Dear Bernadette

[jtb790]

Dear Bernadette,

In another thread you indicated you were new to forex and requested some insight into trading so that you may advance yourself.

I'm sure others will be able to see the intentions behind my thread and I hope its lightheartedness will be understood.

Your other thread ran a bit amok so perhaps this thread will encourage members who have some to offer good trading advice, and to do so more politely.

I can start by suggesting a principle I know is true because I have used it in real trades using real money to win consistently.

It is this: There are times when, once you enter into a trade, engaging the forex market, that the difference in the outcome between being a winner or a loser is so infinitesimally small you literally cannot understand why it happened to go into your favor versus why you didn't get creamed.

Best regards,

jtb

[jtb790]

Dear Bernadette,

When it comes to building a system you may wish to know that, once you have made 100s and 1000s of trades, and you have, by testing, built in and taken out 100s of trading rules and principles into your trading system, if it is a good system it will win. Period.

Example: The system I'm using (developed over 1000s of trades both demo and live) in this EUR/USD short trade is one in which even if errors and mistakes are made it still cannot be beaten. Correction: Has never been beaten.

I was in a short trade with EUR/USD back in the 1.2100s in Sept. Which is not unusual, a lot of traders may have had a short EUR/USD position in the 1.2100s.

Over the next 90 days the difference between me and others is that I am still in the trade, many are not.

Now, on face value, most may say I am a bad trader, a sloppy gambler, to hold a position(s) in exess of 1500 points drawdown. I feel that it is not so, because the instrument is EUR/USD.

I would actually be in great shape right now had I not made 2 fundamental trading errors when the trade hit 1.2550.

A mistake at 1.3300 did not help matters either.

Be that as it may, the system in place is excellent and has won many a grueling trade. It has actually positioned me once to triple my account size though the mistake I made then was to get out of the trade 600 points too early, that, I suspect, if this current trade begins to fall into my favor may be the same case. In the case of the trade just mentioned, it took only 3 weeks for the trade to go into my direction (at full profit from average price) 600 points.

Hence, as you can imagine, it is a dangerous system. Most do not triple their account off one trade.

At this moment at the current market price of 1.3620 whether I win or ultimately lose (and the loss would be that of my account) has crossed the line of being imperceivable.

This gives me some hope. Knowing that the system I built from scratch, in development for over a year, has not been able to ever be beaten even though I have made mistakes and made trading errors in other trades with it. And, at times, gotten extremely close to getting liquidated.

Sometimes that's just the way life works, the difference between winning or losing is a close call.

Best regards,

jtb

[jtb790]

Dear Bernadette,

Being that it is a bit slow right now in the markets I have a little extra time to post therefore wanted to add an additional comment.

In your thread you wrote:

"What I am trying to do ... is establish an equally profitable shortterm day trading strategy where I can scalp at least 10 pips per day from the EUR/USD pair ... at 10USD per pip, I can bag $500 per week... if I can find such a profitable strategy. And if I add "multiple lots" ...like maybe 5 or 6, then the profits will also multiply."

To this a member replied indicating that all is rarely gravy in forex.

This is true. I'd even say that it is the nature of the forex market to prevent you from "bagging $500 per week" at $10 per pip. But to the contrary will see to it that you lose that same amount. So it is in currency trading.

Therefore, please let me introduce you to two ways of thinking since you probably do NOT want to lose $500 per week.

System one deals with stop losses, in brief, it means that if a trade you enter begins floating away from you contrary to your plan you pull your own cork, so to speak, killing the trade and willfully lose your drawdown amount. Then, in theory, you go back to square one and start over again, entering a new trade hopefully with a happier ending.

As you can imagine losses can stack up quickly. I'd even venture to say that most who lose their entire account do so using this method of getting sliced and diced to pieces over a longer term period while waiting for the one big trades to give them back all their losses plus profit - that rarely happens.

The main thing with system one is that you lose. Many see this as stopping larger losses thus actually benefitting yourself.

System two does not enter a trade with a SL attached. What?? Correct. Imagine entering a trade having no stop loss in mind. Seems suicidal? Most think so. But then again most die in the forex arena.

The second system then makes use of a sub-structure of money, trade and risk management techniques that by opening and closing additional positions throughout the trade gets them to the other side where they can A). Close the trade that went astray at break even, losing no money, or, B). Manipulate positions to adjust their average price (different from original entry price) so that when (IF) the rate turns into their favor they can then close the trade with profit - sometimes, in my experience, huge.

Ultimately it will be up to you on how you decide to handle drawdowns, but be assured, trading forex, there is no way to avoid a drawdown, it is just up to you on how you deal with them.

Best regards,

jtb

[Trader2Be]

JTB,

You sound like Coinz from Elite Trader. Are you?

[jtb790]

Dear Bernadette,

Just so you can see some proof that I am not just making things up, during this slower market I popped open an FX Game account and made 13 winning trades out of 13 (100% wins, no losses) on EUR/USD all shorts in 6 hours.

You'll see the starting balance, the growing balance and final balance. I typically make 100s of winning trades like this in a row on EUR/USD. As you can see, my entry and exit signals work pretty well.

There's not very many people in the world who can open and close 13 EUR/USD trades in a row all wins no losses (let alone 100s) with very low risk. I'm usually flat most weekends except in the event where I want to take on a longer term trade (such as the current EUR/USD trade I been in since Sept) purposefully increasing risk substantially.

The snapshots are in the following 3 frames.

Best regards,

jtb

[jtb790]

snapshot 2

[jtb790]

snapshot 3

[jtb790]

Originally posted by Trader2Be
JTB,

You sound like Coinz from Elite Trader. Are you?

You mean Sam? Nah, Coinz is a LOT better than me.

He's insane.

From what I hear he made over 45,000% profit in 2 weeks in the last GFT Forex currency trading competition turning $5,000 into over $2,100,000.