I’m a bit confused with all your messages in this thread.
First you wrote,
“I am looking for some recommendations for a new broker. What would you suggest?”
Then you wrote,
“I am currently trading in the UK and using Coinexx.”
Then you wrote,
“I found a new one though, its called OspreyFX. working really good for me.”
At last you wrote,
“I have been trading with them (OspreyFX) for 5 months now!”
So, you are with OspreyFX for 5 months now and it is working really good for you. Then why you came to this completely irrelevant thread and asking for a recommendation for a broker?
Isn’t it an attempt of spamming on behalf of OspreyFX?
So, if banks (and similar big money institutions) mostly use lines at interesting price points then we can expect a lot of action at those levels. Delving deeper, I assume the support and resistance lines were taken from previous high and lows or resistance turned support type areas. Would they also use Pivot points and Fibonacci for these lines?
The edge point makes sense, I’ve developed a couple of systems that all work well, except when I trade with real money, then my own mind plays tricks, like closing positions early with no real reason except a momentary ‘worry’ that suddenly overcomes me, which if left open turns to a perfect profitable trade. I am at the point now where the strategy doesn’t matter too much but control over my mind and understanding how to tackle the psychology behind the decisions. For a starter I realised my morning trading decisions are bad, also I am removing trading apps from my phone so I have to slow down to make a trade at my PC station or laptop with my trading journal / manual at hand.
However, I really am looking for that psychological edge. I realised this is the missing piece of my puzzle. Please tell me more about how I can change my mindset.
As to the fundamentals, if a retail trader was focused solely on cable, without looking at the fundamentals, such as brexit, would this not leave the trader vulnerable if completely ignored it (fundamentals)? I understand the gambling potential if not guarded against, but brexit has been a big factor in the current down trend, thus quite important. Or are there other fundamentals that could be the diversion, such as PMI’s and the such? I realise that the advice would be to stay away from cable due to volatility, but it is my chosen focus over this year and the next. (I chose this specific instrument as my main focus)
Wether Pivot points or Fibonacci are used depends of course on the individual trader but for the most part in my experience they are not used as much as some might think.
You will often times read reports from “experts” be it for stocks or for currencies or whatever market and they will say price bounced from this pivot point or this pyschological level and really they are just retrospectively applying whatever tool that fits. So maybe the RSI was showing overbought and they credit the reversal to the RSI being overbought the next time the RSI isn’t overbought but priced reversed from a pyschological level. The next time RSI was showing overbought for days price blew through a psychological level but price reversed from such and such pivot point.
I personally do not use them but you don’t need to trade like me though. The key is in finding a tool or some combination of tools that gives you a 50 plus percent win rate and you can you make a heap of money if you manage your risk right. Even a 35-40 percent win rate should be atleast break even if not profitable for you.
And of course buying from a pivot point or Fib retrace will definitely be higher probability if you are trading with the trend.
This is good.
Definitely give trading in the zone a read or listen.
You can do a youtube search for Rande Howell he has some top notch material.
Also you are going to need to truly accept and even embrace the risk of each trade. Trade only an amount you are truly comfortable losing. Don’t even think about how much you can earn. Find the best place to place your stop and then if you are only okay risking $1 only risk $1 and just let the trade play out. It either stops you out or hits TP and you have truly accepted and embraced the risk. Once you build enough confidence losing some money and seeing that you make it back you’ll feel more comfortable risking $2 $5 and so on.
Using real money will definitely be more emotional even for small amounts so start there and build your confidence and increase the amount risked as you do.
I see no reason why a trader would or should focus solely on a single currency pair.
As far as Brexit the down trend caused by it is clearly visible on the price chart and I have favored shorts on the pair simply due to the strong down trend for quite some time profitably.
Brexit is not a fundamental driver of the pound. It is not something that we can look at the history of its reaction over 10 or so years. It is a “short” term impact that will hopefully work itself out.
When I began trading at a bank we learned about the news events that individual currencies reacted to and how strongly they typically reacted. This was sometime ago and of course there was no way to factor in the history of the pound when Brexit news came out. If you understand what I am trying to say.
The gambling aspect applies to those traders that are trying to trade NFP or numbers on a PMI and go long or short in the moments after the release even though they being at home are getting that info later than the “big boy” traders and most end up just getting burned.
General awareness about a political issue like Brexit I hope most would have.
If you want to focus on one currency pair in attempt to “learn” it you may but from my view point it is a waste of time. All markets trend range and consolidate. Looking for high quality signals on the Daily charts that are appropriate for the state of the market (is it trending ranging or consolidating.) On multiple pairs is going to give you much higher probability trading opportunities in the long term than trying to learn the way one market behaves on say the 15 minute chart. The Cable can be trending down now but it will trend up at some point again, it will also become range bound at some point and it will also find itself stuck consolidating and not giving very many good moves to trade.
If you do choose to focus on it though then just make sure to manage your risk and develop your psychology and you can most likely find a way to make it work. I just personally see that as being too complicated.
And believe me I tried focusing solely on the EUR/USD for a time starting out as well as USD/JPY. So I know where you are coming from.
@thetradinggod Thanks for taking the time to share some of your knowledge, it is very welcomed.
As a new trader there is so much to learn and to think of. I have been studying for a few months now and I write everything down which seems relevant to me. With those infos I will develop a trading plan and a strategy.
So my question is, is there anything you wish someone had told you sooner and is there anything you wish you hadn’t focused on so much?
Yes, I have noticed the retrospective application of reasoning, especially in assigning price moves to news! The book, Trading in the Zone arrived on Friday and I’m nearly half way through. It is exactly what I needed. I am already at the point that I have identified my mind and thoughts negate my trading signals from my strategy. You are right, one of my problems has been truly accepting the risk, as the book also says. From my perspective, it does not matter if it is £1 or £100 risked on a trade, it is the percent, or in reverse, it is the risk of attaining or not attaining my % goals. I understand the concept of compound interest and what 25% or 50% yearly gain can mean to potential investors and the positive consequences. Part of my fear, I have just realised, is a performance anxiety. I fear losing x% of a trade or account compounded, versus attaining x% compounded with random loses peppered in between. I will be trying to focus on the outcome of the average and not the individual trades and individual loses. And yes, I am using smaller amounts of money.
Yes, again, I have realised that I was trying to learn more about the pair, thinking if I understood more about a currency I would trade it better, whereas the reverse is true. Because I am not truly accepting the risk I am trying to compensate by learning more about the market, without accepting the fact that nothing is certain and that I will never know all the variable there are (thus not accepting the risk)
Yes, I realise that now, and am going back the the main pairs I watched before. I only recently thought it a good idea to focus on a single currency, but before was looking at all the main pairs. After reading the new book I have looked back and realised I have missed quite a few nice and easy trades on the crosses. But it’s a new day, It’s a new dawn, and there are new opportunities around the corner. I also mainly focus on longer time frames, daily and weekly for signals, with 4 hours to see what is happening intraday.
Just reread thread. Great info! Thanks again for posting, very helpful.
This is key to keep in the front of mind whilst controlling emotions.
Planning like this is critical. Having a realistic plan like above will let you know exactly what is needed to stay on target. If There is no plan like the above often new traders simply push the “pedal to the metal” and are going “full speed ahead” often on too low of a time frame, Like a slalom skier who is going too fast to hit any of the gates.
this is a great thread too!!
Love the glibness.
I missed the “no trust” sign when I walked in.
Where is it?
“Move along… Nothing to see here”
Bingo! I have BINGO!
I am only a “professional” demo account trader presently. There is a lot to learn. I think far more than folks initially think. Starting out I would get out of losing trades fairly quickly and let the winners run on the Daily TF.
Then I went down the rabbit hole of indicators and lower time frames only now reemerging this summer. It was horrible down there! Like pulling a thread on a sweater!
So I am back to establising my goals as stated above by @thetradinggod, @Clint also has a great approach to this in his interview with @Penelopip?
I have drank the “no stop-loss” Kool aid and it didn’t work for me. Don’t think my chart reading was good enough to employ this. Reviewing some of my Demo Accounts proved that I could let my winners run … but it also proved I had let my losers run too. This review made the “If only I…” take away crystal clear for me was get out of my losing trades. The percent of my losers that turned and became great winners, within a reasonable time frame - a few weeks - was minimal. In my estimation not worth it.
As a US citizen myself, I just opened an account with IG and will be funding next week Trading daily TF. The spreads seemed much tighter than Oanda.
This is the most common sense approach there is and guarantees the trader makes a profit if winners can run. This approach as simple as it is requires a very strong mental toughness!! The lure of the “turn-a-round losers” is like the sirens of Odysseus!!
Thanks this is very useful.
I was wondering do you think price action technicals is good enough or you need some fundamentals.
As a side. I agree with the make yourself rich ideas.
E. G. A strategy is much much better than a shor term one month win of few thousand.
Case e. G.
Go to a compound interest calculator. Say place a rate of 12% a month. So on a 10000 account thats say 1200 not much you think.?
Ok then compound say for 6 yrs what do you get. Something like 50million dollars. Do for 20 yrs the result is like a trillion dollars. So why arent jp morgan goldman sachs making this amount of money… Lol because it’s impossible. However find a strategy that works can making 6% a month continuously… Well calculate to see how rich youll be.
With $10,000 you can’t live but if you have a good edge in 2 years you can grow the account to a point of you will make enough profit per month to put the 50% into the account to increase your investment capital and the other 50% you can take it to pay you. I think you need at least $70k in funds available to be able to live a decent live with forex only if you have a good money management and win loss ratio.
maybe some say its not possible but i have different point of view @JayTr
if u can take out 1R a day (yes 1 lousy R) no more! with 1-2% Risk on a 10K account =
1% a day = 100$ , 5 days a week = 500$ = for a month thats 2000$
2% a day = 200$ , 5 days a week = 1000$ = for a month thats 4000$
for sure bigger account is even more comfortable cause you may just need 0,5R or even way less a day and you can play very very small risk and protect your capital in a great way ( in case you hit a bigger losing streak for example) but in my eyes if u have a method providing you with an edge / a good strike rate or even a good RR factor and a bad strike rate you can make it even with a “small” 10K account and pay your bills …compounding the account is another story but also within the realms of possibility …
but its a totaly clear that as the account is bigger trading for a living gets more and more “easy” cause you “just” need to hit a very low RR a day or a week to pay bills …talking again with the example above for a lets say 30K account (1% risk 300$ / 2% risk 600$ ) you just need to hit 2R with 1% a week!!! to make a return of 2,4K a month … 2 R a week thats 0,4R a day … make the same with 2% risk each trade and you have to make 0.2R a day …i think thats truely achievable
just my toughts about tarding for a living with smaller account size
Dears , I found one thing that is not mentioned in your conversation and babypips school about capital.
maybe some newbies just read your tutorials about that and decide to invest about 10,000 dollors , but missing point is country. As you know we don’t have fair exchange ratio in some countries. As my situation , my salaryis just 500 dollors so is it make sense to invest 100,000 or 50,000 dollors ? in addition my salary is good in my country as well.
if i can earn just 500 dollor it is good for me , so capital depends on several variables.
so 4000 dollor capital to invest can pay my bills as well.
sorry for English
I’m sorry Trueman23 but you are totally wrong, because in your calculations you are not counting your looses and also you are going to have profit 5 days a week constantly? That is impossible you can have 10 months profit and 2 months loses in one of the best escenarios, you could be right back in 2010 but not in these days.
i think what he wanted to state is that the bigger ur account is the smaller ur risk can be in order to make nice profits. and it is tottaly doable depending on ur win rate, the amount of risk ur willing to take per trade, where do u cut ur losses and when do u take ur profits when ur right. a healthy risk reward management will achieve u that 1, 5, 10% easily as long as u know what ur doing imo
…The Exit is open… 
