My Fund Trading Adventure by Ben Bakhsh – w/c 27/02/2012- Blog 15

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Hey guys!!

Well, I wanted to open by summarising the past 5 months of live trading and tell you about a pitfall I hit this week – a pitfall I KNEW of and had advised others against yet still became prey to….

Ok so to summarise October – December 2011 – I made over 7% in total with little effort…. Then January 2012 over 6% …. And last week I was over 11% up for February, I WAS ON FIRE!!!!! But unfortunately my James Bond alter ego came out and I did the unforgivable… I over leveraged… I was cocky, arrogant, thought I was some sort of trading god in the making and I destroyed my trading mind set and therefore my account…. My REAL account…

I was riding the CHF and as it was ranging I was placing martingale trades to chase the rate ready for the imminent breakout… well as a result I kept increasing my risk, as you do with Martingale… eventually I was risking something stupid like 40% and got into the trap of thinking I’d gotten in to the mess too deep to pull out now and so I continued to place counter trades…

I didn’t eat, or sleep for 2 days while this was going on then eventually I did get to sleep and at 5:30 am the markets went in my direction… “Phew” are you thinking? Well you’re wrong… you see the rate did go in my direction and actually past my TP levels… but due to spread it missed the close by 1/10, yes  ONE TENTH of a pip…… ONE TENTH….. Of course I wasn’t around to manually close the trades (another dumb error, assuming TP would just trigger forgetting about spreads) so of course the rate bounced back up….. At this point I was around $200 down with open orders… but did I close them and cut losses? No I carried on in the trades hoping and praying the rate would go back in my direction… of course it didn’t and I watched over around 5 minutes as my balance went from $560 down to $69…… HORRIFYING…..

This, I believe is the most horrifying lesson I have ever learnt in my life…. And the most humbling…

So… my thoughts following this… well initially they were “IM NOT CUT OUT FOR THIS”…. “ILL NEVER TRADE AGAIN”…. Although, one thing was apparent, I KNEW this was all my own fault, I knew exactly what I had done wrong (even as I was doing it) and I knew that this was not the fault of the markets… there was no bitterness or hard feelings… in fact I had this strange feeling of relief… as I write I really can’t explain it but some strange part of me feels relief that this all happened and I’m now more determined than ever to succeed… This week is a week I will never, ever forget…. Not matter how good I do, it is now drilled in that I am not indestructible and I never will be. This week will ultimately have made me a stronger trader….

 

Well that’s it for now folks but I’ll be back next week. 

My Fund Trading Adventure by Ben Bakhsh – w/c 20/02/2012- Blog 14

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Hey guys!!

Firstly, apologies for the lack of blogging over the past week or two – in honesty I do not like to trade a lot when the markets range so there hasn’t been a lot of action over the last few weeks. Also I had a mini break  😉

I took a few heavy losses at the beginning of the month but of course I stayed consistent and it paid off and I’m now in profit for the month… I’m approaching the +1% mark for the month and over all I’m at +7.23% for the year (average of +3.6% per month – I’ll gladly take that).

A few more wins would be nice to end the month on a high again but my primary focus is still staying consistent.  I have passed my 100 consistent trades target and it really has paid off so my new target – another 100 consistent trades.

You’ll see from my myfxbook account that the drop I had a few weeks back was heavy, but then you will see how remaining consistent and not succumbing to recancy bias helped to bring the account straight back in the green – food for thought. No matter how tough the markets can be on you just stay consistent. The Live Connect Service taught me this….

Looking back, my performance before LC was at best -7% in a month… it seemed that I just wasn’t cut out for trading…  joining LC was the last try for me…  but this turned my results around for me and the difference was instantly noticeable.. The last 3 months of 2011 (when I had been applying the LPT advise) gave me over 7% overall profit… and already this year I’m at over 7% up… living proof this works…

Now with each passing month I see that goal of fund management getting closer… exciting times!

 

Well that’s it for now folks but I’ll be back next week. 

My Fund Trading Adventure by Ben Bakhsh – w/c 16/01/2012- Blog 12

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http://www.myfxbook.com/members/BenjaminNathan/my-manual-trading-strategy-london/223516

Well it’s been another huge week, hence the delayed blog.

I decided that as an addition to my manual account, to hire some developers and have an automated robot built around my strategy, so it’s been developing and graphics design all week while continuing my manual trading…

In addition to this I’ve had talks with potential investors so hopefully I’ll be managing my first account from June if I continue to be consistent.

Ill concentrate on my manual trading throughout my blogs though as opposed to robot developments as I’m a firm believer in manual trading as being the best, and most fun way to trade…

On to this week:

There have been 14 trades, 10 of which were winners, and as I write this my 15^th trade is 17 pips up and approaching the 30 pip T/P. I’m thrilled… thinking in probabilities while maintaining consistency is paying off, in fact I’m 3.41% up for the month… (I’m happy with 2% a month).

There have been 2 trades this year so far which were not part of my consistency plan, both of which cost me 30 pips, but overall I’m starting to get it. I have found that reading just 2 pages of Trading in the Zone a day seems to be keeping consistency in the back of my mind and the profit I’m starting to see is spurring me on even more.

Well… my AUD sell I just mentioned has finally broken the Daily Low support and its plummeting… happy days….  VERY happy days… I’m now 25 pips up. I hope that as time goes on I will be living, real time proof of how consistency and thinking in probabilities = success.

The only problem I found this week was “switching off” when it comes to trading as in once I get to the evening forgetting about trading… it’s a bug isn’t it… but again, without that switching off it can get difficult to maintain consistency – something I would encourage any trader to be mindful of.

That’s it for now… but I’ll be back at the end of the week to wrap up. 

My Fund Trading Adventure by Ben Bakhsh – w/c 09/01/2012- Blog 11

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http://www.myfxbook.com/members/benbakhsh/intellitrade-2012/220171

Well it’s been a big week for me today.

I’ve taken everything I’ve learned over the past 3 years, the best strategies I’ve learned and compiled this into a logical, low risk, high probability strategy that I can trade with little management.

So now – time to put it through the LPT tests.

The link to this strategy is above so please follow me as I continue my trading adventure.

My end result after 2012 was a total of +17.5% from Oct – Dec. (When I started trading my strategy consistently). Compared to the -75% in September this is living proof of the power of consistency.

Remember – my target is to be consistent for 100 trades to really train myself to be a consistent trader.

So far there have been………well actually I’m at square 1… here’s why:

As per my strategy I entered a CAD sell on Wednesday… then it rose and hit my counter trade as per strategy… for 2 DAYS this thing bounced between my T/P and S/L’s. In fact … about 4 times it was within 4 pips of TP… now for the horror… at the end of day 2 I had enough! It rose within 4 pips of TP so I hit right mouse button, hovered over “close order” and DING! POWERCUT! The whole neighbourhood house alarms go crazy and I’ve lost internet and have no idea what happened after 2 days of fighting emotion.  I sit there jaw dropped and sickened!

Anyway, I get my internet and power back and log on to see the rate has started falling again and loosing profit and after using my Fib tool I saw that the rate was retracing perfectly and analysed that the  rate would carry on falling so I bottled it, and closed the trades taking a -5 pip loss… I was happy though, the nightmare was over and I was in profit for the day as the markets had already given me 30 pips from an AUD buy. I was glad to be out because sure enough the rate dropped and ranged exactly where I predicted!

BUT… the story continues….

Today as per my strategy there should have been a buy order set up this morning on the CAD… HOWEVER… I avoided it because in my mind the market was ranging and I had total belief that I would lose if the order triggered… to follow, about 10 minutes before writing this week’s blog I watched in horror as the rate smashed through what would have been my buy order and raged above and beyond my 30 pip T/P in just a few minutes…. The lesson……

RECENCY BIAS

That’s it for now, but I’ll be back next week……….

My Fund Trading Adventure by Ben Bakhsh – w/c 02/01/2012- Blog 10

 

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Hi everyone and HAPPY NEW YEAR!

 

Well the first thing I have to say is BOY I MISSED TRADING over Xmas… although after December’s

-8% it was a welcome break.

 

3 Trades so far this year, 2 Wins, 1 Los.

 

The loss was my fault through… I won my first 2 trades of the year and got a little arrogant.

 

My strategy is designed to take smaller wins but at a much larger hit rate using daily support and resistance as profit targets… on this particular trade (CAD Long on Thursday) I got a little over confident and used the 2^nd resistance as my TP, not the 1^st as per my strategy… the result…  my first loss (and lesson) of 2012 – A LOSS … and to rub salt into the wound 1) It would have been a win HAD I stuck with the usual T/P method 2) After reversing and stopping me out it rose past the TP again…

 

LESSON/REMINDER = CONSISTENCY!!!!

 

I take it as a gentle reminder AND I’m glad it happened just 5 days into the month…

 

Sometimes the longer you have been trading the more difficult it can be to stay consistent. You see more things, things you didn’t know of before, such as Gartley patterns and Butterflies forming… it’s always so tempting to ride outside my strategy… but a strategy is like a marriage… cheat on it and ultimately you get found out and screwed over as a result. So stay faithful and at least while you are in the testing phase of a strategy (100 trades is a good standard to decide on how well a strategy works) … oh and keep the “window shopping” to a minimum…

 

My aim for 2012: Well of course profit is nice… but I’m avoiding profit targets for now… instead my 2012 target is to stay consistent no matter what happens… for at least 100 trades. If I can make 100 trades without slipping up, as in changing something, or taking profits too early, too late etc, then I know I’m on my way to “The Zone”

 

Its NFP day today so I won’t be trading, so for now, Happy Trading, and I’ll be back next week.

My Fund Trading Adventure by Ben Bakhsh – w/c 12/12/2011- Blog 9

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Well…. This week has been another painful one.

There have been a few trades, mostly losers. Here’s the biggest mind bug about all of this:

As it stands I lost most trades (all but 3) … and I’m down 7% this month…  but remember a couple of weeks back we spoke about my analysis and how I had come to the conclusion that I could half SL and Double Lots while keeping risk at 1%…? Well If I HADNT incorporated these new rules I would have won 11 out of 12 trades taken this month and id be in a very healthy profit for yet another month…. OUCH.

As you can imagine after spending about 6 hours analysing all of my trades that day, I was confident that the new rules I had incorporated would have a great effect on my account but instead I experienced a losing streak…  I never take things out on the market, I take full responsibility for any trade outcome so, naturally I started to think back to when I was analysing my trades the other week… I thought back to my reasoning… the REAL reason behind spending 6 hours analysing every trade id taken.

At the time I told myself that I was doing it to make sure that I was trading consistently and to see if anything needed tweaking…  but let’s face it things were working … very well… id just broken the 10% mark for the second month in a row… so maybe the subconscious REAL reason for this analysis was to JUSTIFY halving my SL and doubling lot size… maybe I had already made my mind up before I started analysing…  in honesty this seems more like the real reason looking back… I got too arrogant because I had 2 fantastic months and I was on a winning streak (If I remember rightly id won around 28/30 trades)… so there we are… I betrayed myself and tricked myself into changing my system without even knowing it, even if the changes were small… they weren’t needed… and I got hurt as a result.

It’s amazing how time and time again our own minds can betray us no matter how in control of it we think we may be when in the trading environment…  remember, we are our own worse enemy.

I learned a lesson this week and that is to REALLY understand myself when doing things such as analysis trades or reviewing rules… I thought I had 100% mastered being in control of my actions and emotion, but the last two weeks have taught me NEVER to take this for granted.

Now EVERY time I even consider making a change to the way I operate I will ask myself an important question:

Am I doing this to ensure I’m staying consistent and to see if there are any serious problems with my strategy, OR am I doing this to justify a change I want to make… and from there WHY do I want to make this change – is it to become a better trader, or is it because of Greed!

That’s it for now but I’ll be back to wrap up for the year next week!

My Fund Trading Adventure by Ben Bakhsh – w/c 5/12/2011- Blog 8

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Well…. This week I’ve made some discoveries… we all know that the public enemy #1 when it comes to trading is ourselves…..

This week has been hard, VERY hard… I’ve discovered public enemy #1 for my strategy….. SPIKES!

They may be best friends to some people but to me,,, I’ve discovered that they are my worst enemy.

 

Well, this week there have been 4 trades, 1 of which was a NZD short, which paid a VERY small win, 12 pips… the other 3, well let’s just say on all 3 trades, spikes hit mid-trade and I managed to get out of them loosing just 46 pips… if I hadn’t seen the spike it would have been a 75 pip loss, so every cloud has a silver lining and I’ve really seen how spikes affect my strategy in a negative way.

 

A small price to pay for yet another valuable lesson.

 

It also brings home the fact that fundamental analysis is important, even for the technical trader, even if it means just being aware of the main announcement times and the effect the announcements are likely to have…

 

It’s been a nerving month so far as it’s the first time I’ve traded throughout the holiday season, but at the same time I’m developing personally as a result… I’ve fought and conquered various personal obstacles this month already such as the urge to experiment when things seem a bit too quiet on the trading front – that appetite for the buzz you get from the trading bug, watching a trade crash and sticking with the strategy and staying consistent, trading without hesitation despite how the month has gone so far…. It’s been hard but rewarding psychologically.

 

If I was to go back into my mind 1-2 years ago, I couldn’t have imagined having the mental attitude I have now.

 

I may be 2.97% down so far but the month is young… and in light of the above I’m glad I’m trading it, for better or for worse… and let’s face it 2.97% for a lesson,  it’s far less expensive than the 75% lesson I paid for in September when I started trading my micro account….

 

It’s all about the Income and Expenditure…. This week has been expenditure…..

 

That’s it for now but I’ll be back next week.

My Fund Trading Adventure by Ben Bakhsh – w/c 28/11/2011- Blog 7

 

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Well, it was a quiet week this week BUT I managed to secure my 10% profit for the month which I really am pleased about. It was the ultimate goal for me this month.

Monday gave me a small 9 pip loss on the GBP, but I took 20 pips back from it on Tuesday and Wednesday I took a small trade on the EUR which paid out almost 10 pips – just enough to take me over that aspirational 10% profit target for the month.

So, although this week was quiet in terms of trades taken, it was pretty exciting all the same and very satisfying.

I took 1 trade on Friday (CHF Long) but unfortunately it was still going when the NFP was announced and the price crashed and stopped me out (only 25 pips though – my first actual loss in a while). Nothing of a concern though as my max risk is always 1% so December is not a concern.

This week I learned the true benefit of logging trades… on Friday I spent about 5 hours analysing all the trades taken since October (48 in total) – I wanted to see if I could half my stop loss and double my lots to ultimately bring more profit to the table without taking considerably more losses as a result. I went back and traced each trade on the m5 chart to see exactly what happened and took note of the maximum draw down before reaching my T/P levels. The results were better than expected, in fact with the halved S/L and doubled lot size, risk reward ratio is better and if the trades I have already taken were executed with these new rules, not only would my losses be smaller, my profits would be multiplied 400%!!!!!

This really highlights how tracking your trades and analysing them in a non-emotional, constructive way can help with your trading…

So December here we are… I don’t expect profits as big as October and November due to the upcoming holiday season, but I’m still feeling positive about the month.

That’s it for now but I’ll be back next week.

Happy Trading.

My Fund Trading Adventure by Ben Bakhsh – w/c 21/11/2011- Blog 6

 

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For those of you following me on myfxbook, you will now see that following Septembers disaster and learning curve that left me at 79% drawdown, and the 2 very successful months that have followed, I now have no drawdown in terms of pips (I’m now 44 up overall)…. BUT… I’m still at 69.2% draw down in terms of cash! So why is this?

A classic example illustrating how trading with too much risk and not enough consistency can potentially destroy a new trader!!!!!

So now I guess is a good time to tell you about my personal goal… in September when I sat back and re-evaluated my risk after taking such heavy losses, the easiest thing to do at the time would be to a) just take some more silly risks and hope for the best as my account was so far gone or b) just start again on a new account or c) just give up.

But I didn’t do this.

Why? Because I wanted to show the community of new traders that as dire as things get it isn’t too late to rescue a system in draw down… the fact that I’ve gone from nearly 80% drawdown to less than 70% in 2 months shows that it is always possible to rescue an account. My goal now is to continue to make consistent profits and slowly reduce the drawdown figure and bring the account to overall profit.  The important thing to note here is that the key factors enabling me to start healing this account have been addressing my risk, adding more specific exit rules and more importantly, staying consistent with all of this.

The fundamental rules of my system i.e. what to trade have barely changed since day 1. This really goes to show the difference between Consistency vs. Non-Consistency.

In terms of trading this week – well I bagged 90 pips on Friday shortly after posting last week’s  blog, giving me 8.47% profit for the month. This week has been slow – maybe down to the American holidays however I was pleased with the 4 trades that I took and won, giving me 55 pips. The thing I’m most pleased about, reflecting on the past 2 months is that I’m proving with real money (not demo) that good profit margins for the month are achievable WITHOUT having to take big risks.. As stated previously I am only risking 1% on any given trade and I am staying totally consistent in the way that I trade with no hesitation. As of now I am 9.61% up for the month. (I’m hoping to hit the 10% mark next week, but we never know what the market will throw at us – something I vowed never to take for granted).

That’s it for now but I’ll be back next week, until then, happy trading.

My Fund Trading Adventure by Ben Bakhsh – w/c 14/11/2011

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Well, this week has been ok, albeit a little slow. I’ve had a nice little winning streak (12 in a row) and am currently 6.5% up for the month in terms of profit and I am investing small amounts each month to steadily grow the size of my account.

I had to really fight off the emotion on Monday though – I had two trades open that had started reversing against me (I was Short on the NZD and GBP). When you are in profit for the month it can be very difficult to keep that emotion off.

The ‘Walk Away Approach’ works a gem for me… that is as long as my S/L and T/P is in place I just shut MT4 down all together as I feel emotion creeping up and reflect on the fact that if the trade does not succeed than it is not a loss; it is a business expense… A small cost incurred while heading to the ultimate goal – trading a fund.

I have to say I was relieved to log back on and see that the trades had actually succeeded.

Here’s what a learned this week upon reflecting on my experience and some of the books I’ve read and recommended in previous posts… system chasing is the main killer of noob traders.

So, what if we get rid of the words ‘system’ and ‘strategy’ all together, just for now? After all, most novice traders think that the system is the most important thing to be a successful trader, yet most fail!

So this approach MUST be wrong.

I’ve been helping a new trader as he had been “developing his system” this week and while my advice was something he had not heard before it really did help him. Here it is:

FORGET about finding a ‘system’ (for now)… instead concentrate on RULES… we are operating in an environment with no rules and no boundaries…  something we are not humanly raised to comprehend… no wonder so many fail. The first thing I recommend from experience and various trading materials – establish your RISK before ANYTHING else… on ANY trade I have a maximum of 1% equity risk – I never break it. I know then that no matter what the market throws at me I’m not going to be one of those 95% who sit back in 3 month’s time and realise that they’ve blown an account!

Next, establish some basic rules for entry and exit. Market Flow is an important one for me… but of course there are other factors to consider such as support and resistance, market volatility, trends etc.

CONSISTENCY is the next important factor – never EVER break these rules… of course when starting out there will be some tweaking – on demo of course… but you will establish a defined set of trading rules…

Now, just by following some simple processes which I believe are fundamental to anybody wishing to trade, a system has created itself… I’m finding more and more as I go along that a consistent, low risk approach to trading is far more important than ANY ‘system’…. Its basic stuff yet we can all easily fall prey to the implications of not trading in this way.

That’s it for now, but I’ll be back next week!