Today marks the beginning of the second year I am in live trading, well...sort of.
One year ago, I put on my first live trade. As I try to recall that moment, I was shorting EURUSD. It was kind of nervy, kind of exciting, and as I clicked on the button, I got that "damn it, go baby, go!" feeling. No surprise, it turned out to be a loser.
Come think of it, I did not ever think that trading forex will cross my path one day. I used to "trade" stocks technically (my first transaction was also on 1 or 2 June, way back in 2004!). I didn't really see the success that was being promoted at the trading workshop that I attended. Then I became less active, and eventually, when I've got a handful of losing holdings in my hand, like most people, I started to call myself a "long term investor". Two of those are still in my portfolio now!
It's only when my mentor, kind of by chance, attended a trading workshop that I got to hear more about Forex. Slowly, I started to be attracted to learn more about it through him. As he was also new to the game, he was very enthusiastic and gung-ho, pretty excited about a predicted big bear run and then everyone's gonna make a bucket of gold, and expedite the retirement plan by 10, 15 years. All these painted a rosy picture in my mind, and I was keen to set up a trading account already.
And I did. My account go live about 3 months after I played with a demo. Though my demo record was not anything to be proud of, I still decided to go in to real trades, thinking I could learn more things there that I couldn't with a demo account. That's very true. I felt the pinch of emotion, I chased price, I moved stop losses, I took profits prematurely (though not many profits to talk about), I checked the chart every 20 seconds even though I was trading an hourly chart setup, and basically my heartbeat was governed by the market. A winning trade would make me so eager to talk about my trade, and a winning streak would cause me to ponder about turning into a full-time trader. On the other hand, a losing trade would silence me a bit and a losing streak would cause me to look at the fund and think how many more trades I can lose before going bust.
In terms of method, following my mentor's footpath, I started by learning pw, then being exposed to Ichimoku and shadow methods, before coming to know harmonic trading. It seems my method changed rather revolutionarily, but in fact it is not. None of the methods contradict with each other. In fact, I would call the method becomes more complete, and yet not more complicated. In the beginning, even though there was a method in place, putting on a trade was more of a "trade what you feel" thing instead of "trade what you see". I knew about stop loss, target, and risk:reward ratio, but I didn't stick to the rule of defining all these parameters BEFORE entering a trade. I knew support and resistance have to be respected but when they were in my way of entering a trade, I would bet they might be wrong THAT TIME. Of course, I had to learn my lessons the hard way in the end.
There are so many things that can be mentioned throughout this 1 year, but really not all are worth mentioning. Before the end of the 5th month, I went bust. In fact I have not load up my account until now but I am not ashamed of it, that's why I said "sort of" in the beginning of this review. So, I am no exception. I am one of the 95% traders who loses money in the first year of trading. But one important thing I have learned recent months is, method is not important. Well, not the most important anyway. To quote Jason Stapleton, if method is the key to success, then 95% should be the success rate, not failure rate. That makes a world of sense. If one can win by finding THE METHOD, then winning can be acquired, there is nothing so difficult.
Besides my mentor and trading buddy, there are a few persons made an impact in my trading journey - Pesavento, Carney, Stapleton, Douglas, to name a few. They are important because they taught me (though not personally) to think trading as a business. To think in probability. To think psychologically. To not think in terms of money. To really accept losing as part of the business. To think that it is OK to lose. To realise there's always a next trade. To understand discipline. To learn more about myself instead of about the market. To understand there's no quick way to succeed. To know those workshops who claim to enable one to earn quick monies are liars (unless they also claim one can lose quick monies). To practise. To minimise (not eliminate, I don't want to be a robot, yet) emotion. To be patient. To plan my trade and trade my plan. Finally, to be RESPONSIBLE FOR MY OWN TRADES AND FUTURE.
Jason once said there are four stages in trading:
1. Unconsciously incompetent,
2. Consciously incompetent,
3. Consciously competent, and
4. Unconsciously competent.
After all the lessons and encounters in the past 1 year, I think I am consciously incompetent. Let's see if next year I can move up another level. If not, 2 years later.
Lastly, thanks to my mentor and Trading Buddy, who are very determined themselves and constantly giving me encouragement and reminders to move on. Let's work hard together!
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