"How to stop merging on Forex?" - the same webinar
Hello friends forex traders!
The time has come to speak frankly. About the most painful. About losses in the market. For those who are tired of stomping around. For those who feel that literally a couple of details are lacking before success. Secret chips and tricks, tricks that are not customary to talk about, which can give a good kick yield curve)
We will talk about all this at the webinar "How to stop merging on Forex?"
What will happen at the webinar?
We will not talk about how important it is to keep a diary of a trader and use a check list to open deals. You know it and apply it so well, right?
There will be specific advice on the case. Let's follow in the footsteps, money management, techniques for getting out of position, a little psychology (I know that you ignore it, because everyone needs a grail, huh ...). But there will be unusual techniques, you will like it + there will be a couple of tricks that you are unlikely to hear anywhere else. Without water.
First, take a look at the survey data. This survey was conducted in our VKontakte group. We have ordinary people there, no elite traders, not “the best representatives of the genre”. Ordinary people, like you and me. The survey was quite simple: How much did you merge on Forex? It should be noted that about 1000 people voted at the time of the webinar. What do we see? Of course, someone answered for the sake of a joke, but in general, I think that the result that scored the most - from 100 to 1000 dollars, is true. On average, they lose on Forex before they reach success, or even without success - up to $ 1,000. The reality is that people come and go, losing money and never figured out what's what.
People are merging, and today we will talk, what can be done about this? We will analyze tricks, chips, secrets that can give you an advantage when trading.
Stops at the opening and during the transaction
- For many years I was a fan of short stops. If the market goes in our direction, then it will, but if not, the losses are minimal. But with experience, I came to the conclusion that the optimal stop size is where it becomes clear that we are wrong. Not 75 points, not 1%, not 2 ATRs - the market doesn't care what you calculated there. There is an extremum, there is a level, there is an indicator value, if you use them, where it becomes clear that your rebound from Bollinger bands did not work? The stops should be set exactly at the level where it becomes obvious that your signals did not work. Having calculated the stop, for example, through ATR, you tie it to a logical point at which it will become clear that you made a mistake and the transaction will not work, or the signal has lost relevance.
- Most traders use too narrow stops when opening a deal, and on the final stages, on the contrary, they are too wide. When their deal goes into a plus, they switch to a fairly wide trailing stop, because they hope that they will be able to make large profits, and at the same time do not want to be knocked out of the market. But it is worth doing the opposite - upon reaching a certain profit, significantly reduce the size of the stop.
The most profitable trading systems, to date, are breakdown and night scalpers. Trends are changing, but I recommend focusing on breakdown systems for high profitability.
Having entered into a deal, after a few days do not create the illusion that the market remembers your position. Most likely, the market has already worked out this information and lives on, and you still expect something from it. Take a look at your strategy and see how you can apply time outs to it. “Come out through N candles” - this is a universal rule that says that if you enter into a transaction and, for example, for 5 candles nothing has changed significantly - it’s better to close it, left with a slight plus or minus, than just sit and to wait. Choose the optimal time frame for yourself that is right for your vehicle.
Consider the possibility of 4 stops in a row
The table shows examples - if you have an average risk of 2%, then after 4 stops in a row you will have a drawdown of 8%, if 3% - then 11.5%. But if you have a 10% risk, then the drawdown percentage is growing significantly, reaching already 34%.
Regarding optimal F, it’s not in vain that Ralph Vince has been studying this for years. Optimum F - for racers, for others who do not need to win the competition or prove something - optimal F is not needed. I believe that 2% is enough, because 4 stops in a row is not a lot, sometimes up to 10 stops. Beginners stop trading according to the system, on average, after 3 stops in a row, those who decide to stay in business after 4 stops - you have a chance to become a successful trader) A risk of 0.5% -1% is the middle ground, but it all depends on your goals and the importance of the amount that is on your deposit.
Stages of development of the trader
In total there are 4 stages of development of a trader:
- Trade in plus;
- Extension to more tools.
But most traders begin to skip stages, feel themselves on horseback and skip the stage of stability. It is better to get a fixed profit for several months than to drive forward headlong.
It is important to focus on the current stage and develop gradually. Increasing tools is a serious step, many traders use only one tool in their arsenal and earn money. He is like a brother to them, they know everything about their instrument and feel it perfectly. Do not expand the toolbox too much.
An important and interesting technique is to enter a trade from several orders without increasing the risk. If we entered lot 0.1, then in this case we enter several orders of 0.025 each and then use several exit strategies:
- in the first transaction, we set, say, stop loss of 30 points, take profit - 300 points;
- in another transaction - an easily achievable take of 1 stop;
- in the third - a close trailing stop;
- in the fourth, we are added in the direction of travel until we are taken out by trailing or an advanced stop.
We get an entry signal, but share the risk into different exit strategies. In case of failure, we will not lose more than in case of entry with one order.
Martingale - increase in the lot when the price moves against your position. Thus, it is possible to reduce the average entry point. Almost all PAMMs, almost all funds, but under different names use martingale.
All traders scold martingale, but this does not prevent them from using this method to maintain their positions. Even if PAMMs use it, then we should also think about using this technology.
But it’s worth using it wisely, you can find out the main points here from the article Safe Martingale.
Come in less often
A paradoxical council rooted in the Samurai codex. He urged warriors to get the sword out of their sheath as rarely as possible, only as a last resort. We love action, because we have been taught from childhood that you need to be active in order to get money, otherwise there will be nothing (who does not work, does not eat).
If you look at a chart looking for a place to enter, stop and do not enter. The best deals are those that you cannot go past. A real bargain attracts you to enter into it. This technique is especially applicable to scalpers, because their eyes are blurred from a large number of transactions.
It’s worth entering only in that market in which there is volatility. If the market moves horizontally, it is impossible to accurately predict its future future. A dead market can go anywhere and it is impossible to predict its fate.
An important technique is to enter into a deal with a delay of 10 minutes. When everything is ready for you to enter, observe the situation and wait. This is called strategic patience. Jennifer Roberts, an art history teacher, taught her students patience. During the assignment, it was necessary to spend a painfully long time before the selected work of art. A break will allow you to cool down and take a sober look at the charts and reduce the total number of impulse trades.
One stop per day
The rule works especially well for beginners. If you caught a stop during the day, stop trading, turn off the computer and do other things. Today is not your day, it is better to spend time on analytics, work on bugs or spend a few hours with your family.
The situation is similar with take-ons - after three successful deals, go play golf or do analysis. The fact is that after a certain number of successful transactions, the trader falls into euphoria and loses vigilance.
Better to do less, but better!
Get out of Loss faster
The statistics of brokers shows that traders come out of profitable transactions much earlier than from unprofitable ones. On average, losing positions hold 4.5 times longer than profitable ones. It's all about psychology, the trader still does not lose hope that the course will be corrected and he will be able to reduce his losses.
The average amount of loss is 7 times more than profit. Try to use statistics to your advantage and exit earlier losing trades.
A useful rule is to retain at least 10 candles in a profitable trade, and leave no later than 5 candles in a losing trade.
Tests and tests again
Before using the new strategy - use it in test mode, check the patterns and only then apply it on the main account.
Use a demo account in order to find 20% of transactions that bring 80% of the profit. The Pareto principle has never failed anyone.
The main advantage of a test account is that you lose nothing. You can try the latest techniques, check the accuracy of the signals and even find your own.
Ludoman, gambling account - open a cent account, it is important that this is not a demo, but a real account. If you have a desire to conduct a strange transaction that you are not sure about, open a transaction on a cent account. In this case, use the main account only for transactions in which you are 100% sure. Do not trust Martingale, but I wanted to try it - go ahead, use the Ludoman account.
With it, you can successfully take your soul. Believe me, this is very calming and allows you to save your money and nerves. This is very important for the trader.
5 rounds in a revolver
Another psychological trick. You have the opportunity to open only 5 transactions per week on the main account. Limit yourself by opening 1-2 transactions per day - so you will wean yourself to enter into unreliable transactions. Naturally, this rule should be adapted for yourself, increasing or decreasing the number of transactions depending on your trading style. You can spend all the “cartridges” in one day, but then for the rest of the week you will bite your elbows, looking at the charts.
An unusual approach to Martin, etc.
Suppose you have a deal open on the demo where you used Martingale. A large drawdown is formed within a few days. We enter the transaction on the main account and by closing this drawdown on the demo account, you close the transaction on the main account. Minimal risk, but at the same time you enter much less.
A great strategy for keeping a perfect score. You increase the likelihood of success.
Suppose you have a strategy, and in the process of implementing it on a demo account, you reach a stop three times in a row - you increase the likelihood that you will catch a trend. If you write this in the form of a clear rule: caught three stops on a cent - the next call in dollar.
100 trades without a drain
This challenge is perfect for those who can not stop merging. Open a cent and try not to merge it for 100 transactions. You have no task to earn, your task is to hold out a hundred transactions without a drain. At first glance, it seems that this is a simple task, but it is not. Persistent ludomaniaes will quickly realize that for them this task is insurmountable without a change of strategy.
It turns out that it’s quite difficult to conduct so many transactions without losing money.
Work with anger and anger
Many books on trading devote a large amount of information to the fight against greed and fear, and very little attention is paid to anger and anger. This is fundamentally the wrong approach - anger is a much more serious problem, because it affects not only the strategy, but also the health of the trader.
Three steps to combat anger:
- Throw out emotions. I have a punching bag, a great thing! Pound it with all your anger, beat the pear for the market, metatrader, idiot in the chat and everything else. The option is simpler - a table pear, a cheap alternative that allows you to throw out anger, "without departing from the cash register." It’s useful to go to the shooting range, shoot at targets. Someone uses games, for example, “Tanks” work well;
- Understand the reason. Let's say you got mad at the next stop, it's time to figure out the reason. Take a pen or open a notebook, start writing “my stop worked again” or “I got on my foot”. Your task is to understand the cause of your anger. So it will be easier for you next time to calmly accept what has happened;
- Adoption. “I myself can step on someone’s foot”, or “there have been cases when the stop loss has worked 5 times in a row, and now there is only one.” You do not act as the one who forgives, your task is to bring negative emotions to nothing.
All these “step back, imagine yourself looking from the clouds to the ground” or “sit down and meditate” - do not work in 95% of cases. If this is what helps you, continue in the same vein; I recommend that everyone else try this technique of working with anger.
Work with fears
Everyone has fears, if you have no fears - you are not a person. Fear paralyzes the adoption of adequate decisions, blocks thoughts about opportunities and does not allow you to effectively evaluate information. Fears should be addressed. The most common fear is to be wrong. To get rid of it, you need an assistant, but you can solve this problem yourself.
Say: “I'm afraid to be wrong in trading.”
Your assistant should repeat your words: “OK, you are afraid to be wrong in trading, what's next?”.
You: “Then in my eyes I will become incompetent in trading, although I have been doing this for two years now.”
Assistant: “You will become incompetent in your own eyes in trading, although you have been doing this for two years now, what's next?”
And so continue your dialogue until you understand that you are done, usually it ends with laughter. So you will come to understand that your fears are only in your head, although the reality is far from so terrible. Do not be afraid to go too far, in the end it will bear fruit.
It sounds strange, but in fact, this very effective technique can save you from fear through living this very fear.
Morning pages are a widespread and well-known tactic of psychological unloading by keeping a personal diary. The description of thoughts, the transfer of everything that occupies your head in the morning - helps to remove the burden of problems and worries until the evening.
Unlike the diary, “morning pages” is not a story about life or an assessment of events, it is a simple unsystematic letter on all the topics that occupy your thoughts. The pages do not need to be read, at the end of the work they are torn or burned.
Just take 3 A4 pages and write there all the thoughts that you now have in your head.
The presented tactics and strategies work under the condition of complex application. Particular attention should be paid to psychological techniques, some of which have not yet been described in common trading techniques.
The webinar was created with the aim of familiarizing with the entire range of techniques for improving performance, regardless of the strategy used by the trader.More information on many of these tricks can be found in the articles on our website.