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Why 99% of traders lose money

  • #281
  • Edited 10:34am Dec 12, 2019 7:28am | Edited 10:34am
Quoting ForexCR
Because you think your going to be rich at the end of the trade. Then some news story come out and wipe out your account.
Can happen but generally it happens during normal trading hours!

The KEY to stop losing is to preserve your account balance or at least the bulk of your acccount at all costs. I have recovered from less then 50% but it's incredibly difficult!

It's most definitely a mental thing - one desperately wants the trade to be a winner. When it starts going against, the urge or temptation is thinking that "well it has to come back in my direction sooner or later" so as a first option - you add to the trade or you'll maybe chose the second option - you move your mental or physical stop loss further away (I'm not going into hedging - that's a whole different and difficult ballgame) What happens? More often then not a Big loss !
Actually it's not the first or second option that's really the problem. It's the thought that "well it has to come back in my direction sooner or later" that's wrong! One HAS to be willing to take a fair amount of small losses and aim for a few BIG gains rather then a fair amount of BIG losses and very few if any big gains which is what the 99% are experiencing!

In practice it means being RUTHLESS. Not with the market, not with other players but with YOURSELF! Be very harsh on trades that are in the red, cut them as soon as your pre-determined SL is reached. That might be as little as 3 - 5 pips. I just don't agree with the advice to give a trade "room to breath". That could easily mean a 50 pip or more SL which most day-traders are not willing or able to stomach. On the other hand LOVE trades that are in the green which means leaving them alone as LONG as possible!

Lastly, once you've funded your account, you HAVE to decide if you are going to gamble, speculate or invest. Make that decision BEFORE you start! Obviously the last option is probably the only one that the 99% should select. Why? because it means you are NOT going to leverage your positions!! It might only mean .001 lots per trade and you might only be gaining 1% a day but that's 52% a year - what bank is gonna give you 52% interest on your money??
  • #282
  • Jan 3, 2020 3:15am Jan 3, 2020 3:15am
its a nice description with more detail ,
got so many information. thanks MTI for constantly nice posting. hope it will continue.
  • #283
  • Jan 3, 2020 11:00am Jan 3, 2020 11:00am
Quoting MarkFxAnde
its a nice description with more detail , got so many information. thanks MTI for constantly nice posting. hope it will continue.
Hi MarkFx

Thank you! When one has been trading for quite a few years, one has the advantage of having made ALL the mistakes. That can be good as long as one eventually learns from them of course! The problem is that due to the nature of forex trading and the ready availability of leverage, the big danger is making the same mistakes over and over again

Anyway, let's suppose one has a really nice trading system/strategy that highlights good trending opportunities but you're still losing. Why? Well the answer is invariably IMPATIENCE. I think that resolute patience is most definitely the main virtue to cultivate in this very tough game. What often happens is - you've just funded your new live trading account and you are RARING to go! All of a sudden you're seeing trading opportunities all over the place!! Well they maybe not 80% chance of success trades but at least a good chance of success (you think) and so of course you open a trade. You're already on that slippery slope that ends in disaster! The solution? WAIT for that 80% trade even if it might mean that you might not trade for 2 or 3 days especially if you are only concentrating on one or two trading pairs. Often the problem with many of the 99% is that they are part-time traders. So when they open the charts, they are trying to "force it" - trying to see trades that just aren't there. There is a solution and that is to just trade around session open times. Might mean getting up early (depending which time zone you live in) but it could be worth it!

I will try to post some example charts over the weekend
  • #284
  • Jan 4, 2020 8:05am Jan 4, 2020 8:05am
Quoting Mtinifx
{quote} Hi MarkFx Thank you! When one has been trading for quite a few years, one has the advantage of having made ALL the mistakes. That can be good as long as one eventually learns from them of course! The problem is that due to the nature of forex trading and the ready availability of leverage, the big danger is making the same mistakes over and over again Anyway, let's suppose one has a really nice trading system/strategy that highlights good trending opportunities but you're still losing. Why? Well the answer is invariably...
Learning from own trading mistake is the best practice; and I am really excited to see your charts!
  • #285
  • Edited 3:14pm Jan 5, 2020 1:44pm | Edited 3:14pm
Quoting Mtinifx
{quote} Hi MarkFx Thank you! When one has been trading for quite a few years, one has the advantage of having made ALL the mistakes. That can be good as long as one eventually learns from them of course! The problem is that due to the nature of forex trading and the ready availability of leverage, the big danger is making the same mistakes over and over again Anyway, let's suppose one has a really nice trading system/strategy that highlights good trending opportunities but you're still losing. Why? Well the answer is invariably...
Here is a good strategy using ema's although other indi's such as arrows, 200 ema for trend direction and ema cross and also CCI can be added to add additional confirmation. Really though, what we're looking for is a push away or candles moving strongly AWAY from the ema line. H4 is the recommended timeframe (see GBPUSD chart attached) but I prefer H1 but come down to M30 to actually enter because sometimes at FF open the price will go two ways.

This video is excellent:
Inserted Video
  • #286
  • Jan 6, 2020 8:31pm Jan 6, 2020 8:31pm
There are many informative content within the post to motivate traders, that how a person is dealing in trading market.
  • #287
  • Jan 16, 2020 9:33am Jan 16, 2020 9:33am
That is one of the many positive sides of forex forums and especially ForexFactory - people are able and willing to share knowledge.
  • #288
  • Mar 12, 2020 2:23am Mar 12, 2020 2:23am
yes, its a place where trades
can share their experience among all, its really supportive to increase knowledge and experience.
  • #289
  • Mar 12, 2020 4:25am Mar 12, 2020 4:25am
... collect to much informations and unusable material/indicators.
I done this in the past also and what i have seen,99% of all the things are true misleading garbage.
Better take pencil and paper and realize what is market at all. Put simple things together and you will reach much more and in much faster time.
Perfection is the enemy of good enough!
  • #290
  • Mar 12, 2020 6:26pm Mar 12, 2020 6:26pm
I've been trading CFD for ower two years and i know for sure that there are only two things that can clean your account. Black swan and holding loosing trades.
Nothing else. One thing is beyond your control and other is all yours.

You don't need a plan to make money in this sandbox. Don't hold losing trades is the most important part, and what is even harder and with what i have a problem is holding winning trades.
It's way harder to look at profit that slowly disappears then at losing trade in hopes that it will reverse.

9/10 trades i will close prematurely just to open new trades later on because of greed and usually it leads to loses.

Don't be greedy and you will stop losing money, don't be afraid of losing too much of your profit(in position) and over time you will make money
This simple technique will give you opportunity to make it big, Ona Trade To Pay Them All.
  • #291
  • Mar 13, 2020 1:06pm Mar 13, 2020 1:06pm
Quoting amando77
Hello to all, lets discuss here why most of people lose some money. I have the opinion, that the most trades lose money, bcs the have no plan to win. lets look to all trading book, the most of discussions, everywhere are stated out, that you should not risk mor then x% of your money. That i will agree, you have to do risk managment. But the most important thing is, no one have a winning plan. Lets say in this way, a lot of people say, let the winners run. this is maybe a point, but not a plan. Nearly nobody want to start a business without a business...
Most traders out there including the rookies lose money when the move contrary to their trading strategy. Diifferent traders have different strategies which the stick-to, inother to ensure consistency
The success of a successful man is behind the success of a successful frien
  • #292
  • Mar 13, 2020 1:34pm Mar 13, 2020 1:34pm
Presently, while some of this needs to do with the brokers tricks and misdirecting training that they put out there for their own particular benefit, it additionally needs to do with the traders also. Most traders lose, on the grounds that they don't regard forex trading as a venture. Without a doubt, the forex advertise moves regularly and it is open 24 hours per day, 5 days seven days. Be that as it may, this doesn't legitimize NOT regarding forex trading as a speculation.
  • #293
  • Mar 13, 2020 2:27pm Mar 13, 2020 2:27pm
Quoting michael205
I've been trading CFD for ower two years and i know for sure that there are only two things that can clean your account. Black swan and holding loosing trades. Nothing else. One thing is beyond your control and other is all yours. You don't need a plan to make money in this sandbox. Don't hold losing trades is the most important part, and what is even harder and with what i have a problem is holding winning trades. It's way harder to look at profit that slowly disappears then at losing trade in hopes that it will reverse. 9/10 trades i will close...
Nicely put - and so true.
  • #294
  • Mar 14, 2020 8:16am Mar 14, 2020 8:16am
Quoting Mtinifx
{quote} Nicely put - and so true.
Even those two worse scenarios can be avoided by having a manual SL at all times IMHO. A well placed SL according to proper MM is the only way to go. If it seems that they are always knocking out your SL it only means that you've placed it too close to the action or your trade is not opened at the correct time (market is ranging rather then trending). And although black swan will hurt it does not have to be lethal if one is using good MM. I've managed to recover accounts that are even 50% down but if one loses more then that, it's almost impossible to recover.

I have always preferred using mental SL but I'll probably never recover all of my losses over the years so that is not a good advert for using a mental stop loss! The lesson is DO NOT rely on your mental ability in this game. One breaks the most simple and logical of rules when one is suddenly placed under huge stress - they are totally forgotten. When you look at what you've done afterwards, looking at the day's chart, you think - what the hell was I thinking of!! Human emotions are deadly and totally unreliable as far as profitable forex trading is concerned. Even the big boys now use algorithms, robots, automated trading - the old pit trading floor days are disappearing.

The more one can get rid of emotion in forex trading the more successful one will be. That is the BOTTOM LINE. Closing winning trades too early and not closing losing trades until it's too late are all related to that

Remember, it's not always about what you've not won - it's about what you haven't lost!
  • #295
  • Mar 14, 2020 9:34am Mar 14, 2020 9:34am
Right now, traders also lose money due to the market crashing.
  • #296
  • Edited 2:16pm Mar 14, 2020 1:23pm | Edited 2:16pm
Quoting mlawson71
Right now, traders also lose money due to the market crashing.
Yes you've put your finger on an interesting thing. I was unfortunately not able to trade yesterday. Gold dropped viciously in the NY session yet I wonder how many small traders picked up and benefited fully from that move of around 800 pips! I wonder how many were rather trying to buy XAUUSD. This mindset of continually trying to pick tops and bottoms is common and banks cleverly take full advantage often swiftly reversing the price in a strong uptrend or downtrend for a few pips to give the impression the move is over and the price is reversing. Of course that sucks in many an unwary trader - ending up on the wrong side of the trade resulting in loss.

You will more then likely find that just a relative few experienced or maybe pro traders took advantage yesterday. These crashes can yield huge profits. But unfortunately the vast majority did not take advantage or even make any money.
  • #297
  • Mar 15, 2020 7:32am Mar 15, 2020 7:32am
I haven't really had the presence of mind to trade for the past week, too stressed out by the ongoing crisis.
  • #298
  • Mar 15, 2020 7:37pm Mar 15, 2020 7:37pm
Well according to most if not all brokers, only 73.5% lose money this days So it would seem 26.5% MAKE money, which I think is a good news
Can you afford to take that chance?
  • #299
  • Mar 16, 2020 10:54am Mar 16, 2020 10:54am
Quoting auricforecas
Well according to most if not all brokers, only 73.5% lose money this days So it would seem 26.5% MAKE money, which I think is a good news
Sounds like people got smarter. You probably misread that part.
  • #300
  • Mar 16, 2020 12:45pm Mar 16, 2020 12:45pm
Quoting TradeFlow
{quote} Sounds like people got smarter. You probably misread that part.
Not really sure what this statistics actually means but it would seem that way That is why some are suggesting the profitability raised too much hence more trading rules... I'm not sure how they measure profitability but anyway, any stat can be misrepresented... Just hope it gives us some clue. They have to present this numbers to traders before they sign, at least regulated ones...
Can you afford to take that chance?
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