Help-Fine Tune Trading skills

[buccas13]

Dear Firends,

I'm a new budding trader. I trade in currency spot markets. I've been trading for 3-4 months. As far as my analysis goes, I''m doing fine. I'm able to predict the direction of movement. The problem I'm facing is often on retracement my stop loss gets triggered.

My trade setup:

Currency pair: GBPUSD
Time Frame: 1H
Session: London.
Indicators: Heiken Ashi
MA: 8MA exponential; Close; (24 hrs/ (Lon+NY+JY) = 8)
MA: 40MA exponential; Close; (8MA * 5 days = 40MA)
RSI: 14 RSI
Stop loss: 15 points (due to small capital base)

Every time I open my position it goes around 15 points in my favour but one retrace it triggers stop loss. To add to my woes it later goes well into favorable direction 34-50 points.

Can you please advise me as to how plan my trades and manage my open positions. i fear if i kept stop loss too far and if there was a reversal then it will damage my capital base badly.

Regards,
Rajat Verma.

 

[TraderZones]

Quote from buccas13:

Dear Firends,
I've been trading for 3-4 months. As far as my analysis goes, I''m doing fine. I'm able to predict the direction of movement.

Yes, You traded 3-4 months and you can predict the direction? Not even multi-billion dollar financial institutions can or claim to have this ability

I would say that you somehow convinced yourself you could do this, but in reality you are completely wrong.

That aside, you need an edge (very few traders actually have one), you need top money and trade management skills (can be learned, but this is a distant second place to edge), you need to be extremely patient, focused and disciplined. You need to be prepared to lose a lot of money And you need to realize when all is said in done, if you stil ahve at least $20,000+ left, you have perhaps a 0.3 to 0.5% chance or less of becoming lucrative, longterm trader.

You will find those who are supportive of a newbie are little help and probably unsuccessful themselves (do not really understand what is need to succeed), and those who are brutally honest (still, most of them are unsuccessful) are the ones you should listen to very very carefully.

Become your own worst critic.

 

[bigmrfrank]

Trade smaller size and increase stop loss. Simple as that.

 

[buccas13]

Dear TraderZones,

I respect all that you said. But yes it is true I'm able to get an idea that for the next hour or so which direction market will move. But what I fail to understand is the crucial points or should I say pivot points.

I'm looking for rectification of it. I'm looking at all the angles, it can be if my timing of entry is early. I'm looking into smaller time frame charts for the move within an hour.

I fail to factor in the volatility factor into my trades. I can partially understand what the bar chart is speaking. I don't get the fine details or should I say the intuitive part of it.



Yes I'd get the directions wrong earlier, I'd go long at peaks and short on troughs but after reading various articles and going thru many indicators and I'd been able to rectify that part.

I'm not looking for some quick fix solution in these forums. I'm looking for some wisdom or insights which will help me. After all traders draws there influence from various other fields apart from just technical analysis and fundamental analysis.


Thanks again for your response.


Regards,
Rajat Verma

 

[nukethewhales31]

Quote from buccas13:

Dear TraderZones,

I respect all that you said. But yes it is true I'm able to get an idea that for the next hour or so which direction market will move. But what I fail to understand is the crucial points or should I say pivot points.

you may think that you can gain an idea of were price will move. but its a newbie illusion. If you want to buy the exact bottom then sell the exact top, then your lookin to lose money.

I'm looking for rectification of it. I'm looking at all the angles, it can be if my timing of entry is early. I'm looking into smaller time frame charts for the move within an hour.

I fail to factor in the volatility factor into my trades. I can partially understand what the bar chart is speaking. I don't get the fine details or should I say the intuitive part of it.

there is nothing intuitive about it its math... your risk 1 vrs you gain 2 on fixed position sizing means u need to win 35% to break even beat 35% and you make money. how is that done? an edge like traderzones said.. not picking what direction price will go. Forex ample you know price reverses at x% past previous leg 35+% of the time and makes atleast a 25% retrace... you can wait till price is x% away from previous leg and enter place stop at 10% and stop at 20% as long as your over 35% and you keep your risk at fixed intervals not %'s then you make money...

Yes I'd get the directions wrong earlier, I'd go long at peaks and short on troughs but after reading various articles and going thru many indicators and I'd been able to rectify that part.

I'm not looking for some quick fix solution in these forums. I'm looking for some wisdom or insights which will help me. After all traders draws there influence from various other fields apart from just technical analysis and fundamental analysis.


Thanks again for your response.


Regards,
Rajat Verma

try to predict the future and you will destroy your account.. of course I can tell you that and youll go to 0 before youll reach that I cant do this ill give up stage .. then fight to make it work.

 

[buccas13]

Dear Nuke,

Thanks your reply. I'd really like to get into conversation with you.

I take yours and traderzones comments seriously. I'll try to find out what is it that I'm terribly wrong at that I'm able to get an idea of direction of price. This does not means open and close at proper extremes, but price momentum is showing stagnancy and it is about time it reversed or retraced. Take a conservative profit points.

I'd spoken to alot of people about my problem and finally have had the answer, i was not using multiple time frames to time my trade and a tool historical volatility, it is a good assistant.

May I question you on one thing, you said try to predict future and you'll fail. Then what is the approach of the trader?

My idea was that a trader (not scalper) looks at the TA tools (as probability factor) to determine Long/short and then he times his entry.

As I'd mentioned I'm new, I'm very much open to new ideas. If my mindset is not appropriate for the trading then I'm ready to change it.

I'd appreciate if you can elaborate a little, whats wrong with my thought process.

Regards,
Rajat Verma

 

[achilles28]

None of those indicators mean squat.

Don't confuse brains with a bull market (IOW, an extended period of wins).

You're about to find that out the hard way. Have fun.

 

[nukethewhales31]

Quote from buccas13:

Dear Nuke,

Thanks your reply. I'd really like to get into conversation with you.

sure sounds good

I take yours and traderzones comments seriously. I'll try to find out what is it that I'm terribly wrong at that I'm able to get an idea of direction of price. This does not means open and close at proper extremes, but price momentum is showing stagnancy and it is about time it reversed or retraced. Take a conservative profit points.

price momentum is bullshit, stagnancy is bs most times the reversal comes out of nowhere and you left with big red hanging trades.

I'd spoken to alot of people about my problem and finally have had the answer, i was not using multiple time frames to time my trade and a tool historical volatility, it is a good assistant.

sounds like youve been getting advice from jack hershey.. gurus come up with these fancy names for things that dont exist and tell you thats how the markets run..

May I question you on one thing, you said try to predict future and you'll fail. Then what is the approach of the trader?

easiest answer ever "to extract money from the markets using a systematic or nonsystematic approach." I dont need to know the future to do that. Im not mrs. cleo im a trader.

My idea was that a trader (not scalper) looks at the TA tools (as probability factor) to determine Long/short and then he times his entry.

does your ta tools tell you what your probability is in a number? 70% chance on this trade or 80% chance on this trade...? or is it a general feeling that if your on a trendline your gonna do better then if you were not on a trendline.... your trigger point should be tied into your probabilities you said predict then decide on entrance .. a trader says this would initiate the setup and put me in the trade and my probability of success from there is x%.

As I'd mentioned I'm new, I'm very much open to new ideas. If my mindset is not appropriate for the trading then I'm ready to change it.

you need a very skeptical mindset ... you need to prove things to yourself before you trade... no reason to say ah i got an extra 40k in a savings account because my family is rich i dont respect money lets blow it. you need to prove that you can trade before you attempt to trade.. get a demo for about 6 months make something like 600-800 trades during that time using a basic system where you have a stop trigger and take profit in place every trade load all the numbers into excel and plot yourself a equity curve. see how you did... if in 6 months over 600-800 trades you were profitable then move to real money. nothing like i believe price will rise because of this.... i dunno what a good trigger is ill just enter whenever trades... leave that stuff for the guys on MSNBC who are wrong all the time.

I'd appreciate if you can elaborate a little, whats wrong with my thought process.

Regards,
Rajat Verma

really your best bet is to go learn some PA setups and use fixed risk positioning on them on the same time frame and stay out of news releases. dont make it hard on yourself ... if your trading correctly your job should be boring... if your excited you need to punish yourself... because your falling into greed. money is money.. there are alot of otherthings worth more. start with this thread i dunno if im violating by posting this but whatever.. http://www.forexfactory.com/showthread.php?t=2331
no indicators here.. very rarely will you see a 3000 page thread... there is alot of good shit in there.
love nuke

 

[buccas13]

Dear Nuke,

I'll sure think about all that you have mentioned in your reply.

I'll say, you are better than others who does add remarks to his comments. Others they love to say you are wrong and then full stop.

I'll sure go thru that thread. May be all that I'm working with is proving to be good enough in the short period of time, but may eat my out is long term.

All I can say I'll get back to you. I'm very keen to have experienced guys as mentors and guide, who are been there and done that kind of. I hope I wont bother you with it.

Regards,
Rajat Verma.

 

[buccas13]

Dear Nuke,

You can delete the link, I've got it now.

Thanks for taking that extra thing.

Regards,

Rajat Verma.