How, or can, I make a living out of FX trading?

dennis14685 · May 16, 2013, 7:25am

Yep perfect,Your hedge zones pre-determined therefore an entry with a plan. .

konan:

OK, so…I tested this for you and I made a new demo account just to show you that if you’re an experienced and a good trader - that you can make A LOT of money…OK, so, I told you here, 4 days ago that I NEVER trade spot gold and it’s true. This was my first trade on xau/usd…ever! So when I told you to buy gold this week I was only looking at price action(technicals on the chart) and was not familiar ,at the time, with the fundamentals, except the general correlation between other currencies and gold…OK…So, I use very simple rules of >PA or price action trading to determine where price MIGHT go during the week because NO ONE actually knows FOR Sure where it is going.

THis is how (according to the rules of PA) this buying of the gold should have played out.

And, if I did it by the rules, I would have never bought gold because price did not break high of the pin. But, I wanted to buy it at the wrong place just to show that EVEN if you’re initially wrong, that YOU ARE SUPPOSED TO MANAGE THE losing TRADE to minimize the loss and not just let it hit the stop loss!! So…at some point, I saw the trade go south, I checked the fundamentals and news and then actually formed an opinion that the strength is returning to the USD and that gold was overbought for the longest time…China’s fundamentals also played a role in this…Ok, so…I decided to hedge the trade of 1 lot with 2 lots instead of stopping it and losing 2K I think…In brief, I was never in danger of losing my capital really because I know how to manage my trades ( which is the toughest part of the job but also the one that the 95% of other traders don’t even bother with really) Your arse has got to be in the chair and ALERT!..And, that’0s the point of FX to me…this is how I make my money…
Here is the open myfxbook too…I closed the trades only because I was impatient to show you that you can basically do what you asked for in the title…!
Gold is probably going to go down to 1336 now and further and really just…who knows 1100 …then 700…who knows…and those that don’t ,hedge lol…

Mt4-116551 System | Myfxbook

Also, I forgot to add…there’s a second but bearish pin that I also went by when deciding to sell with 2 lots…

dennis14685 · May 16, 2013, 7:27am

it takes practice…loosing money and once you lost it all stop living its much easier then making money

dennis14685 · May 16, 2013, 7:32am

jgray110:

There is the [B]inside game[/B] everybody talks about and the never mentioned [B]outside game[/B], these [B]four observations[/B] are [I]part[/I] of the most important [B]outside game[/B], the hidden big picture, that anybody can replicate and observe:

Make bid-ask lines (BA) visible, best seen in 1m or 5m to speed things but occurs all timeframes, time periods, pairs, brokers, accounts, clients, and markets.

[B]1. Mousetrap[/B] - place mouse on Buy (or Sell) button, observation: tick freezes and BA [B]pulls back and reverses[/B].
[B]2. Cat’nMouse[/B] - chase trades in demo, Buy, Close, Sell, Close, Buy… BA [B]pulls back, reverses, and/or sideways[/B].
[B]3. Clone[/B] - FreeStockCharts, settings comparison of any 2 or 3 things, [B]all[/B] markets move together correlated or inversely.
[B]4. LiveWire[/B] - live accounts require [B]signed agreement[/B] the broker-dealer is trading against all trades.

My suggestion is to trade the [B]smallest possible size amount and account[/B] and to only trade when you have a confident setup. The proper mindset for new traders is to [B]focus on risk[/B], [B][B]don’t lose any money on anything[/B][/B], [B]#1 manage the risk not the reward[/B], #2 manage the reward [B]by managing the risk[/B], #3 repeat 1 and 2.

You should add dont use mt4 unless your a super pro as the charts suck. and are deceptive in my opinion. better of trading from an i phone or android

konan · May 16, 2013, 7:57am

The thing is…I was gonna be a winner in this trade, whatever happens! Personally, I made 800 $ dollars just last week by shorting Yen on my real account…So, it’s very doable, to live off of FX trading and with as little as couple of K in your account to start with…The people that are telling this newbie how he’s hopeless are actually part of the 95% losers in this market…and they all have regular daily jobs probably…FX IS A HOBBY for losers only…that’s it, good luck lol

dennis14685 · May 16, 2013, 8:17am

agreed. i hedge all the time, i even hedge my take profit so i can run both swings without any headache on entry. I am Position and swing trader so hedging is like awesom. EJ to day weekly to weekly simple as pie long, if i feel the game is up i will short cover that long and wait for one side to kick of again. I do scalp when im bored and i do not use hedging when I am scalping. Today I went long on EJ just above the weekly at around 131 546 will short cover around 132.415 if need be. Did scalp some longs on the way up, those market maker boxes were bright and clear. Still holding long…

konan · May 16, 2013, 8:41am

I don’t scalp at all though…When I used to scalp it was very stressful for me ( I had to have the wood door to my office replaced coz I punched them in and I destroyed all my plants by chucking them to the wall)lol…And no, u really cant hedge then + the broker market maker is very likely to fck u up…If it’s a legit ECN broker then OK I guess.

dennis14685 · May 16, 2013, 10:00am

YES SPOT ON…only two brokers i trust the rest, just give them the keys, better of then watching them rip you of…All that sychology stuff about mindset for trading, bull in my opinion. People would thrive much better if they posted sychology of a market mincer. But there are a few good ones.

Nothing works without good tools, mt4 dump that, spreads dump that. Give me charges based on volume J forex a cup of tea and some computing power and im in cruise control.

Scalping i only do in between a swing i.e Long running/ average swing Weekly to Weekly EJ is 80 pips. Market mincers will start looking for retail account about half way on that journey. So I do a bit of scalping around there accumalation distribution system what they all pretty much do (Those boxes). Nothing complicated , its just a level to a level. Dont care about whats in between. Just fresh air. Holding ej long from just above weekly with short cover at daily mid point above pp…same everyday…simple has pie.

SerenityFX · May 18, 2013, 4:03pm

I think this post is spot on. I tried scalping when I first started out…definitely don’t recommend it. Way too stressful and not worth the time. There’s plenty of easy money to be made trading on real timeframes

Royalblood · May 23, 2013, 1:05pm

There are many traders who are making a living out of their forex trading income and for sure this is possible from your end also that you could be making a living provided you have good knowledge of the forex market.

dennis14685 · May 23, 2013, 1:54pm

I actually make more money scalping then Swing trading, sure swing trading is lower leverage and bigger pips. But scalping is higher leverage smaller pips.

Swing trading less stress more work. Scalping less work more stress.

Why lower leverage in Swing trading? I do not like to leave big postions in the market.

Why bigger postions in scalping? small target pips big position. in and out but at key levels. For example bounce on a monthly pivot. Nothing random

Thats how i do it, i respect everyones views but thats what works for me. I do agree that scalping is the hardest way to trade, but its not actually, its the hardest thing to learn! its very deciplined. I may do a thread on scalping, but I think traders should learn to swing and position trade before attempting scalping. Scalping is then a natural evolution to your tool box during swing profit runs. i.e. Long in profit. Short cover scalp.

KaterinaEK · May 23, 2013, 2:05pm

It is definitely possible to make your living trading forex but if you have very limited money then it could be hard.
Also note that learning fx trading takes some time, almost every successful trader put at least one year to establish himself as a consistently profitable trader.

SerenityFX · May 23, 2013, 2:26pm

I actually think it’s best to start out with limited funds and build up from there. Sure, it takes a lot longer, but if you can turn $1000 into enough money to trade for a living, you know what you are doing is great.

MrGone666 · May 23, 2013, 2:35pm

A big No, desperation has turned the Eagles into Vultures, hell no!!!

dennis14685 · May 23, 2013, 2:57pm

exactly…

gs8888 · May 24, 2013, 12:49am

MeiHua:

Yes, but your in a horrible position to start. Given your psychological burden of the need to pay your families expenses as a ticking time bomb. Let me address your questions in order and we will return to this main point.

Yes you can earn >2500$ per month. But not with 2000$ capital account. This is just ridiculous, you would be earning 125% per month which would make you the best trader of all time. I suggest you have an account large enough where earning 5% per month will give you enough to live on and that is provided you are a very consistent earner. In your position that would be at least 50k.

This you would need to develop on your own. No one is going to give you a holy grail. If they have highly profitable strategies, especially earning the 125% per month you require. They can sell them for 7-10+ figures to hedge funds. Why given them to you?

When you develop a constantly profitable strategy practicing in demo. Then have executed 50 trades perfectly at MINIMUM for statistical evaluation. 100 trades or more is better.

Look here, your not going to make it. I hate to be frank, but its just going to kill you. You will blow out your tiny account before you even get a chance to learn to trade. You will be heavily emotionally attached to the money itself, causing you to make trading errors. Money in this game is a tool, you can not have any attachment to it whatsoever. Most people who look at trading either because they got fired, or they cant find a job and are reaching for straws fail. They just don’t have the time, the capital, and the psychological balance in order to do this day in day out.

Here are some requirements you can consider if you still want to pursue this as a full time endevour.

50k-75k account minimum. Remember the 5% rule, but account for the fact that if you withdraw that 5% every month you never grow. You need to have some compounding in your account.

at least 6months (i recommend 10 months) of family expenses in the bank. This takes the pressure off and gives you the time to get yourself in to right mindset. This is a job and a business like anything else, if you are constantly withdrawing from your trading account to pay bills, you are just increasing your chances of failure. Number 1 reason small start ups fail, lack of capital. Number 1 reason new traders fail, lack of capital.

You need to have a profitable system. This needs to be crafted to your own personality, no one can give you that. If i have a strategy that makes money over the last 3 years, even with performance reports. But it holds for weeks and has draw downs in the thousands of dollars, and has loosing streaks of 8 trades in a row, would that still be good for you? Probably not, it might make you vomit the first few losses and then you miss out on the following winners that make all that up and more.

My advice. Harsh that it is. Get a job, support your family, and come back to trading when you have the time and funds to give this a real shot. Otherwise just take that 2000, put it all on black in the casino. You will do better that way.

It’s not at all harsh. It may be harsh to people who dream to bag 100% return a month. What you’ve said is so true. Like any other conventional business, Capital is required is trading business too.
Starting with 100$ or 200$ and dreaming of turning that amount into couple of thousand dollars within no time is every beginner’s mistake…

konan · May 24, 2013, 1:19am

There is nothing “consistent” about this business…You pick and choose your trades carefully…Real good long trend traders maybe initiate one trade a month, maybe none…And then they just move the stops…Do not listen to people that tell you how it can’t be done because they are not aware of your trading skill and they are probably in the 90% of losers anyway…You might be too, but no one can tell that yet,lol…So, daytraders and scalpers, very likely in the losing majority

gs8888 · May 24, 2013, 1:35am

So you mean all the day traders lose money and only long term trend traders make money ?

konan · May 24, 2013, 1:43am

Says “very likely” in that post…Especially non automated and even automated scalpers can’t count on long term success.

dennis14685 · May 24, 2013, 2:24am

Yes agreed. Remember day traders (Scalpers) focus on Levels daily and intra-day which is a very noisy area to be in! its such a small picture of the market, odds stacked against you.

Swing Traders focus on higher time frames the Weekly levels, Postion traders Monthly levels and Long term investors Yearly and above. Very more reliable then day trading methods.

Day trading is scalping, 10 to 50 pip trades are scalps in my books. And I will only take a scalp to short cover or long cover a swing position.

Andrew_Flanders · May 24, 2013, 7:37am

I have to agree with MeiHua. You CAN make a living from forex, just like doctors, lawyers or shoemakers make a living. Why would anyone think that trading isn’t as serious as any other profession? It takes time, and money. A lot of money. $2000 isn’t nearly enough! However, if you are interested in making a quick buck, and learning a thing or two about trading, there are other ways. But, that is a whole other subject, and one that can lead to a heated discussion, so I’d avoid giving any advice. Either way, to make a living trading anything, you need to put in the time and the effort.