Forex Glory

U niversità F orex F utures Forex Trading amp Futures Università commercianti Istruzione Articolo del Mese Benvenuti nella nostra conoscenza è Resource Guide di alimentazione, fornendo i futures liberi informazioni commerciali per arrivare sulla strada per il successo commerciale di oggi di negoziazione dei mercati FX Forex futures con informazioni offerti dall'Università per Forex trading educazione in fx metodi di negoziazione dei futures, i sistemi di negoziazione e metodologie commerciante che portano ad un trading di successo. Trading finanziari Articoli amp Tidbits - scritto da esperto di mercato di Joe Ross. 1. Misurazione Parere del mercato e sentimento Hi Joe Che dire di rapporti sentimento del mercato volte questi rapporti d'accordo e, a volte non sono d'accordo. Qual è la sua opinione sui rapporti sentimento Anche se questi rapporti suono scientifico, nulla sui mercati di negoziazione può essere misurata con precisione scientifica. futures su materie prime amp mercato forex dispositivi di misura non sono semplicemente troppo preciso. Non vi è alcun scopo pratico per misurare con precisione un mercato e la maggior parte di misurazione del mercato è nel migliore dei casi solo una stima approssimativa. Quando misuriamo mercati a termine, ci sono fondamentalmente anche misurando il comportamento umano, e il comportamento umano non è facilmente misurabile. Quando si tratta di prevedere condizioni dei mercati finanziari o sentimento del mercato non ha senso a lottare per la massima precisione. Commodities futures e prezzi di mercato forex si basano sul parere umana. Quando si misura il comportamento umano nel mercato, l'errore statistico è notevole, generalmente in esecuzione con risultati più o meno 5. Una stima del commerciante o opinione investitore è solo una supposizione, perché non tutti hanno la stessa opinione esatto, sia perché è difficile misurare con precisione un parere. Le variazioni di questi 2 fattori sono indicati nella 8220standard statistico error.8221 Il miglior rapporto sentimento di un mercato delle materie prime in grado di offrire è una dichiarazione di probabilità sulla base di alcune importanti ipotesi. Let8217s faccia una relazione sentimento presuppone che l'universo si sta misurando in realtà è vero. Un'altra ipotesi è che la misurazione del parere è affidabile. Ho visto questo fenomeno in azione. Quando ho posseduto una fattoria e si mescolarono con altri agricoltori a vari incontri, era ovvio che gli agricoltori non hanno detto l'agente della contea le loro vere intenzioni di impianto. Eppure, il dipartimento dell'agricoltura pubblica una relazione sulla 8220Planting Intentions.8221 agricoltori con l'intenzione di piantare semi di soia avrebbe detto l'agente che stavano andando a piantare il mais (e forse anche commercio il loro sistema di mais di trading. Gli agricoltori che intendono mais impianto avrebbe detto l'agente che erano andando a piantare il grano. l'ipotesi che l'universo fosse vero era spesso incontrato perché l'agente ha effettivamente agricoltori sondaggio. il secondo presupposto che il parere era affidabile non era certo reale, perché per vari motivi alcuni agricoltori potrebbero aver mentito all'agente agricola. E 'difficile per misurare un parere mercato. e solo perché un parere o intento è dichiarato, doesn8217t significa la persona che agirà su ciò che dicono. Questi problemi hanno un impatto diretto su forex, i futures, mercato azionario e commercio di materie prime. Come i commercianti di forex, a meno che non ci stiamo trading (con 100 analisi tecnica o grafico forex), stiamo anche cercando di valutare opinione corrente, e anticipare ciò che i prezzi del forex farà basato sia alto, in basso o lateralmente, sulla base di tale parere la direzione del mercato. Forex azione dei prezzi di mercato è un riflesso di ciò che gli esseri umani fanno e ciò che vedono e pensano gli altri stanno facendo, e molti commercianti basano le loro decisioni sul potenziale reazione degli altri operatori. Così al centro del trading è l'idea che l'opinione del mercato è misurato con precisione attraverso il prodotto corrente o prezzo delle azioni. La sua creduto da esperti di mercato del forex tutto noto di un mercato, che può influenzare i prezzi del forex a livello mondiale, è già in gran parte integrati nel Forex o Futures Prezzo, e tutto quanto non conosciuto non si riflette nell'azione del prezzo dei futures. E 'anche giusto dire che vedendo il prezzo forex corrente o tutte le condizioni di mercato, i commercianti di forex reagire in un certo modo prevedibili. Per la maggior parte, quando i prezzi del forex declino, i commercianti di forex tendono a diventare paura e vendere le loro posizioni per proteggere il loro capitale residuo, e un nuovo acquisto quando vedono i prezzi aumentano in modo da soddisfare la loro avidità. Naturalmente, è vero il contrario dei commercianti di Forex che tendono ad essere venditori allo scoperto. Ma la paura di aumento dei prezzi da parte venditori allo scoperto e la paura di caduta dei prezzi da parte di coloro che preferiscono essere lungo non è certo l'ingrediente principale timore nel mercato. Il maggior timore sembra essere quello di perdere una mossa. Che la paura è direttamente legata alla avidità. Un importante principio di ogni teoria del mercato è fx commercianti di Forex e gli investitori reagiscono a certe condizioni di mercato, in modo coerente e prevedibile. Famoso vecchio commerciante W. D. Gann visualizzato queste reazioni sotto forma di angoli geometrici, forme e modelli. Elliott li vedeva come le onde (ora conosciuto come Elliott-Waves), e Charles Dow li vedeva come una interrelazione tra l'industriale, dei trasporti, e settori di utilità dei mercati. Tuttavia, ci sono buone ragioni per dubitare se i prezzi di mercato riflettano realmente le opinioni di coloro che vi partecipano. C'è dubbio anche sul fatto o meno i partecipanti al mercato di reagire a situazioni di mercato in modo coerente. Sembra che il comportamento umano è troppo difficile da misurare e le persone (compresi i commercianti) non sempre agiscono sulle loro opinioni, atteggiamenti e credenze. Essa ha dimostrato di essere molto difficile da misurare il comportamento umano, e la gente non risponde con regolarità alle situazioni, anche situazioni identiche. Quando si assume che i mercati dei futures trader reagiscono in modo coerente a particolari condizioni del mercato forex e quindi formare i forex pattern di prezzo grafico descritte nei testi di analisi tecnica commerciante classiche, stiamo mettendo il cavallo commercio davanti al carro. Siamo quindi dal presupposto che gli esseri umani sempre agire allo stesso modo a certe situazioni e condizioni. Tuttavia la verità è che forex trader non agiscono in modo coerente. Piuttosto, essi reagiscono in modo coerente. Forex modelli di grafico sono un riflesso di tutto ciò che è conosciuto nel mercato forex. Quello che vediamo quando abbiamo scambi di modelli di grafico è il modo in cui i commercianti di forex e gli investitori reagiscono alle condizioni di mercato. Popolari binari broker di opzioni recensioni e presentazioni possono essere trovati qui. Le nostre stime di ciò che Futures commercianti e gli investitori faranno sono semplicemente migliori congetture, e quelli potenzialmente imprecisi. Il sentimento del mercato tenta di stimare quanto commercianti FX agiranno. È qui che in una certa misura perde il suo valore. E 'molto più accurato per valutare come la gente reagirà a ciò che accade nel mercato Forex. Così, quando si sta cercando di anticipare ciò che i commercianti del mercato forex faranno, tenere a mente che le reazioni commerciante non sono necessariamente visti con la precisione di forme geometriche, i conteggi delle onde di Elliott, relazioni settore di mercato, o un indice di sentimento del mercato. Non esiste una cosa come la sicurezza del commercio. Quando incontro la persona che mi può dire con assoluta precisione e coerenza dove il prossimo tick o pip sarà, sicuramente mi ho trovato il Santo Graal del Forex Trading e Forex giorno di negoziazione 2. Ottenere al passo con i Forex amp Futures Market precoce nel corso della giornata di trading forex, come parte della vostra preparazione commerciante al giorno (si ha una preparazione quotidiana, don8217t voi) il suo utile per praticare un po 'per ottenere un quotfeelquot per quello che si potrebbe fare e come si potrebbe commercio forex oggi. Un modo per farlo è quello di fare un paio di piccoli commerci, utilizzando solo una piccola percentuale del vostro normale dimensione di trading e il vostro broker forex conto del patrimonio netto. Mettere su una posizione commerciale piccolo aiuta a concentrarsi. Una volta entrati nel mercato, vedere come il commercio delle materie prime o del forex sta lavorando. Se si utilizza indicatori tecnici guardare per vedere se sono d'accordo con la tua previsione dell'azione future, magazzino o il prezzo forex. Se avete anticipato un buon forex o commodities configurazione commerciali verso l'indicatore di analisi tecnica, ha fatto che effettivamente accadere Era abbastanza buono, quindi vi fidereste di nuovo i commercianti di Forex che tentano di 8220trade nella zona, 8221 tenta di ottenere la sensazione del movimento dei prezzi . Vogliono essere al passo con gli alti e bassi del movimento dei prezzi FX. Iscriviti alla Newsletter gratuita Ti Come fare soldi negoziazione sui mercati finanziari Ezine amplificatore per quanto riguarda tutte le questioni di denaro anche immobiliare amp prestiti Click-qui ora per ottenere quotHow Fare Moneyquot Click-Sopra per unire Newsletter ezine o Click-per iscriverti al Feed RSS Alcuni giorni appena non può essere buono come siete su altri giorni. Quando non si è in sintonia con il mercato FX, dovrebbe essere un segnale a voi che 8220this8221 isn8217t la giornata. Se isn8217t, commercio don8217t. Ogni operatore avrà crolli di negoziazione, i periodi in cui i commerci solo don8217t sembrano funzionare fuori. Durante crolli commerciante, semplicemente non ha molto senso continuare a provare. Non si adatta al commercio, così don8217t. Non sarà operando al meglio. Clicca ora Trading Suggerimento del giorno. futures su materie prime professionali e commercianti FX suggeriscono in piedi da parte quando voi o vostri commerci non stanno avendo una buona giornata di trading. In definitiva, it8217s una buona idea di prendere una pausa dal commercio, a riprovare più tardi. La pausa può essere ore o giorni. Quando I8217m in un crollo, ho decollare un'intera settimana. I don8217t comincio di nuovo il commercio fino a quando vedo i commerci e dei mercati che vanno a modo mio. 3. Don8217t negare la realtà Se si vuole essere un Forex o Futures trader di successo, è necessario assicurarsi che non negare la realtà in tutte le fasi del tuo trading. Non si può negare perdite, direzione dei prezzi, gli errori si fanno, di essere sottocapitalizzate, o tutta una serie di cose che non preferisce pensare. Molti commercianti pensano che il modo migliore per trattare con le idee spiacevoli, eventi o difetti di carattere personale è quello di chiudere gli occhi e far finta che don8217t esistono. Let8217s affrontarlo, FX e commercio di materie prime può essere difficile, a volte molto difficile e la sua essenziale che si concentri sulla realtà. La negazione prende la vostra attenzione lontano dalla cosa molto è necessario essere concentrando on8212the azione del prices8212regardless del lasso di tempo. La mente deve essere chiaro in modo che si può guardare il mercato e vedere che cosa è davvero lì. Il modo in cui ho imparato a gestire il rifiuto è stato quello di scrivere semplicemente giù e confrontarsi con tutte le possibili idee che avevo problemi ad accettare. Alcune riflessioni ho potuto risolvere e gli altri ho solo dovuto accettare. Ma di fronte alla verità di ciò e chi sei è l'unico modo per affrontare con la negazione. Dovete capire che per la maggior parte le uniche cose che si possono cambiare sono in te stesso. Altre cose che devono solo accettare. Bisogna accettare la realtà di slittamento, per esempio. Dovete capire che gli indicatori spesso danno falsi segnali e che non vi è alcun media mobile magia né vi è un oscillatore magica. È necessario rendersi conto che alcuni trade vincenti sono solo fortunato commerci e non aveva nulla a che fare con la vostra abilità come un commerciante. Per lo stesso motivo, sarà anche sperimentare la sfortuna di avere prezzi fare una mossa improvvisa e inaspettata contro di voi. Invece di sprecare il vostro tempo in segno di diniego, concentrare i vostri energie mentali per migliorare se stessi e migliorare le vostre abilità di negoziazione. Lavoro a migliorare la vostra capacità di osservare. Rendetevi conto che si deve sopravvivere ai mercati, al fine di beneficiare dell'esperienza dei mercati. C'è davvero solo vero problema con il vostro problema è che si trading8212that Tuttavia, il problema si manifesta in due modi: 1. Le condizioni di mercato sono cambiate e si haven8217t. 2. Non è più sta facendo quello che hai fatto quando eri vincendo. Vi siete allontanati. Non sei coerente. Il primo aspetto del problema è dovuto alla scarsa osservazione. Il mercato è cambiato e si haven8217t cambiato con esso. Scadente osservazione deriva da una varietà di problemi minori ma importanti. Hai sposato un mercato, o di un commercio del forex. Si può avere permesso il tuo ego per ottenere il meglio di voi e non sono più umili. I8217ve chiamato solo un paio qui. Vi sfido a pensare alle molte cose che si possono distrarre da vedere quando le condizioni di mercato sono cambiate. Fare un elenco di quelle cose e confrontarsi. Il secondo aspetto del problema deriva dal commerciante incoerenza. Anche in questo caso, si dovrebbe fare una lista di quelle cose che ti fanno essere incoerente. quotPerhaps ero un buon commerciante in una sola volta, ma le condizioni di mercato sono cambiate e non essere in grado di mantenere la mia reputazione up. quot Questo è un problema che tutti gli operatori devono affrontare ad un certo punto: mantenere la loro reputazione. Quando uno fa grandi profitti di trading, la sua tentazione di dire a vicini e amici come bene si sta facendo. La sua grande quando sei fare le grandi profitti, ma mantenere le apparenze spesso è la caduta di anche il commerciante più astuto. Ancora una volta, negando la vostra esigenza di fama e gloria, o fingendo che si può mantenere una reputazione irrealistico, utilizzerà la vostra energia psicologica e interferire con la capacità di concentrazione. Enormi profitti tendono ad andare agli umili, quindi cercate di non costruire la vostra reputazione. Ammetto che si avrà difficoltà a tenere le apparenze e appena smesso di farlo. Un fatto che un commerciante lotta con continuamente è la nozione, quotTrading non è un job. quot legittima Molti commercianti lottano con la legittimità del trading. Alcuni commercianti trovano che possono semplicemente ricordare a se stessi, quotTrading fornisce liquidità e aiuta a controllare prices. quot Altri commercianti, tuttavia, pensare che questo non è abbastanza buono e la necessità di trovare più significato nelle loro attività commerciali quotidiane. Ad esempio, possono concentrarsi su come il commercio li aiuta a fornire per la loro famiglia, o possono intenzione di donare parte dei loro profitti in beneficenza che vedono come persona di valore. Il punto è, Non negare la possibile verità di tali idee. Si sarà meglio riconoscere e lavorare attraverso di loro, e poi basta andare avanti. Negando esistono, invece, utilizzerà fino tempo ed energia. credenze inaccettabili tendono a mentire nella parte posteriore della vostra mente. Rimangono lì, in agguato, e quando si sono vulnerabili, che possono fortemente influenzare la vostra prospettiva. Così riconoscere le idee inaccettabili, e una volta che si ammette la possibile validità di tali idee, si neutralizzare la loro potenziale influenza. Questo consentirà di liberare risorse psicologiche limitate, permettendo di concentrarsi tutta la vostra energia di negoziazione con profitto e costantemente bene. 4. Perdite da negoziazione Hey Joe perdite sono un grosso problema per me. So I8217m dovuto 8220learn amare them.8221 Come si fa a trattare con questi eventi scoraggianti Dopo una serie di scambi di grande successo, un commerciante non deve diventare scoraggiato da normali perdite successive e conto di intermediazione equità prelievo, ma imparare ad aspettarsi loro. Avviso ho didn8217t dico, 8220learn amare them8221 let8217s Va bene dire che hai appena preso un considerevole successo e l'equità drawdown nel mercato forex. Ci si sente in colpa e arrabbiato. Desiderate che non ha ancora accadere. Desiderate per andare via. Ci si dice, 8220This fa parte del prezzo da pagare per diventare un trader.8221 redditizia e di successo è questo il pensiero giusto è questo commercio è tutto di fare si ha realmente bisogno di andare in un commercio in attesa di perdere Don8217t ci credi Anche se si vede tali dichiarazioni esposte come verità, credendo di loro non sta andando per aiutare a diventare un trader di successo. Se si pensa a te stesso, ho appena perso un sacco di soldi e soffermo su quel pensiero vi sarà presto nei guai. Se si pensa, 8220I sopraelevazione basta scrivere il tutto, 8221 poi allenarsi a pensare ad esso come una battuta d'arresto minore e andare avanti. So that8217s difficile, ma è ciò che si deve fare. Come un commerciante mercato forex, è necessario pensare a lungo termine. Dovete credere che se si lavora abbastanza intelligente, e fare i buoni commerci fx sotto le condizioni di mercato, youll uscire in anticipo. Tuttavia, non c'è modo che questo tipo di pensiero viene facile. Ci vuole una quantità enorme di disciplina e di autocontrollo per la gestione delle perdite di trading in modo positivo. Perché, perché le perdite hurt8212they male non importa quanto tempo you8217ve stato trading. Se avete problemi a prendere una perdita, non siete soli. Tutti i commercianti subiscono perdite. Come un commerciante, le perdite si prende può essere un dato di fatto, ma quello non li rendono facili da maneggiare, e certamente don8217t imparare ad amarli. Come un commerciante si dovrebbe controllare la quantità di perdite mantenendoli piccoli, e cavalcare attraverso il sorteggio-basso fino a un'altra sequenza di trade vincenti inizia. Tuttavia, si possono trovare te sentirsi in colpa per prendere una perdita. Perché abbiamo questa sensazione di colpa per perdite Una parte di quel senso di colpa nasce da un forte bisogno umano per proteggere se stessi. Così, quando si perde il denaro, anche come un operatore professionale e attivo, fa male quando si pensa delle cose per le quali si potrebbe avere usato i soldi che hai perso. Probabilmente vi è stato insegnato a pensare in questo modo. I valori sociali e culturali di proteggersi sono stati programmati in voi in tenera età. Quando si perde soldi su un commercio, si sente in colpa e forse anche un po 'di panico. Il suo del tutto naturale e comprensibile, ma chi dice che i commercianti sono naturali o addirittura che si comportano in modo comprensibile come un operatore professionale attiva, dovete cambiare il vostro pensiero su perdite. Bisogna resistere alle vostre inclinazioni naturali e imparare che le perdite sono una parte di ogni azienda. I negozi al dettaglio prendono le perdite da rotture, taccheggio e furto dei dipendenti. Le compagnie di assicurazione prendono le perdite da false affermazioni. Le compagnie del tabacco sono citati in giudizio. Le aziende chimiche fare cattive lotti e devono buttarli via. Gli agricoltori perdono le colture. Allevatori perdono il bestiame. Non riesco a pensare a un business che non sperimenta perdite. Allora che cosa fare circa il modo in cui sono stati programmati fin dall'infanzia, è necessario confrontarsi con i tuoi sentimenti e trattare con loro. Riconoscere che si verificano colpa. Capire perché si hanno questi sentimenti. Per ciascuno di noi la ragione di fondo può differire in natura e intensità. Aiuta ad ammettere il fatto che ci possono essere conseguenze negative di prendere rischi con il vostro denaro duramente guadagnato, e tenere a mente che i sentimenti di colpa associati con la perdita di denaro che non può permettersi di perdere è ancora peggio. Nessuno ha il commercio affari con i soldi che non possono permettersi di perdere. Quando si fa trading con denaro che è stato specificamente messo da parte per la negoziazione, e tu e la tua famiglia (se ne avete uno) tutti d'accordo che questo è il denaro si può fare a meno in caso di perdita si toglie un sacco di pressione di perdere . Attivamente evitando perdite attraverso la gestione del rischio intelligente aiuta anche per alleviare lo stress e per abbassare la probabilità di una perdita catastrofica. Quando si sa che avete fatto tutto il possibile per ridurre al minimo i rischi e si sente certo che si può sopravvivere un colpo importante sul vostro conto scenario, sarete in grado di gestire più facilmente le perdite. Efficace rischio, il denaro, e la gestione del commercio andare un lungo cammino verso la costruzione di vostra fiducia e alleviare lo stress da perdite commerciali. Una volta che avete preso cura di rischio, denaro e problemi di gestione del commercio, è inoltre necessario assicurarsi di avere sufficiente capitale di trading. Uno dei più determinati modi per finire un fallimento nei mercati forex o altri mercati a termine è quello di andare in loro sotto-capitalizzate. La più alta percentuale di fallimenti di tutti i tipi sono da sotto capitalizzazione. Gli Stati Uniti Small Business Association afferma che solo 1 in 1.500 piccole imprese start-up è successo al termine di 5 anni. La maggior parte di quei fallimenti aziendali provengono da imprese che sono sottocapitalizzate. La sua non è diverso per l'attività di forex e altri trading sui futures. Lei ha il più possibilità di successo nel business del trading partendo con un piccolo 5.000 conto come si fa di vincere Stato Lottery.8221 Indipendentemente da quale livello si inizia con si deve tagliare subito perdite commerciali. Il più veloce il tuo trading prende una perdita, maggiore è la probabilità vi troverete infine a essere redditizia. Imparando a prendere le perdite rapidamente si avrà successo prima. perdite da negoziazione sono una spesa aziendale. In un certo senso, perdite commerciali sono parte del costo di fare business. In un altro senso, il costo delle perdite è parte di quello che si paga per imparare l'attività di trading sui futures delle materie prime. Le perdite sono un fatto della vita in una vita commercianti. Le perdite non sono facilmente accettati. Ma certamente don8217t imparare ad amarli. 5. Trading panico e veloce Mercati Hey Joe Con tutto il parlare di una possibile preda al panico, lei crede che il governo interverrà per migliorare un crash quando un panico di trading attanaglia il mercato, chiedetevi cosa il governo farà per ripristinare la sanità mentale e proteggere i suoi migliori interessi finanziari. Durante mercati azionari panico, la Federal Reserve inietta liquidità istantanea attraverso il riacquisto di titoli di Stato, e tassi di interesse più bassi. Nell'ottobre del 1987, future T-Bond sono radunati 10.000 per contratto, quando il Dow si è schiantato 508 punti in un solo giorno, che è stato considerato un gigantesco crollo del mercato basato sul basso DJIA durante quel periodo di tempo. Ci sono stati momenti in cui non NYSE è stato scambiato, perché non c'erano acquirenti. Ci sono voluti un trader a 4 giorni per mettersi in contatto con Charles Schwab per confermare un mestiere. Il telefono era in ripetizione automatica 07:00-19:00, durante quel periodo di 4 giorni. Ci sono voluti 14 giorni per confermare il commercio E 'mia ferma convinzione sulla base di prove in mio possesso che il governo ha davvero un tuffo Protection Team, una entità off-shore che entra nel mercato azionario nei momenti in cui i prezzi sono in calo troppo in fretta. Questa entità acquista qualunque cosa, ovunque, e quando necessario per mantenere il mercato azionario da un incidente a titolo definitivo. Quando i prezzi dei cereali salgono bruscamente a causa di inondazioni notizie danni, è nel migliore interesse del governo per consentire ulteriori rincari considerare l'effetto inflazionistico del grano pesantemente ponderata CRB Index. Quando i prezzi dei cereali aumentano a causa di crescenti problemi, gli agricoltori si sentono risentimento nei confronti dei commercianti di Chicago, che possono trarre profitto da parte degli agricoltori sventura. Il governo può emettere falsi rapporti di guidare i prezzi del grano più bassa. Le inondazioni hanno colpito 1993 70 del mais e 50 delle soia Stati produttori, ma i rendimenti sono stati superiori a 1991 livelli di produzione ad eccezione di tre stati. Come potrebbe questo essere erano figure di governo alterati per contenere l'inflazione puoi scommettere che erano. Guarda per la fine del 1993-tipo di governo rialzista rilasci di mercato del grano per spingere i mercati del grano sostanzialmente più elevati quando compaiono condizioni di inondazioni o siccità. Ordinare una consultazione Trading o sito web Inquiry da Going-Qui 6. Hey Joe voglio imparare a scambi, ma I8217m avendo un conflitto. È scambiato i futures trading sui futures di gioco è il gioco d'azzardo solo quando li si scambi senza la piena conoscenza di ciò che si sta facendo. Vi è una buona misura di auto-conoscenze necessarie per scegliere la giusta rotta da seguire se si vuole diventare un trader. E 'stato anche ipotizzato che molti piccoli commercianti nei mercati forex e future, senza saperlo, segretamente vogliono perdere. Saltano con alta hopes8212but vagamente colpevole. Colpevole sul gioco d'azzardo con i soldi familys, colpevole sopra cercando di ottenere qualcosa per niente, o colpevole oltre immergersi in senza in realtà aver fatto molte ricerche o analisi. Poi si puniscono, per questi o di altri peccati, con la vendita di fuori, demoralizzato, in perdita. Un trader è il gioco d'azzardo quando heshe mestieri dall'ignoranza. Il giocatore fa le sue decisioni di trading su sentimenti viscerali, le speranze, i sogni di ottenere arricchirsi rapidamente, consigli dal broker, information8221 8220inside da amici, e dalla comprensione improprio e l'uso di indicatori, oscillatori, medie mobili, e sistemi di trading meccanici. In generale, si è alla ricerca di un modo per scorciatoia dover imparare veramente cosa sta succedendo. Purtroppo, la maggior parte dei nuovi operatori che tentano di negoziare i futures rientrano in questa categoria. Tuttavia, la vera trading è in realtà la speculazione (rischio gestito). Lo speculatore è disposto ad accettare il rischio di fluttuazione dei prezzi in cambio di una maggiore leva che viene fornito con il rischio che, nella speranza di guadagnare un profitto maggiore. Il vero speculatore fa le sue decisioni di trading sulla base delle conoscenze raccolte da informazioni sul comportamento del sottostante, stagionalità, trend storici e attuali del mercato, analisi tecnica grafico, i fondamentali delle materie prime, le dinamiche di mercato degli investimenti, e la conoscenza di chi commercia esso. 7. Hey Joe Che dire l'aggiunta di nuove posizioni quando giorno di negoziazione un commerciante di giorno deve imparare a premere il negozio e aggiungere contratti a conferma trend di prezzi cruciali intraday, spostando tutte le fermate di protezione per rompere anche con ulteriori contratti. Quando un mercato toro fa nuovi massimi mezza giornata, invece di negoziazione di un prezzo unico dimensione dell'unità, il commercio di due o più unità di prezzo con un arresto stretto. In entrambi i casi il mercato esplode con profitto, o il commercio si esce immediatamente. Quando si costruisce posizioni commerciali toro-mercato, spostare protettivi ordini stop-loss a break-even come vengono aggiunte nuove posizioni commerciali. La posizione migliore per il vostro ordine protettivo stop-loss è al di sotto di una precedente reazione bassa, swing-basso, linea di tendenza, o area di resistenza prezzo psicologico. E tenere a mente che non si aggiunge a una posizione esistente. Lo avete corretto quando si dice aggiungendo 8220new8221 posizioni commerciali. Sono nuove posizioni commerciali e devono essere gestiti come tali, pur ricordando che ogni posizione 8220new8221 è messo su molto più vicino alla fine del movimento e quindi comporta un aumento del rischio di negoziazione di perdita. 8. Hey Joe Crede che ci sia di vero in quanto i singoli operatori sono interessati dalla umore generale del mercato finanziario e del forex credo che ci sia un sacco di verità in questa affermazione. Credo anche che si deve imparare a staccarsi da le mosse dei mercati finanziari. Ho letto qualcosa di molto tempo fa e salvato. Io don8217t ricordo chi l'ha scritto, ma qui è: il commercio 8220Short termine deve rango vicino alla parte superiore della lista delle attività più imprevedibili ed emozionanti del nostro pianeta. Come l'aggregato degli operatori di mercato cavalcare il mercato ad altezze svettanti e bassi terrificanti, la coscienza collettiva della folla vola all'euforia e cade nella disperazione di concerto con il movimento dei prezzi. 8220If la folla sperimenta un emotion8212ranging cumulativo da lieve ottimismo, l'avidità e l'euforia, ansia minore, poi la paura e panic8212it a titolo definitivo ovvio che tutti ma il più robotico dei commercianti passare attraverso sentimenti personali che rispecchiano l'esperienza della folla. 8220Its comune per trovare i commercianti che restano di buon umore quando le tendenze del mercato in su, e si sentono sconsolato e depresso quando il calo del mercato. Negli anni passati, questo può aver avuto più significato, perché molti commercianti hanno rifiutato di vendere allo scoperto non hanno potuto sull'azione mercato quando caduto. Un altro motivo per il 8216up è buono, verso il basso è bad8217 bugie emozione altalena nel fatto spiacevole che quando i mercati scendono, molti operatori inesperti ignorano i loro punti di stop-loss. Un mercato in calo del valore conto di cadere. L'aspetto negativo di questa sindrome, però, è più che dannoso per la vostra ricchezza. Attaccare le tue emozioni a giravolte del mercato possono influenzare negativamente il vostro rapporto con i vostri cari e amici. 8220How si fa a rimanere scollegato e distaccato da stati d'animo di mercato In primo luogo, affermiamo l'ovvio: acquisire le conoscenze e la disciplina necessaria per fare scelte di trading sagge. In secondo luogo, raffinare le competenze di gestione del denaro è un assoluto 8216must.8217 definire un piano globale, big-picture per la vostra attività di trading, in modo giravolte mercato giornaliero dont sembra così scoraggiante. SEMPRE pianificare il vostro commercio e il piano. In caso di dubbio, uscire. Se non godere di vendita allo scoperto, quando il mercato 8216rolls sopra, 8217 prendere profitti e rimanere in disparte fino a quando le condizioni migliorano. Dopo tutto, quando si è in contanti, si avrà nessun legame emotivo legato alla attività di mercato. 8220Once si impara a disconnettersi da umore del mercato, si scrollarsi di dosso i limiti emotivi che possono aver ostacolato le vostre decisioni commerciali. E che dovrebbe avere un impatto positivo sul tuo trading success.8221 dettagli su Trader Consulting o Realizzazione di un sito web Inquiry da Going-qui 9. Hey Joe So io sono un over-trader. Credo proprio don8217t capisco perché Nella gestione generale, dove non oltre il commercio in sintonia Over-commerciale si inserisce in sotto il tema della gestione del rischio. Stiamo parlando 8220risk control.8221 In primo luogo, vorrei dire che la gestione del rischio è una delle cose più importanti che si ha realmente bisogno di capire. In secondo luogo, è necessario iniziare a sotto-commercio, sotto-commercio, sotto-commercio. Qualunque cosa si pensi che la tua posizione commerciale dovrebbe essere, tagliare almeno a metà. La mia esperienza con operatori inesperti è che il commercio da 3 a 5 volte troppo. Altro che sugli spread, si stanno prendendo da 5 a 10 rischi per cento su un commercio quando dovrebbero prendere 1 o 2 rischi per cento. Il principio di conservazione del capitale implica che prima di considerare qualsiasi potenziale coinvolgimento mercato, il rischio dovrebbe essere la prima preoccupazione. Si dovrebbe considerare la ricompensa potenziale, solo nel contesto del rischio potenziale. Rischio deve diventare il fattore determinante nel prendere una posizione. Questo è il vero significato di analisi riskreward. Correttamente applicato, definisce lo standard per valutare non solo se prendere un commercio affatto, ma anche in che misura. Conservazione dei capital8212refuse per lose8212becomes la base per la gestione del denaro intelligente. 10. C'è ordine nei mercati Ci sono definibili formazioni grafiche che costituiscono gli elementi di base di azione dei prezzi Sì, io ci credo sono, e sono felice di condividere con voi. Li ho scoperto molti anni fa, nel corso del tempo e attraverso l'uso di statistiche. Tre modelli di base sono emersi che può essere visto in qualsiasi periodo di tempo su qualsiasi grafico che è in grado di mostrare i valori alti e bassi di prezzi. Sono interessato nell'interpretazione di questi modelli che si applicano a prezzo movimento. Io chiamo questa scoperta legge 8220The di grafici, 8221 ed è a disposizione dei lettori di questa pubblicazione senza alcun costo semplicemente visitando il nostro sito web. È possibile scoprire la legge di grafici su qualsiasi tipo di grafico comunemente utilizzati nelle analisi di mercato oggi: la legge può essere visto su grafici a barre, grafici candlestick e grafici punto e figura. La Legge di Grafici I tre modelli di base che compongono la Legge di Grafici sono i seguenti: Alcuni di questi possono essere ulteriormente suddivise come segue: Per anni gli operatori hanno guardato grafici dei prezzi e mi chiedevo cosa significassero. A volte la visualizzazione di un grafico dei prezzi è simile a guardare le stelle e cercando di capire quali collegare visualizzare la formazione conosciuta come 8220Taurus, il bull.8221 Troppo spesso tracciare esistono formazioni solo negli occhi di chi guarda. A che punto fa una formazione 8220pennant8221 diventare un gagliardetto Ciò che costituisce esattamente un 8220coil, 8221 e quando è che una bobina Esattamente come definirebbe un 8220head e formazione shoulders8221 quando si può chiamare un 8220megaphone8221 un megafono soprattutto, quali fare nessuna di queste formazioni vi dico la scoperta della legge di Grafici era abbastanza accidental8212something sull'ordine di Newton scoprire la legge di gravità quando una mela cadde sulla sua testa. Come con la maggior parte delle scoperte, la legge di Grafici è stato scoperto attraverso semplici grafici observation8212studying per molti anni fino a quando le formazioni appena spuntato fuori e si sono rivelati. The details of the Law of Charts are seen in our e-book entitled, of all things, 8220The Law of Charts.8221 To see how this trader law is applied in regular trading, we are happy to share with you our weekly journal in which we show actual application of the law. The weekly journal, which we call 8220Chart Scan8482,8221 is also available at no charge. The Meaning of the Formations 1-2-3s occur only at the end of trends and swings. They are an indication of a change in trend. They take place when the directional momentum of a trend is diminishing. Exactly the way to identify 1-2-3 formations is detailed in our e-book. You will also find in the e-book how to register to receive our Chart scan journal. Consolidations and the ability to identify them are of utmost importance because prices tend to move sideways far more than they tend to trend. Ledges occur only when values are trending. They constitute a pause in the trend. The pause may be due to profit taking or, more usually, are reflective of uncertainty in the market. The traders e-book explains more fully how to deal with so called Ledges. Ledges are consolidation areas consisting of no less than four occurrences of price value and no more than ten occurrences of price value, having two matching highs and two matching lows. Congestion areas are sideways consolidations of price value and reflect periods of accumulation and distribution. You might say that they indicate a market that is essentially at fair value with no significant changes in supply or demand. Congestion consists of from 11 to 20 occurrences of price value prior to a breakout. Trading ranges are extended consolidations of price value. They consist of sideways movement lasting twenty-one bars or more. Interestingly, statistics show that breakouts from trading ranges occur most often on price value occurrences from twenty-one to twenty-nine. Furthermore, the narrower the trading range becomes, the more explosive tends to be the breakout, and the wider the trading range becomes, the less explosive will be any breakout from the sideways action. Trading ranges also reflect markets that are at fair value with little change in supply or demand. Ross hooks always occur as the result of profit taking. A ross-hook is defined as the first failure of prices to continue in the direction they were previously moving following the breakout of a 1-2-3 formation, the breakout of any of the consolidation patterns mentioned above, or the breakout of a previous Ross hook. Each one of the basic trade formations is able to be defined. The specific definitions are available in the previously mentioned e-book, 8220The Law of Charts.8221 Since the basic formations occur in a variety of ways when seen on a chart depicting actual price action, we want to help you fully understand how to apply the law. There is considerably more to the Law of Charts than can possibly be described in this overview article. You can obtain a clear, thorough understanding of how we trade using The Law of Charts through the Chart Scan, which is sent out by E-mail each week. We invite you to join us in a better understanding of what you see on a price chart. Joe Ross8217 Trading Educators is dedicated to helping serious traders to become better traders. Our staff and branch offices consist of real traders trading real markets. Trading Educators is involved in day trading and position trading in a variety of markets including futures, equities, and forex. In addition, our offices regularly trade futures spreads and options on futures. 11. Hey Joe If I get all my forex buy and sell signals to work properly, I should come out a winner, right Wrong The perennial questions are, 8220Should I buy Should I sell8221 All too many traders focus their efforts on identifying buy and sell signals. In fact, that8217s what most trading books consist of8212some way to find buy and sell signals. Trading systems are usually all about 8220where to get in.8221 The research and analysis traders do is geared towards reaching the goal of getting that magic 8220base line8221 directive to guide their actions. How ignorant can you be Any successful, experienced trader will tell you that although properly identifying buysell signals is important, it8217s not the key to being successful. Instead, the way you manage each trade is what will determine your success. Traders who take the baseline approach tend to believe that the success of their trading activity is dependent on following the right buysell signals at the right time. Clearly, it8217s important that a trader be able to understand the process of generating signals and to use the methods involved. Realistically though, almost any financial trader can find a way to generate signals (whether using technical methods already out there, coming up with their own system, or using their platform8217s automated signal generation tools). Any successful, experienced commodity futures and forex trader will tell you your trade doesn8217t begin and end with a buy or sell. There8217s a trade management process involved. For each commodity futures trade you make, you8217re making a group of decisions. The way you manage and time those decisions is what will determine the success of your trade. Let8217 say 2 traders get the same trade signal at the same time and act on it. One8217s trade may result in profits while the other8217s results in losses. How is this possible It can occur because each trader made a different combination of decisions throughout the course of the trade. The decisions may include scaling in andor out of the trade, using or not using trailing stop-loss orders, setting or not setting profit price target objectives prior to entry, patience or lack thereof, etc. The forex and commodities futures traders who made the most effective overall combination of trading decisions will have the better trade results in the end. Of course, there are time when pure chance, gives the better result to the worst trader. It8217s very important to regard trading as a process, and to understand that as a trader your efforts need to be focused on the activity of trading itself, as opposed to getting a quick base line answer. Because there are many things to take into consideration in making your trades successful, it8217s essential that you educate and train yourself in all the different areas. Learn how to develop better trading plans and to trade a sound and proven important trading technique and technical indicator, and learn how to apply what you have developed to the overall process of executing a trade vs the original impulse to enter or stay-out of a trade to the control of your thought processes and emotions in making and managing that trade. 12. Hey Joe I8217m a long-term trader. Any trading advice for me Note the yearly ranges for the commodities you trade. What is this yearly high and low, are they higher highs, lows and closes compared to last year Does the close confirm price action What is the long term trend How does this years compare to last three years average range Should next year have greater volatility than this year How much based in dollars was the commodities price move from the annual lowest low to highest high price How much did you take out of that range What should next years high and low be for the commodities you trade based on the yearly trend analysis These questions define the yearly long term vertical bars, use the monthly priced bars to answer them. Use weekly price bars to answer major trend questions for monthly highs and lows. 13. Hey Joe At the trading seminar you said it8217s a good idea to study military campaigns if you want to be a good trader. Would you elaborate on this a little Grant and Napoleon had one ability that separated them from other generals, the ability to maneuver troops and supplies to their most effective placements under rapidly changing circumstances. Traders should learn how to manage their funds, rework stop placements, and change their position size with changing market conditions. Conducting warfare and commodity trading have many common factors. All modern warfare is derived from the spear and shield, attack and defend, offense and defense. For trading markets, offense is trade entry and defense is the protective stop. Day trading is like guerrilla warfare, which was first used in Europe during the early 1800s when Napoleon placed his brother on the throne of Spain. Attack rapidly then retreat. Value of Persistence: In the Battle of the Wilderness, Grant let the Southerners know one thing, he would never give up and would fight them under the harshest of conditions. After the battle was over, instead of retreating back to Washington to rest, as some past cowardly Northern generals had done, Grant moved south and stopped Lee from sending reinforcements to Atlanta, which fell to Sherman. The Civil War was won from the Battle of the Wilderness, which Grant is still incorrectly thought to have lost. Grant broke the South psychologically after the Battle of the Wilderness. The stock market or futures trader is a successful human being for the courageous act of trying to become a success trader, regardless of his brokers account equity statement. Churchill said, quotNever give up. Never, never, never give up. quot That statement defines persistence and commitment. There are many trading systems that are profitable, yet there is only one way to correctly analyze price action. Those lessons are contained by regular practice reading charts and working out what you see there. Dont give up and you will find them on the charts. 14. Hey Joe I know you must have been a truly committed trader when you began. How do I get myself to be in control Statistics and society may predict, but you alone determine whether you will succeed or fail. You alone are in control take responsibility for your performance and your life. There are always tremendous opportunities in the markets. It is not what happens it is what you do with what happens that makes the difference between profit and loss. Most traders move from trading method to trading method, over time, until they find one that suits them8230 one that is comfortable to run, and tests well first by trade back-testing, and then by real-time trade testing. Some traders never stop looking for the 8220right8221 way to trade. That is a problem. There are many ways to trade that can generate nice profits over time. To settle on a right way for you to trade: 8226 First, you have to believe in the process which leads to the generation of your entry signals. Does that process make sense to you Maybe you8217re a visual sort of person and you are drawn to Candlestick charting. Take the time to understand why the patters mean 8220reversal8221 and not just accept the 8220picture8221. Go deep. Choose a guru to follow. Maybe you learn best from mentoring. Choose wisely. 8226 Second, method you decide to go with, back-test it. In today8217s modern world of software, there8217s no excuse not to run all the back data you can through your method and see what the results would have been. 8226 Third, THINK about the process you are choosing and why it8217s right for you. THINK about the results you get from your back-testing and your real-time testing of your system. 8226 Fourth, BE A MACHINE (DON8217T THINK) when you are trading your method. This is why I am a huge proponent of mental training for traders. Unless you can control yourself, you can never control your trading. In order to control yourself and your emotions, you have to believe totally in the way you trade. Do the work. Think. Then don8217t think. 15. Hey Joe If you had to come up with a set of steps that would bring trading success, what would those be. I guess from time to time I would say this somewhat differently, but what comes to mind is as follows: Here are five steps to becoming a successful trader 1. Focus on trading vehicles, strategies, and time horizons that suit your personality. You need to be comfortable. 2. Identify non-random price behavior, wherever you can find it. 3. Absolutely convince yourself that what you have found is statistically valid. 4. Set up trading rules. 5. Follow the rules, but don8217t be afraid to break them if the don8217t work. In a nutshell, it all comes down to: a. Do your own thing (independence) b. And do the right thing (discipline). 16. Hey Joe What about adding new positions when day trading Day traders should learn to press the market and add contracts at crucial trend confirmation intra day prices, moving all protective stops to break even with additional contracts. When a bull market makes new half day highs, instead of trading a one price unit size, trade two or more price units with a tighter stop. Either the market profitably explodes, or the trade is exited immediately. Trader Consulting Information, or Make a Website Inquiry by Going-here When building bullish trading positions, move your protective stop-loss to break even as new positions are added. The location ideal for the protective stops are below a previous reaction low, a trend line, or psychological resistance price. And keep on mind that you are not adding to an existing position. You have it correct when you say adding 8220new8221 positions. They are new positions and must be managed as such, all the while remembering that each 8220new8221 position is put on that much closer to the end of the move and therefore carries increased risk. 17. What exactly is a hedger, and what is a hedge A hedger could be someone who grows and sells hedges, but in this case we are not talking about horticulture, although the idea of growing a hedge as a means of protection lends itself to the concept called 8220hedging8221 in the futures markets. The details of hedging can be somewhat complex but the principle is simple. Hedgers are individuals and firms that make purchases and sales in the futures market solely for the purpose of establishing a known price level 8211 weeks or months in advance 8211for something they later intend to buy or sell in the cash market (such as at a grain elevator or in the bond market). In this way they attempt to protect themselves against the risk of an unfavorable price change in the interim. Or hedgers may use futures to lock in an acceptable margin between their purchase cost and their selling price. Consider this example: A jewelry manufacturer will need to buy additional gold from his supplier in six months. Between now and then, however, he fears the price quotes for gold may increase. That could be a problem because he has already published his catalog for one-year ahead. To lock in the price level at which gold is presently being quoted for delivery in 6-months, he buys a futures contract at a price of say, 350 an ounce. If, 6-months later, the cash market price of gold has risen to say 370, he will have to pay his supplier that amount to acquire gold. However, the extra 20 an ounce cost will be offset by a 20 an ounce profit when the futures contract bought at 350 is sold for 370. In effect, the hedge provided insurance (protection) against an increase in the price of gold. It locked in a net cost of 350, regardless of what happened to the cash market price of gold. Had the price of gold declined instead of risen, he would have incurred a loss on his futures position but this would have been offset by the lower cost of acquiring gold in the cash market. The number and variety of hedging possibilities is practically limitless. A cattle feeder can hedge against a decline in livestock prices and a meat packer or supermarket chain can hedge against an increase in livestock prices. Borrowers can hedge against higher interest rates, and lenders against lower interest rates. Investors can hedge against an overall decline in stock prices, and those who anticipate having money to invest can hedge against an increase in the over-all level of stock prices. The list goes on. Whatever the hedging strategy, the common denominator is that hedgers willingly give up the opportunity to benefit from favorable price changes in order to achieve protection against unfavorable price changes. 18. What8217s the meaning of 8220Position Limits8221 Although the average trader is unlikely to ever approach them, exchanges and the Commodity Futures Trading Commission (CFTC) establish limits on the maximum speculative trade position any one trader can have at one time, in any one forex or futures market contract. The purpose is to prevent one buyer or seller from being able to exert undue influence on the market price in either the establishment or liquidation of positions. Position limits are stated in number of contracts or total units of the commodity. The easiest way to obtain the types of information just discussed is to ask your broker or other advisor to provide you with a copy of the contract specifications for the specific futures contracts you are thinking about trading. Better yet you can obtain the information from the exchange where the contract is traded. Position Limits can dash the hope of even the most ambitious traders. With a certain number of contracts, you then have to report your intentions. Along the lines of Position Limits, are certain limits built into any venture which limit a trader8217s ability to trade large size. It is a common fallacy of most aspiring traders to think that if they could just learn to be successful trading a single contract, just think what they could do with 100 contracts, or 1,000 contracts. Besides becoming reportable, the trader runs smack up against two immutable laws: 8226 The law of diminishing returns 8226 The law of diminishing productivity The larger the trading size of the trader, the fewer markets he can enter without becoming everyone8217s target. When you trade too big, everyone is out to get you. If they catch you going the wrong way on a trade they will make mince-meat out of you. So that trader must stick only with markets that can absorb his size. The more contracts you put on, the more problems you have with fills. It becomes difficult to get all contracts filled at a single price. Instead you find yourself managing a series of prices. No fun at all You are so busy managing one trade, that you can no longer manage other trades. Having to manage a lot of different prices reduces your productive ability. 19. Oversold or overbought markets One way to look at consolidation areas is to try to buy into a market when it is said to be 8220oversold8221 at support, or sell into one that is said to be 8220overbought8221 at resistance. In either case you do this as soon as it begins to move in the opposite direction. Overbought conditions are said to exist when a market has experienced rapid price increases. Intermediate resistance is a price, or clusters of prices, which have formed at price levels not exceeded for several days or weeks. The opposite is true for oversold conditions. They are said to exist when a market has experienced a rapid decrease in prices. Intermediate support is a price, or clusters of prices, which have formed at price levels not violated for several days or weeks. Timing such trades based upon the chart pattern greatly reduces risk and facilitates such a counter trend entry. The minimum price objective for this type of entry is generally about 50 of the price movement from the previous top to the previous bottom. 20. Three components of market timing All market timing has three components: entry into the position with a protective stop, repositioning the protective stop, and exiting the trade when it is completed. Profits may take care of themselves, but losses require money management. These timing components must be built into every successful trading system. Good stop placements, relative to price action, are like fishing for big fish using a light line the right amount of tension is required at all times. Picture it this way: If a fish is given too much fishing line, i. e. too wide a stop placement, he will come towards the boat then explode outward, thus ripping the hook out of his mouth, i. e. taking the trader out of the market. If too much tension is applied, i. e. stop placements too close, the fisherman rips the hook out of the fishs mouth and loses the fish. The trader with too close a stop takes himself out of the market. The wise trader must know how to use stop placements, especially if he fishes at high risk bottoms or tops. 21. Pullback or trend reversal When seasonal pressures favor a trend already underway, a pullback can offer attractive entry opportunities 8211 if you know what to look for. When seasonal influences coincide with an emerging trend, a reciprocal relationship can develop that generates dynamic price movement. Short-term pressures reinforce longer-term trends, and longer-term fundamental change promotes a greater sense of urgency in seasonal pressures. Consider the effect of a seasonal increase in demand when supplies are in structural decline amid a potential shortage. A trend is a series of actions and reactions. When prices move too far too fast in one direction, they tend to pull back 8211 almost like 8220two steps forward, one step back.8221 Not only does this pullback allow the market to correct any imbalance, it also affords lower-risk entry opportunities before the trend reasserts itself. The questions, of course, are how much of a pullback and when is a pullback a reversal instead. Such is the trade-off in buying pullbacks, but general rules of thumb exist to help. Probably the best rule of thumb is to determine whether or not the pullback is nothing more than profit taking. Profit taking will generally not cause more than three price bars of pullback. A trend reversal should be considered whenever there are more than 3 price bars in the pullback. More than 4 price bars gives a very strong indication that the move may be at least temporarily over and that immediate consolidation of some time period is in process. 22. Defined risk Defined risk is something to be quite concerned about. We always want to keep it as small as possible relative to the anticipated reward. Risk can come in unexpected ways. As a rule, you don8217t count on lousy or unreasonable fills. You don8217t count on the market being under fast conditions at the time you enter. You don8217t count on the fact that even though you are trading in a normally liquid market, today is the day when traders are just standing around. You don8217t count on the fact that tick size may be unusually large just when you are entering the market. Perhaps you have a resting stop, and just when prices reach your stop, the market becomes fast or the tick size unusually large. You don8217t count on a huge fund entering the market just at the time prices reach your resting order. It is because there are so many unplanned for items that can exaggerate risk, that we learn to respect the trend. The reward can be surprising, the risk defined. The market contains the knowledge of all the players, therefore it knows more than any one of its players. When a market trends, it does so for a reason. At times, the reason is never fully understood until afterward. Trends usually get underway slowly and then accelerate as they gain momentum. Momentum is potentially as helpful to a trader as a ocean waves are to a surfer. And because momentum is also a function of market psychology, trends can carry to even greater extremes than seem possible, thereby legitimizing the question, 8220How high is high8221 or 8220How low is low8221 It is human emotion that drives markets to extremes. For instance, one definition of an up trend is a series of progressively higher highs and lows on a price chart. By that definition a trend becomes risky when there is penetration of the most recent prominent low. However, that fixed chart point can also help a trader to estimate the depth of corrections, and to identify possible entry points. By understanding the trend you can get a better idea of the amount of your risk exposure. Trading with the trend can place the probabilities in favor of your ultimate success. When it comes to trading with the trend there may be as many ways as there are traders. I prefer to 8220nibble8221 the trend, taking frequent profits as I go and then reentering ifwhen the trend continues. When nibbling the market, I use no indicators of any kind. In a down trend, my trailing exit stop is always 1 tick above the high of the latest price bar. My entries are 1 tick below the latest price bar. If prices gap beyond my entry point I do not enter. Sooner or later every trend breaks down, and not coming to the full realization of that seems to be the undoing of many traders. There is a tendency to hang on much too long. 23. Is it true that selling a market when it is limit up is usually a great strategy This 8220brilliant8221 strategy stems from the idea that selling a market at limit up, may result in the trader gaining two limit moves in his favor while theoretically not losing any money the day of entry. I think is that this is an absurd idea. I don8217t advise this high risk approach as a trading tactic. Keep in mind that most markets that remain limit up on the close, will open sharply higher the next day over 90 of the time. The limit-up sell is recommended only as a partial profit taking measure, not to initiate short positions which may be considered on the next higher open. If ever trapped into a limit up move situation try to buy deferred futures contracts or call options immediately and ask how many contracts there are to buy on the most active futures contract. If there are over 1000 contracts to buy, do not assume the most active futures contract will come off limit to trade the remainder of that day. 24. Rallies and Declines The price relationship and magnitude of price movement, where rallies and declines occur, defines trend. A bull market has a higher high followed by a higher low which should be followed by a higher high the majority of the time. The magnitude of rallies is greater than the correction of declines. Examining the distances between highs and lows allows the lowest risk entries, and forecasts where and when market tops and bottoms should occur for profit taking exits and new position entries. Buying bull market corrections makes good sense, since the next rally should be greater than the decline on which the position was taken. That, in essence is what we are doing with the Traders Trick Entry. Declines should not be lower than the previous price bottom. The same principle applies to day trading. It is the downward corrections in a bull market that quantify the strength of the market. With a chart pattern recognition approach, it is very possible to know where any market will trade days, weeks, or months in advance greater than 78 of the time. Too bad we don8217t know exactly when 25. Detecting the End of a Trend One way to know that a trend is over is as follows: Downtrend: A low is made and then a correction (retracement) follows. If the distance from the low to the high of the correction is greater than the height of the two corrections prior to making the low, you are probably looking at the end of a trend. The highest probability is for prices to now enter a consolidation, since few markets consistently make Vee bottoms. Uptrend: A high is made and then a correction (retracement) follows. If the distance from the high to the low of the correction is greater than the depth of the two corrections prior to making the high, you are probably looking at the end of a trend. The probabilities are now equal for prices to consolidate or for an actual change in trends. Markets make Vee tops more often than they make Vee bottoms. 26. No more than two indicators are the maximum to confirm price action Simplify your approach to technical analysis as much as possible. Emphasize price action analysis, de-emphasize indicator usage, and unless you are in a position to gain lots of information, totally ignore fundamental analysis. No more than two indicators are the maximum to confirm price action. At a trading seminar, at which I spoke, one trader there used 9 technical indicators to trade the futures markets. More than half of the trading seminar was devoted to technical analysis indicators and their usage in trading. Wells Wilder wrote the best book ever written on trade indicators, quotNew Concepts in Commodity Trading Methodsquot and it should be read before oscillator usage or trading seminar attendance. However, keep in mind Mr. Wilder eventually publicly disavowed every indicator except ADX. These days, I do not use Gann, Elliot, Fibonacci, open-interest, or RSI, in my technical analysis. I use mostly mental analysis of buying and selling pressures, as expressed in a series of price bars or chart patterns. If you are going to trade with indicators despite my ranting and raving against them, the best way to trade them is to know what levels they achieve only 15 of the time when at a major top or bottom, and know the percentage of price action and indicator divergence for each market in which you use the indicator. If only 15 of all Stochastic values go above 83 for Treasury Bonds, then upon reaching that value wait for confirming price action to generate a profitable sell signal. Traders may combine indicator values to specific time value tops and bottoms for counter-trend price objectives, but be sure to use non-correlating indicators to do the job. The 15 level is different for each market. Price vs technical analysis divergence is an indicator value created when the market price moves to new higher levels, but the indicator remains below a previous indicator value level relevant to a previous price top. Corn used to have price action and stochastics divergence 80 of the time at bottoms. Knowing the percentage of divergence at tops and bottoms for each commodity makes money. What is the average counter trend price move when the Stochastics rise above 83 for T-Bonds with divergence If you don8217t know, you need to know. Tell you what, it8217s a lot easier learning to read a futures chart and to be stingy in your use of indicators. 27. TRADING THE ROSS HOOK8482 The Ross hook8482 (Rh)8482 is always created as the result of profit-taking. It is defined in the following way: 8226 The first failure of prices to continue in the direction they were going regardless of time frame: Subsequent to the breakout of the 2 point of a 1-2-3 formation subsequent to the breakout of any area of price consolidation containing at least 10 price bars Let8217s look at some examples, including a daily chart: Of course the proper way to trade the Rh8482 is through the use of the Traders Trick Entry8482. The Traders Trick Entry8482 and the Rh8482 go hand in hand and are part and parcel of each other. The 1-2-3 formation is part of the Law of Charts8482, and the Traders Trick Entry8482 is the best way to trade the Rh8482 formation. Both are available to anyone as a free resource at Click-on Law of Charts8482 and also on The Traders Trick Entry8482 (Resources). I give these links here in order to save precious space for the remainder of this trading article. Now let8217s look at a 5-minute chart. Notice that every Rh8482 is a potential 1 point for prices to move in the opposite direction. It is important that you refrain from taking a breakout of the point of the Rh8482. Too often this will place you in the market too late for capturing a sizable portion of each move. There are numerous ways in which you can use the Rh8482. I will present here just one of the methods. Hooks can be combined with indicators if you like. Here we will combine the 1-2-3, the hook and a simple moving average, as one way in which you might trade. The chart shows trending prices underscored by a simple 9 bar moving average of the Opens. To compute the moving average, simply add together the Opening prices of the latest 9 price bars, and divide by 9, and then plot. Here are the rules for trading: First you must define a trend. I did it here by virtue of the violation of the 2 point of a 1-2-3 low formation. We buy one tick above the 2 point as prices move higher (breakout) above the 2 point. For protection, we tail a stop loss one tick below the previous bar8217s value for the moving average. In our example, prices do not move below the previous bar8217s moving average until the price bar marked 8216Out.8217 Let8217s talk briefly about trade management. Assuming you bought 3 contracts upon entry you would cash one contract as soon as you could cover costs and take a small profit. You would then use a trailing stop-loss protecting 50 of your unearned paper profits, and move one stop to break even. If you prefer, move both stops to break even. Once prices move up a sufficient amount to where both stop losses can be placed above break even, trail one stop at 50 and another wherever it feels comfortable. Keep in mind that 8216stop loss8217 means protecting your position against a serious loss of margin (which can easily happen in the forex market in particular). Once the trade is in the clear, stop-loss means protecting your open position equity against loss of profits. The simple trend following method we have shown you is not the 8216be-all to end-all8217 method of following a trend. There is much more to learn about trading trends. You might consider any of the following money management styles: 1. Taking all of your position off at once time at a specific objective of points, ticks, or dollars. 2. Taking 13rd of your position off at a first objective and then the remainder at a second objective. 3. Taking 23rds of your position off at a first objective and the remainder at a second objective. 4. Taking 12 of your position off at a first objective and 12 at a second objective. All of the above methods involve only money management. Futures money-management involves setting monetary, tick, point, or even percentage trade objectives. The following methods involve money management for the first taking of profit at an objective, but then using a trailing stop (trade management) for one or more of the profit taking exits. 5. Taking 13rd of your position off at a first objective and trailing a stop with 23rds of your position. 6. Taking 23rds of your position off at a first objective and trailing a stop for the final 13rd of your position. 7. Taking 12 of your position off at a first objective and trailing a stop for the remaining 12 of your position. I8217m sure by now you can see that there are other management combinations as well. By means of testing you should be able to determine which method works best for your chosen market and time frame. Also realize that no method of management is to be set in stone. Markets change constantly, and you must adapt your trading to the realities of your chosen market. Let me give you an example: At one point in my trading career, when the currencies were heavily traded, a time prior to the creation of the stock indices and US dollar market, I found in trading the Swiss Franc I was able to consistently make 12-ticks on most Traders Trick Entries8482. Trading was during time intervals very easy for me. All I had to do was place my entry stop order in the market, and contingent upon being filled, I would have a Market if Touched order resting 12 ticks beyond my proposed entry point. This method of management worked for almost a year. Then one day I noticed that all I could get was 10 ticks 8211 eventually only 8 ticks, then 6 ticks. This method of management was not worth trading for less than 6 ticks, because at 6 6ticks I had to double my position size to make the same amount as before. When I could no longer get 6 ticks I abandoned the trading method. I moved to other markets and did well in those 8211 mainly the British Pound and the Japanese Yen. However, in those markets I had to trade a bit differently than in the Swiss Franc currency market. It took some time, and I periodically kept an eye on the Swiss franc. Then I noticed that it was once again possible to make 12 ticks. This time that niche lasted only 6 months and it was over, with Swissie moving back to under 6 ticks in a matter of days. In 47 years of trading, I have not found a holy grail of trading. In today8217s markets I find that I have to change and adapt more often than ever before. Changes in today8217s markets are many, and the markets continue to change more rapidly than ever before. New exchanges, new markets (such as Forex Currencies), computers and electronic trading systems, have all changed the markets 8211 especially with them bringing many thousands of new market participants. Since any commodity, futures or forex trading market is comprised of all its participants, the changes have been monumental. No longer are financial markets dominated by professional speculators and commercial interests. Today, much of day trading is heavily populated by newbie traders trying to get rich quick. The single phenomenon of amateur day traders has caused the forex and commodity futures markets they trade in to become chaotic and confusing. You must change. You must adapt. You must coordinate your trading with what is really happening. To that extent, you must trade the Rh intelligently and with common sense. There is nothing magic about Ross hooks. They describe what happens when traders take profits during the course of a trend. There is nothing more to gain than the realization of the simple fact of profit taking and what it looks like on a market bar chart. 28. It8217s our job to trade 8220Forex8221 not 8220Histories8221 Throughout the years I8217ve been trading and writing Ive often written about mind set8212having the right frame of mind for your trading so you become a winner. Ive stated that it is our job to trade quotfutures, quot not quothistories. quot The future is the next bar on your chart. You cant possibly know how it will develop, how fast prices will move, or where it will end up. Since none of us know where the very next tick will be, its impossible to know where the tick after that will be, or the tick after that, etc. All we know at any one time is what were seeing. Interestingly, what were seeing may not be true. If we are day trading, we are not sure that what were seeing is a bad tick, especially if it is not too far astray from the price action. The daily price bar-chart doesnt always tell the truth, either. The open may not be where the first trade took place. The closing price is merely a consensus, and may be quite a bit distant from where the last trade took place. The high price may not have been the high, and the low price may not have been the low. If you dont believe that, then I challenge you to pick up any newspaper and take a look at some of the back months. For example if the futures exchange has reported that a back month they opened at 9755, with a high of 9802, a low of 9760, and a close of 9784. Does that make any sense How can the low be higher than the open How can the close be higher than the high Yet thats the kind of garbage we have to put up with in this business. Now you know the problem with back testing of trades. Back testing and simulated non-real-time testing are based on nothing but lies. Thats why they dont work when you actually put them to the test with real trading using real data. In fact, there are many reasons why back-testing and trade simulations wont work, and I may as well dump them in your lap right here. Because you dont really know where the high or low were, or if the market ever really traded there, you dont know if your simulated stop was taken out or not. If you say you have a trading system in which if you get three up days followed by a down day, the market will be up twelve days from now 82 of the time, then your whole statistical universe may have been based on what is not true. Have you ever watched the cocoa market from the open to the market close You can clearly see it trading at the open, but by the time the market closes, the open will at times be placed opposite the close. That might be fifty or more points away from where you saw it open and trade, and also as born out by a report of time and sales. The way they report cocoa prices is going to give a fit to a lot of candlestick traders. Why Because they are going to see far too many quotdojisquot (openclose), more than are really there. Cocoa is not the only culprit, but historically, it is certainly one of the worst When you see a completed bar on a chart, you have no idea which way prices moved first. You dont know if they moved down first or up first. You dont know whether or not prices opened and then moved to the high, went down to the low, and then traded in the lower half of the price range until the close, at which time prices soared up to the high and closed there. You have no idea of the overlap. Ive seen prices trade from one extreme to the other more than once at each extreme. In any of those instances, your protective stop could have been taken out intra day. You know nothing of the market volatility on any given day, once you see a completed price bar. Were prices ticking their normal, exchange minimum tick, or were they ticking two or three times the minimum every time prices ticked Even if you purchased intra day tick data for your simulation, showing every single tick the market made, you dont know what the volatility was. For instance, you dont know if the SampP was ticking five minimum fluctuations per tick or twenty-five minimum fluctuations per tick, and if it was doing it quickly or slowly. You dont know and you cant know, and anyone who tells you their simulated system works, based on such phony baloney, is a liar. Not knowing how fast the market was means you cant really know what the slippage might have been. The faster the market, the greater the slippage potential. You can sit there and say you would have gotten in at a certain price or that you would have exited at a certain price, but if you dont know the market volatility, and how fast the market was, you do not know enough to say that you would have done such and such. Not knowing how fast the market was, you have no way of knowing how much slippage there would have been on your entry or your exit. Without knowledge of slippage, you cant possibly know the risk. That is also true of volatility. Volatility is made up of range of movement, speed, and tick size. If you dont know the extent of slippage, you will not know the extent of the risk you would have encountered. As if thats not bad enough, you also dont know how thin the market was at the time you would have traded it. If you are position trading, you cant go by the reported daily volume (which is always too late to do you any good), because there is no way to know what the volume was at the time your price would have been hit. So here again you have no idea of what slippage you might have encountered, and once more you would not have known the risk. If you want to spend your money on a commodity or forex trading system based upon the unknown, then you must assume the risk of doing so. Since this is a business of assuming risk, you are entitled to insure prices in any market that you care to. Insurance companies spend a lot of money to make sure that the risks they take are actuarially sound. That is the equivalent of finding good, well-formed, liquid markets to trade in. But any market can become totally chaotic. Markets can become extremely fast, and they can become quite volatile. So even if your system was back-tested in a liquid market, when that market becomes fast andor volatile, your back-tested, simulated system will not be able to cope with it and you will lose. Its like going out to write life insurance on a battle front. If your back-tested, simulated system does factor in some room for fast andor volatile markets, then, when you will be trading in slow, non-volatile markets with the built in factor, you will be utilizing a system that is totally inappropriate for the slow, non-volatile market you are in. The best you can hope for is an quotoptimizedquot system. How can you possibly expect to compete with traders who are acting and reacting to the reality that is at hand at the time Extensive back-testing is for historians, not traders. It is the wrong view of the markets. Your trading must be forward looking without being ridiculous about seeing into the future. If you dont know where the next tick is, how can you possibly know where the next market turning point will be Can you see into the future Perhaps you may like to trade using astrology. as it has been said the famous old-time trader (from the 1920s thru 1950s era) Mr. W. D. Gann (William D Ganns photo to the left) used to trade financial markets successfully in his personal trading of stocks amp commodities. Astrological traders are always trying to peer into the future. In the automobile business they have a saying, quotTheres an ass for every seat. quot Likewise, theres a fool for every fortune teller who claims he can see into the future. You can always go out to your local coven and hire a witch to tell you what beans will do tomorrow. She may even be right from time-to-time. You could always do as one charlatan did and run the biorhythm for each market based on the day it first started to trade. Or, you can cast the markets horoscope based on the same date. With the biorhythm, youll know what time of day the market should be on its highs, and what time of day it will be on its lows. Youll know which day the market will be ecstatic and reach a new high, and which day it will be down in the dumps and make a new low. However, youll find that from time to time the market will reach new lows on the day it was supposed to reach new highs. Well, thats easy enough to explain. You can tell everyone quotWeve had an inversion. Until the market inverts again, the lows will be the highs, and the highs will be the lowsquot 29. Help with Trading Orders One way I can help is to suggest that you pick up a copy of our 4 cassette tape-set and manual called 8220Trading Order Power Strategies .8221 No one has ever produced a product quite like it and many of our trader readers have told us that it was of immense help to them. However, until you get your copy, learn the following: When the market trades above a buy-stop price order, it becomes a market order. The first down tick, after the market order price is activated, determines the highest price a buy stop order may be filled. The rule to remember placing stop-loss orders is this, quotBuy above and sell below. quot Buy-stops are placed above the current market price and sell-stops are placed below the current market price. If a buy-stop price is hit, the order then becomes an at-the-market order to be filled by the pit broker at the best price possible. If an SampP buy stop is hit at 40 and the market trades 40, 45, 50, then 45, the worst fill a trader can receive is a 50, because 45 is the first down tick. The exception to this rule comes under 8220fast market8221 condition, when brokers are not legally held to any prices, or in some New York markets, where pit brokers possess a license to steal. Avoid trading fast markets (fast-market are common in the forex currency markets). A fast market condition exists when extremely volatile price action results from a large amount of orders executed or entered into the pit, almost simultaneously. These market conditions reflect emotional reactions usually in response to the most recent government statistics like crop reports, or unemployment data etc. Whenever you are able, avoid placing trade orders under fast market conditions because of the high probability that you will receive excessive trade slippage. In general use at-the-market orders when its absolutely necessary, unless your commodity or forex trading strategy calls for you to use them. 8220Slippage8221 is the price difference between the stop-loss-order price and the actual fill price this becomes dangerously excessive in fast markets, when brokers have no restrictions on order prices. Ask your futures broker about which government statistics can move the markets, thereby causing extreme price volatility. Try to avoid being in the market during the most critical governmental statistic release, when fast market conditions are likely to occur. It is wise to stay out for about an hour or unless the fast market condition calms down. 8220Triple Witching Day8221 involves the expiration of stock options, index options, and futures contracts. Always know when these days exist and try to avoid trading on these days, which are marked by excessive slippage, poor market fills due to extreme price volatility. All exchanges issue commodity report calendars that will be sent to traders upon request. The New York markets usually have more slippage than Chicago commodity markets, and estimated 100 per trade slippage and commodity broker commission deduction should be used when producing hypothetical testing results from a futures trading system. The New York markets have less restrictions on their floor brokers and customers orders are accepted on a 8220not held responsible8221 basis. Recent reports of 10-cents slippage in a slow silver futures market are not uncommon. For Chicago markets you can use 50 to 75 slippage and commission for testing purposes. 30. Hey Joe, I8217m never sure about trade position reversing. It is scary, isn8217t it The only reason to reverse a daily chart short term position is because the intra-day buying and selling pressures have reversed the short term trend direction. When only intra day trend changes, a reversal is not mandated unless longer-term time and price objectives have been satisfied. If the short term market trend does not change but a technical stop-order is generated, then a trade exit without a reversal is mandated. Powerful trading signals, like an outside daily or weekly vertical bar, a previous five-day resistance top or support bottom violation, demand immediate reversals. The above holds true for any time frame. If you are trading a 3-minute chart, and the trend reverses on the 1-minute price chart, its either time to get out of the market or time to consider reversing your market position. You are correct about reversing being scary. It most certainly is, and I would not suggest doing so unless you 1.) Know what you are doing. 2.) Have the stomach for it, sufficiently quick on your feet. Developing a stomach for trading position reversing takes practice and the self-assuredness that comes with the courage of your personal strength and convictions. Joe Ross is with TradingEducators UF. ORG is our Trademark - All Rights Reserved. This traders article is also copyrighted by Joe Ross amp Reprinted with permission. Some article additions, comments, enhancements and editing has been done by the UF website editor (in particular involving FX forex markets and forex traders), thus the entire traders article text is not all attributable to Mr Joe Ross, though most is contributed by Joe. Click-Below if looking for:Day Trading Income Potential For Forex Traders and CFD Traders I have posted another article, Position Sizing For Forex Traders and CFD Traders. that serves as the basis on the position sizing that will be used in this article. If you find that the assumptions in the sections below are too conservative to your taste, you can check out that article for the reasons behind. This article is long so get yourself a cup of coffee (or tea, or energy drink, or whatever) and take your time to read it. The Importance Of Patience Many forex traders and CFD traders think that they need exceptional luck to make big bucks trading forex. That is not true. To make good money trading forex consistently, all you need is a half decent trading strategy with matching trading capital. You may not start out with enough capital to make a lot of money in the beginning, but that is not important. What is important is that you have to be consistent in executing your trading strategy so that you can accumulate enough trading capital. In a sense trading forex and CFDs with very small starting capital is like the professional poker scene. Majority of the professional poker players learn their skills from trading tiny bet size tables. They do not play just a few times or even a few hundred times at those tables to gather their initial stakes for buy-ins to the major poker tournaments. They played thousands of hands to accumulate both experience and bankroll. These professional poker players can make a decent living by continue playing poker games at tables (both real ones and online ones) offering bigger bet size. But some of them would choose to enter major tournaments to see if they can get a big break. Those who enter the major tournaments using all the money they gathered for the buy-in may not be able to take home any prize money, hence losing all the gains and have to start all over again. In this case, those poker players are doing the same thing like the forex and CFD traders who raise their position size significantly disregarding the risk of losing everything in the trading accounts. If things work out, of course, the trader would be looking at a significant boost in the available capital to trade with. Well, if things do not work out in the trader8217s favour, this trader has to start all over again. There is no absolute right or wrong in a situation where raising the position size so much that the risk of losing all the money in the trading account becomes a real possibility. Every market scenario unfolding in real-time are different. That is the probabilistic nature of the markets. Just make sure 1. you understand the possibility of losing the account is real and possible, 2. you have considered the consequence, and most important of all, 3. prepared mentally to handle the negative outcome. Before you get to the point of facing this decision, however, you have to have the patience to grind through the bankroll accumulation process. Power of Scalability Forex and CFD trading offer the most flexible position sizing options available to small traders. Hence it is possible to increase position size steadily to improve overall performance. Following is the projected performance of a trader trading euro dollar multiple times a day with average profit of 20 pips per trade expectancy and that the trader would adjust his position size every 100 trades. Notice that in the beginning the profit per trade is expected at 6. It is a small amount. And many people who do not have experience trading would have the urge to increase their position size quickly so that they can make more money faster. The problem is that increasing position size too quickly will easily ruin the account if it is not done properly. Hence, focus on the the potential and stick to a plan that is reasonable and doable is always better than rushing towards the finish line. Given the example above, which is not that remote for many day traders who pay attention to the price movement closely, a day trader who do 3 to 5 trades a day will likely reach 100 trades within a month or two. A very consistent trader having a stable strategy and following this plan with no accidents and no deviation from the execution of the plan, would be able to accumulate an ending balance by the end of the year (or by the end of the 600 trades) would be 48,500. I leave out the calculation on next few levels of position size from the table. If you are paying attention, you will be able to figure that out easily. You will also be able to figure out the profit potential the same way. This is the power of scalability. The very same trading strategy that generates only 6 per trade on average in the beginning can also generate 264 per trade on average when it is executed with position size of 132,000 instead of the original 3,000. A position size of 132,000 is not a big one in the forex markets at all. Moving positions of size 300,000 to 500,000 is also not a problem during busy market hours. Beyond that, you will have to think about your impact on the market with your orders in illiquid conditions. Liquidity And Slippage I just show you a very simple growth plan trading forex. It exists and it is possible to do it. It may take you 6 months. It can take you 3 years. The time needed to get to the point where you have a decent size trading account varies depending on the person. It is not something you can rush. Just remember that by the time you get to the point of 200,000 position size, you need to stop increasing your position size at the prescribed rate. You have to start working on strategy that enables you to trade even bigger position size, or, diversify into trading other forex pairs. Why diversify from a winning strategy when it is working so well The problem lies in the fact that the approach which works with small account size are mainly scalping strategies. Some people call that trading the flow. It enables you to get a piece of the action in the market and works very well up to certain extend. Such strategies will have execution problem if you try to do it in large scale. Slippage becomes a very real problem when your average profit is just 20 pips and that slippage eats into that by 5 pips or more. Depending on the brokerage you use and also the exact strategy you are using, you may be able to push the position size larger but eventually at 500,000 range you will have to deal with the liquidity issue still. It is better to resolve the problem by keeping your current strategy to work on a reasonable size so that you have capital allocated for diversification into trading other forex pairs andor strategies. Consider the transition from the small account size (less than 50,000) to reasonable account size or trading capital (up to about 200,000) as the bottleneck period, it is the the most likely time when a good trader who can turn, say, a 5,000 account, into 30,000 in months, going busted in just a few weeks. A trader who can run the account up 6 times the initial capital is not stupid. The trader obviously has done something right. The problem, however, is that along the way in accumulating the capital, unlike playing pokers, the trader can easily deviate from his original working strategy to optimize for the current market environment. Even a slight change of a good strategy will drastically modify the risk profile and performance of the strategy. In this situation, however, the trader most likely does not even know he is drifting away from his working method because relaxed money management can often get away in certain market conditions that are more forgiving. Hence it is important for the trader to make sure the trading plan is followed properly. If the trading plan is followed rigorously but the performance is still slipping, it is important to give yourself time by reducing the position size and observe objectively if the strategy is no longer working, or, it is just one of those periods where the method has a tough time making money. By keeping your original strategy to trade at a reduced position size, you get to give yourself some room to test out new strategies. For example, if you successfully traded your account from 1,000 to 25,000, you may consider lowering your position size to base on just 15,000. Then use the other 10,000 as your capital for testing new strategies. It is best to keep the position size as small as possible for the new strategies. This time, however, you are not cash strapped to just the 1,000 you start with. You can try out multiple strategies with say 2,000 behind each experiment. As long as you are doing this carefully like how you first started, this will speed up your process in finding new ways to trade your account more efficiently. Many professional day traders trading forex make only 50 to 60 pips a day net on average. It is not that much at all. They do not scalp that often as it is easier to maintain multiple positions trading the swings . The take home profit per unit traded stays approximately the same as trading the flow . although with few trades. The reason for the similarity in performance is that capturing swing profits require relatively larger risk per trade which is not feasible with very small trading accounts. These traders are making decent amount of money because they are doing it with size. Yet, we seldom hear or read anyone telling this simple truth to the beginners. It is their hard earned wisdom. I guess not that many people like to share this. Those home runs we hear people keep talking about are the glory trades . They are also talking points in social gathering but they are not the norm. Beginners often confuse that these glory traders are the reasons why some traders can make it big. The glory trades are just frosting on top of a sustainable trading career. They are done on the side with limited risk and usually do not affect the daily trading routines of these traders. The secret to trading forex successfully for most retail traders is to start small and learn to trade the flow. After accumulating enough capital, the trader will have to learn the next set of skills to master swing trading, even if the timeframe is just day trading. By then, the trader will be able to carry decent position size, making it possible to make a good living off the trading profits. The income potential of trading forex and CFDs is not that different from trading the emini SampP (see Day Trading Income Potential For Index Trader ) with similar trading capital. The difference, however, lies in the transition issue mentioned above. Traders trading the emini SampP index futures do not suffer from this problem in general because of its better liquidity at each smallest price increment (probably one of the best markets in this aspect) and non-directional volatility (allowing efficient scalping). Traders trading forex can start out with smaller account size and have the advantage of being able to trade smaller position size and easier to scale up the positions with very small incremental size but have to deal with the slippage issue later if their trading style depends heavily on very small profit targets. No one can speed up the process of evolving from trading the flow to trading the swings for you. You need the experience yourself so that you can handle changes to the trading environment in the future without going into a panic. As I mentioned many times in my other writings, it takes personal growth to make you a consistently profitable trader. Trade with an FCA UK Regulated Broker Forex. Stock Indices. Commodities. Precious Metals Tickmill is a trading name of Tmill UK Limited (a company registered in England and Wales under number 09592225). Principal and Registered Office: 1 Fore Street, London EC2Y 9DT. Authorised and Regulated by the UK Financial Conduct Authority. 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