Still dropping... Keep going guys! So glad I did not take the losses. Hopefully they go into profit soon!
Still holding GBP/USD. Half way there!
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Free registration at the forum removes this block.Still dropping... Keep going guys! So glad I did not take the losses. Hopefully they go into profit soon!
I mentioned something aboutWhy did you delete the post? Sorry I didn't have time to reply. I have a lot going on right now
I was drawn to fx because of the market availability and leverage options... Stock market doesn't come close on either aapect
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Interesting article which discuss if trading psychology is only for gays and women http://www.decisiveinvesting.com/blog/emotional-control/is-trading-psychology-for-gays-only/
Its not a loss till its closed
EUR/USD finally went positive for me yesterday after approximately one month of holding this trade. This was the longest I have ever held a trade before. After seeing numbers like -$600 I feel like nothing can phase me anymore. I feel rejuvenated in trading and almost a sense of comfort now. I looked back at all my old trades and realized if I had held all of them instead of panicking and taking loses, all of them could have easily been winners.
I just want to give a shout out to @CarrieW, who help me stay strong and gave me confidence to keep going. I like how you put smiley face icons even when you are down in negative profits and make trading feel fun and light. And a quote that stuck out to me most
This.
Still stuck in a negative trade with GBP/USD, -700pips. But I am not as concerned anymore
Good to hear that you didn't understand all of it. Someone has to provide capital for winners!I don't know which part of the article upset me most
If you trade a system that will allow, say, -500 pip loss to get a +50 pip gain, it will win 99% of the time. You can compound your profits and make a lot of money. Until you take the 500 pip loss, and lose all your profit. Unless you took money off the table, and out of the game, you will eventually lose. This strategy is what all the Forex bots, grid traders, and carry traders use.
There are two ways to trade. Make a lot of little wins, and take the occasional massive loss (described above), OR take a lot of little losses and make the occasional home run (as trend traders do).
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The method you described is how I got wiped out in 2008, except I was doing carry trades. I was making the interest differential between the two currencies as I waited for a loser to turn in to a winner. The system had +100 pip take-profit, and unlimited loss. I was only initially betting .5% of my account. I was making winning trades for months. The only way I could lose was if there was some kind of worldwide financial calamity. Which is exactly what happened.
http://www.investopedia.com/articles/forex/09/credit-crisis-carry-trade.asp
I'm not saying you should avoid your method of trading, but just be aware of how you can be hurt. There will always be a "black-swan-event" where the trade just keeps going and going and going against you. If you've banked sufficient profits before that happens, you will be fine.
It is true that you don't take losses until a trade is closed, but you also don't take real profits until they are removed from the game.
Trend-trading is not necessarily better. Plenty of trend-traders "die of a thousand cuts" while waiting for their "home run", they just tend to be more aware of their losses because they are constantly taking them.
Good to hear that you didn't understand all of it. Someone has to provide capital for winners!
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