Intraday Trading the Forex market to make consistent profit

Liquid validity said:
Did I say your 33% loss and 50% gain was wrong - no, so why mention it?
Your 50% loss and 75% gain was what I questioned.
You did not mention fresh capital injection.
You have not mentioned that anyone should set money aside for that
until now either.

Point is, do you still recommend 2% risk with a 5SL,
now that the potential pitfalls of over leverage have been highlighted?
You yourself do not use 2%R and 5SL - so how can you recommend it to those you teach?
Click to expand...

I recommend - UP to 2% on 5 pip sl on all small accounts under $5k and under $10 k if you have become experienced at scalping

On capital accounts over $25 - NO would not recommend 2% on 5 stop losses and as you know a lot of my scalps on $50 -70K account are under 1 % and as low as 0 3%

On retail capital account over 100k - would say under 0 5% with 5 pip stops

The size of the stop is not a major factor if you are good and can scalp well with as you win ratios should be over 70%+ and if I have never had 7 bad consecutive scalps losses - lets place another scalper at say double - ie 15 in a row losing

On 1% that only 15% down - yes on 2% - 30% down - but part of what I am teaching is that you NO WAY carry on scalping with 5 pip stops after even 5 bad trades - you stop and start again another time. Plus the fact I would advocate reducing entry stake size - not even think of martingale methods - and get back into your zone before going back up to 1 % and 2% gains

Its all down to discipline and control

If you have not get it - then even on just 0 5% stake size - you can fooc an account up- as we all know - but its just a slower death ;-)

Regards

F

PS Must get back to trading - and MM as had 4 losses in a row after a 85%+ win ratio on over 20 trades yesterday - On one batch of 11 trades he had 2 losses - both under 3 pips

Told him to stop completely - why we review what he has been doing - and not think about trading again- until we sort it out and not make similar errors on going today
 
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Hi F

Thanks for sharing your method on this forum. This is my first post on t2W but have been lurking for some time now.

I've been part time trading the fx spot market since July 2007. Started trading live (after a few weeks of learning to work the trade platform and searching for a system) with an MA crossover strategy. I had absolutely no idea what I was doing and needless to say this was perfectly reflected by my dwindling account. All that saved me from rapid annihilation was a max 2% risk on my trades using a fixed stop.

I've traded more strategies than I can remember - using some indicators, more indicators, no indicators etc, etc. I'm finally off the trail in search of the elusive "holy grail" (well - I think I am?) Now I basically trade PA at supply - distribution zones with a few trend lines and a 20 ema thrown in for good measure. Working a lot more on my psyche issues and nailing down the business trading plan.

What you've presented so far with your method fits well with what I'm now trying to do. Agree totally with the small stops small initial target philosophy. Looking forward to learning more. Hopefully we can move on from the "leverage" debate so you can spend more time presenting your method.

Cheers
Greg
 
Forexmospherian said:
I recommend - UP to 2% on 5 pip sl on all small accounts under $5k and under $10 k if you have become experienced at scalping

On capital accounts over $25 - NO would not recommend 2% on 5 stop losses and as you know a lot of my scalps on $50 -70K account are under 1 % and as low as 0 3%
Click to expand...

It won't come as any surprise that I strongly disagree with the bold highlight.
There is a massive difference between a 10K parallel play account and
someone whose entire pot is 10K
Personally, 10K is under capitalised.
I don't see any justification for increasing risk on a serious trading account,
being under capitalised does not provide justification.

Forexmospherian said:
The size of the stop is not a major factor if you are good and can scalp well with as you win ratios should be over 70%+ and if I have never had 7 bad consecutive scalps losses - lets place another scalper at say double - ie 15 in a row losing
Click to expand...

Its the position size which is the issue.
At 2% and 5SL it is over geared.
 
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TatNthTrader said:
Hopefully we can move on from the "leverage" debate
Click to expand...

Why?
Because a sound risk foundation is boring or because its not what you want to hear?
Not having a pop, but it never ceases to amaze me that so many people
give risk such a low priority.

It should be top of the list...
 
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Liquid validity said:
Why?
Because a sound risk foundation is boring or because its not what you want to hear?
Not having a pop, but it never ceases to amaze me that so many people
give risk such a low priority.

It should be top of the list...
Click to expand...

Hi LV

Risk is definitely a priority for me (but so is a trading strategy with a positive expectancy, the mental capacity to trade it consistently and a well thought out comprehensive trading business plan). I've become very good at taking losses (a lot of experience) but still need to improve.

Just stating a genuine desire to learn more of what F is showing here.

Greg
 
robster970 said:
Rule 1 - If you don't bet, you can't win.
Rule 2 - If you lose your money, you can't bet.
Click to expand...

Balance is a key to getting it right

Remember though we are different to the commercial world and their stories should not just relate to us

Yes Banks and hedge funds can go bust losing billions - a retailer trader losing the whole of a $10 k account - should accept that - as you should not bet or retail trader with money you cannot afford to lose

No body like losing money - I much prefer low draw downs - but I am totally different to the commercial traders who are happy with 40% win ratios and RR's of 3 +

Give me over 70% win ratios with the small stops you can get away with it

As far as I am concerned - with strict disciplines - taking losses - all the downside can be rebuilt by the upside -

BUT - you need to be on top of your game - and be flexible to adjust with the market session changes

Flexibility to me is key - Fixed rules can sometimes work against you

No problem debating anything to do with FX trading - as far as I am concerned

Regards

F
 
TatNthTrader said:
Hi LV

Risk is definitely a priority for me (but so is a trading strategy with a positive expectancy, the mental capacity to trade it consistently and a well thought out comprehensive trading business plan). I've become very good at taking losses (a lot of experience) but still need to improve.

Just stating a genuine desire to learn more of what F is showing here.

Greg
Click to expand...

Yeah fair enough, I'm not slating you for that at all.
This is dragging on and on, but the point I'm getting across
is demonstrated here:
http://www.trade2win.com/boards/tra...ket-make-consistent-profit-5.html#post2286326
http://www.trade2win.com/boards/tra...ket-make-consistent-profit-7.html#post2286522
http://www.trade2win.com/boards/tra...ket-make-consistent-profit-5.html#post2286422

I'm not arguing for the sake of it.
It isn't a minor nit picky issue either.
2% risk is just a very basic starting point.
You should always take into account position size in relation to account size.

If you are already aware of that, fair enough.
 
TatNthTrader said:
Hi F

Thanks for sharing your method on this forum. This is my first post on t2W but have been lurking for some time now.

I've been part time trading the fx spot market since July 2007. Started trading live (after a few weeks of learning to work the trade platform and searching for a system) with an MA crossover strategy. I had absolutely no idea what I was doing and needless to say this was perfectly reflected by my dwindling account. All that saved me from rapid annihilation was a max 2% risk on my trades using a fixed stop.

I've traded more strategies than I can remember - using some indicators, more indicators, no indicators etc, etc. I'm finally off the trail in search of the elusive "holy grail" (well - I think I am?) Now I basically trade PA at supply - distribution zones with a few trend lines and a 20 ema thrown in for good measure. Working a lot more on my psyche issues and nailing down the business trading plan.

What you've presented so far with your method fits well with what I'm now trying to do. Agree totally with the small stops small initial target philosophy. Looking forward to learning more. Hopefully we can move on from the "leverage" debate so you can spend more time presenting your method.

Cheers
Greg
Click to expand...

Cheers Greg

Got to pop out for 30+ mins and then need to get some more scalps in on othere thread

Will be doing a lot more on my method etc - and I do welcome all comments etc - and I do know LV and Robster and Tar are good guys and do know what they are on about

Regards

F
 
Forexmospherian said:
a retailer trader losing the whole of a $10 k account - should accept that - as you should not bet or retail trader with money you cannot afford to lose
Click to expand...

That illustrates the whole problem here.
That is your attitude to 10K - fair enough.

You should not be transposing your attitude to losing 10K
onto those who only have 10K - without explaining
the over leverage issue.

You didn't, and I had to point it out instead.
Now do you see where I am coming from?
You aren't putting yourself in the shoes of someone who only has 10K.

How many of them would take the risk unwittingly because of what you have said?
How many would still take the risk in possession of all the facts?

Thats is all I am saying - bear in mind there may well be people following you,
to whom 10K is not insignificant...
 
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Forexmospherian said:
Cheers Greg

Got to pop out for 30+ mins and then need to get some more scalps in on othere thread

Will be doing a lot more on my method etc - and I do welcome all comments etc - and I do know LV and Robster and Tar are good guys and do know what they are on about

Regards

F
Click to expand...

Thanks F -and thanks LV for your response.

Looking forward to learning and hopefully being able to contribute as well.

Greg
 
Actually, after having had a shower and putting on my mid-morning kimono I thought I would deconstruct the simple method I posted yesterday and how something this simple is underpinned by a solid understanding of the market:

1) Switch to an exchange traded product so you can see volume.
Volume is the context for a price movement. If you cannot see volume you are more likely to get the context of the situation wrong. When price reaches a high, has it stopped there because nobody wants to trade at that price or is it because somebody is heavily trading at that price using limit orders because they have determined that this is value for them? This is a big difference and shapes how you engage in the trade. Somebody hoovering up the market is a very different tell to nobody wanting to play.

2) Wait for a trend to emerge.
Initial directionality is important as it implies a continuous imbalance in the orderflow in a particular direction. It might be being caused by long term traders (a big trend day) or more often than not, short term traders playing follow the leader and unloading into those less gifted at trading. However in either case it is a force that would need >= and opposite force to stop if a price considered value is reached. This implies somebody with money would need to stop this move. If the market is chopping, nobody is playing.

3) When price gets sticky, confirmed by a volume spike, fade the move that got it there (short for a uptrend, long for a downtrend)
The volume spike is a tell. In this situation it is saying that somebody with quite sizeable cojones (like our squirrel) is hoovering up the market orders at this price. As price is not moving and volume is going up, the initial directional force has met an equal and opposite force. You probably want to be on the same side of the market as the money here.

4) Place stop just below the highest(short), lowest(long) point.
The money didn't want to trade higher or lower than this point - trade with them.

5) Exit mgmt: Trail on 15min or follow the mantra "What gets you in, gets you out"
Auction rotations on $ES_F are anywhere between 1.5-4 points typically for a 15 minute period. Stay behind the rotations so you don't get taken out. If all goes well you will see somebody else start hoovering up the market orders and you have a choice to bail or reverse.

6) Rinse and repeat. Any timeframe.
This phenomena occurs almost on all timeframes. However the higher the timeframes, the deeper the pockets you need to play and this is reflected in the size of participant you are dealing with in the market. This is why you should always look at charts from high to low - you see where the big boys are playing and you should generally be trading with them.

The question I have for FoMo is whether his method actually stands the test of time based upon the market dynamics created by the other participants that largely drive the market? I know mine do.
 
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Back now - although trading for an hr or so - but look forward to replying to many of the points raised by LV and Robster during the day - cheers
 
Liquid validity said:
Why?
Because a sound risk foundation is boring or because its not what you want to hear?
Not having a pop, but it never ceases to amaze me that so many people
give risk such a low priority.

It should be top of the list...
Click to expand...

No, because for that can be found a lot of information in the web, that thread here was start for understand and teach and explain why at that system pull the trigger!

and we see here now only a lot of hot air!

cheers
 
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