Is forex really completely randomized and no real methods exist?

Tommy777

Member
Hey guys! I'm a trader for over 9 years I have my series 3 and 6 so I'm going to ask here what I've thought in my head for the past 9 years pertaining to day trading forex NOT investing.

Who here actually makes money from forex as a living? over a year ... with an fxbook to show just curious?

I'm trying to understand if the market is just really actually chaos and completely randomized (excluding fundamentals)

99% of EAs fail and they say 95% of all traders fail (4% making a living, 1% making it to the millions mark)

also you hear left and right about people who trade with a successful strategies and correct trading methods......but you can code any strategy into an EA so i really cant understand why nearly all eas fail? wouldn't that just reflect that EVERY method there is fails then? There seams to be always 5-10 good eas out at a time. but 6 months to a year later they are old news and failed and replaced with 5-10 new eas that are working now and the process repeats.

Only thing I can think of is that when a certain EA works then it catches on and now 70,000 people are now using it and everyones orders triggering at the same time are now taking the liquidity out of the market at that instance causing the ea to fail. then allowing for the new 5-10 eas to come in and replace the old ones?

Thoughts, comments, suggestions would be great.
I think I'm going to start attaching my fxbookaccount to my signature is that possible? would be cool if everyone had that. Yes my account would say -43% lol but hey i don't care that's why most of us are here anyways right ;)
 
Hmm..definetly some food for thought. I've been trading myself for about 3 years...and i can honestly say i'm still a complete newbie! (When it comes to making consistent profits that is.) With the only success i have had, it was short term. I probably could of been in the top 5% who succeeds, had it not been for my greed and not obeying the secret.

But to answer your question...everything in life has a pattern, some harder to find/see than others...but it's there. For the simple fact that life itself is not random..neither is the air we breath or the earth we live on. But if you really want to know the secret to long term financial growth, i would be happy to tell you! :) Here's a hint *he's* not a secret...

Later!
*GOD* Bless you! :)
 

bonnie1234

Active member
99% of EAs fail and they say 95% of all traders fail (4% making a living, 1% making it to the millions mark)

also you hear left and right about people who trade with a successful strategies and correct trading methods......but you can code any strategy into an EA so i really cant understand why nearly all eas fail? wouldn't that just reflect that EVERY method there is fails then?


Personally been trading in the region of 15 years.

I would place myself in the 4% range. To earn millions you need to start with a lot of funding and compounding earnings with lot sizes as your account grows.



My aim is to make in the region of 3-5k per month, each and every month. Once that is achieved I sit back an relax from trading until the new month is upon me.

Stress and over trading are two deadly forces to deal with.

If you have ever met a trader who has no stress from trading, then he or she has never traded for a living with their own funds.

Don`t get me wrong I love trading as the "buzz" you get from it makes you feel alive and as long as you know what you are doing you should be fine.

Have you ever had that feeling in your stomach? Nights that you could not sleep properly? Worries about a certain trade? We have all been there, it just part of being human and trading...

I never show trades as I do not want anyone copying what I am doing. One reason is people can blame you for "trading advice" even though none was ever given.

I have no "one" specific strategy because I use a combination of everything that I have gained from reading and watching closely

I do not give trade signals nor trade for anyone else these days.

I do have rules and I stick to them everyday.

If you look at my stats you will see that I use cost averaging in my trades, in that if I have a loosing trade I buy or sell further up or down and get an average price to either break even from or to make profit from. Its a good strategy and if used correctly with money management / lot sizing for the account it is a no loss system. When I say no loss you do have a losing trade(s) but the cost of offsetting them basically gets you to break even when required. This is just one strategy that I employ...basically there are too many to list here...

With regards to the EAs...been there done that many moons ago...Even tried recently to adapt a good working strategy into an EA but the EA did not produce enough ROI and had too much drawdown for it to be completely automated so I just continued to trade it manually.

A good strategy will fail as an EA because the human element has been removed and the Robot does not care about your account equity and will quite happily blow it up for you while you sleep. The human on the other hand cares quite a lot about preservation of equity and thus will open and close trades as deemed appropriate, taking profits / losses whereas the robot is playing poker with your funds and is "ALL IN" all the time.

If you want to survive in this jungle you must adapt and overcome using your own trading method and religiously stick to it. Do not ever change your rules or gameplan half way through. Stick to your guns and your patience will be rewarded in time to come.

"Slowly, Slowly, Catchy Monkey" as the phrase goes
 
Forex trading is surrounded by a fact for a trader that the market is so easy to survive with assuring expected profits with minimum investments and investing whenever is desired. Of course, for making good returns through the forex market, a skilled and experienced forex broker can do a lot for you. An efficient forex broker always aims to assure that you deal with the best forex trading system routine and they provide you all the details needed to make the absolute decisions in the forex trading.
 

Murphy12

Member
I don't believe on EAs because most of the EAs are just scam and nothing. These are promoted as 100% profitable EAs but do not help.
 

eigenvector

New member
I've investigated virtually every publicly available class of strategy in the entire trading learning space over a number of years and after this search can only point to one class of strategies that can objectively produce profit consistently. This is in the quantitative strategies area, more specifically stat arb. I'd suggest if you wish to become a consistently profitable trader that you spend the time and effort necessary to search and learn as much as possible about quantitative methods and statistical arbitrage. It's a long journey. Good luck!
 

eigenvector

New member
It's been a year since my previous post on this thread, so I thought I would update. In addition to what I stated before regarding quantitative methods and stat arb, simple methods can also be very profitable. In particular, simple trend following strategies can be profitable such as breakouts if they are done correctly. Combining simple strategies is a very powerful concept. The strategies can vote to reduce them down to a single signal, and you get a higher quality signal than by using just one strategy. Don't underestimate the power of this concept.
 

jeuro

Member
.
An going back to the original question regarding to if the forex prices are chaos or random... They are not.
In the contrary are quite orderly... they move tick by tick, or 1 pip at the time 99% of the time.

Random price would be if eur/usd is now 1.3350, next tick 1.5820 and next tick 1.2833 .

Now.. is not ramdom but by the nature of the market is unpredictable. NO ONE can. And that is the main issue. Not the next tick, 1m from now nor 1 week from now.

This is why most fail in trading this market... they attempt to predict it using dumb indicators and a lot of nonsense.

Said all that to agree with eigenvector... because price moves UN-predictible but orderly, Quantitative methods, stats, arbs and all type of math related strategies are best for forex.

J
 

Kasy

Member
It's been a year since my previous post on this thread, so I thought I would update. In addition to what I stated before regarding quantitative methods and stat arb, simple methods can also be very profitable. In particular, simple trend following strategies can be profitable such as breakouts if they are done correctly. Combining simple strategies is a very powerful concept. The strategies can vote to reduce them down to a single signal, and you get a higher quality signal than by using just one strategy. Don't underestimate the power of this concept.

What happened to "I've investigated virtually every publicly available class of strategy in the entire trading learning space over a number of years and after this search can only point to one class of strategies that can objectively produce profit consistently. "? You said that you checked out everything and only arb trading works. Now you say simple strategies work.
 

MerlinBrasil

New member
At the top of the food chain, you have the Market Makers; Massive Banks; a few huge Institutionals
Between them and the Trader comes the Broker(s). Can be multiple brokerages as some have White Label brokerages under them.
Then you have the Individual and Group Retail Forex Traders.
Each level has it's own BUSINESS MODEL. Everybody is in it to profit.
Each level has their own rules and LIMITATIONS.
One of the keys, imo, is to understand each BUSINESS MODEL and create YOUR Business Model so that you're trading BEHIND
the 'smart money' in order to maximize your wins and minimize your losses.
I could go on for hours on this subject, I think, but that's my point of view in a nutshell.
 

jeuro

Member
At the top of the food chain, you have the Market Makers; Massive Banks; a few huge Institutionals
Between them and the Trader comes the Broker(s). Can be multiple brokerages as some have White Label brokerages under them.
Then you have the Individual and Group Retail Forex Traders.
Each level has it's own BUSINESS MODEL. Everybody is in it to profit.
Each level has their own rules and LIMITATIONS.
One of the keys, imo, is to understand each BUSINESS MODEL and create YOUR Business Model so that you're trading BEHIND
the 'smart money' in order to maximize your wins and minimize your losses.
I could go on for hours on this subject, I think, but that's my point of view in a nutshell.


Hello Merlin Brasil.
No such thing as "smart money" in the forex market. So, there is no one to follow.

In a nutshell... this is an "exchange" market. Composed of 2 types of exchangers:
a) Non-speculators (about 70% of the volume)
b) Speculators. ( that is what "we" do)

Also, we have only 2 main categories of business models:

a) Institutions that facilitate the "exchange" for a fee , Major Banks like DB, Citi, UBs
Barclay, Brokers, White labels, all the way down to exchange business in your local airport.

b) Institution/individual that speculate.

Obviously, we can not follow the business model of the facilitators, unless to get some cash and start a Brokerage house yourself.

How would you follow some speculating Institution??? or any other traders??
When there is no clue of what they are doing and when.

J.
 

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