Not A Single Losing Trade In A Year, With >20% Return. Possible? Yes!
Yes, it’s a FACT. Headline is not to bait you. Because it is not that I know somebody who has done that but in fact I have done / doing it myself. Well, this post is not for any signal advertisement or something like that but only purpose to share is to let the traders know that everything is possible if you are committed.
I have always liked challenges and a decision to take on this particular thing came out of this sentence which even you might have heard many times – “It is all about luck. Markets are too random to trade with effective edge consistently”
Of course, life itself is all about chances and luck, and there is no denial in that. Birth decides many thing in life. But well, without going into philosophical discussions, let’s focus on market. Here I would like to disagree with that sentence because market acts based on psychological patterns. So in order to trade market with an edge, one needs to posses two things, 1.) Ability to identify patterns of psychological behaviour of market participants 2.) While holding his own nerves in right state in order to execute and manage the trades.
So in order to dispel the myth and put my thoughts against it, it is not just enough to be profitable trader, which I was ( am ), but need to do something which really proves that market can be traded profitably with consistency. Well, the result of all winning trades so far have exceeded my expectations but it is fun nonetheless.
First, here is the quick rundown of the journey.
– About 10 to 20 trades per month
– Return is on notional amount, so almost no leverage.
– Trading mostly majors. No exotics. Namely, EUR/USD, GBP/USD, AUD/USD, NZD/USD, USD/CAD, USD/JPY, EUR/JPY, USD/CHF, AUD/CHF, EUR/GBP
– As of now, after 14 month, there is not a single losing trade. So each and every trade has been winner so far.
How is that possible?
– Discipline, Discipline and Discipline.
– After spending a decade trading Forex, last year I decided to do something based on my research and back testing that there are strategies which are almost 99% profitable. Of course, the goal was to minimize the losing trades as much as possible by strict selective trades based on the strategy. And the result is that so far, no losing trade.
What is the strategy?
– Keep it SIMPLE. I repeat, keep it SIMPLE
– Even looking at my published trade ideas you will see that it is very plain and straight forward.
– Forex markets moves on central bank rate expectations. Period.
– No use of any indicator. I use moving averages and fib levels just for reference but don’t hang my hat on that.
– Finding the solid technical spots for the entry, mainly in the direction of fundamental argument
– No trade if entry advantage is lost
– No rigid stop loss or profit targets. ( That doesn’t mean to keep on adding in losing trade. Nope, averaging loser is not a strategy ) If things change, trade entry and expectation changes. Yes, even within seconds !
– In a nutshell, the strategy is purely based on good “Understanding of Price Action”. Now if you ask me, what does that really mean then only thing I could say is that looking at the tape one must FEEL the relative strength and weakness of the price. There is no trick in this. One must spend enough time with the market to have this feeling. Same as understanding a person ! The more time you spend, the more you will understand. There is no definite time period to achieve the proficiency. Some are quick learners, some are slow and some never will. That’s reality of life.
Achieving excellence in Trading is like “Nirvan”. The journey is done alone. One needs to find one’s own technique. Borrowed tricks will not work in most cases. Yes one can gain knowledge by looking how others trade but eventually it will be your own ability which will carry your further.
I guess it is enough for now and will share things in future if I find it worth sharing.
“A person has to lift himself up, using his mind and should not let himself fall. This mind, is the friend as well as the foe of person’s life”
Bhagvad Gita, Chapter – 6, Verse 5