The Resemblance Between Marriage and Currency Trading
http://bit.ly/L2CQi9
My experiences in life are filtered through my trader eyes. For example, yesterday I went to a wedding and realized that there is a lot of resemblance in a successful marriage and a profitable career as a forex trader. Read more and judge for yourself... 1. You need commitment to succeed. It is easy to have an opinion about marriage when you are single. But living the life of a married man, or woman, is a different story. Committed couples work every day on their happiness. They handle problems in a mature way, and understand they will only get out of marriage what they are willing to give. Many people have an idea of what currency trading is, and later realize that the reality is different. If they are not committed, when problems arise, they will fail for sure. 2. There will be difficult times. When you find a couple that has been married for 25 years do you think everything was nice and easy in their lives? I am sure there were times when things were hard. That is why we admire them, they were able to overcome problems and made their marriage work. Successful traders go through difficult periods on their career, but they never quit. Remember: winners never quit and quitters never win. You need to handle your losses in a mature way or your career as a forex trader will be doomed. 3. Many marriages fail, that does not mean marriage is a scam. Many marriages end up in divorce, that is the equivalent of a trader's account been wiped out. Just because many fail that does not mean you have to join them. If you do things in a different way you will have different results. Developing the right mindset is a good start, for example. People that get married aspire for a long lasting relation; investors who trade seek profit; in both cases many will fail. Promise yourself that you will succeed no matter what, people with strong resolutions have big power over their lives. Finally I want to say that if you want a profitable career trading currencies find good mechanical system with positive expectancy, and sound money management rules. I know trading the forex market can be a rewarding occupation; you need no special skills or natural talents to become a successful trader. Anyone with the determination and the right information can learn how to trade. FREE Trading System!
Thursday, May 17, 2012
Invest Tips - Top 3 Secrets of the Rich Forex Traders
http://bit.ly/L2Btjq
Are you considering forex trading as an investment alternative? Would you like to be one of the few who profit? In my experience successful traders have no special talents or skills; but they think and do things differently. Here are some ideas I want you to analyze. 1. Do nothing. The forex market is open 24 hours a day; but that does not mean you should have open positions all the time. Successful traders trade only when there is profit to be made. You should take into consideration that there are periods when the market is active and periods when it's not. This may sound strange but some times doing nothing can be very profitable. 2. Pull the trigger even if it hurts. You should always trade when your system tells you, even if it hurts. Sometimes, after a series of consecutive losses, taking the next trade can be very difficult. But this next trade is the one that will help you recover from your losses and make some profit. Consistency is the difference between rich forex traders and everyone else. I know it's hard, but the rewards can be enormous. 3. Be loyal to your money management rules. You should always adhere to sound money management rules, never deviate. Most professional forex market traders agree that you should risk between 1%-2% max on every trade. This will allow you to avoid wiping out your account and at the same time help you make some dollars out of the market. Some traders try to recover their losses increasing, recklessly, their positions and end up wiping out their accounts. Sometimes traders think they know where the market is headed and make bigger bets on their assumptions. If you go into a roulette table and bet all your money on the black, just because the ball landed on the red on 10 consecutive spins, you are going to lose all your money. This is called gamblers fallacy. You should always follow your money management rules, no matter how sure you think you are of the outcome. I know trading the forex market can be a rewarding occupation; you need no special skills or natural talents to become a successful trader. Anyone with the determination and the right information can learn how to trade. The only thing you need is good mechanical system with a positive expectancy, sound money management rules, and above all self-discipline.
http://bit.ly/L2Btjq
Are you considering forex trading as an investment alternative? Would you like to be one of the few who profit? In my experience successful traders have no special talents or skills; but they think and do things differently. Here are some ideas I want you to analyze. 1. Do nothing. The forex market is open 24 hours a day; but that does not mean you should have open positions all the time. Successful traders trade only when there is profit to be made. You should take into consideration that there are periods when the market is active and periods when it's not. This may sound strange but some times doing nothing can be very profitable. 2. Pull the trigger even if it hurts. You should always trade when your system tells you, even if it hurts. Sometimes, after a series of consecutive losses, taking the next trade can be very difficult. But this next trade is the one that will help you recover from your losses and make some profit. Consistency is the difference between rich forex traders and everyone else. I know it's hard, but the rewards can be enormous. 3. Be loyal to your money management rules. You should always adhere to sound money management rules, never deviate. Most professional forex market traders agree that you should risk between 1%-2% max on every trade. This will allow you to avoid wiping out your account and at the same time help you make some dollars out of the market. Some traders try to recover their losses increasing, recklessly, their positions and end up wiping out their accounts. Sometimes traders think they know where the market is headed and make bigger bets on their assumptions. If you go into a roulette table and bet all your money on the black, just because the ball landed on the red on 10 consecutive spins, you are going to lose all your money. This is called gamblers fallacy. You should always follow your money management rules, no matter how sure you think you are of the outcome. I know trading the forex market can be a rewarding occupation; you need no special skills or natural talents to become a successful trader. Anyone with the determination and the right information can learn how to trade. The only thing you need is good mechanical system with a positive expectancy, sound money management rules, and above all self-discipline.
Wednesday, May 16, 2012
Top 4 Excuses To Avoid Forex Investing
http://bit.ly/LSdvdd
Many of the reasons some people use to avoid giving the forex market a try may have some merit, but most of them are excuses. I know the forex market is a good alternative, and if you stop talking yourself out of it you will be able to make some money. Lets take a look to some of the main excuses. 1. I don't have money to save and invest. You don't need to be rich to trade the Forex Market. One of the main advantages of currency trading is the minimal capital needed to open and fund your account. You might be able to start trading with only $10 dollars. When you are on your learning stage, you can open a demo account and trade live without putting any of your dollars at risk. So your first approach to the forex market is free. 2. Trading is too risky. There is the same amount of risk involved in trading the forex market as there is on anything else in life. As long as you are prepared you can keep your risks under control. Many people never take important decisions hoping to avoid risk. Sometimes when you think you are taking the safe path you are increasing your risk. Did you know, for example, that if you save your money in the bank there is a 100% chance to lose some? Huh? Yes, the interest the bank pays you is always lower than the inflation. That means your money is losing value every day; at least for you, cause the bank is making profit taking risks (with your money). 3. Trading is to complicated, I will never learn. Many, self proclaimed, experts want you to think trading is complicated; their job depends on that. There is a big industry that feeds on peoples fears and ignorance. The truth is anyone with the determination and the right information can learn how to trade, it's not that hard. 4. I don't have the time to trade. I can't quit my job. Successful forex traders only take positions once a day or once a week. So, you don't need to quit your job to trade in the forex market, and you don't need to be in front of the screen all day to be a profitable investor. I know trading the forex market can be a rewarding occupation; you need no special skills or natural talents to become a successful trader. You could use, the forex market, to complement your salary or as your main source of income. I hope this was helpful information!!! FREE Trading System!
http://bit.ly/LSdvdd
Many of the reasons some people use to avoid giving the forex market a try may have some merit, but most of them are excuses. I know the forex market is a good alternative, and if you stop talking yourself out of it you will be able to make some money. Lets take a look to some of the main excuses. 1. I don't have money to save and invest. You don't need to be rich to trade the Forex Market. One of the main advantages of currency trading is the minimal capital needed to open and fund your account. You might be able to start trading with only $10 dollars. When you are on your learning stage, you can open a demo account and trade live without putting any of your dollars at risk. So your first approach to the forex market is free. 2. Trading is too risky. There is the same amount of risk involved in trading the forex market as there is on anything else in life. As long as you are prepared you can keep your risks under control. Many people never take important decisions hoping to avoid risk. Sometimes when you think you are taking the safe path you are increasing your risk. Did you know, for example, that if you save your money in the bank there is a 100% chance to lose some? Huh? Yes, the interest the bank pays you is always lower than the inflation. That means your money is losing value every day; at least for you, cause the bank is making profit taking risks (with your money). 3. Trading is to complicated, I will never learn. Many, self proclaimed, experts want you to think trading is complicated; their job depends on that. There is a big industry that feeds on peoples fears and ignorance. The truth is anyone with the determination and the right information can learn how to trade, it's not that hard. 4. I don't have the time to trade. I can't quit my job. Successful forex traders only take positions once a day or once a week. So, you don't need to quit your job to trade in the forex market, and you don't need to be in front of the screen all day to be a profitable investor. I know trading the forex market can be a rewarding occupation; you need no special skills or natural talents to become a successful trader. You could use, the forex market, to complement your salary or as your main source of income. I hope this was helpful information!!! FREE Trading System!
Beating Your Emotions in Forex Trading
http://bit.ly/J8aLKf
The psychology of Forex is an important element of trading currencies and your emotions will certainly affect the way you trade and invest, in the Forex market. Although embracing the psychology of Forex trading is important too, sometimes you just want to beat your emotions - or at least minimize them as much as you can. Although humans have many emotions, the two most destructive emotions in currency trading, are greed and fear. If you're profiting, you can get greedy and when you're losing, you can get fearful. However, in both cases, if you do succumb to these emotions you will most likely lose everything. All Forex traders and investors have emotions. The difference between successful currency traders and ones that fail, is that successful ones know how to control their emotions effectively. Remember, currency trading psychology is only one aspect of trading currencies; hard work is ultimately required, to succeed in the currency market. However, psychology is important too in currency trading and if you can control your emotions effectively, you will a greater chance of profiting consistently in the long run. Firstly, make sure that you have a good Forex trading plan and you remain disciplined with it. Adopt good money and risk management within the plan too and stay consistent with the techniques you choose. Money management techniques such as protective stops should be used. A Forex trading system is a must, if you want to take currency trading seriously and ensure your long-term success in the FX market. Your system will be individual to you and will include your Forex trading strategy. You must follow the Forex trading rules that are laid down in your system and again, you must stay both disciplined and consistent with your system. Don't trade Forex all the time - this links in with your Forex trading strategy and system, in fact. The Forex market is volatile and doesn't move in straight trend lines, so understand this and don't trade currencies all the time; be aware of the fact that retracements can occur in the currency market. If you are new to currency trading, then focus on long-term investments - place long-term orders. It's better to trade a trending market than a indecisive one. In conclusion, there are many ways in which you can limit and beat your emotions in Forex trading, including: having a good trading plan, having a good trading system and knowing when to trade, as well as when not to. At the end of the day, if you want to beat Forex trading psychology, you need to focus on staying disciplined and consistent. This way, you will consistently make rational decisions and you will remain calm, which is exactly what you are looking for. Remember, no matter how successful you become in the FX market, your emotions will always be there, but as long as you learn and know how to control them then you needn't worry about them. In fact, you will probably eventually embrace them, as your emotions will keep you interested. FREE Trading System!
http://bit.ly/J8aLKf
The psychology of Forex is an important element of trading currencies and your emotions will certainly affect the way you trade and invest, in the Forex market. Although embracing the psychology of Forex trading is important too, sometimes you just want to beat your emotions - or at least minimize them as much as you can. Although humans have many emotions, the two most destructive emotions in currency trading, are greed and fear. If you're profiting, you can get greedy and when you're losing, you can get fearful. However, in both cases, if you do succumb to these emotions you will most likely lose everything. All Forex traders and investors have emotions. The difference between successful currency traders and ones that fail, is that successful ones know how to control their emotions effectively. Remember, currency trading psychology is only one aspect of trading currencies; hard work is ultimately required, to succeed in the currency market. However, psychology is important too in currency trading and if you can control your emotions effectively, you will a greater chance of profiting consistently in the long run. Firstly, make sure that you have a good Forex trading plan and you remain disciplined with it. Adopt good money and risk management within the plan too and stay consistent with the techniques you choose. Money management techniques such as protective stops should be used. A Forex trading system is a must, if you want to take currency trading seriously and ensure your long-term success in the FX market. Your system will be individual to you and will include your Forex trading strategy. You must follow the Forex trading rules that are laid down in your system and again, you must stay both disciplined and consistent with your system. Don't trade Forex all the time - this links in with your Forex trading strategy and system, in fact. The Forex market is volatile and doesn't move in straight trend lines, so understand this and don't trade currencies all the time; be aware of the fact that retracements can occur in the currency market. If you are new to currency trading, then focus on long-term investments - place long-term orders. It's better to trade a trending market than a indecisive one. In conclusion, there are many ways in which you can limit and beat your emotions in Forex trading, including: having a good trading plan, having a good trading system and knowing when to trade, as well as when not to. At the end of the day, if you want to beat Forex trading psychology, you need to focus on staying disciplined and consistent. This way, you will consistently make rational decisions and you will remain calm, which is exactly what you are looking for. Remember, no matter how successful you become in the FX market, your emotions will always be there, but as long as you learn and know how to control them then you needn't worry about them. In fact, you will probably eventually embrace them, as your emotions will keep you interested. FREE Trading System!
Tuesday, May 15, 2012
Trading Forex With Interest Rates
http://bit.ly/KqyeFL
Some economic announcements are known for their immediate impact on the currency markets. One of these announcements is interest rates. Typically, countries with higher interest rates are more likely to attract foreign investors as they can expect a higher return on their investment than they could expect should they invest locally. As currencies are traded in pairs, this means that the currencies of countries with higher rates can often rise against those with lower rates. So why do interest rates rise? If an economy is doing well, growth is rising and unemployment is going down, with consumers spending more of their money. This starts to boost inflation as the demand for goods increases. As the role of central banks is to maintain a certain rate of inflation, central bankers begin raising interest rates to reduce consumers' disposable income, which in turn slows the rate of inflation. Interest rates significantly contribute to the fundamental value of currencies - as stated above, higher rates attract foreign investment, and this increases external demand for the currency. At the same time, when central banks pump rates up it has the same impact as withdrawing funds from the economy, which further reduces supply and increases demand for the supply that remains. And, as in any market, higher demand and lower supply puts upward pressure on the price of that currency. Central banks can also create a reverse scenario by lowering rates. If an economy is doing badly with stalling growth and rising unemployment, consumers are more conservative with their money. When the central banks lower interest rates, it is in the hope that consumers, who have extra cash now that their mortgage repayments aren't so high, will start spending that extra money and give the economy a boost. However, this also causes foreign interest in the currency to fall, because the return on their investment isn't as high, which means that sellers start to outnumber buyers and the value of the currency starts to fall. This makes rates and rate announcements an essential point of research for anyone interested in forex trading . However, although these rules may hold up in 'normal' economic conditions, there are often exceptions, where a currency with a lower rate may outperform one with a higher rate. For instance, if an interest rate is rising due to concerns in the market about credit risk in an economy, then that currency is likely to fall, regardless of the central bank rate. In Australia, the AUD has benefitted from relatively high interest rates since the global economic crisis. However, if rate cuts continue it could become more vulnerable. FREE Trading System!
http://bit.ly/KqyeFL
Some economic announcements are known for their immediate impact on the currency markets. One of these announcements is interest rates. Typically, countries with higher interest rates are more likely to attract foreign investors as they can expect a higher return on their investment than they could expect should they invest locally. As currencies are traded in pairs, this means that the currencies of countries with higher rates can often rise against those with lower rates. So why do interest rates rise? If an economy is doing well, growth is rising and unemployment is going down, with consumers spending more of their money. This starts to boost inflation as the demand for goods increases. As the role of central banks is to maintain a certain rate of inflation, central bankers begin raising interest rates to reduce consumers' disposable income, which in turn slows the rate of inflation. Interest rates significantly contribute to the fundamental value of currencies - as stated above, higher rates attract foreign investment, and this increases external demand for the currency. At the same time, when central banks pump rates up it has the same impact as withdrawing funds from the economy, which further reduces supply and increases demand for the supply that remains. And, as in any market, higher demand and lower supply puts upward pressure on the price of that currency. Central banks can also create a reverse scenario by lowering rates. If an economy is doing badly with stalling growth and rising unemployment, consumers are more conservative with their money. When the central banks lower interest rates, it is in the hope that consumers, who have extra cash now that their mortgage repayments aren't so high, will start spending that extra money and give the economy a boost. However, this also causes foreign interest in the currency to fall, because the return on their investment isn't as high, which means that sellers start to outnumber buyers and the value of the currency starts to fall. This makes rates and rate announcements an essential point of research for anyone interested in forex trading . However, although these rules may hold up in 'normal' economic conditions, there are often exceptions, where a currency with a lower rate may outperform one with a higher rate. For instance, if an interest rate is rising due to concerns in the market about credit risk in an economy, then that currency is likely to fall, regardless of the central bank rate. In Australia, the AUD has benefitted from relatively high interest rates since the global economic crisis. However, if rate cuts continue it could become more vulnerable. FREE Trading System!
Find Your Risk Comfort Zone
http://bit.ly/KY9MZ3
Are you trading within your means? In today's volatile markets, the price range of a single day's trading can be quite large. If you are trading wisely, you are defining your risk exposure before you place your trade, and usually this is done by using a stop-loss. But where are you placing your stop-loss? What are you using to define your risk exposure? At the very least, you may be using the range of previous day's price action as your allotted risk. For example, if you are entering the market LONG (buying) when price moves above the high of the previous day, perhaps your stop-loss is placed just below the low of the previous day, or current day if lower. The logic behind this is that if you are going LONG (buying), you expect current lows to hold and are hoping for higher-highs to be made instead. Unfortunately, some accounts are not large enough to handle the risk exposure some markets would present when using a complete day's trading range. How much might one consider risking on any given trade? Well, to answer this question requires several variables, including the win/loss ratio of the methods used, the gain/loss per trade averages, and what you can psychologically handle. This is clearly going to be different for each trader. W. D. Gann advocated risking no more than 10% of the account on any given trade. Well, that may work well for someone of W. D. Gann's caliber, but it may not be for you. For ANY person, however, the amount should NEVER be more than 10% and more likely should be LESS. Simple math will help you determine whether your wins vs. losses and the average profit and average loss numbers will put you ahead if you divide your account by 10 or 20 equal size chunks to risk. But math will NOT have any bearing on the psychological variable that should be addressed. Suppose that trading one contract of a certain market, say Soybeans, would require that you risk 10% or so of your account. If the market moves against you, say 50-75% of the total risk amount, leaving you with just 25% from being stopped out, would you start to feel uneasy? Do you find thoughts starting to flood your mind about possibly getting out now rather than losing the whole 100% of the risk amount, or debating with yourself as to what to do next? The real measure of whether you are trading within your psychological comfort zone is if you look at the trade in negative territory, not yet at your stop-loss, and feel indifferent about it. If it gets stopped-out, not a problem. If it is not stopped-out, great. It does not matter how large or small your trading account is. What does matter is the amount you are risking in relation to the size of your account. Your account may statistically be large enough to handle the risk of one or more contracts. Yet, if you start feeling some discomfort or pain when the market does not immediately move in your favor, that is an indication that you need to SCALE DOWN your trade size to a more manageable level. What prevents some traders from doing this and therefore not only enduring unnecessary discomfort but unnecessary losses or lost opportunities for gain? GREED first...then FEAR! The GREED factor comes into play when a trader is so sure of the trade he/she is entering and wants to get the maximum profit in the shortest amount of time, that a position is put on that is really larger than should be put on. Thoughts of big profits cloud better judgement, and once the trade is on and moves in the direction the trader does not like, the mounting unrealized losses start to cause the trader to feel FEAR. At this point, judgement is clouded and the wrong decisions are most like going to be made at the wrong time. GREED is destructive to a trading account.
FEAR is destructive to a trading account and trader's psychology now and for future trades. What would you rather have: A. An account that slowly grows and grows, month-after-month. B. An account that quickly gets wiped out because lots of chances are being taken to make the big killing in trades. At the end of the trip, I'm sure you would want to be in the green and playing on the green, rather than in the red and your account is dead. Okay, so you have decided that you are going to control your GREED and FEAR by trading more manageable lots. But what if the trade setups seem to produce too much risk for even just one contract for the size of account you have? Today, there are several markets that you can trade MINI lots. Currencies, grains, metals, indexes and others have MINI-sized contracts. Of course some are less liquid than others and may be much less than the full-size contract. However, there is enough liquidity in many of these to make it worth looking into. Now, if your mind is immediately thinking that you will not get as big a bang per tick using a MINI as the regular size contracts and that starts to bother you, you are already falling back to the original problem of GREED. Of course a single contract in Soybeans might move 15, 20 or 30 cents in a day (at $50 per one-cent move) that equates to anywhere from $750, $1000 and $1500 per contract (respectively) in a single day. But keep in mind that if the market moves against you, that amount is what you have to endure as a potential loss. But if you were to trade the Soybeans MINI contract, which is one-fifth the size at just $10 per one-cent move, then you're looking at daily moves of $150, $200 and $300 per day. If you cannot feel calm about a move against your account of just $300, then your trading account is seriously too small for trading and you should consider adding additional funds before you do any trades. The point is that you must find YOUR comfort level. You must discover how much draw down you can have that does not make you concerned at all. If you start to feel a little tinge at some loss amount in respects to your account size, note the percentage of your account that the loss represents and LOWER it by at least 1 percent as your comfort ratio. Then DO NOT exceed that ratio at any time for all future trades. FREE Trading System!
http://bit.ly/KY9MZ3
Are you trading within your means? In today's volatile markets, the price range of a single day's trading can be quite large. If you are trading wisely, you are defining your risk exposure before you place your trade, and usually this is done by using a stop-loss. But where are you placing your stop-loss? What are you using to define your risk exposure? At the very least, you may be using the range of previous day's price action as your allotted risk. For example, if you are entering the market LONG (buying) when price moves above the high of the previous day, perhaps your stop-loss is placed just below the low of the previous day, or current day if lower. The logic behind this is that if you are going LONG (buying), you expect current lows to hold and are hoping for higher-highs to be made instead. Unfortunately, some accounts are not large enough to handle the risk exposure some markets would present when using a complete day's trading range. How much might one consider risking on any given trade? Well, to answer this question requires several variables, including the win/loss ratio of the methods used, the gain/loss per trade averages, and what you can psychologically handle. This is clearly going to be different for each trader. W. D. Gann advocated risking no more than 10% of the account on any given trade. Well, that may work well for someone of W. D. Gann's caliber, but it may not be for you. For ANY person, however, the amount should NEVER be more than 10% and more likely should be LESS. Simple math will help you determine whether your wins vs. losses and the average profit and average loss numbers will put you ahead if you divide your account by 10 or 20 equal size chunks to risk. But math will NOT have any bearing on the psychological variable that should be addressed. Suppose that trading one contract of a certain market, say Soybeans, would require that you risk 10% or so of your account. If the market moves against you, say 50-75% of the total risk amount, leaving you with just 25% from being stopped out, would you start to feel uneasy? Do you find thoughts starting to flood your mind about possibly getting out now rather than losing the whole 100% of the risk amount, or debating with yourself as to what to do next? The real measure of whether you are trading within your psychological comfort zone is if you look at the trade in negative territory, not yet at your stop-loss, and feel indifferent about it. If it gets stopped-out, not a problem. If it is not stopped-out, great. It does not matter how large or small your trading account is. What does matter is the amount you are risking in relation to the size of your account. Your account may statistically be large enough to handle the risk of one or more contracts. Yet, if you start feeling some discomfort or pain when the market does not immediately move in your favor, that is an indication that you need to SCALE DOWN your trade size to a more manageable level. What prevents some traders from doing this and therefore not only enduring unnecessary discomfort but unnecessary losses or lost opportunities for gain? GREED first...then FEAR! The GREED factor comes into play when a trader is so sure of the trade he/she is entering and wants to get the maximum profit in the shortest amount of time, that a position is put on that is really larger than should be put on. Thoughts of big profits cloud better judgement, and once the trade is on and moves in the direction the trader does not like, the mounting unrealized losses start to cause the trader to feel FEAR. At this point, judgement is clouded and the wrong decisions are most like going to be made at the wrong time. GREED is destructive to a trading account.
FEAR is destructive to a trading account and trader's psychology now and for future trades. What would you rather have: A. An account that slowly grows and grows, month-after-month. B. An account that quickly gets wiped out because lots of chances are being taken to make the big killing in trades. At the end of the trip, I'm sure you would want to be in the green and playing on the green, rather than in the red and your account is dead. Okay, so you have decided that you are going to control your GREED and FEAR by trading more manageable lots. But what if the trade setups seem to produce too much risk for even just one contract for the size of account you have? Today, there are several markets that you can trade MINI lots. Currencies, grains, metals, indexes and others have MINI-sized contracts. Of course some are less liquid than others and may be much less than the full-size contract. However, there is enough liquidity in many of these to make it worth looking into. Now, if your mind is immediately thinking that you will not get as big a bang per tick using a MINI as the regular size contracts and that starts to bother you, you are already falling back to the original problem of GREED. Of course a single contract in Soybeans might move 15, 20 or 30 cents in a day (at $50 per one-cent move) that equates to anywhere from $750, $1000 and $1500 per contract (respectively) in a single day. But keep in mind that if the market moves against you, that amount is what you have to endure as a potential loss. But if you were to trade the Soybeans MINI contract, which is one-fifth the size at just $10 per one-cent move, then you're looking at daily moves of $150, $200 and $300 per day. If you cannot feel calm about a move against your account of just $300, then your trading account is seriously too small for trading and you should consider adding additional funds before you do any trades. The point is that you must find YOUR comfort level. You must discover how much draw down you can have that does not make you concerned at all. If you start to feel a little tinge at some loss amount in respects to your account size, note the percentage of your account that the loss represents and LOWER it by at least 1 percent as your comfort ratio. Then DO NOT exceed that ratio at any time for all future trades. FREE Trading System!
Monday, May 14, 2012
Design a Trading Strategy
http://bit.ly/LIEPdK
One binding aspect typifies 99% of the trading strategies that we develop. The finished product does not stay completely true to the initial design. All development projects go forward in one of two ways. You can either pursue a task from the peak to the bottom, or you can build from down to up. The former alternative represents the old way of thinking, especially within higher education. When professors assign homework, the requirements never change. The project remains unchanging. Reality hardly ever cooperates like that. Instead, people change their minds. They watch the work underway and decide that a minor tweak might dramatically change the outcome. The expert advisor programmer is forced to constantly accommodate to the shifting goal posts. I repeatedly tell clients that they will alter their minds about a number of the rules during the process. Many stand firm that they will not. The clients do, naturally, predict that the conditions will work. Then, the rules surely change for nearly all of them. Theory goes out the window. The traders ascertain the real issues that expert advisors grapple with in the market. Coders created a new methodology to adapt to the regularly shifting rules. It's called agile development. This issue does not only take place with Forex traders. It also happens to businesses developing web sites, database programmers saving data, and in effect any project that involves human beings. People are prone to changing their minds. It's our condition. Agile development is the programmer's acknowledgement that getting upset at clients for changing their minds is not practical. The agile blueprint segments a project into time periods with an arranged list of goals. The crew decides which goals are most important and achievable within the allocated window. The window starts and everyone rushes to create as much code as possible. Everyone regroups after 2-6 weeks to rank the progress and to transmit the updated version to the client. Most expert advisor tasks only span a few weeks, so an exact replication of the agile blueprint would not adjust very well with creating a trading strategy. We throw the strategy development approach on its head by assigning sorted goals with a cutoff of 1-2 business days. The goal is to expedite communication, which is inevitably the most difficult obstacle in this field. We also make the evolution less established to expedite things along. The speedy answers suggest a succession of yes/no responses. The customer either gets fired up that it works properly, or more presumably, feels that we did not interpret him correctly. The truthful goal of this strategy is to get the user away from going over the concept for the 1,000th time in the same, identical way. The previous explanation did not help the plan move along. Consumer comments from functioning software guides the programmer into comprehending the thought on his own without making the client feel like he's echoing himself. I like to think of it as the consumer steering the driver's wheel while the programmer controls the gas pedal. The strategy development process only works when the steering and power move in synch. Overcoming expert advisor programming challenges When consumers feel like an expert advisor has not made the desired progress, the first step is to assign goals one at a time. Too often, we receive reports with 20 different bugs. The emphasis on priority falls away as the desire to "fix everything and fix it now" drowns out the details of each request. I always like to take a step back and reaffirm our commitment to developing the strategy, but we can only handle so many issues at a time. I have a very patient client in New Jersey (I never though I'd say "patient" and "New Jersey" in the same sentence") who ordered a lot of custom elements in a basic expert advisor. Most of the complications arose from the fact that I had to remotely access his computer with LogMeIn to do the programming. His indicator only has one license. Purchasing a second for the expert advisor programming was not economical. The requirements to remotely access the computer and the amount of custom code turned a simple plan into a complicated one. The way I addressed the issue was to remove almost all of the custom components and to replace them with code from our usual template. Now that the customer sees that the "strategy" stuff works, he found it much easier to write a checklist of bugs to fix. More importantly, seeing critical components of the code working reinforced his confidence in the company's programming ability. Although he remained patient throughout the debugging process, I could hear the flagging confidence in his voice before we switched gears. Changing the direction of the project showed him that the expert advisor actually does work; it's the little pieces and how they fit together that are the problem. Of equal importance was the fact that he felt confident in my ability to deliver the results that he wants. The client gets full credit for releasing control of the debugging process, even when he wasn't entirely comfortable doing so. The notion of papering over the custom steps with pre-programmed template code struck him as a step backwards. He nonetheless followed the programmer's lead, letting him drive the process with himself providing feedback where it was needed. Both parties agree that we're once again heading in the right direction. The consumer sees obvious progress in his expert advisor. The programmer is able to manage the debugging process in a methodical, organized manner. Everyone is happy. Realistic strategy development The most realistic way to develop a strategy is to acknowledge that you don't exactly know where you're going. You know it's likely to involve a certain indicator and that it either trends or ranges. The best way to get ready for the journey is to acknowledge in advance that it is indeed a journey. You more than likely will make changes, most of which you cannot expect. It's 100% certain that something is going to go wrong when you program your first vision. It's your strategy, but it's really a two-man team that builds it. Make sure to pick someone that knows what do when problems come up. Before you make a choice of your programming partner, be sure it's someone that you genuinely trust to get the task done. You definitely want to work with someone that offers excellent communication skills and knows the importance of a timely response. Organizing the vision and overcoming unanticipated challenges assists everyone get back to their true passion of trading. FAP Turbo Here!
http://bit.ly/LIEPdK
One binding aspect typifies 99% of the trading strategies that we develop. The finished product does not stay completely true to the initial design. All development projects go forward in one of two ways. You can either pursue a task from the peak to the bottom, or you can build from down to up. The former alternative represents the old way of thinking, especially within higher education. When professors assign homework, the requirements never change. The project remains unchanging. Reality hardly ever cooperates like that. Instead, people change their minds. They watch the work underway and decide that a minor tweak might dramatically change the outcome. The expert advisor programmer is forced to constantly accommodate to the shifting goal posts. I repeatedly tell clients that they will alter their minds about a number of the rules during the process. Many stand firm that they will not. The clients do, naturally, predict that the conditions will work. Then, the rules surely change for nearly all of them. Theory goes out the window. The traders ascertain the real issues that expert advisors grapple with in the market. Coders created a new methodology to adapt to the regularly shifting rules. It's called agile development. This issue does not only take place with Forex traders. It also happens to businesses developing web sites, database programmers saving data, and in effect any project that involves human beings. People are prone to changing their minds. It's our condition. Agile development is the programmer's acknowledgement that getting upset at clients for changing their minds is not practical. The agile blueprint segments a project into time periods with an arranged list of goals. The crew decides which goals are most important and achievable within the allocated window. The window starts and everyone rushes to create as much code as possible. Everyone regroups after 2-6 weeks to rank the progress and to transmit the updated version to the client. Most expert advisor tasks only span a few weeks, so an exact replication of the agile blueprint would not adjust very well with creating a trading strategy. We throw the strategy development approach on its head by assigning sorted goals with a cutoff of 1-2 business days. The goal is to expedite communication, which is inevitably the most difficult obstacle in this field. We also make the evolution less established to expedite things along. The speedy answers suggest a succession of yes/no responses. The customer either gets fired up that it works properly, or more presumably, feels that we did not interpret him correctly. The truthful goal of this strategy is to get the user away from going over the concept for the 1,000th time in the same, identical way. The previous explanation did not help the plan move along. Consumer comments from functioning software guides the programmer into comprehending the thought on his own without making the client feel like he's echoing himself. I like to think of it as the consumer steering the driver's wheel while the programmer controls the gas pedal. The strategy development process only works when the steering and power move in synch. Overcoming expert advisor programming challenges When consumers feel like an expert advisor has not made the desired progress, the first step is to assign goals one at a time. Too often, we receive reports with 20 different bugs. The emphasis on priority falls away as the desire to "fix everything and fix it now" drowns out the details of each request. I always like to take a step back and reaffirm our commitment to developing the strategy, but we can only handle so many issues at a time. I have a very patient client in New Jersey (I never though I'd say "patient" and "New Jersey" in the same sentence") who ordered a lot of custom elements in a basic expert advisor. Most of the complications arose from the fact that I had to remotely access his computer with LogMeIn to do the programming. His indicator only has one license. Purchasing a second for the expert advisor programming was not economical. The requirements to remotely access the computer and the amount of custom code turned a simple plan into a complicated one. The way I addressed the issue was to remove almost all of the custom components and to replace them with code from our usual template. Now that the customer sees that the "strategy" stuff works, he found it much easier to write a checklist of bugs to fix. More importantly, seeing critical components of the code working reinforced his confidence in the company's programming ability. Although he remained patient throughout the debugging process, I could hear the flagging confidence in his voice before we switched gears. Changing the direction of the project showed him that the expert advisor actually does work; it's the little pieces and how they fit together that are the problem. Of equal importance was the fact that he felt confident in my ability to deliver the results that he wants. The client gets full credit for releasing control of the debugging process, even when he wasn't entirely comfortable doing so. The notion of papering over the custom steps with pre-programmed template code struck him as a step backwards. He nonetheless followed the programmer's lead, letting him drive the process with himself providing feedback where it was needed. Both parties agree that we're once again heading in the right direction. The consumer sees obvious progress in his expert advisor. The programmer is able to manage the debugging process in a methodical, organized manner. Everyone is happy. Realistic strategy development The most realistic way to develop a strategy is to acknowledge that you don't exactly know where you're going. You know it's likely to involve a certain indicator and that it either trends or ranges. The best way to get ready for the journey is to acknowledge in advance that it is indeed a journey. You more than likely will make changes, most of which you cannot expect. It's 100% certain that something is going to go wrong when you program your first vision. It's your strategy, but it's really a two-man team that builds it. Make sure to pick someone that knows what do when problems come up. Before you make a choice of your programming partner, be sure it's someone that you genuinely trust to get the task done. You definitely want to work with someone that offers excellent communication skills and knows the importance of a timely response. Organizing the vision and overcoming unanticipated challenges assists everyone get back to their true passion of trading. FAP Turbo Here!
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