OK so here are the main reasons why i failed to make a profit from live chart based trading –
Not knowing where the chart price will move to or when, i had/have no crystal ball.
Having to cover the brokers spread before a trade position can move into positive territory. And then still not knowing where the chart price will move to or when anyway.
Needing to limit the maximum size of losing trades with a stop loss.
Extra pips negative slippage in terms of my chart entry and exit prices, and what my actual loss for that trade should have been in my trading account versus what actually happened.
On average I lost an extra 0.55 pips per trade, which is massive.
This occurred at around the same 0.55 pips extra loss per trade, whether I used charts displaying prices provided by my own broker or charts displaying a different datafeed to my broker.
This is a massive HUGE extra burden and confidence drainer to have to endure, especially more so trading off smaller time interval charts.
Charts displaying forex prices to five decimal places rather than four decimal places. The extra fifth decimal place makes the chart so much more user unfriendly to look at and read and was irrelevant to my trade management. Four decimal places was all i needed to see - pips, not pipettes.
In my opinion each of these contributing factors are massive obstacles, and big reasons why (as it is said) something like 90% of people who try online trading / chart based trading fail to make a profit.
When I started trading, I was paying 5 pips (not pipettes or fractional pips) + $4 commission. There was no rollover/swap, so the broker had to close my position at the end of the day and to open another one after the open. That resulted in me paying the spread one more time. And all of this was for the most liquid pair EUR/USD! Don’t ask me for GBPJPY or others
Yes, you can say that the game is set against us, but with the current trading conditions it is definitely not a “massive HUGE extra burden and confidence drainer”.
But, the important question here is what are you going to do about it? Quit? Or adapt - find such instruments and trades where everything from above won’t bother you.
Good advice and warnings on this topic can be found here.
i presume the statistics like - around 90% of people who try trading online fail to make money - are fairly accurate and have been released by the industry, like the govt health warning on cigarette packets.
The optimist in people would then presume or hope that the other 10% made a fortune. Or perhaps they all just withdrew more money than their initial deposit and so may have only made $1 trading.
From these statistics it seem likely that the vast majority of people who are or have been members of trading forums never did, have or never will make any money from online trading.
The optimist in people hopes to become part of the 10% who do not lose. But logically, if there is any type of investment opportunity where 90% of people lose more than they invest/deposit, perhaps a wise person should be asking or suspecting - is the whole thing one big scam???
Yes, it is accurate. That means that you should be very careful when taking advice from somebody in a forum, like me for example The chances that I am one of those 90% are quite high, aren’t they?
But there are people who constantly make money - Dalio, Buffet, Cohen, Simons, Williams, Jones,… How those people do it? If they are doing it constantly, decade after decade, there must be something. Focus on that if you are planning to continue
And i cant explain how and why this happens. Only that it did.
Why was i losing an extra 0.55 pips on average per trade (whether the trade won or lost) compared to what should have happened based on the prices i clicked on and my brokers spread at the time?
Why couldn’t i have been making an extra profit of 0.55 pips on average per round trip trade, compared to what should have happened based on the prices i clicked on and my brokers spread at the time?
Oh no they couldn’t have that could they.
But an additional 0.55 pip deduction from every round trip trade can be the difference between being a loser and being profitable enough. At 10 trades per day, that 5.5 pips x 5 days = 27.5 pips lost per week.
Ask yourself why are there so few haves and so many have nots? Why is there 20% of the worlds population controlling 80% of the worlds wealth??
Why are there so few elite athletes and so many also rans.
Some people will say that the successful people are the lucky ones or the ones born with good genes and exceptional abilities. Not so. Most of the time you will find the most successful people are the people who have a passion and are prepared to work harder than anyone else to achieve their goals. Look at just about all rich people and yes some are born into wealth but many are self made. Nearly all of them have one thing in common and that is they took the hard knocks life dealt them and learnt from them. They did not let setbacks defeat them. They stayed the course and pushed on because they had a belief that they would succeed.
The vast majority of the average population remain just the average because they lack commitment, determination, drive and/or are just to lazy to pursue their dream their passion until they achieve success.
If you want it you have got to chase it because success will not just come to you.
i put 1000’s of hours into trading, I worked harder and harder.
I still did not find or develop a crystal ball method that could tell me consistently enough where the live chart price will move to and when that would enable me to make a satisfactory amount of pips profit.
I have an IQ that places me in the top 1% of the human population,
I still failed to make a profit trading online, using charts - as most people also seem to do.
Therefore based on my own experiences, I could not and will not recommend online trading to anyone.
Not to label any individuals, anywhere, but, statistically speaking - of the people on forums telling the person who has just said they tried and they failed - to try harder or get a different method or put more hours research into it - statistically speaking up to 90% of these people will also have never made and will never make a net profit from online trading.
Reality denying, dreaming ???
Facing reality -
One of the hardest decisions we sometimes have to make in life, is choosing whether to try harder, or to walk away.
Facing facts, and listening to our intuitive inner voice of wisdom can tell us which is the right option for us as individuals to take.
I smell one big scam with this online trading thing, where around 90% fail to profit (how could this not be called a scam?) which in reality I have also been a victim of.
It is normal for people to tell you to continue in hard times. It is called support.
But sometimes, again not to label anyone, you see somebody’s writing in a forum about things you already experienced or he/she is speaking of a place where you’ve already been. Not only that but 90% of traders have been there
Then you try to politely explain to that person that for the market it doesn’t matter how smart you are, how capable, how intuitive,… One can spend 10000 hours without any progress.
You then continue by showing that he/she misses something. Since this person like statistics very much you try a rough example:
The chances of tomorrow being a bullish day (up bar, candle) for EUR/USD is 50/50 it can either be or not. But for S&P500 that probability is 52.5%! Now can this small bias bring you big profits? Maybe not, but can it cover that so problematic spread…
And last but not least the big truth is that markets are not made for you and me to profit there. They serve another purpose. So there is no point to be upset if things didn’t work out that way we want them.
Its common sense really guys, and i wish I had thought of this on day one, but its a vicious circle as –
If i don’t know where the chart price will move to or when (how could I, it hasn’t happened yet, and i don’t have a crystal ball), i don’t really know where i should enter a trade. And even if my necessary stop loss (to prevent my account balance being wiped out by one draw down suffering trade entry) is not hit (though it often will be, which means i WILL incur losses), I don’t know where i should exit as i don’t know where the chart price will move to or when (how could I, it hasn’t happened yet, and i don’t have a crystal ball).
A chart can only graphically represent what has already happened to the price so far, not what will happen in the future.
And i have not even re-mentioned the overall average negative “slippage” that occurred in the “brokers”/dealers trading software. This ensured that each of my round trip trades was on average around 0.55 pips worse off than it should have been based on the chart price at the time of my entries and exits. It was not friendly positive advantageous slippage which i suspect is much rarer than negative slippage.
But you can have a reasonable foresight of what is likely to happen.
I use Eur/Gbp in my business, I make decisions based on what I consider likely. This morning cpi was released - you may see from my posts on other threads that I took the view that there was a reasonable chance that there would be a miss - (given that the UK retail body posted a very negative piece on sales last week)
I also take the view that at best retail sales numbers will be as predicted but more likely also a miss. I further take the view that given this outlook there is a reasonable chance that the vote count will change for at least one more dissenter.
With all this in mind it would have been reasonable for a trader to enter long EG before the cpi release this morning without looking at a chart?
Im talking about chart based online trading here guys . some of you are mentioning stuff and people that sound related to long term investing which is something completely different, yet if chart based the principle is the same - not knowing what will happen next, needing to use a maximum stop loss to prevent one big losing trade wiping out the account balance.
With all this in mind it would have been reasonable for a trader to enter long EG before the cpi release this morning without looking at a chart?
Perhaps it would have been, i dont know, i have not checked, and what you outline does not sound like chart based online trading.
However, even if your EURGBP had done what you hoped it would do, theres also a reasonable chance that your stop loss would have been hit before it did, or that once eurgbp did what you hoped for and move into positive territory you did not know what to do next / where or how to exit for a profit, before it possibly comes back to hit your stop loss.
Please people, if you are going to post in this thread and try to deconstruct the very real and valid points I have made, please also provide us with some indication of your total net $ profits from online chart based trading. That should be a very real and easy number for anyone here to bring to mind.
I can’t because i failed to make a net profit, i did try but i failed.
Because it is often said that up to 90% of people who try online trading fail to make any profit. And for all we know a large chunk of the other 10% may have withdrawn from their trading accounts the same amount as they initially deposited, or only a dollar or more more.
