I’ve been doing much better. After my last melt down I took a break. Now I’m focusing on journaling and not being stupid. I’ve noticed I’m correct in market prediction more often than not but still not making money on moves that I predict. I’ll B/E or close early and miss out. I’m looking at this as progress along the challenging road that is trading.
Here’s what works for me.
I believe that markets are a “Random walk with occasional Leve Flight” and I also believe that the entry is the least important part of the trade and they give you no real edge. Your edge comes from trade management, your exit and trading with the trend! Trend of course can be defined in many ways, I use the 200SMA on an M15 time frame, but it’s not really that important in the long term what you use. I enter many times a day and loose on most but I define my losses as R (risk) the stop-loss on each trade, and my wins as multiples of R! I tend to target around 7R on each trade or sometimes trail it.
The R value I set as a percentage of my account usually 0.5%, so if my stop-loss is 20 pips I set the Lot amount as 0.5% of account I would loose on 20 pips. So my wins are 7x 0.5% of account 7R and my losses are all measured as 1 x 0.5% or 1R, makes life so much easier than Pips!!
Now I loose many many more times than I win but each win is seven times (or thereabouts) more than each loss and, overtime, I come out on top with hardly ever a loosing month. But you have to keep on trading even when you may have had ten losses in a row, safe in the knowledge that a win will come along overtime!
I do no analysis at all, no trend lines, no support/resistance areas, no indicators of any kind, just the 200SMA for entry direction. Trading is very easy and simple, it’s the execution that makes it hard together with your own psychology. So forget entry analysis and trade a pair that tends to trend well overtime (I use EUR-JPY) and just concentrate on trade management and your exit, and you’ll be fine……………..
Works for me!!!