My Epic Recovery Journal (- $200k in losses to date)

I’ve thought about starting a public trading journal for a long time and I’ve finally decided to do it. This is a ‘business’ decision first but I also really enjoy writing so hopefully I can provide some entertainment along the way and even make some friends.

TL;DR (Too Long; Don’t Read) version:

  • Been trading almost 4 years, since mid-2017.
  • Lost somewhere in the $175 - 200k range to date ( :arrow_left: Terrible Trader in the house).
  • Traded everything from Equities to Options to Futures.
  • Recently shifted to FOREX.
  • Had some early success in FOREX trading Long-only and zooming out to the 1H timeframe.
  • Trade all Major Pairs and anywhere between 0.5 - 50 Lots.
  • Strategy: mean reversion / retracement.

The Detailed Story

Brief History
I am from the UK and I live in Dubai, UAE. I have a successful career in an industry I hate which is why I am so motivated to make it at trading; something I love passionately. I’ve been actively day trading since the summer of 2017 … with zero success to date. I’m the guy the MarketMakers rub their hands together about when they see me log onto whatever broker/trading software I happen to be using that week. That means I’m approaching 4 years of pursuing this dream without anything to show for it. That’s a little demoralising but it’s a testament to my perseverence I guess.

2017 - 2019: I spent the first 2 to 3 years trading Equities predominantly. I threw in some Options trading from time to time but I never got to grips with the mechanics of Options. I tried every market and every strategy known to man and it was an utter disaster.

2019 - 2021: I discovered Futures. I really liked Futures because (a) the leverage and (b) the timings. I could trade /ES and /NQ all day, every day, which was attractive given my location. I traded my own money during much of 2019 and part of 2020 without success. There were some big, vomit-inducing losses (low 5-figure) during that time so around September 2020, I decided to try out for one of the online Futures prop firms (TopStep, Earn2Trade etc.). If you’re not familiar with these, you basically pay a monthly subscription and you have to complete a challenge/combine without breaking their rules. If you break their rules, you pay $100 reset penalty and you start over again. I cannot count how many resets I’ve had over the last 6-9 months. I’m guessing it will be in the mid to high 4-figure dollar range.

2021: I persevered with Futures right up until a few weeks ago. I got to a point where I was banging my head against a brick wall … again. I needed a fresh start. A clean slate. I never thought I would move to FOREX but I was running out of markets and instruments to try my hand at so I didn’t have much choice!

Like everything else in trading, I started at ground zero with my FOREX education. Up until a few weeks ago, I thought a Pip was something I found in an apple and a Lot was something my grandparents grew vegetables in. I don’t think I’ve come much further with my education of the lingo but I’m sure I will pick it up.

Why have I been such a terrible trader to date?
I put this down to a combination of technical and psychological reasons. I’ve never really settled on a defined technical strategy. To add insult to injury, as soon as I felt like I’ve found something that works, I get distracted by a new strategy and think the grass is even greener elsewhere. My psychological issues revolve around greed and impatience. I’ve been in such a hurry to leave my career behind that it’s had a profound impact on my ability to be disciplined and consistent. In short, I’ve probably set a record for being so bad for so long that it’s a wonder how I’m still persevering with trading.

Why am I starting this journal?
I feel like I’m finally seeing a little light at the end of the tunnel. I’ve had some early success in FOREX and I feel comfortable enough to start sharing my journey. I obviously want this to be a positive story and outcome, but I was never going to start a journal while still wandering around like a headless chicken without a strategy I believed in. I also think this will give me more accountability and keep me in check. The thought of posting a big loss is all the motivation I think I need to stick to some rules.

What is my strategy?
The only lightbulb moment I’ve ever really had during my trading career is to trade Long-only since moving over to FOREX. With the benefit of hindsight, my bias was so clouded and conflicted when I was looking for both Long and Short opportunities that I never had a feel for the market or instrument I was trading. I’m sure most of you are thinking, “Well, duuuuh!” but for whatever reason, I never grasped this fundamental concept, or, I was too arrogant to assume I could trade in both directions on any given day.

Something else that’s really helped since moving to FOREX is my decision to zoom out to a slower timeframe; specifically the 1H. I’m sure you guys are now thinking, “Oh jeeze, DXB has only discovered this after four years!? Get me some popcorn sweetheart, we’ve got ourselves a basket case here.” You’d be right. I have exuded all the qualities of a basket case and then some! But, for everything I’ve lacked in my trading career so far, I’ve got a plethora of determination and nothing is going to stop me pursuing my dream.

From a macro perspective, I’m looking for any pair that is oversold/over-extended to the downside and is primed for a reversion or retracement to the mean, and, by ‘mean’, I’m referring to the 20sma. If you’re looking for an example of something I love to see, look no further than the massive sell-off in USDCAD on 21st / 22nd May. Occasionally I will look to join a clear uptrend but those trades do not come naturally to me.

When I’ve identified a pair that is massively oversold on the 1H and is starting to find some support, I then start to zoom in to as low as the 15-min and look for a few different reversal patterns like Bearish Deep Crab to name just one. Like I said, sometimes I will look at bullish trends but I think I have a much higher win rate with oversold mean reversion trades.

Hopefully this will become a lot more clear as I post charts with my executions as this journal progresses.

If you’ve stuck with me for this long, here’s the fun bit for you readers. I trade anything between 0.5 Lots all the way up to 50 Lots. I’m sure you are certifying me as nuts at this point but don’t worry, it’s not completely irrational gambling. I’ve worked seriously hard in my day job such that I earn a very good living. I definitely don’t have liquid money to burn - a lot of it has been burned on trading - but I benefit from being able to replenish quickly due to my regular salary.

What have I lost to date since starting on my trading journey in 2017? I am deliberately avoiding answering this question with any accuracy because I don’t think it will benefit me in any way. But, in the spirit of entertaining my readers, I reckon it’s somewhere in the $175-200k range.

When/If I surpass $100k in FOREX profits on my Tickmill account, I will have the courage to upload all my statements onto a trading journal website and post a lifetime chart. It will still be negative at that point but I know I will be well on my way.

Tickmill sends a really nice Daily Confirmation email so I will take a screenshot of that for the time being while I decide on a trading journal to upload and publish my results going forward.

I look forward to contributing to babypips and enjoy the read!

8 Likes

What a story!. We’ll be rooting for you to reach full scale profitability. Have myself been trading since late 2017, but I think that it’d be better forget the past, ignore the dollars lost and just work on profitability in pips say in a year’s time. Otherwise, sounds like you’re planning to revenge on the market now…

GOOD LUCK…

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Thanks for sharing your story. It’s similar to a lot of traders in many ways, except on a much higher scale than most. The biggest difference is your determination to keep going and get things right after all the losses.

I think if you truly want to start over you need to try to get this out of your head. Write it off as your tuition, or a business expense and move forward. Telling yourself that you need to pay this back is physiological torture and will weight you down forever if you let it.

Write down all the things you did wrong and figure out how to correct them. Build on all the things that have worked.

Think of Forex as a business. You build a business 1% at a time, and that’s the truth, there’s no fast and easy way around that.

Good luck in your new journey, I look forward to following your progress.

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That’s some really great advice @MattyMoney, thanks. I’ve spent way too much time thinking about the deficit I have to make up and I know that has hindered me, psychologically speaking. Sometimes I’ve questioned whether I will ever do it but I remain very determined and I have never lost faith in myself.

I’m really trying to focus on taking each trade and day as it comes. Something I’m coming to terms with is the idea that if you try and skip a rung on a ladder, you could very easily trip, so you have to climb each one in order.

I know psychology is the biggest obstacle I have to overcome - like so many I guess - and I’m trying to address that. In fact, I’ve got a few sessions with Jared Tendler starting this week so I’m looking forward to that.

2 Likes

A very interesting post, thanks.

Two suggestions: first, do not try to bring your losses back to break-even. That’s a failed psychological strategy when your mindset should be to go forward past that point. Just put that behind you, and look to trade profitably with Jared’s help. He’s a great mentor to have.on your side.

Best of luck…

BTW, IMO the reason you’re losing money is becaiuse you cannot control risk . A lot size of 50, unless you’re trading millions, is well OTT. Jared will help you to establish the underlying cause of why you lose control, and hopefully find a solution with you.

Let me guess: what’s failing you is your desire ‘to make it’ at trading, which you’ve taken the wrong path instead of focusing on a process that makes profits more than losses - and which is an alternative path that would eventually lead to your goal.

Probably, a very simple process strategy, if followed to the tee, and enacted c.10,000 times, would be all you need to become successful. .

As Bruce Lee said: I’m not afraid of any opponent who has practised Kung Fu for 10,000 hours, only the opponent who has practised one technique 10,000 times.

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A bit confused on what you mean by long only? If your trading the EUR/USD your long EUR & short USD.

Hi @rolandlc33 - I only click Buy for my entries on the basis I think price will increase on whatever pair I’m watching.

No, it’s not nuts at all to trade 50 lots. In my opinion, it doesn’t matter what size your margin is. What matters is the percentage.
If 50 lots normally leaves you with a stop loss only risking 1% (2% max), then cool.

And if you want to risk less, that’s fine. But the variation from .5 to 5.0 leaves a huge gap, and it seems unsystematic to me. A non-rigid plan structure.

But, maybe I’m wrong. I’m learning, just like you.

Perhaps, decide if so much flexibility is good or bad for you.

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P/L: $1,083.81
Win Rate: 75%

Just some stress free base hits so far today. The EURCHF trade was a bit frustrating. I closed it out because I had to go to a meeting, only to come back to find it had made a big move. That’s trading I guess! :money_mouth_face:

There’s been some big 1H candles in the last 1-2 hours so I’m keeping my eyes out for some continuation or my favourite scalp - the washout long.

If someone can tell me how to show my trades/executions on an MT4 chart, I can post them.

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@dushimes, you’re absolutely right. I was quite self-deprecating in my OP - I actually deserve most of the criticism I give myself - but I don’t believe I’m quite as reckless as I sound. Although I don’t have it written in stone, I size much smaller on breakout trades, for example, if I am anticipating a breakout of a bottoming pattern, an ascending triangle or falling wedge. Conversely, I am ready and prepare to get much larger on my favourite scalp - the washout long - when price is super extended to the downside and will almost certainly rip back up like an elastic band.

Really appreciate the advice though. Thanks.

One way could be screenshots, if you can’t export the charts.

I can screenshot the charts but I don’t even know how to turn on my trades in the settings so that they show on the charts. Any idea?

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Be careful. Practice risk management. I’ve felt the same way about trades. “This is gonna be a big win, so I can open a larger-than-normal position.”

You never know what price will do. You only know what it could do. Hopefully you win. But if you lose, it’s ok because your risk was 1% (2% max).

By the way, so you had some heavy losses in the past. What are you doing differently now?

How will this run be different from the last?

I’m asking because I’m in a very similar situation. I had to take a step back and assess my whole approach.

Right-click?

I’m not on Meta, so I’m not so familiar. Perhaps a youtube search will unveil the answer.

Update

P&L: $2,653.62
Win Rate: 50%

GBPUSD ended up being a winner but it was bad trading. It was a classic case of being right about the direction/move but wrong about the trade.

Here’s a snapshot of the setup and trade. I seem to like setups where there’s been 3 or 4 hours of selling pressure but it seems to be holding. I’m basically looking for the big retracement to the 20sma - which occurred - but I was early and it was a little impatient. I like a few indicators to all be telling me the same thing and this was my mistake. Everyone has heard of the MACD; some have heard of the TTM squeeze but my favourite indicator is the Vortex Indicator. (I’ll go into why and how I use it another time.) In hindsight, the VI and MACD weren’t in good positions and that’s why I’ve graded them down to B-. Yes the move came but it was a bad entry and bad trade management.

image

I’m going to wrap it up for a day to avoid over-trading.

Good trading (so far) today. I had a nice setup in USDCAD but I cut it early because I didn’t like the way it was moving and I wanted to focus on USDCHF, which was a much nicer setup for me.

USDCHF is an example of a setup I love. Similar to GBPUSD yesterday, my interest rises when I see 3 fairly large red candles on the 1H which are extending price quite far away from the 20sma. I always wait for the hour to close and I will usually wait another 20 mins or so before I take some starters but I had reason to start taking pieces early. I liked this so much I loaded up fairly fast and then added even more about 10 or 15 minutes later when I felt selling was exhausted. Here’s a screenshot of the trade in action and all my buy lines:

It’s not easy to see but it had broken below the low of the last candle but was holding nicely, and a nice hammer candle was starting to take shape. It took 20-30 minutes to start the so-called elastic band retracement but I’m okay with that. I then started to sell pieces into the next hour and was all out when price looked like it was running out of steam. This was about as easy and stress free as it comes for me.

I know I probably miss out on an even bigger move back up to the 20sma but I like to be out of the market as fast as I get into it. I’m trying to get used to holding a small piece for longer but that will take time. And, at the time of posting, it’s continuing to rip towards the 20sma.

Daily P&L (excl. commissions): $2,693.89
Cumulative P&L (excl. commissions): $5,016.41

Suffice to say I’m happy with the start of my public journal. I won’t trade for the remainder of the day unless I see another A+ set up.

Another good day from a P&L perspective but it’s been a C-grade in performance. I was simply too stubborn and ran out of patience with both USDCAD and EURAUD.

Price action was pretty choppy on USDCAD once I’d made my entries and I just didn’t like the price action. I then got spooked by this candle (circled in green) so made a quick exit, only for it to immediately board a train with a one-way ticket to the moon.

EURAUD was even more frustrating. A complete chop-fest. I decided to cut it when it hit resistance for the 17th time; which turns out to have been a good decision! Anyway, good riddance to EURAUD today.

I’m seeing lots of nice setups but these trades have knocked me off my A-game today so going to step away for a few hours.

Day 3
Daily P&L: $2,560.10
Cumulative P&L: $7,576.51

Day 3 Update
Daily P&L: $3,233.55
Cumulative P&L: $8,249.96

A little wallet-padding with a nice plunge on the 1H in EURGBP. I’m sure it would continue to retrace back towards the 20sma (which it seems to be doing as I write this update post) but I’m fine with taking my $700+ in 15 minutes.

image

I would typically try and turn $3k into $6k at which point it would all go horribly wrong so I think I’ll call it a day.

Hope trading goes well for everyone today!

Looks like you’re doing well so far, but your trading style looks destined for disaster. Huge lots for small returns usually results in one big loss that wipes out your profits in no time. I’ve traded exactly like you are and had my account ticking up before a big loss wiped me below my starting point.

if in 2017 you’d put $200k in an S&P tracking fund, you’d be sat on about $375k now. That’s Warren Buffet’s advice. Maybe not enough to live off, but if you can afford to lose that much on forex, then you could probably afford a lot more on a more stable investment.

I’ll keep an eye on this thread and cross my fingers for you.

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Thanks @chesterjohn

I appreciate my style is very unusual. I do have one or two other setups I look for but these washout longs come very naturally to me. What I like about them is that it gives me a very high winrate. As much as I’ve tried to be one of those traders who can accept a low win rate in exchange for a high risk/reward ratio, I have never been able to get used to it. From a psychological perspective, I have to win often, even if it’s small. And, I’m okay with that. I think I have swing trading in the locker in the future but right now it’s about base hits rather than home runs.

My downfall has been cutting my losers on the few occasions this type of trade doesn’t do what I want. I’ve been controlling the losses soooo much better the last few weeks which, I assure you, has been a huge obstacle for me.

I’ve also begun having sessions with Jared Tendler which, alongside his book, are really helping. I know how fallible I am so I’m just trying to take each trade as it comes, each day as it comes and remember this adage:

"Do not let one trade define your day, or week, or month."

Thanks again for your feedback.