Hello everyone.
I’m new to this forum, but not really new into Forex trading. And honestly, that’s what have been stressing me out.
I have learned Forex trading seriously for 8 months. By serious, it’s considering I have been pouring 10+ hour in learning Forex trading (demo account and reading books). I have read a dozen of trading books (Alexander Elder’s, Mark Douglas’, Robert Miner’s, Jack Schwager’s, ets). So I’m already familiar with trading strategies, risk management, and trading psychology. I also keep a trading journal, but if I’m being honest with myself, I haven’t been doing it properly since last month.
I never buy a trading system or signal from trading gurus. To be honest, I just don’t trust them. I’m too skeptical about those. Also logically speaking, how can I be comfortable and confident in someone else’s system. So yeah, no to buying those things.
The big problem is, even after all the grinding and reading, I’m still red on my demo account. I put stop loss in every order, so I never lose big and never (or not yet) burned out my (demo) account. But my win rate is so small that even when I took a winning trade, the profit couldn’t cover for the losses.
This is not my first setback. I have a couple setbacks before this one. But this time, I couldn’t figure out what did I do wrong or which/how I should improve.
Also, I start to question myself. Needless to say, 8 months grinding and still in red, my confidence level is on the flat line. The only thing that make me keep trying is because I keep telling myself that I haven’t burned down my account so I still have a chance to learn.
Details
I use MT4
I trade 4 pairs, USDCHF, AUDUSD, USDJPY, USDCAD. I chose those because they have smaller spread than others. I tried EURUSD and GBPUSD, but the volatility were too much for me.
I trade using M30 timeframe with H4 and D1 as trend guideline.
I use price patterns with 8 EMA and 200 EMA. I also use MACD Histogram indicator as entry/exit signal.
I always trade with 0.01 lot size and stop loss 100 pips, so my risks are always set on 1.00. I either took the trade with 1.00 risk or watch at the sideline for better entry point. I’m aware that I still don’t have the psychological capacity to risk greater than 100 points.
Up to this day, I have taken around 200 trades or that’s what writen on my trading journal, and -36.00 on my demo account. So far, my worst balance was -45.00.
I’m not saying that this is the ultimate trading system. But, this is what I’m currently comfortable with. On basic theory, this system should work. Must be there’s something I do wrongly.
Despite the detail, its not possible to see exactly what is not working for you, but setting a randomly selected constant pip distance as a stop-loss is almost guaranteed to fail you. Using a set pip distance means that sometimes your long SL’s will be above support and sometimes below, and almost never will they be near but just below a significant round number.
I’m also puzzled by your aversion to the high volatility of EUR/USD and GBP/USD. My price software shows the historical volatility of these two pairs as respectively 17th and 20th out of the 28 leading pairs. Of the pairs you listed, only USD/CAD has a lower volatility than both these two. Now maybe we’re looking at different metrics but maybe its not high volatility at all that was your problem with them… Maybe it was low probability entry signals or set-ups?
For the constant pip distance, I try to make the trade near support/resistance level and if the price have moved too far (>100 pips) I’ll pass the trade.
About EUR/USD and GBP/USD, I will check again on these two.
Perseverance is pushing on even when it gets hard. Sounds like it got hard. It’s only stubbornness if you do the same thing that doesn’t work over and over. Some thoughts below.
With 2:1RR on average you need to be right 33% of the time to break even. I think you said you risk 100 pips every trade — how often do you hit a target of 200 pips?
33% doesn’t sound like much but it’s hard to do consistently. That’s why you still need an edge. Continuing to learn and adapt your approach to look for that edge is a good idea. Apply it with discipline, track progress, and assess continuously. Apply lessons learned to improve future trades. Sounds easy — it’s not.
Do not think something is wrong. In my opinion, everything looks very well organized. Maybe you should try to include some fundamental analysis so that you can make bigger steps.
Your approach to trading seems totally fine, but you should remember that trading is a game of perseverance and patience. It can take years before you start making any good profits from your trades.
Hello everyone. (long overdue) update.
I (possibly) found what I did wrong at that time.
I’m using MACD indicator wrongly. Stupid mistakes. It’s clear that the MACD in the books I read and the standard MACD in MT4 are a bit different. Took me (way too) long time to realize.
Too small timeframe. Now I trade in D1, H4, and occasionally on H1, with weekly and monthly chart as long term view. Less noise, less trade
(I think) I made a wrong trade strategy. What I did was ONLY 200 EMA as trend and MACD indicator by itself as my entry. I didn’t include support and resistance. (maybe) learned my mistake. Now it’s trend (200 EMA), SnR (high lows and a little bit of chart pattern breakouts), then MACD only as my confirmation to entry.
My winrate has been better. Still working on it though.
Previously it’s below 10% with Risk : Reward ratio around 1 : 10, but too many mistakes made before getting some profit resulting in minus account.
Now it’s around 25% (working towards 30%) with average R:R (almost) 1:4, still trying to reduce mistakes
hey man, i have been trading for like a year on and off (the last 4 months with a real account), so take this advice with a grain of salt cause im definetly no expert. but i thought i might give u some advice that has been slowly been pushing me to be more and more profitable / a better trader.
watch raja banks on youtube. he does new york session streams and explains all his trades and analysis live in real time. he focuses on scalping but even if thats not your style he still gives a lot of feedback on how price action/the market works. highlyyyyyy recomended.
ever since i read “naked forex” and stopped using indicators because of it ive been doing way better. they really limit your understanding on why the market is doing what its doing and gives you something to blame if a trade doesnt go your way. so id recomend you try naked trading for a while and see how it goes, cause its probably better if in the long term you learn to recognize entry/exit signals by yourself.
this is rajas advice but its so key for really understanding forex in my opinion: its basically to focus on 1 pair. each pair has personality and when everyday you sit down and watch/analysis the moves that pair did in the last 24hr you will develop a gut instinct about how its gona act. i know it might feel counter productive or make you think that you will lose out on moves but it really builds discipline and price action knowledge.
lastly ive actually been having the most sucess by keeping it simple. for me for example ive been focusing on two main strategies: 1. entering trades that follow the trend at key resistance zones or 2. retracements trades after a big move (or also works with smaller moves once you get more expertise)
dont worry about the time man. this things take time. think about how most people spend 3-6 years to get a degree that will give them a fix salary. you are building a skill that once developed can set you up for life by letting you earn in %s .
hope any of this helps man and if you have any questions let me know
Okay. I have a long overdue homework which I haven’t finished. Backtest this new strategy. Since the last update, I’m only doing foreword testing (demo) and journaling it. I also have online night class (no correlation with trading). So, I’m juggling 3 things in one day, everyday. I thought I could do it, but apparently not.
Since I can’t stop my online class, I think it’s better to focus on backtesting first rather than demo and backtest on the side. Market won’t go anywhere, I will just miss some trades (which mostly are losses anyway, because my winrate is still too low). Hope I could get something out of this backtest to improve my winrate. If anyone could tell me how to analyze journal (not just the statistic numbers like winrate, drawdowns, etc), I’m more than grateful. Thank you
If tweaking your strategy does not work btw, I advice to look into other strategies. You can check out ICT on Youtube. He currently is releasing a free version of his mentorship.
Oof sounds like a busy schedule. It’s impressive that you’re still doing this despite what seems to be very hectic days! What are you studying if you don’t mind me asking?
What do you mean with ‘‘analyze journal’’?
Well, after I write journal, then what is it for?
“look what’s working for you and keep doing it while stop those which not working”, I always hear this sentence, but I don’t know how to do it? Is there any guide how to do it?
What are you studying if you don’t mind me asking?
Mandarin (Chinese). Hahaha. My dad had his own plan to send me to China to study.
Youtube ICT forex. Watch his videos as it will teach you the strategy you need. Those are free videos so expect to put in a lot of work and time. I can guarantee you it works. You can also elect to study other price action methods as supply & demand, wyckoff, etc. ICT is the best though in my experience. Study this and you will not have to read BS sentences like “look what’s working for you and keep doing it while stop those which not working”. They have zero value.
Why did price go up from this point? Cause the banks brought price down to manipulate and accumulate buy orders for themselves ( which is correct ), while counter parties accumulate sell orders ( which is wrong ). I am not saying this will blow to heaven, but it is already at a healthy RR and half my position has been booked. Just the 1M timeframe.
Your strategy simply does not work at all/well enough as banks, who manipulate the market, do not care about your MACD, EMA, support, resistance or whatever crosses what line. What they seek is liquidity. The market is rigged aka manipulated.
You said you read Alexander Elder. Have you read “The New Trading for a Living”? There is a section that shows you how to grade your trades. This is a part of it. Believe reading the other parts will make more sense.
Also discussed another grading system in this post.
You don’t have to use any of the above mentioned methods. Maybe you can take inspiration to make something that works for your trading style. The goal of trading your journal is to determine whether your winning trades got you the best return based it possibly could; and determine how bad your losers were.
