I am looking for long term advice and thoughts regarding several positions I hold in NZd/USD pairs. I did well buying and selling them several weeks ago and foolishly placed several more believing they would upswing and all they have done is plummeted.
Firstly, I have read the trend analysis and the long term has now gone, this is somewhat concerning, all the positions had no stop losses (yes big mistake) and so are now languishing at -£1000.
Secondly, I have 1000% margin so some ways to go but really need advice as to whether to cut my losses and run.
So, my question’s are, should I wait it out or cut and run?
What are the chance of this trend reversing as this is the lowest the pair have been for a long time, im 700 pips off my first close?
Hi, so you want someone to make the decisions for you, honestly? I don’t think you will get a definite answer. You started live trading without any preparation, and now you are paying for it. Learn from your decisions and come back to the market with more knowledge and experience. Good luck Regards Greg
My advice for anyone without a proven and comprehensive strategy would be to a) not enter a position, and b) exit any positions open.
As far as riding price trends goes, this is a valid approach to trading (its all I do) but you need to recognise that trends eventually fail. So I find its useful to have a check-list of the chart characteristics of the trends I’m following. When one or more of these turn from bullish to bearish or vice versa I get out and stay out. I’m only interested in established trends, not trend birth points.
This may seem to be a really stupid question, but if you are operating on 1,000% margin and you are losing £1,000, that means you opened this trade with a £100 risk. If you have opened an account with any more than £1,000, sell immediately to prevent infinite losses (or whatever amount you funded your trading account with). I am amazed your broker has not closed your account yet - unless, of course, you are risking far more than £1,000.
Is this not an obvious choice to you? Not only have you thrown away £1,000, but you are still sat there with Hopium that this will somehow be mitigated by waiting and doing nothing. I hope you have a good job or a rich Dad.
If you have any funds left after getting out of these positions, please don’t go in the bookies and bet on any accumulators. That is exactly what you have done here, but with potentially unlimited risk
You should never wait in such situations. Cut that as soon as possible. Actually, I strongly recommend to close the deal if it doesn’t seem to go according to your plan. Do not wait for too long as this, as a rule, leads to quite depressing outcomes. Cut it, learn the lesson that you need to use stop losses and move forward.
Are you okay?
This is really a very frightening situation for a trader. I agree with all those who have replied here, You should not have waited so long for closing the position and plus do not make any trades in future without SL and TP, your story is the perfect example of first greed and now fear. You have a FOMO and this made you trade impulsively. I also advise you to not put all the funds in one pair too, here you missed out the the opportunity of hedging your funds. Look for inversely correlated pair too in such situation to escape so that you can turn the tables in your favor.
But before all this, make a analysis and plan to put hand into trading again.
Thank you all again, you have all identified correctly the situation as it unfolded. I did have a few sleepless nights. Would you believe I closed the trades as they started to get worse and they rebounded and I would have made a vgood profit an hour later. I have learned lots and it been an expensive mistake, I will take all of the info provided and be very much more cautious.
advice is really important there is no way to ignore but i think any kind of advice can be useless if you not work in practically , so we have to work on field with dedication. thank you
That is what happens when a trader doesn’t have any precise plans.
I feel that every deal should be preceded by thorough planning in order to avoid such a situation when a trader feels some pity for cutting an open deal and takes losses at the same time. I am not talking about planning about the time, I am talking about setting certain limits in order to avoid losing more than you can afford. That is of utmost importance because everything may happen on the market which makes it a good idea to use stop losses in your trading.
Anyway, you’d better cut the deal and move on. The best-case scenario would be to analyze this deal later in order to understand where the mistake was. This will help you improve your decision making process and increase your profits. But firstly, you’d better cut the deal.
My advice is to work out a trading plan before making a deal and act according to this plan. In such a condition you’ll not have to ask such questions as you will already have the answer to this question. I feel that there is no room for improvisation in trading. Every action should be preplanned and thought very carefully, otherwise, your trading will never be consistent and predictable.
My recommendation is to create a trading strategy before making a deal and stick to it. You won’t have to ask such inquiries if you’re in this situation because you’ll already know the answer. In trading, I believe there is no place for improvisation. Every action should be meticulously planned and considered; else, your trade will be inconsistent and unpredictable.
You should never wait for the miracle to happen. For now, you need to close the deal but you need to learn a lesson out of this situation. In the future ALWAYS make a trading plan before opening a deal. You can use stop losses or if your psychology and discipline are strong enough, you need establish the borders for the price to close the deal, otherwise, you’ll lose a lot.
I have taken all of the advice to heart and changed my very ‘ad hoc’ shotgun approach to the wise words above.
I now read and identify what’s trending and how longs that’s been the case, I devise a plan and stick to it come what may.
I only have 2 trades open at any time so as not to stress my free margin (and my nerves!)
Since I adopted this strategy I have started to make regular successful trades averaging £500-700 a day with a £10k stake, some days it does not feel quite right or the stats on the trading ranges on Babypips are too close to a possible reversal so I sit and wait.
My stress levels have reduced and I am feeling much more comfortable about trading.
Regards Greg