Losing- how to know

Hello,

I am very new to trading. I have my first trades on at the moment using the daily charts on my demo account.

One of them is in profit for two days and doing well,but the other dropped shortly after placing it and is currently 140 pips down. Is it normal to be so down?-Or is this a loser?..Is it possible for it to go up into profit again if i wait, or should i cut it short?

I guess i will just leave it until i’m stopped out, but i am just curious as i don’t have the experience to know what is normal or not!

Any help would be great. I maybe haven’t given enough info about the trades but not sure what details are needed.

Thanks, Lewis.

That’s logical, if you think your stop-loss was in the right place to start with.

The logic is that you put the stop-loss where you wanted to be taken out of the trade if the price reached that level.

The inference is that if it hasn’t reached that level, you still want to be in the trade.

IF the stop-loss level chosen was a valid one. Which depends on a lot of things related to how you choose your stop-loss leves, which you didn’t say.

Your other question about whether it’s normal to be this much down also depends on other factors not mentioned, and they include time-scale and volatility. For some time-frames, 140 pips is nothing much. For others, it’s frightening.

Good luck with it anyway.

2 Likes

Thanks very much for that. Yes makes sense.

I calculated the stop loss using max risk/stop loss initially, but then moved it down a bit more when the price got too close, as i was confident it would then go back up after that,which was a mistake i think. Saying that it is at 80pips at the moment.

I’m just trying to get a feel for what sort of price moves are acceptable when trading the daily charts, but really am just being too impatient and should just carry on and find out for myself i guess!

Thanks again for your help.

Just continue to trade on demo. My first days (weeks?) on demo account I was just like “Whaaaaaaaaat’s going on here?”. But after a while, everything starts to become more clear and you begin to understand how it works.

I think you should make a lot of mistakes and analyze all your trades while you are trading on the demo. Because on a real account an error can be costly. Perhaps you have your own vision of the situation on the market and you understand that the price will then come out of the drawdown and the dates of the profit, you can expect it, and if several such situations simply take away money, then it’s worth closing or not entering into such situations.

That is my advice as well. If you’re not sure whether a position being 140 pips down is a loser or not it’s better to return to demo trading for a while.

Thank you for all the replies,i really appreciate it.
Definitely agree with all the advice.
Looking forward to learning from experience. I’ve never enjoyed being a beginner at things! :grin:

Your stop-loss shouldn’t be calculated, it should be decided upon technical analysis. You place your stop where price would negate your set-up & then calculate your position-size accordingly.

Stops are usually placed above resistance, below support, above/below the wick of a pin-bar etc.

1 Like

Ah yes sorry I was talking about position size there. I had only just got out of bed when I wrote that! :smiley:
Thanks for your help on the stop loss though.

You’re welcome. I wish you profitable trading and as little stress as possible while you trade. :slight_smile:

1 Like

I see, you are very new! Don’t worry, spend long-long sessions with BabyPips school! In addition, now it’s time to learn Forex, don’t judging your trading skill! Learning technical and fundamental with details; then you’ll able to identify good entry and exit points of Forex!

1 Like

Thanks for that. I will carry on with the learning journey!

That is the spirit. :slight_smile:
Keep in mind that journey is often long and difficult. You won’t learn how to trade well overnight and sometimes you will want to give up. If you persevere and you learn from your mistakes you should see yourself improve over time.

All the best! Try to start your live journey with your personal trading system!