. Over 3 years live trading this same strategy. Still very young. But I had back tested it over 10 years. Then further tested it on random years. It worked the same in oldest charts I could find :slight_smile:
13

but emotions controlling - very, very important

14

hello justmy2pips,

thanks for the thread. do you have any advice on how to evaluate the stastistical edge of a system? eyeballing is nice, but i prefer “real” backtesting, especially if it is a system, that is easily quantifiable and thus easy to put in some form of code and let then let the computer do the computations. i know how to code (matlab), but there are two problems attached:

  1. where do i get reliable data? (h1 would serve my purpose)
  2. getting the data, data cleaning and manipulation and coding the system would probably take a couple of days. i don’t really have that time atm. do you know of any software or something that could be used for backtesting a strategy?

how did you do it?

kind regards

15

Hi, TopFroxx,

I just go into my OandaMT4, in history center, you can double click EURUSD for example, and download historical data for 1min, 5min, 15min,30min,1h… afterwards you can easily export it and use it however you want :slight_smile:

16

I’m long GU @ 6150
Lets see how it goes.

17

Hi,

I’m a programmer my self. I coded an EA for MT4 and back-tested using it. I got historical data from various sources.
As ‘Richard87’ suggested, I got data from ‘history center’ in MT4 also. Tried data from different brokers, downloaded from different places etc.

But all those data I found had gaps. When there are gaps in data your EA doesn’t produce accurate results.

So I was forced to use eyeballing. That’s the only method worked fro me. And I was 100% sure about the results :slight_smile:

If you find any reliable data source in your search, please don’t forget to inform me also.

Just My 2 Pips…

18

I’d buy GU again @ 6050.

My trading strategy has a strong long signal.

But anything can happen in this market, that’s why I use hedging.

At the moment both my long positions are making a loss.
Lets see how it goes.

19

what pair is this “GU”?

20

GU is GBP/USD shorten.

Like wise we use EU, AU, UJ, EJ, GJ etc. Can you guess what pairs those could be :slight_smile:
EUR/USD, AUD/USD, USD/JPY, EUR/JPY, GBP/JPY

Just My 2 Pips…

21

i actually thought it was gbp/usd for a sec but ur numbers confused me, anyway im bullish on this pair as well

22

When you have a system with a statistical edge,
when you learn to execute your trading plan flawlessly,
when you learn to take many small losses emotionlessly,
when you don’t get mad if your SL hit,
when you don’t get thrilled by TP,
when you don’t doubt your trading decisions,
when you don’t hesitate to execute your trading plan anymore,
when trading becomes just executing your trading plan,
when trading becomes boring,
you had achieved consistency of profitability.

If you think otherwise, then my friend, it just means;
you haven’t made all your trading mistakes yet,
you haven’t traded that many trades yet,
you haven’t had enough experience yet !!!

Well, of-cause it’s just my personal experience and opinion.

Just My 2 Pips…

23

Hello.

Excellent!!! And FAR shorter and to the point than my L-O-N-G inane posts!!! LOL!!!

Well done.

Regards,

Dale.

24

money management has a very good
role to play in being a good forex trader
it makes you stay alive in the market…
manage your money wisely

26

Thank you :35:

27

Stats talk is useless. Also, there aren’t a whole lot of profitable traders among those with 33% win percentages! You just won’t in the real world! They would have been demoralized by the insistent losses. Find a trading system & aim for 10 pips or 20 pips win per day. Why traders insist on always swinging for homeruns is beyond me.

28

the reason with only getting 10/20 pips a day is hard coz spreads is expensive
going for 20 pips a day is crazy because where;s ur stoploss ? at 10 pips? spreads is already 2-3 pips…
unless you have a superb broker offering superb spreads

29

That’s why I stated on my first post;
“I know you will not listen to me, neither did I when I was told the same, 4 years ago here at babypips.
Learn it the hard-way, by making all the mistakes that most of us did. It will make you mentally tougher.
Eventually you will mature, will be more disciplined. Understand it’s nothing but trading psychology that matters.”

Stats talk is useless.

Why traders insist on always swinging for homeruns is beyond me

Yes, it’s beyond you as you don’t understand what it means. If you don’t understand something please learn, practice, get more experience before condemning an idea. Please don’t talk about things you really don’t understand. I share my experience here after been a consistently profitable trader for couple of years. This is my fifth year in forex trading, Yes, I’m still new to trading world, but I’m consistently winning. That’s the only reason I started posting in 2013. Before that, I didn’t talked about things I really didn’t understand. I’m talking only by my experience, no nonsense. Only just ‘real world’ practical things.

Yes, aiming for 10-20 pips per day is really good, that’s all what you need if your pip value is high. And it really works in real world too. In-fact my usual day trading TP is 30 pips. But you need to be a well experienced, consistently profitable trader to become successful when using higher pip values, don’t you think? If newbies try this, they will probably loose their account in no time.

If your pip value is low, you need swinging. Otherwise you will not make a decent income.

People have different criteria, so different strategies and systems are needed. Both these methods are useful.
I use swing trading also, but my pip value on these trades are less.

It’s just your choice, you can’t insist someone to choose your way of trading, can you?

I use both methods. Usually my TP is 30 pips per day. It’s just my system. But my system gives swing trading signals sometimes. May be once a moth or so. I trade them using a different money management technique than day trading technique.

Stats talk is useless.

You think so!!!

IMO it’s the next most important thing in forex trading after trading psychology. Important than money management, etc.

Do you know how price action works?
Do you know why similar signals sometimes works, sometimes fails?
Do you understand the human factor involved?

Understand statistical edge of your system. And build your system around it.

Do you know how Casino owners make profit while giving large sums of winnings to it’s players?
They know their statistical advantage.

Be the Casino! Not the player.