play it smart and crashes can become advantages 
Iām risky, but not stupid 
ok, curiosity has got the better of meā¦
so whatās your strategy or system?
I know this is probably grounds for starting a new thread, butā¦ another newbie question, is there any such thing as a good reliable profitable EA ? or is that just a pipe dream? Iāve been testing fapturbo with some good results in demo. I got the source code and tweaked it and then it became more profitable with less drawdown but I still want to be able to trade manually on my own so I am still studying and learning before opening a real account
That happened a [I]long [/I]time ago on this threadā¦ Mostly because of me, so I probably shouldnāt be pointing that out. 
I wasted a lot of time messing with various EAs when I was new, and I never found one that was profitable over the long term.
There are others here that swear by them, but commercial EAs are worthless in my opinion.
Now, on the other hand, if you are an experienced trader some EAs can be a great tool. Iām taking about the ones that help you trade, not those that make trading decisions for you.
So hereās my storyā¦
FIRSTā¦I read all the information I could on this site (the school mostly). Random things online, wiki, investopedia, blah blah blah. I recently received an MBA with a decent amount of finance knowledge behind me so I had some of the ideas (I lightly touched up on forex in school) of forex from before.
Secondlyā¦I started a demo account but couldnāt take it serious. This is a problem I have when ever things come down to āfakeā money. Poker, games, forex demo accountā¦
So after 1-2 days demo accounting I figured the only way I could actually take this seriously was if I was actually learning why the āstove is hotā. I started a FXCM micro account with $450. I very quickly realized how important the margin was. So played around a bit, added another $800 to bring to a total of $1250 capital. This is not including the little money I was getting from my winsā¦but I did have my.
Then I noticed that the 1k lot sizes of the micro account just arenāt doing it for me. Win $2 hereā¦lose $3 thereā¦win another $3 hereā¦so I increased my lot sizes. Took some good size losses that put me a couple hundred under the $1250 initial capital. This is when I said āheyā¦I need to read and learn more about the technical/fundamentals of forexā. Itās one thing to read about something, but its another to experience it. So thats what I did, practically re-read everything I did when I started doing this.
And this is what I do nowā¦ (I really donāt think this method of pip making is ideal for all currencies and types of markets in terms of volatility)
First off I gotta know whats going on with the major combinations/currencies (USD, GBP, EUR, JPY, CHF). Read up on the news and such. At first I was looking at CNN business and Business Week, but Iāve expanded my news sources since then to include Forex News, Dailyfx, the calender on this site, and Bloomberg.
Secondly I start looking at what the long term trends are for the currencies Iām interested in. Where did they come from, where are they going, where are the S/R lines (Iām still bad when it comes to S/R), etc. What I mean by ālong term trendsā is that I look at monthly, weekly, and then daily charts. Then I can make a general direction on whether they are majority a long/short direction. Compare indicator/oscillators and any other technical data.
Then I start looking into closer time frames from 60 min to 1 min. If I want to get into a position I wanna see where the candle sticks are, any patterns, any trends, what the indicator/oscillators are doing, etc.
Then comes time for making the position. I use 1k positions as references and I use fairly large (I guess you could call it that for a micro account) lot sizes. Anywhere from 20-50k, I have made a few positions with larger lot sizes.
Now here is my little crazy/risky side. I generally try not to go against the daily/weekly chart trendsā¦BUT hereās something I do that others will probably thing Iām crazy (and probably other things as well) for doing. Last night (5/28, account is in āmaintenanceā for the weekend so I canāt really get any data out on the exacts of the position) I made a long position with GBP/USD on a 30k lot size. It went up a bit then it started droppingā¦and it dropped pretty lowā¦-40+ pipsā¦on the way down I purchased a few more 30k lots so I had a total of 3 30k lotsā¦and no I donāt really use stop/limits. I shrugged it off cause I know from the daily/weekly/monthly charts that the trend is toward the long side of the market. Went to sleepā¦got upā¦o wowā¦they were all in 150+ pipsā¦now lets seeā¦I made a good amount ($1200+) from that and did a few other positions in various currencies and made some more.
Now today might freak you out a bit with what I doā¦and I think phil838 will agree cause he once said how a dollar figure of -$500 would freak him out in another discussionā¦but generally I had positions in various currencies and a huge pip loss that when converted into $$$ would be close to 600ish if not more (and yes I was still making new positions at that point)ā¦and before 4:00pm (when my broker goes into āmaintenance modeā) I was doing fairly well as I was back in the positives (in terms of $$$). Iām really not worried cause I know that itāll come into my favor and I have a large enough margin where I can take a huge hit before things come back upā¦plus Iāll can write off $1250 as investment loss at the end of the year if all goes down hill (I only had 1 closed position that went against me today and I knew it was not going to come back into my favor so I took the loss of around $20-$30) Only thing Iām worried about is the $5,000 cap for a FXCM micro account which is getting too close 
Forex isnāt really hard, itās riskyā¦but so are a lot of things. Its the logic/understanding/reasoning/making good choices/etc. that can put you on the profit or the loss side of the risk. I really treat this as a video game. You donāt need an MBA, gobs of fancy educations, paid conferences, etc. to be good at forex. I take a good deal of time before I make a positionā¦nothing is hard once you learn about it
As I told one of my friends when he was dealing with his forex accountā¦Iām not telling you what to do and how to do things with your hard earned moneyā¦but this is what I do cause it fits me (my riskiness, loss, train of thought, logic, etc.) for now and donāt come crying to me if you lose it all trying to do what I do
I do want to be able to do the decision making myselfā¦ itās going to take a lot of time and effort as I am discovering.
the idea of an EA appeals to me perhaps because I am a programmer by profession so the logic of programming suits me to a T. I was trying to write AI programs back in college in the 80s. Having experimented with a few, I agree that they do seem to have way too large a stop loss built in. Thatās what I changed in my fapturbo code, and it worked better after that. I still wouldnāt rely on it though!
As for this thread getting off topic, it seems to me that it would be nice to have a sort of general generic thread where you can talk about anything, maybe there is one and Iām not aware of it. There have been a lot of good posts and advice that has come out of this one I think.
Excellent post!! And youāre right, that does freak me out!! Personally I think youāre being a little too risky, but overall it seems like you have a good grasp of the forex market. Money managementā¦ not so much, but the forex market in general.
I do have to disagree with your decision not to use a stoploss. You can do all the fundamental and technical analysis in the world but can you predict something like thisā¦
Thatās a chart from Sept. 11, 2001, after the airplanes hit the World Trade Center. GBP/JPY (I wanted an example from a USD pair, but I donāt have data that far back on any of them) dropped over 2 daily ranges in a few hours and took quite a while to recover.
You canāt predict things like that. Even if you donāt like stoplosses I think you at least need an āoh crapā stoploss in case the bottom drops out due to unforeseen circumstances.
WoW that would have been a perfect time to buy at the bottom.
I agree heās a little overconfident, but it is possible to live and breath forex for a few months and be more than barely competent. I know because I did it and Iām still around. Maybe Iām just Super-Duper Forex Man or something, but I doubt it.
While Iām disagreeing with you I might as well shoot your analogy out of the water too. A long time ago, before I was in the forex market, I was a paramedic. I friend of mine I went to school with, after reading a few books and playing around with a cadaver, performed an emergency C-section on a women who had been killed in a car accident. The baby lived, so you can be a surgeon with those qualifications!!
Itās a true story, but Iām just messing with you. I do agree with your point, I just think youāre underestimating some people that are fast learners.
Your right, I am confidentā¦but not ****y. There is a difference. Iām confident that my -40 pips would come back and give me a good returnā¦and it did. I also slept fairly well that night also
I love challenges, and this is a challenge to me. A professor told me I would fail their class unless I got a high A on the final exam and she didnāt think Iād be able to pass it and should drop the courseā¦and that fired me up to actually get that high A on the exam and pass the course with a higher grade then most of the people that would actually go to class. When I first started forex I told myself I wanna make $100 a day. Then I got to the point where I told myself I wanna make $1000 a day. Now Iām looking for bigger options as my micro account is capping outā¦and hereās a bit of me being ****yā¦forex is easy!!!
Things are only as complicated as you make them. For one forex isnāt really complicated from everything Iāve learned so far. There are a set of rules in which the market follows and those are fundamental and technical data. As long as Iām making logical decisions, even a loss would be welcomed because Iād learn from it. I donāt make random decisions and I do agree what I do is risky and I donātā advise anyone on following me, but rather see it as MY method of doing it. Just cause its good for me doesnāt mean its good for you.
I may blow my account, but Iāll be back having learned from my mistakes and taking a different approach to forex just to probably blow through it again. I may even cap my micro account, start a standard account, get more experience and make more money with a fair share of losses.
Your analogyā¦technically that is how the medical field trains its people. Go to school and read some booksā¦cut up some dead peopleā¦go through residency where you pick up a scalpel and have direct experienceā¦congrats you are now a surgeon
Ya I agree that I am being too riskyā¦and Iām ok with it for now. Like I said Iām treating this like a game so Iām not worried about the money management. Now if I had $10k starting capital Iād take this a bit more seriously, but for now some risky logical fun challenge Iām ok with.
The stoploss area is where Iām still trying to learn more about. It comes down to where should I put my stoploss to have enough buffer for a quick turn around if the the currency hits support. Several times Iāve wanted to put a stoploss in and have been hesitant. Other times Iāve wished I would have put a stoploss in and see the currency turn around.
Its one area where Iām still expanding on.
I agree with you, time is needed for one to learn anything. Hence why I started a mini account with $1,250 instead of going ahead and starting the standard account. I couldnāt take the demo seriously and had to experience what was going on for myself with something that would actually leave a mark.
I appreciate your warning signs, but how about some advice on stoploss placement?
Hi there,
Iāve written a few (or moreā¦lol) EAs for myself and Iāve discovered a few things about them. Some work for some pairs and not for others, but as you know they can be ātweakedā to work for each pair (sometimes), but the tweaking is indivualized so youād have to either make a separate version for each pair, or make the EA do different things for different pairsā¦which makes it harder to code.
Only real time testing on a demo account can give you any indication of how well it will do, but that takes time.
But if you have the source code for your EA, then you know what triggers the trades, so why donāt you just manually watch for the setup and open & close the trades yourself?
To the comment about forex being complicated, I say itās as complicated as you want to make it, but actually itās really rather simple, just not always easyā¦lol
Could you explain the āhow big a stop depends on what chart time youāre usingā.
I was just wondering about that also. Isnāt price going to move the same amount regardless of what graph (time frame) you are viewing? Or whether you are viewing a graph or watching tv or something. That doesnāt change how far the price moves so why would it affect the size of your stop loss or TP ?
reminds me of a physics discussion on another forum recently.
Yes the price moves the same over all time framesā¦ thats a given. The question is how long do you want to stay in a trade. If say your trading the 15 m then you might only be in the trade for the sake of arguement for a few hours. On a 4h chart you might be in it for several days even a week or more. Unless youre prepared to man your monitor 24/5 you need to set a larger stop. GBP/USD last week traded up around 750 pips over the week but at one point retraced over 150 pips. If you wanted to ride out the week for the max pips you would have had to factor in a bigger stop than say if youre trading the 15 and the likely gain is for the sake of argument is only 50 pips then you would not want to say risk more than 20/30 pips.
Not a chance!! I agree heās going to blow out the account in the not too distant future. (See, I do agree with you sometimes, R Carter)
He needs to learn some money management rules, but I do think heās intelligent and will learn from his mistakes. I think heāll find out trading is not quite so easy, and after that heāll end up being an excellent trader!
I get the impression that he can afford to lose the money heās put in the account, so I think going right on doing what heās doing is the best course of action. Heāll either keep going like he is and be stinking rich in no time, or blow the account, learn from his mistakes, and then become stinking rich in a moderate amount of time.
I see either way as a win!
Could you explain the ātrading the 15 mā¦few hoursā and ā4h chartā¦several daysā¦ā concept.
I use support and resistance lines to come up with most of my stoploss levels. Hereās an example from a trade I took this week.
The orange line on the chart is the high for this year. It was on my chart [B]before [/B]the price went right up to it and bounced off. After the price bounced off it I knew it was a good resistance level. So I went short at the red line, put my stop up above the resistance level, and set a profit target at the blue line (the two week high).
My point is to find a stoploss that is likely to not get hit based on some sort of evidence. Donāt just pull a number out of the air for a stoploss, but find the next S+R level back (or some other logical place) and put the stop behind it.
Yes I think that is the biggest issue for most new tradersā¦myself included. I traded a system for a little while without a stop loss and took a small account and made it [B]big[/B]! ā¦and I felt quite confident to start doing it live. Then while the real account was setting upā¦the demo account crashed [B]big[/B] time. That shook my psychie a little and I couldnāt do it for real anymore and my real account lost a little. Problem was I needed a stoploss, but when I tried to incorporate one in, it got hit more times than notā¦not fun anymore
Then I took a step back and rethought my whole strategy about my risk level ( loss per trade, # of losing trades for my account size) and probabilites. I have to trade a system with an entry setup that is (fairly) obvious when it fails, and has a high probability for successā¦ duhhhhā¦ why didnāt I think of that beforeā¦lol.
So after a little more demo testing the new strategy, Iāve just started trading it live and so far so good. The strategy is supposed to work about 70% of the time, and the stoploss is to protect me from the 30% when it doesnāt. Most of the trades that failed didnāt come back,ā¦at least not yet anywaysā¦ or the entry area was a little premature. Therefore the loss (feedback) was necessary to find that out and not tie up my funds while waiting and stressing out in drawdown, and instead allowed me to move on and take other trades that were successful. That then is also helping to rebuild my confidence.