Hello everyone there.Let us talk a little bit about this topic.You guys have struggled a lot reading books,watching videos plus paid courses but why still we have the 95% of loosing traders.Some of you in this community might have answers to this question. Let’s share ideas welcome everyone.
Psychology is the reason why most traders fail. They study strategies inside and out and when it comes time to trade real money, they are their own worst enemy.
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drankson, the 95% figure is way wrong
Kiwi, you got that right
Midwest that is the stats from brokers
Not from all brokers. Brokers subject to the ESMA regulations have to declare the percentage of losing clients on their website. These statements are from two brokers that frequent BP regularly:
-FXCM:
78.58% of retail investor accounts lose money when trading CFDs with this provider.
-FOREX.COM
74% of retail investor accounts lose money when trading CFDs with this provider.
However, there are many more brokers who are not controlled by ESMA and we do not know their equivalent figures. But, ultimately, the actual figures are not so important - the worrying fact is that the failure rate is still far too high. And while it remains high it will encourage even further restrictive actions from regulatory bodies.
An interesting observation is that the percentages produced by these ESMA brokers appear to be falling. When the new rulings came into effect most brokers were posting levels around 80%. What can we conclude from this? Are newcomers better trained for trading? Or are brokers providing better education facilities for their clients? Or is it that the new leverage restrictions are preventing the most vulnerable newcomers from starting in the first place?
In my opinion the biggest group of failing newcomers are those that are under-capitalised, over-enthusiastic, under-educated, and over-optimistic. They lack patience and discipline, and any sense of capital management whatsoever.
Because they are so totally unprepared and unaware of how volatile, unpredictable and illogical these free markets can be, combined with an impatience with trading small lot sizes, their small capital is quickly swallowed through excessive leverage, leaving them with a residue that is impossible any more to function realistically with.
But there are many specific causes for failure within this overall setting and a simple search using the search function at the top of this page will produce reams of past threads and posts concerning this topic.
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I just noticed that @tommor acknowledged my above post and that reminded me that I omitted a very important point that he so often rightly emphasises in his own posts:
Many newbies fail because they have a misconception that trading short term charts is much easier than longer term trades. This is not so! It is possible to trade short term consistently and profitably, but it is far more demanding and requires far more experience and discipline and with a lot less logic than longer term positions. It is much more likely to chase prices and get caught on quick whipsaws with TFs of less than 1H than with higher TFs.
But Newbies tend to be more attracted by a misconception that shorter TFs also means smaller and therefore cheaper stoplosses than with longer TFs but that is a very questionable assumption.
So the most inexperienced traders start off with perhaps the most challenging trading style, at least in psychological terms.
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Lol I would never specifically answer this question. In trading Someone has to make money and someone has to lose. So why would we want everyone to learn to trade because then it be difficult to make consistent money from trading. However, I will say, everything is on the internet so get reading.
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On the point of educating traders, let’s not forget one important aspect of the market - why it moves, and who moves it, which is the banks (including institutions). It’s an undisputed fact.
So when all the players who are outside of the bank ‘bubble’ are positionally biased to extreme levels of either long or short the banks will move the market the other way, generally of course.
So this brings us back to learning how to trade correctly - it doesn’t matter (at an advanced level), because when the crowed outside of the banks have a bias the market will move the opposite way. It’s supply and demand. Also, if the crowd outside of the banks are not biased too either long or short at any one time then the banks will move price to drive up such a situation.
Therefore, you’re always going to get a high failure rate?
Banks manipulate price by either holding it or moving it - it’s our job to see where this is taking place by using the tools available - but again, once enough individuals work it out, the banks will change their game and chase the crowd to a new level. Hence, adapting is important and why also one fixed trading approach is a really poor idea.
So yes, what’s missing - the emphasis on adaptation.
Edit: Just to clear up the above post based on Manxx’s reply below - my entire reply is based on market participants, thus those who interact with the market - not to be confused with high street retail brokers where we are not trading at interbank level.
However, there are some retail brokers who do allow interbank level trading, so it’s not entirely impossible; if you can afford it.
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Sorry, but in the world of retail trading this is a total fallacy. Retail traders do not trade against each other!. It would not matter a cent if every retail trader with a certain broker all traded consistently and simultaneously in the same direction and all profited.
Almost all positions from retail traders are counter-partied by their broker. The broker will manage his overall exposure direct via its liquidity providers. At this point the overall risk melts away into the great sea of the interbank market in the same way as a river merges into the world’s oceans.
I single trade of 100mill in the interbank market-making community does not cause even a ripple in overall price direction.
And it is a total misconception that the real foreign exchange market is a closed market where every winner has an opposite loser. For example, if I build an industrial plant abroad and pay in USD, I am not concerned with profiting from my exchange transaction - my factory is my profit source.
So there really is no need to be concerned with hoping the other guys will be worse traders than oneself. In that respect we are all firmly and entirely on the same side here! 
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yes what Manxx said,
and this is why it is a psychological game of controlling your emotions as with a gambler in any profession. Nobody gets an automatic get out of jail card that lasts forever.
drankson, you need to look into what data is being collected and how it is being interpreted and reported. many traders have multiple accounts for various reasons.
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Reliable easy to execute strategies.
Molly, there are numerous easy to execute strategies, it’s what the trader does to manage after hitting the enter button.
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the smaller the margin the highest is the psychological factor and if you add to that less trading skills then you get blown accounts
First of all, we should keep in mind that there is no profession with 100% success rate. It is usual for us to understand that only a few law school graduates will become partners in law firms, and only a few photographers will have their personal exibitions. It is absolutely normal that only a small per cent of the people involved succeeds.
Another point is that those professionals aiming to succeed in their sphere dedicate all thier time to that goal. At the same, many traders belive they can become profitable traders without years of education, just by spending several hours per week.
Trading is a quite difficult profession, and it is necessary to make all reasonable efforts to succeed.
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The most important lesson a newbie needs to learn is the management of losses. Most of us will, after a while, develop strategies which will generate a win rate of 60%+ but if we don’t manage our losing trades then our returns will be poor to negative.
My tip is concentrate on your losing trades and develop strategies for controlling these and your returns will grow.
best of luck.
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Thanks alot
Most of the useful concepts I’ve discovered for use in trading are things that I’ve learned on my own - like brokerage collusion, stationarity in cyclic ranges, double-agent entries, the superior nature of reversal-trading (letting the market make the first move), hidden markov model signal pattern recognizers, probability space divisions, fractal space, the superiority of equidistant bands for finding reliable support & resistance levels, the uselessness of most traditional TA, the usefulness of Hull and smoothed MAs, the all importance of re-entries over exits and entries, the Nitefort principle (properly reading a currency strength meter or dashboard indicator over multiple TF), econometric data (the market is a pattern destroying mechanism but it can’t help but rhyme) and a few others I’ve probably ‘compressed’ in muscle memory but don’t bring to mind very often anymore. Of course most of these ideas originated as the kernel of someone else’s idea, so I’m indebted to many traders and authors who have written about their opinions, yes, some of them even came from BP and FF, but generally speaking time is better spent reading books than forums.
So to answer the question what is missing on the internet about FX trading - almost 99.5% I would guess? Then again, the internet is a big place and I haven’t been able to visit all of it, though if you looked at my bookmarks you’d think I’d tried.
There isn’t much incentive for knowledgeable, experienced traders to wrestle with the ignorance and rudeness of inexperienced traders in order to offer their good advice, and almost all FX ‘trainers’ and ‘coaches’ are charlatans who either don’t trade, trade poorly or trade seldom and make most of their income from selling fluff. So the occasional trader who does give away info that is useful (people like Laurent Brunet) should be followed and analyzed with a fine tooth comb, every droplet of golden wisdom collected with care and then tirelessly examined to see if it can uncover new insights.
However in the end, when you compare the complexity and difficulty of doing something like becoming a dentist or a chess champion, trading is simple and ‘easy’ in comparison. I disagree that psychology is the deciding factor, it’s knowledge but the people who hold it guard it carefully like alchemists of yore because, well, it’s valuable, and if it becomes common knowledge it loses its value - that’s the nature of a market - smoothing out the price imbalances caused by imbalances of knowledge.
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Check out nononsenseforex web page; his videos/blogs on big banks, indicators, psychology and money management will give a hint as to why 90% fail rate. All free and great info.
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I know you’re looking for what is missing from the internet, which as pointed out by many of the contributers here is found mostly through experience and books they recommend. I would like to point out something you maybe missing from the internet.
This a link to a textbook called Forecasting: Principles and Practice. This is not a forex textbook, it is not a trading strategy book, but obviously as you read it, there are some things in that are in the School of Pipsology. It is exactly what it says it is, and is probably the most easily understood, yet thorough text on the subject you can find for free. It even prefaces that you can’t forecast currency rates, yet the principles and methods in this text are the very ones that the quants at the big banks use for their predictive models.
It maybe a turnoff for many of you, because it takes you back to high school algebra and calculus, and I don’t recommend it to any new traders that are still learning the fundamentals of the forex market, but for those that feel confident in their grasp of the markets and are looking for that edge. What you’re lookinig for may lie in here. I recommend to follow the “Further Reading” lists for the sections that pique your interest.
I continue to incorporate more and more of this into my trading, and my weekend homework now usually involves further developing my application and understanding of something from this book.
Hope somebody finds it useful.
Be well
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The divergence between reality and theory is missing. Yes, you can take idea about forex trading with the help of various online trading courses that are being shared on You Tube. But one can’t learn all things through these videos. Thereby to overcome the loopholes a trader should practice demo side by side acquiring basic ideas of trading.
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