Krugman25: The Programmer

krugman25

1. Tell us little bit about yourself. Where are you from? What are your hobbies?

My name is Aaron Kruger. I am a Christian, husband and dad. I have an amazing wife and 2 little boys. I am a technical manager and programmer at a company that works in the gas and oil industry. I have had the honor and privilege to help design and program a device that monitors natural gas stations.

Most of my hobbies revolve around programming. I am currently writing iOS applications and getting ready to write a volume/price indicator. I also try and do my best to pull away from all of the work and hobbies to spend quality time with my family.

2. When/why did you start trading forex? What resources did you use to learn how to trade (websites, books, apps, mentors, etc.)?

I started my trading career over 10 years ago. When I was a freshman in high school I was always intrigued by the markets, and the challenge of beating the market. At that time the web was still fairly young so one of the best ways to get information on trading was through books. I began buying books on trading, and they all looked at the market in terms of patterns. The first book I ever read was “How to Make Money in Stocks” by William J. O’Neil. This started me down my path of trading by looking at the market in terms of predictable patterns. Thinking in terms of patterns was natural for me.

I spent the next 10+ years trading on paper, demos and live accounts. I traded both stocks and options, but loved the high risk and high reward nature of options. I had seen articles about Forex over the years but I always thought how boring it would be to trade currency? One day I ran across a website by one of the popular Forex Price Action teachers, and was completely sold. I realized that I didn’t care about the asset I was trading, but had always looked at charts as a puzzle that needed to be solved, so it didn’t really matter if what I was trading was a company or a currency.

Due to my decade experience in stocks and options trading, I already had a good foundation in trading price and volume. I very quickly picked up on trading individual candles (pin bars, engulfing bars etc.) and was already profitable in my 2nd month of trading. I would have to say Google was my biggest resource in learning Forex and price action candles, because it led me to dozens of different traders and teachers. Overall though I think the best education I have ever gotten has been by actually doing it.

3. How do people around you usually react when you say that you’re into currency trading?

It doesn’t surprise most people I know because they know I trade options. I think what surprises people the most is the amount of currency I am able to trade through leverage. Because most people don’t understand how currency moves, they are usually in awe that a trader can easily trade many millions of dollars a month with a much smaller account, and still have low risk.

4. What were your first strategies in forex trading? How are they different from your strategies today?

My strategies trading Forex are the same now as it was when I started. I have always traded using support and resistance levels, price and volume. I entered into my Forex career this same way and have continued using it.

5. Describe your current daily or weekly trading routine. What do you do before you trade?

With the way I trade I spent a surprisingly small time looking at charts or even thinking about Forex. At the end of the US session, I go through all of my pairs on the daily time frame. I mark down on a piece of paper all of the pairs where price is very close to a key support and resistance level. Then periodically check the charts every 4-8 hours for the pairs that I have written down and see if price action has formed on any time frames 30 minutes and up.

At the end of the US session I recheck all of the charts, re-write my list of pairs that are close to S/R levels, and go through all of the steps again. I general spend a total of 5 minutes a day looking at the charts.

6. What are some of your most unforgettable trades and trading moments?

Because I shoot for very high RR setups, I have had some hugely profitable trades. I have had a couple times where I have doubled my account in a single trade. My most recent memorable trade was when the EURAUD broke out of its range in July. I had went long on an engulfing bar before the breakout and was planning to take profit at the resistance area at the top of the range. Price and volume tipped me off to further bullish movement so I stayed in the trade.

Long story short, price broke out and formed a bullish flag, so I increase my position. Price broke up out of that flag and then formed a second flag, so I increased my position again. Price broke up out of that flag also, and then formed a large reversal candle so I closed my position. When it was all said and done, I had ridden almost the entire move, and I made about 110% profit from that trade.

7. Can you give 3 trading habits that have helped you the most in your trading career?

The most important habit that has helped me is not getting emotional. When a trader gets emotional they tend to sabotage their trades, and it ultimately hinders their ability to make money. The second habit goes in hand with the first which is always having a trading plan. If you have a trading plan, then you are less likely to make decisions based on feelings.

The third habit I have made is spending as little time as possible looking at or thinking about the charts. Once the trade is taken the market will do the rest. If the trader has done due diligence to analyze the trade and ensure it has a high probability of success, then they need to leave the trade alone and let it play.

8.If you could thank one person who contributed positively to your trading journey, who would you thank?

I would have to thank the makers of Google. I have been able to learn a tremendous amount of information for free, just through searches on Google. I would have still learned how to trade through time spent on the charts, but it would have been a much harder road to go down. Being able to read through articles and forums helped me continue to grow in my understanding of the markets.

9. Forex trading is not an easy business. What motivates you to continue trading when in a trading slump?

I tend to think of everything trading related in terms of probabilities and statistics. I can look at my past success and I know as long as I don’t deviate from how I trade; I will keep achieving similar results into the future. This helps me take my eyes off of individual trades or a string of bad trades and look at the long term results.

10. What do you think is the biggest mistake that newbies out there are currently making? Do you have any advice for them?

I tend to think that most newbies can learn a method fairly quickly. I teach price action and it doesn’t take long for the new traders to start catching good quality setups. The problem isn’t that they can’t find good quality setups, but rather that they struggle to filter out the poor quality setups.

New traders get frustrated because they are not profitable, and it’s often because they aren’t good at filtering out poor quality trades. I believe traders take subpar trades is because they feel they need to always be in the market, or convince themselves the trade is better than it really is. Many times the difference between consistently losing and consistently winning is the ability to avoid poor quality trades.

I would advise new traders to be honest about a trade. I would also tell them that they don’t always have to be in the market. Often times the profit made from the good trades are given back to the market through poor quality trades. If traders are honest about their trades and accept that there will be times they are waiting on the sidelines for a trade, they can filter out a tremendous amount of losses and keep more of their profits.

Bonus: Who is your favorite fictional character of all time?

I am a huge fan of the Hobbit and The Lord of The Rings trilogy. I have always been drawn to stories about underdogs fighting against impossible odds. I think the way this relates to trading Forex is that many traders are told out of the gate that their chances of success are slim to none.

Around every corner is a critic telling them the method they are learning doesn’t work, so no matter where a trader turns all they hear is failure. I went down this same road and despite all of the odds against me I trudged on and eventually found success. I didn’t have anyone to help me along the way, so I have made it a goal in my life to help other traders down their trading path.

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thank you. we get some important role by you

Thankyou Krugman25 for your wise words :slight_smile:

How much capital would you recommend for a beginner to have to start trading forex??

thanks you Krugman,

you give me more confident in this market.

If you an absolute beginner and are primarily trading to see if you are profitable and trying to learn the foundation of a trading strategy, you should start off with as little as possible. When trading to test and learn a strategy your focus isn’t making big profits, it simply testing a method to see if you are profitable. In that case there is no reason to risk more than you need. If you can find a broker that lets you trade micro lots then in the US you would need around $100(50:1 leverage max), or 50$ outside the us(200-400:1 max leverage). You just need enough lots to execute and test your strategy.
If you are have your method down and believe it is profitable and want to start trading for profits, I would suggest trading around $1000. If you are risking 1-3% of your total capital, the winnings will be sizable enough to make it worth your time, and it is large enough that you can compound your profits and grow that amount fairly quickly.

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I greatly appreciate all of your kinds words!

[B][I]“The most important habit that has helped me is not getting emotional.”[/I][/B]
Sometimes this is happening to me when I looked at the chart all the time after opening position.
Krugman25, any tips on how to manage emotion during the trade?

Thank you

In my experience there are 2 major ways to reduce emotion in trading, and it will work very quickly. The first is to risk less of your account. Traders know they have a finite amount of money to trade with, and when you lose a large chunk of it quickly you know you just took one big step towards account ruin. As you risk more % of your account in single trades, you become more emotionally vested into those trades because now it isn’t just about making money but it’s about making sure your account doesn’t blow up. If you are use to risking 3-5% or more of your account per trade then drop it down to a more comfortable 0.5 -1%, and you will find that you are far less emotionally vested in your trade and each individual trade won’t feel like life or death. When your trades are so big that each one is life or death for your account it triggers the “fight or flight” emotionally response in your body and you will find yourself emotionally wore out from trading.

The second thing to help is to trade higher time frames. The more your are watching your trades and prices the more you are exposing your emotions to the market. By simply trading higher time frames you will be looking at the price charts less often and exposing your emotions to the Forex market less. You may need to just trade the daily or the weekly charts. The nice thing about trading these higher time frames is you have larger stoploss and profit targets, so you will not need to check on your trades very often(maybe once or twice a day for a few minutes).

If you lower your risk % and increase the time frames you are trading you will see enormous difference in how emotional you get while trading.

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Thank you for the reply…
Appreciate it very much :slight_smile:

Great interview! Especially love to hear how much knowledge the internet provided, not least babypips of course which makes trading fun. Also read with interest your thoughts on how much capital to risk and what difference it makes. I like the 1% idea, and will start with that.

Also while I am all about the shorter time frames at the moment, it definitely takes so much watching. Have to think hard about the benefit versus the longer periods.

Many thanks !

Hi Krugman25,

Thanks for your reply! You’re a champion :smiley:

Do you use any indicators like Fibonacci Retracement indicators or anything else??

Hey Markulet, thanks for the kind words! As far as indicators go I will use a few EMA’s off of the daily chart. I like to use the phrase “if it matters to the market, it matters to me”. The reason certain parts of the market are predictable is because there are certain areas on the chart the matters to the market, and you will see a majority of the market react predictably to these levels. I have found what the market reacts to the strongest is horizontal and trend line support and resistance lines. But because of the popularity of things like EMAs and Fib, you will find the market reacting to these levels. I do use fib, although fib isn’t an indicator, rather it is a measurement tool. Again the market reacts predictably to certain fib levels in the right type of setups, so I include them in my analysis.

If you want to know more about the tools I use and how I apply them to my analysis please check out my thread 301 Moved Permanently

I have articles, videos and a lot of great PA conversation going on, on a daily basis.

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Ananais… I am trying to send a reply to you as a private message but your inbox, apparently, is full… Could you Private Message me an alternative address for me to reply to your questionnaire? I will not let me send it… Sorry to hijack this thread… Cheers…

Yeah I just got the notification! I cleared my inbox a bit. You should be able to send now. Let me know if you’re still having problems :smiley:

Thank you, Ananais! I have now successfully sent you my answer (as a two-part reply). Cheers!

Hi Krugman,
Thanks for your appreciation. Now i can look at my trade with more confidence!

You must be [I]desperate[/I] to increase your post-count, to be bumping even old threads in this part of the forum with your never-ending, fatuous, pointless, one-line posts. :rolleyes:

Lesson learned. Thanking you.

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Your welcome.

It’s always a little bit of a blast from the past with this old thread resurfaces.

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Thank you for this piece of advice and knowledge you have shared.