Why do 5% of Traders Win?

This is a similar example of a gold cfd that I trade that I got nailed on. Sorry, trade not visible. FXCM deletes them when trading day closes at 5pm EST. See that downleg at around 1 following a similar consolidation.

Oops, it changed directions and went right back up again.
 

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I don't see any order flow analysis.. lol.. I can show you a picture of ES today which went down to a low and then reversed hard. I guess its magic how to know which is which.. unless you really can read the order flow. These are things we study in my newsletter.

One thing I realize that I do is that I move 2-3 steps ahead of the market.. not reacting to it. Makes it hard to integrate the order flow fully...

http://youtu.be/Z8nppTSY-Rs?t=50s

"Learn your methods?"


Quote from NoDoji:

I'd love someone on the "inside" to explain exactly how "they" do all this stuff. I can understand head fakes during low volume consolidation (lunchtime and after hours), but during active RTH, you've got so many large professional market participants (mutual fund managers, hedge fund and investment bank traders, including HFT systems fighting each other for fractions of cents) all of whom have different time lines and strategies. Who is this "they" that hunts the stops of small retail traders in a attempt to ruin their lives?

I will share my order flow analysis using a trade today not far from the oil pit close when a lot of good action resumes.
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Quote from NoDoji:

Avoiding the trade altogether is also a winner's strategy :)
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Sadly, I didn't follow my own rule. I didn't resist the temptation to go short. I thought I could pull a little out of it, but no, it went right back up again.
 
Quote from Lucias:

I don't see any order flow analysis.. lol.. I can show you a picture of ES today which went down to a low and then reversed hard. I guess its magic how to know which is which.. unless you really can read the order flow. These are things we study in my newsletter.

One thing I realize that I do is that I move 2-3 steps ahead of the market.. not reacting to it. Makes it hard to integrate the order flow fully...

http://youtu.be/Z8nppTSY-Rs?t=50s

"Learn your methods?"
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The "order flow analysis" was meant to be a joke, hence the description ORDER FLOW: DOWN :p

I trade pure price action, that reveals the order flow for me. If price is trending down, no matter how strong the last drop, I'll continue to trade to the short side until a key support level is reached, tested twice and holds. (Though I do sometimes avoid a trade if I feel the R:R has diminished significantly.) Then I watch for a reversal, sometimes taking an early counter-trend trade off a solid reversal setup.

Very often my final with-trend trade is a losing trade, but I've booked so much profit in the direction of the trend, that the final loser is meaningless. It's like leaving a nice tip to the market for offering such excellent service.

Please show us where the ES was trending down today, went down to a new low, the price action signaled continuation of the down trend, and then after a continuation short trade entry was triggered, price reversed hard. Also let me know where your stop loss would've been on that trade. Just because ES went down to a low and then reversed hard doesn't in any way mean a valid price action short signal occurred after price went to that low.

There is no magic to any of this, although I assure you that if you ever have the chance to observe an experienced price action trader in action prior to understanding the methods involved, it will appear to be pure magic at times.

Think of all the things that appeared to be magical when you were a little child. That's how professional price action trading appears to those who never studied it.

Wow, Sun Ra! Thanks for that, a real blast from my past!
 
Quote from dewton:

HERE IS THE SECRET:

On a long enough timeline, every single trader will lose their entire bankroll. However at any given time, some may be profitable usually by luck.

The real winners are the ones who know when to quit trading entirely once they've become profitable and dump their money into safer investments that will be able to sustain the lifestyle that they want.

Trading is a hit-and-run arena. You go in, do your best to make a killing quickly, and quit. If you keep playing, you will lose it all- guaranteed (just give it some time and it'll happen).
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This is the truth.
 
Quote from oldtime:

I find that if your system is a little iffy, you can reduce the chance of ruin in your lifetime by stepping up the drinking and smoking a little.
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Or you could increase the chances -- trading while intoxicated sounds like a deadly combination. I thought the trader who lost billions at UBS engaged in trades after a night out drinking and partying...
 
How many were watching the round number at 108.xx to get targeted after the ema crossed below the trendline drawn from the low at 10810 and the low of the 1030est bar? You were seeing 2 lower highs from the "then" days high at 10879 (think triangle).

For those that did not leave their desk to get a blueberry/banana smoothie, once the ema was crossed at approx 10825 popping out of that triangle, the 10800 ROUND number was an obvious target because the trendline was also taken out as a clue. Surely most round numbers etc get kissed first, then come back after drawing in some new weak shorts, they get spanked as price goes back to 10820 and comes down to retest the 10800 again, this time it just touches the 10800 and the now smarter previous shorts dare not reshort again, ..........Heck no!! They are smarter and wiser so they see the retest of 10800 hold as tight as a tick so they go LONG.......... The trend surely has reversed to up they are convinced, especially as the ema is crossed to upside. Then price recrosses the ema down after a small flatish putzing around at 10815 while drawing in more Longs, they were now the new suckers to get fried.

Yours truly could smell another test of the 10800 coming...........the target was at least the previous low after the initial crossing of the round number, down to 10785, smashed through that and was a thing of beauty.

See, even a confirmed ES trader can change stripes now and then. I milked that trade and a retrace like i actually knew what i was doing.

It was a day early...........but Sadie Hawkins (Miss Crude oil) picked me as her dance partner yesterday as ES had a headache and stayed in bed.

To fully understand and read price action on a 5m chart, you MUST throw out a lot of ticks and just focus on who will do what when such and such happens when price goes to "THERE". You are getting in their shoes and feeling how they will react when price does what price will do. FIGHT or FLIGHT

You know where price has been, your job is to project where it will go next :cool: :)

PS: I want to tell "hurricaneUS", i learned all that from Nodoji :eek: :D
 
Quote from bighog:

It was a day early...........but Sadie Hawkins (Miss Crude oil) picked me as her dance partner yesterday as ES had a headache and stayed in bed.
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:D As it turns out I was in bed while you and Sadie were dancing. That Sadie sure can dance though can't she? :)
 
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