Active Account - 2018/2019

Like most traders I have more than 1 active trading account. In fact I always maintain at least 4 active account at any one time. If you need to ask why, you have not really started your trading journey. 

The most obvious answer to why one would maintain more than 1 account is because we do not put all our eggs in one basket.This goes to say, usually the accounts maintained are open with different brokers. The other reason for most trader would be to have an account to be used for different trading method used during different trading condition. This is one way of allowing the trader to prevent themselves from over trading on the single account. Trading is risky, if a trader over trade it increase the likely hood of the retail trader blowing up the account when the market season change and swing against the open positions.

As I am resuming my journey, I will be sharing the main account I use for trading so that others may review and discuss about it after. This is a fairly new account open specifically to trade the new trading concept I have learn from JJ. I call it JJFibExtension.

-DC

Where have DC been?

An update on my absence. Am I back in the game?

Its been some time since I've put my heart and soul into Fx. In September 2014 I got a job over to move out of Singapore. I packed my family up and we relocated. The move and adjustment was so constant that within 4 years I lived in 2 countries after leaving home. The changed have made Fx a hobby and my job was my main source of income.

During the first year away of home, I tried using EA to trade as well as creating EA of my own which I ran live. The idea was since I had no time, why not use what I know and get the EA to trade for me? It was a nice idea but as any season Fx trader know, as weather has season so does Fx. I was unable to built an EA that would return significant gains and survive the Fx season change. I lost a few account/signal running my EA live and concluded that EA are like machine. They are there to assist us in our task and not totally replace us.

As I had no time to trade, I looked into Long Term strategy and method to keep with the game. In my Fx Journey, I have learned from Rob Booker about un-hit pivot. It is undeniable that statistically it is a valuable point that pivot are like magnets. They work the same as Moving Averages, it is mathematically designed to be crossed/touched by price. Pivots are my trading foundation and something I still believe in. I started taking long-term trade from Daily Time fame trading for price towards Weekly and Monthly Pivot. Taking only positive swap position. This was how I traded since 2015 to mid 2018.

After 8 years of trading Fx all on my own I finally found a mentor(JJ) who was willing to guide me and motivate me in Fx. He has since open my eye once again to Fx and shown me a different prospective to viewing/understanding the Fx Market. With his guidance, I've decided to resume my Fx Journey. I'll be blogging more often to help keep me focus and motivated.

-DC

Tools for the Job

I always had a problem with trading on the go. Most trader trade from a laptop.. but they are so bulky to carry around. I would love to trade off the iPad but my indicators are not available there.. so how do I do it? I subscribe for TradingView.com, got myself a yearly subscription on a Pro account so that I can get the best of it. Look at the chart from a web browser.. and take the trade on my phone when it is right.  

That was how I have been doing it for 4 months. I finally got my hands on a new tool that would help me perform the trading wonders on the road. The Surface Pro 3, it is an awesome laptop replacement. It runs on Windows 8.1, is light and slip.. size up like a huge tablet but runs like a laptop. It is powerful enough to work like any desktop machine.. my MT4 works perfectly off it. Using dropbox to help keep documents in sync.. trading life haven't been so convenient for quite some time..

Check it out for those who are seeking for a good option to trade on the go.. look up the Microsoft Surface Pro 3.. 

I am still figuring out to fully utilize all its handy feature.. it is a great tool either way.

-DC 

My Trading Style and EA

There are many ways to trade, there are many indication of trade or counter-trend.. What do I trade?

I play a dangerous game and trade the counter trend. So far it have been pretty fruitful.. but it has it flaws. I blow up a small $1000 account this week. It was holding EURUSD and NZDUSD. As it was a small account it had no chance against the massive dip over and over again the strengthening of USD has made across all the currency.

Trading counter trend is very rewarding as you are able to gauge where it will retrace but it requires patience and a huge capability of drawdown. The emotional stress is pretty taxing on the trader. July and Aug have been a very massive trending for USD related pair which has cause me lots of pain..

Technicals on How I Trade:

To catch counter trend, I review the momentum divergence with price. I use RSI to gauge when it is overbought or oversold. With also the aid of Stochastic I will review when a pullback begins and happen. As unreliable as the stochastic is, I would exit a trade earlier if I believe there is a pullback. It does get me out of bad trades, but it also force me to exit good trades earlier. My profit target respectfully would usually be a weekly/monthly pivot. At times to estimate a retracement I would use a Fib Retracement Indicator to help me estimate my exit. 

Thats the technical.. but it does require some gut feeling when I look at price. I look for HL HH and LH LL for price action.. I utilised the 4hr time frame more than anything..respecting the 1hr time frame for earlier entry. Daily chart is use to evaluate overall possible direction of the pair..

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Because of how I trade and targets are constantly changing it is difficult to put this into an EA. The overall target may be fix pivot, but when Price Action indicate a change in behaviour; there will be a need to change target to a closer pivot or risk being caught in a whiplash  which happen to me on AUDNZD and many other trades. 

Trading is risky, I may love it but I have still yet master what I like doing. All I am hoping is to be better at it with each passing day. It is tough especially when so many other traders would love to scrutinised  you. When you are successful they ask for your recipes of success, but when you trip and scratch their account they are all over you. People forget that you are still human.. and as human there is no 100%, failures are literally part of growth. If I do have a holy grail I wouldn't be showing it off to the world and have additional undesired attention on myself.

-DC

Swap in Forex Trading

What is swap? Everyone is aware that banks have interest rates but not every trader is aware that foreign currency trading have interest rates as well. When you buy a currency and sell another you will be impose with a specific swap rate. This swap rate varies from broker to broker and will be applied to your specific trade entry depending on your trade size.

Example when you buy AUDCAD you will be earning a specific interest/swap for the entry; but if you sell AUDCAD you would be paying a specific interest/swap to the position take.

Below is a screenshot of swap payment / benefit from some of my previous trade. Notice the swap column. If a trades is open over a day it would incur swap. You either earn money holding a position or lose money holding it.

Swap rate can really kill you, if you are trading against swap it would be best to exit the trade early. If you are trading with swap for you, this would allow you to hold a position much longer.

How to find out the swap rate and its direction for the trade.. below is some screenshot that will help you along the way.

1 - From the Market Watch section, right click and select Symbols.

2 - From the Symbol window, select the pair you wish to understand better. Click on 'Properties'. Another window will popup. Look for Swap Long/ Swap Short, that will show you the swap value if it is positive or negative. 

The swap value will change when the broker update it on their end. Some broker have these value update as frequent as daily others may do this month. Check with your broker to understand more.

-DC

Topics of Interest

Hi All..

I have been writing all about my own toughs.. is there anything anyone out there would like me to write about? A question that you would want to ask, a discussion that you would like to start..  Give me a shout out at the remarks column below.. I'll take it into consideration and start giving you my share of thoughts on the matter.

Happy Trading..

-DC

Cashing Out Your Profits

Everybody loves money, which means everybody loves big accounts. One thing some people do not realized is that an account size with a broker means nothing other than digits which allow you to trade larger digits(lot size). Trading is risky! If you do not know that already please know that you can lose more than your initial investment.

With risk comes the need for risk management. The best way of risk management is to cash out your deposit/capital. Once you have cash out on your capital, it is time to cash out on your profits.As soon as we learn to diligently cash out from our broker the trading risk is drastically reduce. As we risk our equity when trading, if our capital is withdrawn the trading becomes somewhat risk free.

Understand that we would all like to grow our account. Set a target, once the target is hit, start gradually cashing out. My personal target is to be able to cash out 30% of my profit every month. As I am growing my account my immediate need is different, so what I do is to cash out a comfortable amount every $5,000 materialized account growth. Be very careful when you cash out your profits, it does impact the available funds and change the trading size margin. I personally would try to close all position when cashing our profit to ensure that no extra risk is impose on open position in case a draw-down is faced. 

All new trade entry size is revised after a withdrawal. This is how mechanical I am trying to be when trading. One thing to note is, when your account grows priority change. Capital appreciation is now secondary to capital protection. Do try to revise your trade size and keep them small. Increase of trade size when an account have grown may not necessary benefit you if the trend has change. You must be able to ride out a bad month.Less profit is better than any lost on a bad month.

Remember.. cash out your profits..

-DC 

Exiting a Bad Trade

At some point everyone would make a bad trade.. what is important is that we know how to get out of a bad trade as quickly as possible. Below is an example of getting out of a bad trade. The good thing for this entry was that swap is on my side. This builds up confidence in holding the position and help ease my mind when stacking up trades that was against me.

Below is an example of trading out of a bad trade. I am not here to show you how to trade but the concept of trading out of a bad trade. Some people hedge others use stop to get out of a bad trade. I let it rollover, stack it up and get it going. 

As shown below my pending order was triggered in and the market went all the way against me. From the looks of it the position is really bad. I believe it was cause by a news release spike. What I did next was to top up on the position as it continue to go against me. Of cause when I stack up my position at this point of time it was with indication that price would change direction. It is common that news release spike often will have a retracement, the trick is to catch it.

What I would do is look for indication that price is ready to retrace from a smaller time scale and stack up your trade. As you do this do it with a slightly larger position Calculate the Average break even price and see if it is close to your comfortable exist point.

For this example my initial exit point was at the monthly pivot, but due to the fact that Stoch is showing over sold I decided to exit early. I took an average profit and exited a bad trade.

Important: This method can only be used if your initial position is small and you have the capability to hold your trade for a long period.

Account Size and Leverage

As I've been publishing my signals for people to follow [Click Here]. With that I been asked many times what is a proper account size and leverage do I use. This question is also common for many who wish to start trading. I am writing this out so that instead of replying post after post of the same question, putting this down in an entry here would allow others to get my answer to those question here.

• What 'Account Size' should we start with?

My personal preference is $1000, or for others is the amount that they are willing to lose. Pick an amount that you are comfortable in losing. Before we begin to make money, you have to understand that there are loses. So we always start off with what we can and able to lose. This usually is the bonus from work or a fraction of your savings. Never ever invest with your next month's rent. You would be digging your own grave if you do.

• What 'Leverage' capacity should we use?

I select broker with 1:400 or 1:500 leverage. Leverage trading is very risky, but like a sharp knife is safer than a blunt one when used properly; a huge leveraged account can be very beneficial to someone who use it well. 

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So why $1000 and 1:500 leverage. I do not trust brokers with my hard earn cash. There are a few reason why I started my $10,000 challenge with only $1000. 

1. I believe if you can trade, you can make $1000 to $10000. If you cant trade, even if you have $100,000 it would just get burnt up. I also have little trust with brokers or organization that is intangible. 
2. Offshore brokers are organization that all I have is address, contact number and reviews from strangers. How can I trust them with more money than I can part. It does feel like leaving your money with a stranger on the street to hold while you count your coins to pay a merchant, obnoxiously unsafe.
3. The emotional sanity of trading is the final reason why one should start trading with a small account. If you are not use to losing $100, you will never be able to accept losing $1000. 

I am going to touch more on emotional sanity of trading. It is very important to understand this before we trade our life savings away. When a draw-down happen it can last for weeks at time months. If you are not use to seeing your account in red and still smile at the next person that greet you, you will never be able to accept a materialized lost of investment you have took.

I knew if I did not get use to losing $100s I will never be able to accept lost in $1000s. There is no way I could start trading with a $10,000 account and accept a lost of 10% = $1000.. There will always be days you win and days you have to accept loses. My current largest materialized lost is $977. As I start my journey, the first thing I made myself learn is to accept losses. This is why I force myself to start trading with a small account to get use to the amount of wins and lost. 

Initially I took my loses badly, I would lose my temper and sulk for days when my account was having a draw-down. It wasn't  healthy nor was it fair for the people around me. With time and patience the emotions of trading start to subside. I was soon able to accept draw-dawn of up to $7000 and not panic and lose my temper. Although $7000 was about 30% of my account at that point of time, it was still a huge sum. If I have not started to experience small loses I wouldn't have been able to still be calm and  trade with discipline with such a huge draw-down.

There is a trick to it.. Here is my little secret to success.. When I trade I don't look at value of a position but its growth % or points(pips). This is why it was important to use leverage correctly. Over trading would cause one to burn their account faster in a draw-down. Being able to enter a large position doesn't mean you should. Leverage for me is like extra funds, a capability to hold back the draw-down faced on a bad entry.. I never enter an extra trade when my leverage % reaches 800%, even if the trade setup is a sure win. Self control is one trait you must have at trading. I would curse later that I miss it, but never will I enter a position when my leverage % is lower than 800%.

I also always trade based on points/pips. I exit a position based on the desired signs on the graph. I monitor my trade and smile based on the number of pips I get. I re-enter a position to average out the price only when the first entry are 80-100 pips apart or another signal is shown. I never get emotional and see $500 bucks profit and start closing the position. Only looking at your position in pips helps prevent me from closing my position before it mature. Monitoring a draw-down in pips also removes the emotional attachment to a potential lost. Pip trading and % have allow me to trade more like a robot. It help reduce the emotional stress of a current draw-down and the excitement of a current win.

With that I wish you all the best in your personal trading.. only when you can remove the emotions when trading, you will not be able to trade the way you want to.

-DC

Trust - Broker and its regulators?

Recently I been ask by someone which broker I trust and which regulator is better? It then strike me.. Yeah I never did thought about how much I trust a broker or its regulator. The answers to the question was None, I trust no one person or organization that I don't know or don't see. Most offshore broker are just company registered or regulated by another organization located in god know where. All we see is an address and contact number.

Unlike our local banks which we can walk in and talk to someone directly, offshore broker is something of the unknown. The reliability of a broker is only as much as the review of a stranger about their existing or past experience with that organization. Given the fact that we need to deposit money with these unknown organization, it is hard to blindly trust these brokers with your hard earn money. 

Many would argue, but they are regulated by so and so.. My answer would be, aren't bank regulated as well? Some Banks are even backed by a country's government, yet they can crash and burn. So how do we trade if we cant trust our broker. To me this is why there is this term, "Trade only money you are willing to part". 

A lot of people complain about broker cheating their $ or push the price just to hit their stop. I do agree that there are times these would happen, spread are increased price flux from broker to broker. These usually happen during news release. Not that this have happen to me, but this is all the more reason why we do not put all our eggs into one basket, nor do we put our live savings into it.

Having said that, most broker if they are illegitimate are not out to get you. Brokers only make money when you trade. It doesn't care if you lose money or make money. If the put your position into the market, they make their keep through your spread or trade commission. A broker's favorite customer is usually someone who makes little $ but take a lot of entries. This is because every entry you take they are making off your spread. If you crash and burn you stop trading or if your account is too rich you cash out. Hence.. if we trade trade sensibility.. put your stop correctly and be weary of any economy release which would fluctuate price/spread. Never over trade and blame the broker for closing your position. Even the banks comes after you if you default on your loan.. Trade sensibility or don't trade at all. 

Remember.."Trade only money you are willing to part with".. 

-DC

Signal Service - TradeForTomorrow

When it comes to Signal Service, what comes to mind is... Signal Signal Signal.. Copy Copy Copy.. Money Money Money..

A lot of people look to Signal Service for many reason. Some people use Signal Service because they don't have the sufficient knowledge and experiences to get the desired result. Others use it because they do not have time to trade. Why do you want a signal service?

I myself too wish to find a reliable Signal Service.. until I find someone reliable that have the same amount of desirable result I am giving myself away as a Signal for others to use. As long as I have to trade that much, I might as well let others mirror what I comes about..

Do read the warnings before taking up any of my commentary, advice and Signal Service one find in this blog. [Click Here] 

-DC

Painful Lesson: -865.5 pips

Hi All ..

It was a pretty painful 2 week for me. I let a very good profitable trade go against me very badly. I had 3 chance to exit it profitable, instead I allow it go go against me 3 times, the last was really badly. The position crashed because AUD crashed and caused GBPAUD to rocket twice.. Damn!

Anyway I was down (floating) close to $5000 / -865.5 pips due to AUD retail sales news..

Here is the lesson, always protect your position. I learn that if only I had created a SL protecting my position and creating a free trade. I might have end up losing a good trade entry but not being in an unnecessary drawdown is always a key to ensuring that there is a tomorrow for the account balance. Also the draw down did hold me back from being able to take up 6 different profitable trade that I would normally take if I had the sufficient capital.

In short, protect all profitable trade by adding a SL above the price for a small profit in case it turn around and bite you.

http://www.myfxbook.com/members/desmondc

Oh in case anyone is wondering what happened? I was luckily able to turn a $5000 lost into a $800 cut off. Small price to pay for an excellent lesson.

*Cheers..

-DC

Progress Update

I have decided that I need to record down my progress at least once a month. Doing this will help me have a snapshot of history and how things have grown for myself and others to reference..Here's the first step..

-DC

http://www.myfxbook.com/members/desmondc

My Journey - Becoming a successful trader

I have been trading Forex since March 2011, there were good days and bad days. Like many others who have tried Forex, I have had the privilege of blowing my account, not once but twice. The only good thing that came out of it was that with every failure I gain knowledge and experience. One would tribute the lost we trader experience as the education fees to success.

Truth be told, we do learn better from our mistakes.

Having said that, there are still ways we can learn without going through the same amount of pain and be as experience and successful in the end. One of this way is to learn from others; with ample amount of practice one would eventually be successful.

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Why am I starting this blog today? It is because Today is the day I declare myself a full time foreign currency trader. I have accomplished my first milestone and I am finally confident enough to announce that I am considerably a profitable full time trader. I have been able to turn $1,000 to $10,000 in just a matter of 10 weeks and I will be slowly blogging about how I did it - my journey as a Full Time Foreign Currency Trader.

http://www.myfxbook.com/members/desmondc

Those who stumble upon this blog can either be amused  by it, be judgmental and criticize what I have to share or take this with a pinch of salt. Take what is good and put it to use but most importantly avoid all the mistakes I have and will continue to make as the journey to success is never easy.

Till the next entry.. enjoy your day..

-DC