Monday, February 9, 2015

Foreign Exchange Trade Examples Why Following Your Trading System Rules Are So Important

The good the bad and the ugly could be an alternate title for this post. 

The good is due to the fact that I'm being mentored by a well respected and very talented for ex trader Chris from LuckScout.com and he generously shares all his personal trades with his followers as well as openly share his analysis for free.


The bad is as his student my job is to learn and implement his advice. 

It really is the least I could do because he ask for nothing in return. And it is important to me to be able to make him proud. It's bad because I got impatient and and freaked out when one of my trades turned south on me and my profit went negative. To make the situation worse I began breaking my trading systems rules that are there to protect my investment. 


The ugly is the results of bucking our wise teachers wisdom which i will be sharing with you over the next few minutes. So brace your self for the harsh reality that can happen when you break the rules of a trading system. Uggh! This is very embarrassing but I think it is good to share not only the phenomenal success one can have trading currencies, but the devastating failures as well. So without further due here's the story:

I opened a buy stop signal  that was posted on the luckscout blog:

CAD/JPY (1)

Buy Stop at 95.97
SL: 94.61
TP1: 97.32
I also had a position with gbp/usd which i took against Chris's advice, however they were doing well and everything looked promising. I was happy to see the blue which means your in profit in my Mt4 back office. So I checked again in around thirty minutes which I was taught not to do from my mentor.  



Things still looked good so i tried to get back on track and turned my phone off and went to read some articles. Notice that i added another position late with no take profit and that i was late entering the trade another no no per our trading system rules. I checked the positions again before i went to bed and was elated to say the least because i was almost $900 dollars in profit and I knew from doing thing the way Chris teaches this was only going to keep climbing. But i remember having some nagging feeling about what the indicator's looked like and was wondering if i was just reading them wrong. When you master our system you don't even need them because the bollinger bands and candlestick tell you everything you need to know to make a good decision.


So i get up and take care of some responsibility and around 11:40am I decide to check on my positions. As you can see i was pretty freaked out, a million thing ran through my head. Then i gathered my thoughts and decided it was just a counter attack by the bears and my stop loss wasn't being threatened. So i turned it off and went about my business like your supposed to when you do everything properly. But confusion, fear and greed got the best of me and I went back and started making even worse mistakes. 


So i freak out and start closing my long trades and immediately opening short positions to try to make up for the loses. This is a huge mistake and is no where to be found in our trading system it can be fond on the fxkey's site telling you its a huge mistake!


Now look at the mess I'm in below. The trades i closed turned around and i would be back in profit. Now i have to worry about the other trades that are in the wrong position. This all happened in seconds and now my account is hit hard and might not recover. The good new is that i did take Chris advice and decided to trade demo account only until i become consistently profitable and now i see why because if this was real money id be in serious trouble financially. These guys are from the heart and aren't out to get anyone. The more i practice i see there not lying and they are very skilled seasoned veterans. I'm blessed to be apart of their charity. The least i could do is try harder. 



I thought i was taking the demo seriously but today i can see i need to take it more seriously because this type of immature behaviour is exactly why so many loose in this industry which boast a 95% maybe more failure rate. So this post was tough for me but i have to stay accountable and figured a reminder would help. I apologise to my mentor for trifling his time and wisdom he so generously hands out. I hope those of you new to FxKeys don't have to learn the hard way and not only start from the right place but stay on the right track. I hope this was an eye opener for you. I'm going to the archives to see how i should handle this train wreck. 






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