What you should not do when trading forex Part 4

7. A large number of open transactions

Cause.

All of the following problems relate more to the mechanical part, that is, directly to the process of the trade itself. If you have been working in the market for some time, then you have a trading strategy that you use. This strategy usually involves a certain number of transactions. But, I think, everyone faced such a moment when the area of ​​the trading terminal in which your transactions are displayed does not display all open transactions. And you have to use the scroll bar to evaluate all the deals that we have open. So, this is also a common problem. And it’s a problem because most of us won’t be able to say exactly how many deals are open at the moment, how many deals are open on the same instrument, and most importantly – why did we open this or that deal. By my personal criteria, A transaction is considered justified and potentially effective only when I look at the chart of the instrument for which the transaction is open, within 5 seconds I can explain the reason why I opened this transaction. All transactions that do not fit this criterion are subject to immediate liquidation.

Possible Solution.

Well, if we have a mechanical problem, then the solution will be mechanical. I weaned myself from opening a bunch of obscure deals as follows: If you see that you have a lot of deals open, or you started to forget the reasons why you opened them, take a sheet of paper and write out each deal with all the parameters in a column, as in the terminal. We do not print, namely, write it out with a pen or pencil. Believe me, this will soon bother you. And if there are more than 20 transactions, then a census will be a burden. While you are rewriting, you will solve several problems at once. Firstly, you will mentally speak each transaction, and perhaps remember the reason why it was opened. Secondly, you can spend screenings, completely incomprehensible transactions, possibly close (if you have enough spirit). Thirdly, in order not to deal with this procedure in the future, sooner or later, accustom yourself to control your transactions and their number.

8. Intraday trading

Cause.

Well now, just a huge amount of angry comments from brokers, dealers, and their minions will be showered on me. Still, it would be about an untouchable topic. Everything that brings income to market leaders, I called a mistake. It just is. Tell me at least one person who really, with documentary evidence, makes money on Forex trading within the day. There is no such. And no one in the world can convince me of this. Why not? Because everything that happens on the market within the day I call the “Kingdom of the market maker”. Who is a market maker, I think it’s not worth explaining. Literally, this is the one who makes the market. And this is the most accurate definition of this type of activity. The main task of a market maker is to create a constant game on the stock exchange. The constant manipulation of quotes on instruments, in relation to the open positions of the players, in order to close these positions, and, consequently, the fixing of the commission, spreads, swaps. Your transaction is closed, you open a new one, again giving a commission, spread and so on. You are again being shut down by intraday fluctuations. You open again and this cycle is never interrupted. But if everyone switches to long-term deals, how then will commission be earned? The answer is simple. Everyone will never leave. Intraday trading is an industry, a huge industry, which constantly feeds consumers with trading signals, recommendations, scalping strategies, algo trading, and so on … For example, recent fluctuations in the currency pair again giving commission, spread, and so on. You are again being shut down by intraday fluctuations. You open again and this cycle is never interrupted. But if everyone switches to long-term deals, how then will commission be earned? The answer is simple. Everyone will never leave. Intraday trading is an industry, a huge industry, which constantly feeds consumers with trading signals, recommendations, scalping strategies, algo trading, and so on … For example, recent fluctuations in the currency pair again giving commission, spread, and so on. You are again being shut down by intraday fluctuations. You open again and this cycle is never interrupted. But if everyone switches to long-term deals, how then will commission be earned? The answer is simple. Everyone will never leave. Intraday trading is an industry, a huge industry, which constantly feeds consumers with trading signals, recommendations, scalping strategies, algo trading, and so on … For example, recent fluctuations in the currency pair GBPUSD. Every day, the pair oscillated at the level of 1-2 figures. How many intraday traders lost their deposits? I am also in the position for this pair, but these movements did not affect my transaction in any way. I just have global goals and objectives. How many of you can say that he has the answer to the question: How much commission, spread and swap do you pay each month to your broker? Who keeps such statistics? I think no one. I don’t lead either. But a couple of times he led, and these a couple of times I had enough.

Possible Solution.

For me personally, this decision is not possible, but the only right one: Do not work inside the day. This does not mean that you need to forget about intraday deals. This means that the main financial result should be provided to you by global operations. 9 out of 10 who heard this from me immediately answer: “What will I earn on global intervals with my 100 USD?” My answer is always the same: “And what, will you earn more within the day?” Everyone thinks this way, perhaps because they do not quite understand the properties of leverage and forget about the minimum trading volume. I have a real example. Only this time is an example of one of my students. Having 143 USD on the trading account, for 27 trading days he managed to fix 317 USD profit in just two transactions. Inside the day, for such an interval of time, can you achieve a similar result? I think some can do it in a day. Will they be able to do so so that after 27 days they have such a result? I think no. Try to understand that the time interval does not affect the trading result. And with a lot of short trades, you can never earn more than one long one. If you, of course, trade for more than a month.

Leave a Reply

Your email address will not be published. Required fields are marked *

Solve : *
8 ⁄ 8 =