Well for the past 6 months I have been doing okay with forex… I ran up my acct 60%, but last week I made one bad trade, lost 5% of the total acct… then I rushed back in and made another bad trade… then tried to get my money back on a third rushed trade. So now I wiped out 6 months of profits in a day and a half. I know… horrible money management and all… I was totally ‘tilted’ and I should not have been trading in that condition. My question is do you think I should quit trading and call the whole thing a wash and withdraw my remaining money or should I just take a break and start trading in a few weeks again?
At least I learned not to trade when I am trying to get back my loses. Stupid, I know. If I were playing poker i would have walked away, but FOrex seems much less chancy than poker.
Other than what you said, you may also have traded in a period where intraday volatility was very high, thus making it easier to lose big (or win big, of course).
In your position I would not call it quits but I would take at least a one month break from live trading, and then evaluate if Forex is still something that interests me… If yes I would however enter the market again with much smaller positions, risking no more than 1% of the account equity per trade.
just live and learn, Only learn by making mistakes, The six months profit you made probably wasnt life changing as you had most likely been disciplined and been following proper money management resulting in small profit increases but consitent. You need a descent size stake in forex for it to be worthwhile, but there is a great deal of practising and learning to do before you can make that stake work. If you enjoy it…carry on…aslong as you dont throw all your money away and your playing with money you can aford to loose (like we all have plenty of that lying around)
no, not all my profits but the withdraw cost and wire transfer fee would be 50 USD which would mean almost 6 months of my profits are gone.
started with 300…ran it up to about 480 lost 26 on the first trade which started the downward slide. then another, gulp, 82 over the next day and a half. So 480 - 108 = 372 - 50 withdraw fees and transfers and it is 322… so lost my profits…
As you can see it is not big money at all… just basically learning (and failing to learn?) about forex.
So just wondering if i should just decide that forex is not for me or if I have to just not let my positions get so far behind…
The truth is that when I started to lose, I changed my trading from scalping to longer term. If I continue i wont do longer term… I mean I was scalping 4 - 5 pips at a time so that is why it took me so long to build up the acct.
If you want to quit… then quit. I hear that giving up has made a many a successful _______. With the proper due diligence you should have been fully aware of the risks associated with trading your money. More importantly to me though is the mentality that “ohh I fell off my bike and scraped my knee… I’m never riding my bike again.” Get up, brush it off, re-evaluate, and learn from the mistakes that have instilled in you the desire to just give up. Maybe the $108 was life changing for you… if you you probaly should not have the money in an account any way. The weight of this lesson should remind you from here on out that sticking to your system and practicing your due diligence is in the best of your interest. If, after this, you continue to make the same mistake… at that point look at your self and ask if you really have the discipline to be a trader. Many of the richest people on earth have went bankrupt multiple times before finally getting it right. If they had just given up they never would have made it to the other side. Just remember that.
The last post seem a tad hostile. Let me guess, you lost a lot of money in Forex and you just want to justify your loses?
No, 108 bucks is nothing; it is not the AMOUNT that matters, I am for certain not depending on forex for income. It is that I chased a losing bet, with another bad trade because I had the ‘better make it up’ mentality. I do think I will just take a break until after the holidays.
And your little rant about rich people going bankrupt; that is really a bad way of looking at it, buddy. Losing money is NEVER something you should take lightly. Even if it is a little amount, you have to see WHY you lost it. For me, it is acceptable to lose money, as long as I did not lose it foolishly.
From where I can see it you have two choices now;
1 - call it quits, blame the recession, blame the US/EU/Japan, blame yourself, blame your system (or maybe lack of), blame your MM strategy - or in short, blame something and walk away and never look back.
2 - Take the losses as a teaching of how bad it can get. Take the loss, roll with it, shrug it of and start afresh.
Theres a great deal who chose to take the nr. 1 pick here, blame something and just let it go. They refuse to take the learnings they just have gotten, remember that the best way to learn something is by doing a mistake, or several mistakes. Its the only way to expand your own horizon!
Those who start blaming just stay in theire own conformity zones, refuse to take a beating and just hulks under theire pillow… maybe the bad day just will go away? It was so much better in the good 'ol days…
My advice? Accept the loss, get over it but LEARN from it! What did you do, how did you manage and what can you do to prevent that this will happend again?
We’re close to the holiday season, so trading volume is starting to drop. Maybe you should take a break and not do any trading untill January. Give yourself some time to just ‘think it over’ - where did you go wrong? Rethink things over…
This is learning you’ll never get from demotrading, the mind game. Now its up to you. Should you call it quits and start blaming, or will you take it for whats it worth and evolve from it?
I totally agree about the mind game part. It WAS my own stupidity to remain in the trades when they went against me, but but it is hard for me to bail. I keep moving my S/L, WHICH I KNOW is bad… just decreasing the risk/reward level.
So, after the holidays I will set my S/L and NOT MOVE THEM even if I am “SURE” if I just add 3 more pips the pair will start moving in the right direction.
Also, I decided to ADD money to the account so that I can increase my 1% risk of my bankroll to a more realistic pip number. And I will continue to scalp, where I have had consistent albeit small gains.
Ah, lots of wisdom is being imparted here. I agree, own your mistakes. Recognize them and see that mistakes are good because they will help get you nearer to your goals. Also, NEVER move your stop loss unless you are moving it closer to profit. I learned that one the hard way. In fact, yeschef, my trading experience sounds very similar to yours. I started my live account and went up $40, before going down into the negative a little over a hundred dollars. The sole reason is that I let a few losing trades cause me to make way too many trades in a desperate attempt to make that money back. The result is that I dug my hole deeper and deeper. I paused, read some more advice on these forums as well as the book “Trading in the Zone”, and came back this past week to make back all of my losses and then some. I had one losing day, Friday, and was able to stop and say, “This was a good week”, no need to force any more trades with the market is like it is right now. That felt great. Remember, when you have a losing trade, that’s just part of it. Everybody loses. If your strategy is sound, in the long run, profit will be made simply by having more winners than losers or by having a good risk to reward ratio. Try using very small lots and sticking to your strategy to a “T”, then, at the end of the week (as opposed to the end of the hour or day), see how well your strategy is playing out.
Just take a break, for a day, that is if you have learned the following lessons: Dont’ revenge trade. Predefine and tottally accept the risk of every trade. (your predefined stop loss that is the signal the trade isn’t working) If you can’t tottally accept the risk it will cause you to do things like let losses run hoping it will come back, bad entries, and not see other opportunities because you are focused on that one negative trade.
I also recommend doing a trade journal. In it you should write why you got in and or out of trade and if you obeyed your trading rules. You will be surprised how many losses are caused by disobeying trading rules you’ve set ahead of time and reacting emotionally to bad trades.
Just about all my losses are due to dis obeying my own rules. My account would be +400% if I took off every trade I entered that was against my trade rules and went negative. My journal has really pointed out and tamped down on my bad noob trade practices and reinforced the good ones.
Get this book now: Trading in the zone by Mark Douglas. Seriously.
P.S. I disagreee with the people saying, “go back to demo after losing.” I think if you can learn to trade objectively then trading live quickens the learning curve. You learn lessons hard and fast. Just start with a micro account and work your way up. IMO, thinking demo trading is training will give you false confidence. There are subtle things our brains adjust for on a subconscious level that can’t be quatified. Would you rather learn on a micro account and then when you start being positive know you are doing it for real, or spend weeks/months/years on a demo and wonder what the difference is between demo and live?
simply go back to the flight simulator and get in more time and when the process looks better, and you win a LOT more, than you might think about real money again.
[B]when you open a new simulator, PLEASE open it for ONLY the amount you will be spending in real money ---- you can RETYPE the demo amounts into the application when you open the new one ![/B]
if you demo with $50K dollars and only have a few hundred, you are fooling yourself and falling into the BIG trap brokers set — they give you large amounts because its easier to trade large amounts, otherwise they would only give $250, but then you would immediately see how hard it is to increase that !
I would imagine you threw money management rules to the winds, but understand it takes at least a year for normal newbs to become “competent” where competent means making “some” but not losing “any” !
enjoy and trade well
mp
[B][I]Within the great hall at Elfinore stands a wondrous coffer, precisely four cubits square and securely latched against the outside world. Inside that repository, shut away from impertinent eyes, abides many an intriquing trading secret garnered from around the world and over the ages !
As a child, i used to watch from the darkness as the secrets were debated and annotated by the elders. No one there held a single thought of my presence – BUT I KNOW WHERE THEY HID THE KEY !! [/I][/B]
The saying you hear alot around FX is that it is about getting rich slowly… “SLOWLY” if you want to stay around.
You should keep trading as you originally were, 60% increase over 6 months is good, some might say fantastic. So in my opinion you have something that works, just you let your mind get in the way and possibly have really learned something truely valuable.
So keep at it, demo trading i dont think is the answer, just controlling your emotions and sticking to your trade plan that was letting you be successful to begin with.
without more details cdawg, its possible that he did any number of “mistakes”, including trading in a horribly volitle time !
he could NOT have been prepared for the “whippy” and large candle moves, not been able to focus on the trend, gone in with far too tight a stop loss for these trading days or simply dove in without justifying the trade and/or any number of other reasons that we were not there to see !
while mistakes teach far more than wins, it is RECOGNIZING the mistake(and correcting same) that leads to winning trades, so for that very reason i suggest going back to the simulator, using the techniques that have worked before and then ANALYZING what was done wrong — simply stating “i rushed into two bad trades” is NOT an analysis — you MUST know WHY they were bad trades or nothing of value has been learned !
I differed that to his admission that he did not follow his rules. Recognising the mistake is crucial, if you are to learn from it and become a better trader
22% lost over a trade or two is just insane! A few trades like that and you blow your account and have no reasonable chance to make back your losses. Just remember it takes longer to gain your losses back because there is less capital to work with. The one positive I see is that you have not blown the account completely. Do not fall into the trap of thinking you didn’t loss anything. I hear people that go to casinos and justify their experience by saying they didn’t loss any money. I then ask them how much they were up. They will say some figure and I will ask them how much they left with and that figure will be lower than the previous. However, they seem to think because they walked away with just as much money as they came in with they didn’t loss anything. This a faulty logic. They lost their profits.
Do not let a winning trade becoming a lossing trade.
Cut your losses.
Taking more than a 3% hit on a single transaction is unacceptable!
You may want to consider scaling into a trades!
As for your original question, if you should quit. You really shouldn’t give a damn what any of us have to say on that matter. That is for you alone to decide. A more productive topic may be something along the lines on how to avoid big losses. Starting a topic like this opens a door for the people that are just looking to be a pain in everyone’s ass and to give grief. So perhaps one should rethink how they approach a question?
I guarantee if your topic was, How do you avoid a 22% down draw, you would have had a lot more constructive responses!
I am generally quite harsh on these forums, however, I try to be constructive. Take what you will from my response.
You know that you can’t quit! :eek:
Once you start getting that pip crack rolling into your veins that is it!
I don’t get the whole “rush to a million” mentality…
Risk 1% until you make 1,000% (add a zero).
Risk 2% until you make another 1,000%
Risk 4% until you make yet another 1000%.
If you just make ~5% per week then you would turn $1,000 into $1,000,000+ in about 5 years.
But then that little voice inside says,“yeah, but if you risk 5% and make ~20% per week then you would have MILLIONS THIS YEAR!”
Stay small and be consistent in your profitability.
Double your risk when you increase your profit 10 fold.
Don’t go over 4% unless you are a scalper with a 90% win rate.
I mean I also have 3-4 bad trades in a row but my losses are anywhere from .30% to 1% which is minimum losses, which keeps me continue with my trading.
I also don’t recomend to increase your risk more then 1% even you made 100% of your account balance.
first of all I am sorry about your loss, but I wouldn’t stop, I would just apply a strict money management from now on so if you have 4-5 bad trades you would loose only 4-5% instead 60% ohh man that is alot. It is a good lesson to learn for your next trading carreer