Forexmospherian
Legendary member
- Messages
- 39,928
- Likes
- 3,306
I have noticed more this last year or so - more new or intermediate traders working off the weekly and monthly charts to trade FX
Why - I don't know ?
Its fine to see the "big picture" and the "world map" - but traders give the game away right away when they trade with no stops or stops over 150 or even 200 pips - looking for 500 - 1000 pip targets.
For a start you are just kidding yourself - a 500 pip result sound good and a RR of 3 is good - but if it takes a week or two to achieve it and its only on pennies - then its hardly efficient and not going to help you make your millions.
Instead - learn to read PA at the "coalface"
Learn to reduce your stops down to as low as possible - under 15 pips really is a prerequisite - under 7 pips is needed and then ideally when spreads are under 1 pip - you need stops of only 3 or 4 pips.
Yes its all down to timing and experience etc - but its means when you get a 10 or 15 pips move in 10 minutes - you could have made as much money as the longer term swing trade with his 500 pips - but have done it in 15 mins rather than 5 or 15 days.
OK - its not as easy - it takes more time to learn and carry out etc - but why do you want to wait 4 hrs or a few days to find out you were wrong - when you can know in 5 -10 mins and move on?
With regards to trading without hard stops - i suppose you could say I do it as I scalp with soft stops and rely on one click to get me out - but normally I will have a hard stop as an emergency - last resort - well place out of my scalping range - and 99% of the time not needed.
But some traders - even a well know private hedge fund trader on another well know forum trades with no stops - and does not always hedge
This as resulted in him having to wait over 6 months and up to 2 yrs for some of his bad trades to come back into profits - hardly great trading - and of course it means he has to use very low stake sizes %'s - ie like just 0.1% or lower rather than 1 or 2% . That means when he does win - his wins are just not that large - due to the fact his stake size % is so small.
OK if you are managing $10 million plus - but for 95% retail traders on under $100k Capital you want your 0 5 to 3% stake size of capital - to get your 10 -25% per month ROC - rather than just 2 -5% per month.
I am sure so many new and intermediate traders just do not understand this - they opt for the easier way and will end up with below average results - that's even if the do make money - because many might need a year or two to find out really - they have not really gone anywhere - ie - they have won $15K and lost 14 k and just made $1k for all their work and effort.
All questions on these matter welcome
Regards
F
Why - I don't know ?
Its fine to see the "big picture" and the "world map" - but traders give the game away right away when they trade with no stops or stops over 150 or even 200 pips - looking for 500 - 1000 pip targets.
For a start you are just kidding yourself - a 500 pip result sound good and a RR of 3 is good - but if it takes a week or two to achieve it and its only on pennies - then its hardly efficient and not going to help you make your millions.
Instead - learn to read PA at the "coalface"
Learn to reduce your stops down to as low as possible - under 15 pips really is a prerequisite - under 7 pips is needed and then ideally when spreads are under 1 pip - you need stops of only 3 or 4 pips.
Yes its all down to timing and experience etc - but its means when you get a 10 or 15 pips move in 10 minutes - you could have made as much money as the longer term swing trade with his 500 pips - but have done it in 15 mins rather than 5 or 15 days.
OK - its not as easy - it takes more time to learn and carry out etc - but why do you want to wait 4 hrs or a few days to find out you were wrong - when you can know in 5 -10 mins and move on?
With regards to trading without hard stops - i suppose you could say I do it as I scalp with soft stops and rely on one click to get me out - but normally I will have a hard stop as an emergency - last resort - well place out of my scalping range - and 99% of the time not needed.
But some traders - even a well know private hedge fund trader on another well know forum trades with no stops - and does not always hedge
This as resulted in him having to wait over 6 months and up to 2 yrs for some of his bad trades to come back into profits - hardly great trading - and of course it means he has to use very low stake sizes %'s - ie like just 0.1% or lower rather than 1 or 2% . That means when he does win - his wins are just not that large - due to the fact his stake size % is so small.
OK if you are managing $10 million plus - but for 95% retail traders on under $100k Capital you want your 0 5 to 3% stake size of capital - to get your 10 -25% per month ROC - rather than just 2 -5% per month.
I am sure so many new and intermediate traders just do not understand this - they opt for the easier way and will end up with below average results - that's even if the do make money - because many might need a year or two to find out really - they have not really gone anywhere - ie - they have won $15K and lost 14 k and just made $1k for all their work and effort.
All questions on these matter welcome
Regards
F
