My Trading Journey to become a consistent profitable scalper

Short Introduction of myself

  • I have been trading for the past 8 months, started as a total newbie.

  • I have been trading part time (3-4 hours per day) while I hold a full time job that can support my current lifestyle.

  • I have blown up several accounts so far, some big accounts, some small accounts.

  • I have achieved some small successes recently, but due to lack of self control, I have deviated frequently from my trading strategy, leading to small losses that accumulated to huge losses and undid all the hard work I had done.

  • I am determined to become a consistently profitable trader. I believe I have the attitude and aptitude to do it.

  • My main weakness is the lack of self-discipline and will power to remain focused on implementing my pre-planned strategy and plan and not deviate from it.

My Trading Goal

  • To build a 6 figure trading account from my current bankroll of $20k.

  • Never to deposit money into my account ever again by following a strict risk management system.

  • To trade full time once I managed to earn a minimum of $15k per month on average over a 1 year period on a part time basis.

How will I reach my Goals

  • I will need to work on my
  1. Trading Discipline. I need to ensure than I do not overtrade. Over trading is my main weakness. Due to a host of psychological factors like impatience, hurt ego, unwilling to take losses etc, I have frequently take trades that are risky and not part of my trading strategy.
    As such, I need to work very hard on the psychological aspect of trading. For a start, I will read “The Discipline Trader” from Mark Douglas and fully understand what the book actually is trying to teach.

  2. Trading Strategy. I am using a scalping strategy posit by Bob Volman on 70 ticks chart (EURUSD). I have tried tweaking certain features of his strategy (Eg., instead of waiting for a full 10 pips profit, I will take 50% off at visible chart resistance). However, there are certain aspects from the book that I still do not understand fully. Eg., how to identify unfavourable conditions more accurately etc. I will reread the book again, consolidates the learning by writing a summary of what each concept means.

  3. Writing Journal. I will consistently reflect on the validity of my trades as well as the psychological aspect at the end of each session. I will present the chart in which I traded in this forum and dissect it.
    Over time, I hope to improve my mental and technical aspects of trading from these trading journals.

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Trade Reflection 15/01/2021 (Friday)

Trade 1:
Strategy: Block Break
I failed to recognise the unfavourable conditions before I took this trade. The reasons why this is an unfavourable trade are:

  1. Dominant pressure is bearish. Therefore, I should have considered short options rather than long.

  2. The block is almost 8 pips wide. Prices have been climbing for almost 8 pips before it breaks out of the block. If I were to trade this breakout on the upside, I should have considered a longer stretch of build up.

  3. There is an immediately clustering of prices on the immediate left. This act as future resistance to any upward moves.

Trade 2: Strategy: Fade Break

  1. The horizontal support is a well defined support line based on the past 3-4 hour 70 ticks chart.

  2. The price has been falling sharply and cuts through the support line.

  3. Once the price reverse back into the support turned resistance line, this is the signal to go long.

Overall Review:

  • I was too impatient in trade 1. I was too eager to get into a trade and was blatantly oblivious to the chart resistance. I did not consider the possibility of not having a double pressure to improve the probability of success in this trade. This is a typical mistake that I kept making. I must strive to improve in this aspect ASAP so that it will not hurt my bottom line.

  • In trade 2, while I couldnt fault myself for being rather aggressive in taking the fading move, another option to keep in mind is to wait for a double bottom to be formed first (Black arrow). This is a higher probability set-up where I can envision double pressure coming in to push the price up.

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Trade Reflection: 15 Jan 2021
This is the second session I traded during the London and USA session overlap.

  • Both trade were based on the same strategy “First Break”

  • However, I jumped the gun in trade 1. Why?

  1. I did not wait for the price to cut below the tail of the previous candle.

  2. I could have waited for the candle to go beyond the 20 EMA and then wait for the break of the candle to occur. This is a higher probability set-up due to double pressure.

  • Neverthless, I went in again almost immediately after my trade get stop out just moments ago. Managed to reap a full 10 pips from this trade.
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This is your only mistake, the rest too inconsequential imho

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Excellent intro and reflection. I see a lot of qualitative components above- no quantitative. How do you incorporate the latter to become a professional?

I’d argue it’s difficult if not impossible to. Which is why I ditched FX years ago and am trying to convert as many people as possible to the options market.

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Thanks for the advice.

Not sure if I get the quantitative part correct. If you are refer to using indicators to quantify my entries, then I won’t have any as I am using a purely price action strategy to time my entry and exit.

But if you are refering to having an account to quantify my winnings/losses, then yes. If I were to become a professional, I will need to quantify my winnings and losses and determine which strategy has the highest/lowest winrate and reasons for that.

How do you calculate your probability of profit prior to entering a trade? How do you systemically ensure that you have an edge? How do you beta weight your portfolio to a major index to understand macro risk?

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Been doing some readings on what it meant to be a patient trader?

Here’s some of the takeaways from the article I read.

What is patience?

The capacity to accept or tolerate delay, trouble or suffering without feeling angry or upset.

  • Indeed, in trading, there will be a lot of sufferings. There will always be pains suffered by traders when they lose a trade, or a few consecutive trades. Or, the suffering can be in the form of spending time, waiting for a trade to come but it never came. Suffering can also be in the form of having regrets about taking or not taking a trade.

  • So what does it mean by having patience in our trade?

  • It is not just about doing nothing or sitting in front of your computer and not triggering a trade, it is also about doing it in a manner where you wont feel any anger or being upset about it.

  • Anger is felt when we feel betrayed by the very market that we deemed we are able to control. Anger is felt when a “dead sure” winning trade turns out into a losing one. Anger is felt when market move in the direction we anticipated but due to hesitations or whatever reasons, we missed out on the trade.

  • What is meant by “upset”? It is a state of being unhappy, disappointed or worried. One example of this state of mind is FOMO.

  • But are we able to totally remove these emotions from trading?

  • The answer is no, because we are all human. But, that doesnt mean we will succumb to these negative energy.

  • The best traders are able to turn these negative energy in positive ones. They have learnt how to be aware of these negative energy and know the right things to do when they experience these negative energy.

  • The best traders can use these negative energy to their advantage and bring them to a higher level of understanding what these negative energy entails.

Indeed, as a trader, we have to accept that sufferings is something we have to face every single day. There wont be any day where we wont go through sufferings. If anyone is deterred by having to go through such sufferings, then he or she should be trading at all.

The way to overcome these sufferings is to really accept them as the truth of trading. With acceptance, we should be able to be more aware when these sufferings bring with them their companions - negative emotions.

It is important not to hide these emotions. We must accept and understand that these emotions are just part of trading. We must maintain a conscious mind to be (1) aware of these emotions and (2) not to let these emotions take over us.

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From a purely price action perspective, I will always enter and exit the market in a very short time. Based on my past 300 over scalps, I took an average of 9 min for my winning trades to hit target/manual exit and 5 min to end my losing trades.

My average wins is about $130/trade and losses is $103/trade, with a win rate of approximately 52% over this 300+ trades.

So I believe my strategy does have an edge in terms of probability.

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Asian - London Session 18 Jan 2021

Trade 1 (Strategy - Block Break)
In a slow moving asian market, prices were confined with a tight range of about 20 pips, though it seems to have found a bottom at 1.2065. A strong bullish move breaks out from the consolidation area and then stalls again to form a block. When price broke through the block, this is the signal for me to go long.

A cup and handle formation formed soon after and I am more optimistic about this trade due to this positive develpoment. I am hopefully that my target at 7.1 pips could be reached. However, just before my target can be reached (about 1.5 pips away), price crashed down and hit my trailing stop set at breakeven.

Trade 2 (Strategy - First Break)
After price rebounded from the current day high, a strong bearish move appeared. I waited patiently for a retracement and entered short the moment my set-up (FB) appears.
I may have made a mistake of shifting my SL too early to break even when I was about 5pips ahead. I hypothesize that given the strong move downwards, if price were to ever move against my direction and back to my entry level, I would be better off closing the trade at breakeven. On hindsight, this could be a mistake as the breakeven level isn’t a good place to place my stop according to the market structure.

Trade 3 (Strategy: Fade Break)
I jumped the gun in this trade. I was perhaps abit frustrated by my two earlier trades (assuming I had not shifted my SL, I would have hit target for both trades). This lack of patience has been a recurring problem in my trading career so far and something that I am still struggling to deal with. Hopefully, with my psychological training, I can eventually overcome this problem.

Trade 4 (Strategy: Fade Break)
A mini range within a larger range is formed (grey rectangle). THe boundaries were well defined and I posit that any break of the barriers would require some sort of a build up first, especially given the many obstacles above and below the barriers of the box.
Hence, when a break came rather prematurely, I was looking for a reversal or sort. This arrived soon after and when a break of a bearish bar came, this is the signal for me to short. I exited the trade at the bottom of the barrier once prices stalls at the bottom of the barrier and buyers starts to come in. I exited from this trade for a small profit.

Overall, a breakeven session so far today.

so do i (especially given its original source)

it’s very unusual to see someone starting off with something so realistic and promising

you’ll improve your edge, too, with practice

good luck with this!

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Hi, As a newbie myself, i definatley lack discipline, trading with my heart and not with a real strategy. therefore helping me to recently loose more than i can afford, i might look up the book you mention by Mark Douglas to see if it helps me on a rocky road to recovery.
Like you I would also like to enjoy a monthly income to supplement me wages at first, then if successful, possibly more.
best of luck on your journey

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It is important to trade without fear. I have been reviewing some of my trades thus far and I have realised one thing, I am fearful of many things.

I am fearful of the market taking away my profits and kept taking profit off when in winning positions.
I am fearful of the market running away without me.
I am fearful of losing my winnings and trade smaller when I have a good day.
I am fearful of ending a day in the red and hence I increase my trade size or take on more risk.

I have therefore decided to take on these fear heads on.

From today onwards, I shall keep to my preplanned TP and SL and not move them unless the market structure says otherwise. I shall not surrender in the face of profits eroding when in winning positions.

I have successfully implemented this in my first 2 trades today. Long may it continue.

Both trade 1 and trade 2 are typically strategies in my playbook. What pleased me most are the following:

  1. I did not shift my SL to breakeven when I was 5 pips up (I kept doing this last time).

  2. I accepted that my profit will erode and this is part of trading even when the market moved 7 pips against my winning position.

  3. I added on to my position when another strategy arose and shifted my SL to the new market level.

  4. I did not allow the fear of a possible double bottom (ellipse) affects me and allow the price to continue running.

Overall, I am pleased with how I managed this trade, not because I won, but because of how I take “FEAR” head on

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Good share and best of luck. Just wondering what is the name of the book you are using that you mention in your second point there? Many thanks.

Forex Price Action Scalping: an in-depth look into the field of professional scalping

20 Jan 2021 - Trade Review

Had an overall great day today. Secured two consecutive 10 pips profits earlier and have been patiently waiting for another entry based on my set-up.

At around 2235 SGT, which is shortly after USA market opened, prices shot down once it breaks the current day low. I skipped this trade as I deemed this as an inferior set-up with no build up within the support area. Never did I once regretted this missed opportunity because trading this sudden spike is never in my playbook.

Soon, a “W” bottom was formed. Again, I resisted the temptation to go long here as the pressure is predominantly bearish. The powerful of this bullish move out of the “W” bottom was undeniable. It covered back all the territories gain by the strong bearish move earlier and went even more, cutting through chunks of obstacles. I have essentially just stared at this strong upward moves with no action on my part. This is a scenario that I am just not too familiar with.

Could I have joined in this bullish joyride? Looking at how dominant were the bears earlier on, I am hesistant to do that. Even on hindsight, I just see no entry point in which I could have gone long. The first pullback that touches the 20 EMA? nah…prices has retraced just 30%. Prices has not gone through any technical tests , especially at 50-60% retracement levels as well as key resistance level. How about the pullback t round number? Prices has more than covered the initial gain by the bears (failed technical tests for a rebound). The dominant trend is now bullish (amid short term).

So should I join the bulls now? Not quite also. This bullish run is still against the previously dominant bearish move. This bullish run is overextended that simply encourages countertrend traders to come in and short the market. It is simple too optimistic to expect another strong bullish run that can earn me another 10 pips profit.

So what now? I have decided that I should be looking for opportunities to fade any breakout.

Trade 1 and 2 arises due to prices poking its head (without buildup) above the key resistance level and the faltering in its move. A tight SL was implemented to safeguard my capital in case I am wrong. An aggressive move it is but the RRR is supremely favourable for this type of strategy.

Unfortunately, trade 1 and 2 didnt work out as well as I hoped for. But hey… “anything can happen” in the market.

The third trade arises due to a yet another failed breakout attempt by the bulls and this time round, my fellow counter trend traders came in to push the price down and in the process, forces many of the trapped bulls to turn into bears.

Overall, 3 trades, all using “fade Break” strategy ended up with a modest 2.5 pips profit.

i spoke to a guy who at 35 owned his own house bought and paid for by scalping options - do you know a good source on how i can learn about options?

not too sure about that… so sorry about it.

Trade Review 21 Jan Session 1

Trade 1 was a typical strategy in my playbook (First Break). Prior to my entry, market had ferociously moved down out of the blue. I was looking to enter short at area of values (eg., near the 20 EMA). The opportunity came when a set up (First Break) materialised. Unfortunately, I was caught in a fake move and I exited the trade when its clear than I was wrong about the set-up. A loss of 3 pips.

I continued to wait for a pullback reversal set-up which promptly arrive 5 minutes later. On hindsight, I could have been too eager to enter this trade given that the candles are still above the 20 EMA. Nevertheless, this is still a valid first break (FB) set-up, abeit rather aggressive one at that. Was lucky to hit my 10 pips profit before market reverse back.

Trade 3 was a mistake as I jumped the gun. I was looking for Double Dojis break set-up but somehow fired my short too early. Nevertheless, the market still went in my favour shortly after but reverse back shortly afterwards. I quickly exited for a small loss of 2 pips when it is clear that the market have possibly found a bottom when prices consolidated and then forced its way above the 20 EMA.

Thank you :slight_smile: