Decision-making error - page 3
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The thing is that everything is right, and I understand that fear is irrational, but perhaps Forex is only for the wealthy?
After all, testing yourself in the real world without correcting your current financial situation can lead to a heart attack, and I think Novopasit is no help.
The thing is that everything is right, and I understand that fear is irrational, but perhaps Forex is only for the wealthy?
After all, testing yourself in the real world without correcting your current financial situation can lead to a heart attack, and I think Novopasit won't help.
And here you're wrong too. Of course, you don't have to trade on your last penny when you literally have nothing to eat. But I know two people in real life who have been lifted out of poverty by trading. And without any loans or other help. For one of them it took 7 years and the other 10.
Once again I show you the way to get rid of "irrational fear". Strict TC. And ironclad adherence to it. At the same time you will be prepared that part of the deposit will be spent on "terminal slump" when the TS stops working.
Psychology has no place in trading. Repeatedly tested by many people.
You are wrong. I've seen a TS that has a TP/SL ratio of 1/10 working for almost a year now.
I've also seen a TS with a 5/1 ratio which also works.
Here it is important to compare this ratio with the percentage of winning trades. But in general, all other things being equal, more reliable are considered those TSs with the ratio greater than three.
Try to flip a coin and use it to enter on a liquid pair, the only condition: stop/profit (1/3), risk of loss on a deal of 2%, stops not exceeding 30pp. You won't be surprised, but you won't lose your account that fast, it will even grow.
And if you enter by any signals in this way, the account will only grow.
The problem is that initially the accounts are not that big, they are about $100-300. The risk when opening a trade is overestimated, the stop is far away, the profit is closed at the first price fart on a pullback, and is 5-15pp. When you open the next position, the stop again far, the price immediately begins to go to stop, to close Breakeven is no longer possible, you sit and wait at least +1pp, but it does not, the price is closer and closer to the stop, the deposit is melting like snow, to close a small loss faith does not allow, sitting and crying in the monitor to the chart "Come on, come on, more well, turn around ..." Catch or large stop at unintended risk or stop transferred further, hoping to reverse, but no reversal.
As a result, the first plus position gave 10pp, and the second minus position either took the whole account, or still reason won, and caught a big moose in half the depo. But it is not so comfortable to trade with half of the initial amount. Then the second series begins, the risk increases, as if now I will repay everything. But the market does not oblige to pay off, and if it does, then mainly the trader's common sense and his deposit to his side.
My point is that you do not have to sit and stare at the monitor from morning till night, watching every tick of price and close position at every opportunity. It is like always, you close 10-15pp, but price keeps moving in the same direction, but without you. You open again and again a big haul, as a result, 3-5 trades, and the deposit is empty, 1-2 profitable, and a couple of losses that have eaten everything.
I remember as I am now, I went to the office to attend a seminar, after the seminar I deposited $100 to my account. I opened my position with 0.1 lot at about 15-16th hour and almost 0 on my deposit was left at 23rd hour. The price has passed 10-15 points and changed its direction, I almost cried.
I had a little bit more money, I had to pay again, I had very small amount of it (they were shitting me), I had 150$, deposit lasted about a week, but not as much. I was taking more risks, I was trading all night and I remember 120pp movement per minute with Aussie news, it was night, I opened position before the news, I closed with 100pp, it was a victory. Lot big, profit huge, the next couple of days the account was drained. Clearly followed the adage "The brakes were invented by cowards". I almost cried again.
Next a lot of reading, I stubbornly wanted to be in forex, but not as an observer, but as an earner. I tried again, demo account was not interesting, I could not withdraw money from it and my psychology was not improved. I replenished funds again, but by the time I found out that MT4 was available and that it had Expert Advisors. I started to gradually learn the programming language, wrote all sorts of things, tried to test it on the real account and gradually my account started to breathe, but there was no growth.
I decided to go deeper into programming and earn money from there. I have learned 5 languages, a lot of frameworks, worked and continue to work as a freelancer, but now I earn less and less.
Further writing all sorts of Expert Advisors has shown that if stoploss/takeprofit is below 1/2, then this kind of trading has no place in the future. I have been trading for a very long time now, I am not depositing to my account, I am only withdrawing from it.
The moral is: treat the market like a job at your company. Do not read analytics, especially when broker or brokerage company gives them, do not listen to anyone, search for signals in your TS, analyze the situation, watch the news the whole day, it is also important, then open a position and that's all, then you just do not move the stop, do not close the position at the first tick against the position, do not spend hours in the monitor, mind your business - you are in the market and trade. Take a loss as a cost of doing business. Do not overestimate the risks, I do not know of any successful long-term trading ideas, where the risk per trade exceeds 10% of the deposit. Calculate in advance not the profit, but the loss, because when you get a profit, you do not have to look too hard, but when you get a loss, it usually surprises you with its amount.
Take the market for what it is, the market moves where the money is, first collecting stops, then building up positions again and going after the stops. How do you determine where not to place stops or enter the market? Develop your own TS or use a ready-made one.
Try to flip a coin and use it to enter on a liquid pair, the only condition: stop/profit (1/3), risk of loss per trade 2%, stops no more than 30pp. You won't be surprised, but you won't lose your account that fast, it will even grow.
And if you enter by any signals in this way, the account will only grow.
The problem is that initially the accounts are not that big, they are about $100-300. The risk when opening a trade is overestimated, the stop is far away, the profit is closed at the first price fart on a pullback, and is 5-15pp. When you open the next position, the stop again far, the price immediately begins to go to stop, to close Breakeven is no longer possible, you sit and wait at least +1pp, but it does not, the price is closer and closer to the stop, the deposit is melting like snow, to close a small loss faith does not allow, sitting and crying in the monitor to the chart "Come on, come on, more well, reverse ..." You catch or a large stop at unintended risk or stop transferred further, hoping for a reversal, but no reversal.
As a result, the first plus position gave 10pp, and the second minus position either took the whole account, or still reason won, and caught a big moose in half the depo. But it is not so comfortable to trade with half of the initial amount. Then the second series begins, the risk increases, as if now I will repay everything. But the market does not oblige to pay off, and if it does, then mainly the trader's common sense and his deposit to his side.
My point is that you do not have to sit and stare at the monitor from morning till night, watching every tick of price and close position at every opportunity. It is always possible to close 10-15pp, but price keeps moving in the same direction, but without you. You open again and again a big haul, as a result, 3-5 trades, and the deposit is empty, 1-2 profitable, and a couple of losses that have eaten everything.
I remember as I am now, I went to the office to attend a seminar, after the seminar I deposited $100 to my account. I opened my position with 0.1 lots at about 15-16th hour and approximately 23rd hour my deposit was almost "zero". The price has passed 10-15 points and changed its direction, I almost cried.
I had a little bit more money, I had to pay again, I had very small amount of it (they were shitting me), I had 150$, deposit lasted about a week, but not as much. I was taking more risks, I was trading all night and I remember 120pp movement per minute with Aussie news, it was night, I opened position before the news, I closed with 100pp, it was a victory. Lot big, profit huge, in the next couple of days the account was drained. Clearly followed the adage "The brakes were invented by cowards". I almost cried again.
Next a lot of reading, I stubbornly wanted to be in forex, but not as an observer, but as an earner. I tried again, demo account was not interesting, I could not withdraw money from it and my psychology was not improved. I replenished funds again, but by the time I found out that MT4 was available and that it had Expert Advisors. I started to gradually learn the programming language, wrote all sorts of things, tried to test it on the real account and gradually my account started to flourish, but there was no growth.
I decided to go deeper into programming and earn money from there. I have learned 5 languages, a lot of frameworks, worked and continue to work as a freelancer, but now I earn less and less.
Further writing all sorts of Expert Advisors has shown that if stoploss/takeprofit is below 1/2, then this kind of trading has no place in the future. I have been trading for a very long time now, I am not depositing to my account, I am only withdrawing from it.
The moral is: treat the market like a job at your company. Do not read analytics, especially when broker or brokerage company gives them, do not listen to anyone, search for signals in your TS, analyze the situation, watch the news the whole day, it is also important, then open a position and that's all, then you just do not move the stop, do not close the position at the first tick against the position, do not spend hours in the monitor, mind your business - you are in the market and trade. Take a loss as a cost of doing business. Do not overestimate the risks, I do not know of any successful long-term trading ideas, where the risk per trade exceeds 10% of the deposit. Calculate in advance not the profit, but the loss, because when you get a profit, you do not have to look too hard, but when you get a loss, it usually surprises you with its amount.
Take the market for what it is, the market moves where the money is, first collecting stops, then building up positions again and going after the stops. How do you determine where not to place stops or enter the market? Develop your own TS or use a ready-made one.
Try to flip a coin and use it to enter on a liquid pair, the only condition: stop/profit (1/3), risk of loss per trade 2%, stops no more than 30pp. You won't be surprised, but you won't be able to drain your account that fast, it will even grow.
No it won't. Your account will not grow. It will slowly and surely decrease. But, you're right, it's not going to go down instantly.
That is, it once again proves my words - WEAK TS !!! Even if it is based on a coin - even in this case, the plum turns out to be long and difficult.
The problem is that initially the accounts are not that big, they are on the order of 100-300$.
And what's so terrible about it? You can get 100% in a year, even for a beginner. Next year you'll already have $200, in 2 years - $400, 14 years is quite realistic to get to a million. I would still increase the initial capital somewhat, I think even $1000 - is quite within the power to earn almost any beginner. And then the million will be much closer.
But again - only a TS!!!
The risk at the opening of the trade is overestimated, the stop is far away, the profit is closed at the first price farthing on a pullback, and is 5-15pp. When you open the next position, the stop again far, the price immediately begins to go to the stop, to close Breakeven is no longer possible, you sit and wait at least +1pp, but it is not there, the price is closer and closer to the stop, the deposit is melting like snow, to close a small loss faith does not allow, sitting and crying in the monitor to the graph "come on, come on, more well, reverse ..." Catch or large stop at unintended risk or stop transferred further, hoping for a reversal, but no reversal.
As a result, the first plus position gave 10pp, and the second minus position either took the whole account, or still reason won, and caught a big moose in half the depo. But it is not convenient to trade with an amount half of the initial one. Then the second series begins, the risk increases, as if now I will repay everything. But the market does not have to repay, and if it does, then mainly the trader's common sense and his/her deposit to his/her side.
Exactly. Typical scenario a la Danik.
And I immediately have a question - what does "the risk of the trade is too high" mean ? What does it mean "stop far away" ? What does "profit is closing on a pullback" mean? As I understand, people measure all this "by eye" - so what is surprising that they are in a drawdown, and Danik is surprised that I have not lost a single deposit?
I am just saying that you do not have to sit and stare at the monitor from morning till night, watching every tick of price and close position at every opportunity. It is like always, you close 10-15pp, but price keeps going the same way, but without you. You open again, and again a big elk, as a result, 3-5 trades, and the deposit is empty, 1-2 profitable, and a couple of losses that have eaten all.
Again, all depends on the TS. If it's on the minutes, or even ticks, and we don't have a robot - how can we not "watch the monitor from morning till night"? In my opinion, in this case it's more reasonable to move to hours, and even days... But manually check the TS for a few years - I know only one person who has done such a hell of a job.
Further, writing all sorts of EAs has shown that if stoploss/takeprofit is below 1/2, then such a trade has no place in the future.
You must mean "if higher". That is, the TP should be twice as big as the SL.
I don't quite agree. Let's say this ratio is often decreased when using trailing stops. In this case, the Expert Advisor performs better. But on the whole, yes, you are right.
I've been trading for a very long time now, I'm not depositing to my account, I'm only withdrawing from it.
Moral is: Treat the market like a job at your company. Do not read analytics, especially when broker or brokerage company gives them, do not listen to anyone, search for signals in your TS, analyze the situation, watch the news the whole day, it is also important, then open a position and that's all, then you just do not move the stop, do not close the position at the first tick against the position, do not spend hours in the monitor, mind your business - you are in the market and trade. Take a loss as a cost of doing business. Do not overestimate the risks, I do not know of any successful long-term trading ideas, where the risk per trade exceeds 10% of the deposit. Calculate in advance not the profit, but the loss, because when you get a profit, you do not have to look too hard, but when you get a loss, it usually surprises you with its amount.
Take the market for what it is, the market moves where the money is, first collecting stops, then building up positions again and going after the stops. How do you determine where not to place stops or enter the market? Develop your own TS or use a ready-made one.
I have an immediate question - what does it mean to say that the risk of a trade is too high? What does "stop far away" mean? What does "profit closes on a pullback" mean? As I understand, people measure all this "by eye" - so what is surprising that they are in a drawdown, and Danik is surprised that I have not lost a single deposit?
For a 100$ deposit, one opens a position with 0.1 lot, they say at a seminar with brokerage companies that 1pp = 1$, a beginner's eyes flare up, if they are winning - they are lucky, but if they have two losses (stop loss is too far away or there is none), then there is no account, and if there is, the maximum is 2$.
Overestimating the risk of more than 5% per trade, sooner or later ends badly.
George Merts no need to censor, just take it and show that everything will be good, open an account with exactly 100 quid, enter the position with 0.1 lot (risk overestimated), then put a stop at 80pp(away) and show the result after the loss (triggered stop)
You don't need to be the great Mozart here, you need to take a leaf and immediately calculate, at a loss there will be a loss of $80+spread. The balance in the account is 20$. Our next step is to enter all without any stops.
The question for you: how many years until you reach a million?
Then you get the answer on the trawl and"reversal": you entered the position, the price goes the right way, the trawl is activated, the price corrects, the deal is closed in the plus of 5-15 points. And there are 5 such entries, you are happy, the sixth position goes against, the stop loss is at 70-100 points, one stop loss is equal to what you've earned before and if you catch the stop loss again?
Trailing is something unique and its use requires a lot of knowledge. It may be used when there is a sign of price reversal and it would be better to close it in the positive zone. However, it is the very thing that slashes the profit in its very development.
There are many TS, but working on weekly and monthly charts with an abnormal lot is suicide with a paltry deposit.
If deposit is $100, then trade is usually opened with 0.1 lot, they teach it at the seminar, the reason is that the value of 1pp = $1, the beginner's eyes light up, if he closed with profit - lucky, but if these two losses, (stop far or no stop loss), then the account is gone, and if there is, the maximum is $2.
Overestimating the risk of more than 5% per trade, sooner or later ends badly.
George Merts no need to censor, just take it and show that everything will be good, open an account with exactly 100 quid, enter the position with 0.1 lot (the risk is too high), then put a stop at 80pp(away) and show the result after the loss (triggered stop)
Did you hear me? I asked WHY the lot 0.1 ? Why this "risk is too high"? Who has checked it? Why with 80pts such a lot?
My contention is that you have to trade SYSTEMICALLY. That is, by the rules tested on trading history. You are proposing to set the lot 0.1 for $100 of deposit and 80 pips stop. My question - where did you get these figures? On what TS did it come from?
I am sure, I will draw a simple EA - with such indicators it will not only lose in a month, but it will do it in an hour according to any TS!
But my question remains - where then do such figures come from ?
Next, the answer to a trawl and"reversal": you entered the position, the price goes the right way, the trawl is activated, the price corrects, the deal is closed in the plus of 5-15 points and the price keeps moving correctly again, but without you. And there are 5 such entries, you are happy, the sixth position goes against, the stop loss is at 70-100 points, one stop loss is equal to what you've earned before and if you catch the stop loss again?
Trailing is something unique and its use requires a lot of knowledge. It may be used when there is a sign of price reversal and it would be better to close it in the positive zone. But otherwise, it is the thing which cuts the profit at its very development.
Here we go again. What is the 5-15 pips trawl - what is it ? How much should it be according to your TS ? Why three times the difference? Or you have a variable trall ?
And then you have a stop at around 100 pips ! The question is the same - WHY ?
There are many TS, but with a paltry deposit to work on weekly and monthly charts with an abnormal lot - suicide.
I agree, it doesn't even depend on the timeframe, the lot should be that prescribed by the TS.
So the question remains - where do you get all your numbers from? Here, the same lot 0.1 !!!
My answer - all these figures are more often than not taken "from the ceiling". But then what is so surprising about the drain ?
You know, when I read Vitaly, I truly admired him.
His candour is that of a man of courage.
I think that he probably had "numbers from the ceiling" when trading only at the very beginning of his trading career. With experience came calculations. And the latter depends on many factors.
And the details of the calculations... - ...not everyone wants to know.) Just like showing trading reports/signals etc.
So he was talking about the psychological aspects.
P./S.: I do not think that those who laboriously performed manual calculations (painstakingly counted and recalculated a colossal amount of data, performed a colossal and painstaking amount of manual measurements and remeasurements on charts, etc.) are units. Although, yes, that there were and are many of them, I also doubt it.
Just as I doubt that many with any programming skills are actually capable of programming what would be the automated equivalent of painstaking and meticulous "manual" analysis.
But the details of the calculations... - not everyone will want to reveal it). Just like showing trade reports/signals etc.
He was talking about the psychological aspects, after all.
I don't need "details of calculations". What I'm saying is that all those numbers he cited - should not be taken from the ceiling, but from testing the clear rules of the TS on history.
The simplest situation - you often hear the phrase - "here is the level, so we set a limit on it (or something else, it doesn't matter). You may ask where it is concluded that the level is here. They say that there is a local maximum on ten bars. Ok, but why didn't we place the Limiter on the same maximum of 10 bars the last time? The time before that we did. And two times before that we didn't set it again? And before that - we did it even though the maximum was only among eight bars !
And so on.
My point is simple - you cannot trade without having absolutely clear rules of trading. But, as practice shows, very, very few have them. (Just those who regularly make profit).
As well as I doubt that many who have any skills in programming, really able to program what will be the automated counterpart of painstaking and thorough analysis "by hand".
So, if we cannot program, if we are too lazy to check it manually and we do not want to hire programmers - then we will not check our TS either?
Well, then why are surprised that most people lose most of their money setting 0.1 lot on a $100 deposit at 80 points SL?
George Merts:
... My point is simple - you can't trade without having completely clear rules for trading. ...