Mickey's Journal

[kiravon]

Account now up over 200% in two weeks!

Maximum drawdown was -7%, after +42% up I dropped to +35%
but climbed since then

Confidence is key as one of the guys above noted.

If you think that profit is too inflated to be 'normal' consider
this - if you have losing months when other guys do up to +72%
a month is there really any limit to what we might make
in a month? Is there a limit on Forex profit?

One guy who uses the same approach as me doubled his account
in three days!

and if there is a limit , is it the market that limits us?

is it our system that limits us?

or is it our mental financial blueprint that limits us?

food for thought

If anyone needs a completely free domain name try -

http://freedomains4all.tk/

I just got one, its great. Although if your site gets popular
they will hijack it off you and point it to ad sources.

That shouldn't apply to me

That's not my site above obviously
- and obviously I'm not an affiliate for a free product!

300 pc.jpg

[wiseambitions]

I believe in all the growth potential you mention, this thing produces dozens and dozens of setups, but we don't have to catch them all.

I wonder what is the most comprehensive definition of "over trading" ? I'm sure lot size & money management are the main components, rather than the tendency to spend too long daily at the terminal trying to take more entries.

[kiravon]

3,600 pips a month and no losers!

In other words 174,000 pips over the last four years on
Daily TF just trading one currency. In theory, backtesting
it can definitely be done

But here is a real test for the M1 guys! - try a really profitable
Daily system - AIMS for example - you don't need to look at the screen
even once all day! There's nothing more to do once you've placed
the trade

A real acid test that will sort out the gamblers from the traders.

You may need to do nothing for weeks! How long can you go without
trading? How many minutes exactly?

Here is my trade I opened five minutes ago on H4 GBPAUD
I post it in advance for total transparency.

I am expecting at least 1,400 pips or I might blow my account
in which case I pick myself up, dust myself down and start again.
but I am quite hopeful with this trade, I think it's hit rock bottom
but we'll see - nothing is certain - but trade with that level of
confidence anyway

I think over trading is a completely individual matter, after a while
too much screen time can mess with your head but we're all different,
so being aware of our personal limitations must surely be key.

gbpaud.jpg

[immy]

Some people can't do what others can, it does not make either of them bad or good. Its just what they are made for.


It is our edge, not many can trade the m1 time frame, that itself is an edge.

I don't know what you're trying to prove?

Just make pips, and have fun....

[kiravon]

Let Winners Run!

Perhaps we have heard that the difference between
winners and losers is that winners cut their losses and
let their winners run

Losers tend to do the opposite.

But nothing is that cut and dried

Letting winners run is emotionally taxing and to borrow
from the above post - far from fun! - in fact for most
of us we simply find it too stressful.

That's why even systems that may even have 100%
win rate are not necessarily the 'Holy Grail'

For example one backtested trade on the D1 TF made
a genuine 40,000 pips but the trade took one year to mature!

that's letting winners run!

and obviously you can't keep opening new trades so it effectively
becomes more of an investment than a trade. and we have nothing
to do for a year!

The point about the M1 trading test isn't about good or bad traders,
but if, like me you find you can't keep away from the charts that
might not be helpful for us

worse still, if we can't stop trading we may have some kind of
gambling addiction which definitely will sabotage our chances of
success

Many guys make a fortune scalping the M1, there's no question
about that but it definitely isn't easy.

Actually nothing is that easy or handed to us on a plate.

Here is an example of a trade I thought was quite nice at the
time - an 80 pip win.

The move went on for +140 pips before there was definite
signal to exit.

but before reaching that point you would have seen around
50% of your 80 pip profit evaporate - and that's stressful!

It takes a truly professional mindset. Yes the above poster
is completely right, we don't all have that mindset

I don't have it

But I am committed to acquiring it

True Profit.jpg

[immy]

I think its better not to be tested if you don't have to be tested... i mean 140 is better but 80 is not bad for what the initial risk was there. besides, the spike down was a highly random event, that was the time market was deciding its new path, new incoming information was restructuring the market formation...

[kiravon]

A highly profitable trade might take weeks and even
months to mature.

That wouldn't be a problem in itself, or if it is the
mind can be trained to be patient. Patience is key

However, the roller coaster nature of Forex trading
seems to run counter to human emotions at every
turn of the road, despite ironically human emotions
being the very cause of the markets movement
in the first place

The lure of thousands of pips profit with a very high
chance of success is enticing indeed

but all that glistens is not gold

The time factor cannot be overestimated.

Time, not money is our most precious commodity

So let us say that you open a position on the
M1 TF and it moves 20 pips in your favour within
minutes

Then it retraces 76%, then a little more....

Your stop is at breakeven

Despite the very deep retracement you know
that it can resume the trend, you also know
it may not

So maybe you win, not 20 pips but 30 pips or more

Maybe you were on the edge of your seat for
a few minutes but it was no big deal

It was just one of T20 trades

However all the above does not translate well to
the higher time frames

If over several months your trade makes 2,000 pips
profit but only to retrace 76%....

This is seriously not funny!

Being a little on edge for a few minutes is very different
to seeing massive gains accumulated over time
suddenly decimated perhaps overnight.

Yes it may well go back into profit again

but the frustration!

A lot of profit in your account over time is
like real money in your bank

and it would be hard to imagine your bank
manager informing you that due to
market volatility the balance of your savings
account was down 76% this month!!

The mind is tricky. The more certain something
appears to be over time the greater the psychological
impact when things go pear shaped

When a long term trade was really doing well but
eventually gets stopped out for a loss, due to
our mortal finite lifespan we don't have such a
cavalier attitude as on the M1 TF

'Next!' doesn't seem to cut it

We open a new position with a feeling of dread
that the same thing might keep happening, that
our lives could pass us by without our ever seeing
a real profit.

That's no way to live or trade.

Yes we need to steel ourselves for the rents
and move on to the next trade. It can be done

except on the D1 TF it may arguably be 1,440 times
harder!

But on a slightly less glum note, I just took a trade on the
H4 - a happy medium perhaps

The move down from the top red corona down to
the blue corona is a little over 10,000 pips

Then it retraced 38.2% before forming a Triangle
consolidation pattern

A breakout to the downside usually denotes a move
of similar length to the pre triangle move

I took the break of AIMS for added confluence

I would have to say that triangles are probably my favourite
pattern, I think when it breaks near the apex there seems
a lot of compression has built up with some resulting momentum

Triangle.jpg

[kiravon]

The USDJPY breakout on the above screenshot seems to
be progressing quite nicely

I've opened seven positions and only one is in arrears, but
it is also the most interesting and worth posting.

EURAUD on the H1 - a clear trendline break, I waited for the
break of AIMS before entering after which price retested.

But as you can see from the subsequent white lines drawn
in price is forming a new channel

although that opinion is exaggerated by the white lines
- it is actually only opinion

Which comes first, the opinion or the white lines?

For example, at the time of writing it looks likes it
may move further down to retest the actual
trendline itself

Again, that's just another opinion

I personally can see in my mind's eye a new
channel forming to the upside.

It may only be in my imagination

In the past I might have imagined all sorts of shapes
and patterns that weren't really there

and sometimes that will still happen

Pattern recognition is a very big part of trading success,
it gets better with practice

But even then, there is a lot of psychology and intuition
involved

In the past I used programs like AutoChartist to plot the
flags, Pennants and triangles for me and wait for the alert

usually with disastrous results

Now however if I 'see' a triangle form after a big move it
tends to work out well.

Its possible in the past I might have traded everything,
possibly not concerned about the momentum factor, which
is probably as important, if not more important than
the continuation pattern itself

I think I may revisit one of these programs to see if I
now get on any better with them.

Of course they are only a tool at best, and I don't need
them, but I'm just wondering if 'their' opinion is in fact
mechanically flawed thus resulting in misdirection?

Couple that with lack of discretion and over enthusiasm
for a new toy and you have a predictable recipe for disaster!

[kiravon]

So this was a perfect example of an imaginary setup

There was no new channel to the upside!

Rather as I thought could happen, price is retesting
the actual trendline itself

Now a bounce off the trendline after the retest
should be a much stronger trade

If price genuinely moves up away from the blue corona
it could be a very good move indeed

If it forms a new low the corona will repaint
but on the higher TFs they are quite a good guide
notwithstanding.

Traders are often very quick to dismiss repainting
indicators - they are not all Karl Dittman and some
that repaint hysterically on the lower timeframes
can be far steadier on the higher TFs and actually
be of some use.

But of course you need a lot of confluence ( break of
AIMS for one )

These coronas for example will dance all over the charts
on the M1 M5

but so far I haven't seen one repaint more than about 50 pips
on D1

But caution is needed

retest trendline.jpg

[kiravon]

A Great Day for Triangles!

The USDCHF took off to the upside at LO then retraced 76.4%
and formed a triangle pattern, it then broke out and I took
the break of AIMS.

After about 30 pips it has now formed a second triangle

Yes this is fun and fun is important

I dug up a triangle indicator - I'm using Cynthia's
Its very useful - just ignore the more desperately
plotted specimens

2 triangles.jpg