Its Boxing Day - and I am having a rest in between eating, drinking, visiting, party gaming, shopping, dog walking and watching footie on the TV
Noticed the GU and GJ both very tradable today - but promised myself I would ignore the charts until at least tomorrow
Lets talk about how to achieve 30 -50% increases in your Forex trading account every month instead.
Its certainly on if you are starting off with your capital under $10k. At some time after 3 or 6 or even 12 months if you are smaller accounts - you will more than likely hit your "psychological financial wall" which might be at anything from just 5 lots up to even 30 lots per pip.
This is when you start worrying about having single losses over $500 or even $2000 and you start to value the size of your capital account above any dream of compounding all the way up to $1 million plus.
Nobody ever told me about this - yes heard all about dealing with losses - but nothing negative about the problem of compounding can have on you and your mind ( Why would the Industry ever say anything about that - I mean it's like telling a 5 or 6 yr old child there is no Father Christmas ;-) )
In my own case i stopped compounding and withdrew the monies so basically only having enough capital at the minimum level I needed to to trade on the lot sizes I am comfortable with - but everyone different so if you can stay compounding - go for it - and you will not need another 2 years to get to the big monies ;-)
So what method do you need to achieve 30 -50% increase every month ?
Its easy really- its the opposite to everything the trade and industry say ;-)
ie - My own general rules -
1. Multi trading every day - at least 5 trades a day - not convinced you need 25 - 50 or more trades a day even if you are scalping, but it is a number game - and winning trades count.
2. Small tight stops - ideally 3-5 pips - maximum 10 pips - anything over 10 pips - then you are not really good enough yet - get back to the drawing board and spend another 1000 live hrs watching small frame charts. Yes nothing wrong with 4 hr and daily charts - but they might give you the map - but they don't give you 5 -10 pip stop losses. If you are wrong on entry - you need to know ASAP - don't waste time in negative pips - get out ;-)
3. You
do not need to use over 2% of your capital on every trade. I recommend 1% or less on larger accounts - so that you can have 2 or 3 trades on at the same time.
4. Short trade duration from initial trade entry - ie trades that last under 30 mins ideally - so that you can bank 7 -25 pips and then leave part stake on with stop in profit and hopefully forget until you have 50 -100 pips in the bag - whether that's in 2 hrs or 10 hrs - it does not matter - it's risk free and you can still focus on new trades.
5.Monitor at least 3+ forex pairs - yes major on one - but don't ignore all the rest. Sometimes its possible to take "copy scalps on 2 or 3 pairs and normally one pair will do up to twice the pips as the most popular EU - in the same period of under 15 or 30 mins
6. Pace yourself - aim for 4 -5% growth per day. If you are really good and do 20 days plus in the month - you will overachieve. However if you have a few bad days - and only get 1% or even lose 3% and are not prepared to work your butt off back into profit that session - then you need your 5% daily target to even the days out.
7. Micro manage - split every session into 30 min slots - don't worry if you don't get a trade every 30 mins - but if you cannot find one in 2 hrs - back to the drawing board - and learn and study again
8. Targets need to be with RR's over 2 ideally - ie 10+ pips - 15 to 25 pips - brilliant you only need a couple of RR's over 3 a day and you are in the money and then when you get a RR of 5+ brilliant - ie 30 -40 pips - On 3 pairs - at least 9 trades there with RR's over 4 or 5.
9. Losses - 1 to 3 per day - no problem - but remember if your stops size is 7 pips - don't lose 21 pips on 3 bad trades - get out even at minus 3 or 5. You are still better off than waiting to be stopped out. If you are losing 4 -6 trades a day with stop sizes under 10 pips - back to drawing board - you are not there yet ;-(
10.Win ratios - For me you need over 65% win ratios - According to many fund managers 55-60% is supposed to be top class. That's another myth I laugh at ;-)
It might be if you are fortune telling - but when you trade in the "now" - then 70 -85% is on most of the time The market is dynamic - you need to be - fixed target rules are a no no - take more or slightly less - go with the flows and always reenter if there is more than another 7 pips available.
See - its sounds easy - but it's not.
Its like saying - I can juggle with 3 balls and nearly there with 4 balls - bit i need to juggle 7 balls - will I do it in another month ???
It's taken me years and years with 1000's of trades - but I had to find it all out myself.
Any one with the basics and say 18 months behind them should be able to get there within another 12 months - as long as they do the work and are committed.
Hope that helps retail forex traders
All question welcome on why those are my guidelines
The other thing is - why you are getting there - don't worry if you only make 15% growth or even 20% growth a month - its still far better than the commercial world with their 35 -50% win ratios and there 3-5% per month methods ;-)
Back to the Turkey ;-) ( that's the food - not my wife lol )
Regards
F
