You say a forex trader does not make and cannot make money each & every day…well then what is acceptable to you…every week? month? year? come on man good scalpers (not you) make good $ veryday
Yes, my trade “size” changes. I make a trade with 0.5% risk every time. This 0.5% may be 25 pips on one trade, and could be 40 pips on the next trade. The 25 pip risk trade will be a higher lot size than the 40 pip S/L, however, both risk the same % of the account.
Again, ever trade is same risk. The lot size can change due to size of S/L in pips.
That might have been the case when there were ‘pit traders’ trading the spread (that’s the true definition of scalping by the way). These days, scalping (5-10 pips here and there) is the hardest trading there is to make consistent gains. I’ve yet to see any long term stats to counter this, let alone a relative retail newb with a truck load of over confidence!
Its possible but not with 1 pair only.Trading 1H or 4H charts you can spot big swings for hundreds of pips.Trade like 10 pairs simultaneously and it should be possible.If i were you i would concentrade myself on trend retracements, like the GBPUSD does some nice ones, draw a fibo retracement, and if the economic calendar tells you the right news take the trade and exit at the 38.2-50 fibo retracement level depending on your risk management.
It’s not just me who is saying this. This is reality, and its backed up by hard data if you are prepared to put in the work to obtain and analyze that data.
Scalpers trading retail accounts are at a massive disadvantage, the brokers have far to great an edge, if they do have periods of consecutive gains, its usually due to the asymmetric risk reward profile, taking large risk for small rewards, or martingale type position sizing. IIRC even the institutional guys trading short term arbitrage strategies only achieve profits on around 70 percent of days.
Personally I’m not too concerned about making money every day, week, month. I obviously monitor performance on an ongoing basis, and I expect to see results within pre defined ranges, as long as profits or losses are within that expected range, I’m ok with that. Occasionally I’ll have the odd consecutive losing month, its just part of the game.
I suppose to answer your question, from a practical perspective I like to be profitable over a rolling 12 month window, but max drawdown is a far more important issue.
Could elaborate about concept of “max drawdown” and the reason that metric is paramount to your performance? TIA…great discussion!
Here is the best explanation of drawdown for you. It should clear it up. In short, it is the amount your balance “retraces” when you are taking losses on your account. You WILL take losses at some point. One example being that my current acct has a max drawdown of 8%. My account beforehand (when I did not trade smart and made 4% risk trades in a bad period of trading) was 17%.
Drawdown and Maximum Drawdown | Risk Management | Learn Forex Trading
Dear Jezzode:
Could you please explain why commercial trading can achieve it?
Thanks!
No spread for starters.
I do know a successful scalper. He’s called Keisuke Oikawa (Japanese). He usually makes 10k usd to 30k usd daily (30 lots). That’s like 30 to 100 pips a day. I love his style so much that I’m using it myself with great results. I‘m already taking from 10 to 50 pips daily. Not that much because I’m still a beginner but I can see improvement every day.