From what I understand, chit chat threads are for random off-topic things. And since I will be initiating the exercise of looking back at stuff I encountered before arriving where I am now (the apparent end of the process of developing my trading system) this thread will be only slightly off topic. I don't really care what comments (chatting) others do in response to the entries I post here, except that I will add any contributors who turn out to be too profane, abusive, derogatory or insulting to my ignore list.
This excerpt is from a book that was started (but as far as I know, never finished) by Rose Ferreira... INTRODUCTION This is not just another book about Forex Trading. This is also the book where I will unveil, through my own example, the lower pitch of the mermaid singing when it comes to trading Forex. Before taking you to the very core of this manual, I will pour my heart out and tell you how, ignoring all the basics principles taught here, and seduced by the promise of easy and unlimited earnings, I was drawn to the very edge of the abyss, just like the fisherman who, hypnotized by the magic chant of the mermaid, walked smiling to jump into the deep sea. You will learn from my mistakes and misfortune. You will see in them the real value of the advice and warnings generously given here by my mentor, Will Duckworth. Will is a Forex educator, a "professor" in the sense this word has in Spanish and Portuguese—a teacher who has specialized in Forex education for beginner traders. He will be shedding some light on many of the Forex trading hazards and on what you can do to avoid them. In his own words, “this book will identify a number of Forex’s most serious pitfalls and help you see how taking them out of your way will make you a much better trader and grow your trading account much faster than would be possible otherwise”. We are confident that If you follow the recommendations laid here, you will be well on your way to making the kinds of adjustments that will help you become a more profitable trader by eliminating all the poisonous and toxic practices that either come to you naturally, or that you might have picked up online. After reading these pages, don't be surprised if you find yourself amazed by your own progress once you put its advice into practice. The tips and tricks you will find here can guide you through your personal adventure in Forex and, hopefully, you will discover that Forex trading does not have to be a financial suicide, as it was in my case. It is possible to survive this deadly game! CHAPTER ONE Since I do not think I am all that different from many of the typical retail traders out there, let's see if we can learn from my mistakes and misfortunes… After coming across the idea of buying and selling financial assets online, I was seduced by the promise of easy and unlimited earnings, drawn to shipwreck listening to enchanted songs sung by sirens of untold riches. Having lost my only source of income and with just $5000 in my savings account, I needed to sort out my subsistence issues, so I tried to think of a way to make money without having a job. While doing the research, all roads led me to the same place: The unlimited possibilities offered by having an online job—by working from home. I was thrilled. I spent days thinking of what kind of work I could do from home. After an extensive search and hours of browsing my options, my enthusiasm seemed to be fading away. The unlimited possibilities of the online job market did not seem very promising after all. I could not come up with any idea apart from filling forms, responding to surveys, earning a few pennies to click here and there, selling products on pre-ready websites, etc. Neither was I be able to get anybody to tell me exactly what they did from home to earn money. I felt hopeless. Nothing seemed able to provide me with a reliable way to make a living without a job. Nothing, until I bumped into a video advertisement on a YouTube. The guy on the video was promising a fabulous amount of earnings work free. I did not need to do much. In fact, I didn’t need to do anything. The “system” would take care of everything. All it required of me was to open an account with something called a broker. However, I was naturally quite suspicious of things that sound too good to be true, so I did my homework, carried out and exhaustive investigation about that business and found out that the broker was a legitimate company and the "system" was an automated program just like the computer algorithms being use everyday by big multinational financial institutions to make a killing in the markets. It was a "robot" that could make me a millionaire! I was absolutely thrilled. I wasn't being caught in an internet scam. No, I was stepping into a legitimate, genuine, millionaire business, where people were profiting without having to lift a finger, from home. I Immediately accessed my bank account, and in matter of seconds, the money was with the broker. I was amazed with how simple and quick it was. I was in the game now. Soon my money would double, then triple, and continue to grow to unimaginable figures. According to the instructions that came with the system, the only thing I had to do was press a button and let the robot to do its job. In about 10 minutes, my account dropped to less than half of the money I had just put there, and I panicked. "My robot is losing my money!" I did a bit more investigating and came to the conclusion that I had been the victim of massive scam. Robots could not predict the direction of the market after all. However, as I got to know a bit more about trading, the ins and outs of moving averages, Fibonacci ratios, average true range, convergence and divergence, commodity channel and relative strength indices and whatnot, I decided that I was ready to do the work of the robots myself. I concluded that online trading was overall very simple—so simple that I could not understand how the robot had failed so miserably. There were only two directions, up or down and the task was merely guessing where the line would be in 1-minute time. I could chose 10 minutes or even more, 1 hour, for instance, but I was impatient to profit. One minute was perfect. It was quicker, I could make more money in shorter time. Now, all that I had to do was choose if in one-minute the price would be above or below certain point. Very simple. I could certainly do it myself. Yet, somehow it seemed I could never catch up the right direction of the prices. The result was that for every dollar I earned I would lose no less than two. Soon I started to suspect that the broker was spying on what I was doing and then pushing price to do the opposite. In a couple of hours, I lost all the initial money I had put in the account and I had to fund it again to continue to play. I could have stopped, but at that point I was starting to take it personally. I could not believe that I could not grasp the simple movement on a chart. Once again, I accessed my bank from their super simplified system and funded my trading account. And again, I lost all my money in just a few hours. After a while, I concluded that I had made a terrible mistake. To maximize my potential profits, I used the broker's money—what I was told later to be called over-leverage. I went into margin call trading without stop loss, and had many positions closed out. Finally, I was forced to give up, close my remaining positions, all in red, and accept the loss. Was I done with Forex Trading? I had left my positions running without a stop loss for nearly three months in the hope that the market would come back and move upwards to allow me to at least lessen my losses—but all in vain. Nevertheless, no sooner had I closed all my trades in loss, than the pair USD/JPY started to move up. In time, I started to think that my issue was with God. Where was the Divine Justice? How could any God watch me lose the only savings I had to survive and do nothing? I was furious, frustrated, devastated… but not finished. Perhaps, I just needed to learn a bit more; if there was anyone on Earth that could master the game, I could do it too. I would learn from them. I went back to my education. I read loads of articles, watched hours and hours of videos, learned about price action, technical trading, fundamental analyses, Forex from A to Z and everything in between. I learned about the miraculous Japanese candlesticks, the magic Waves of Elliot, the mysterious Fibonacci numbers and the mesmerizing beauty of the Harmonic patterns. I learned about indicators – numbers, patterns, points, arrows, bars, lines, charts, all sorts of geometric and arithmetic treats and tricks designed to do what I thought was so ridiculously easy, guess the point where the price line would tick and what direction it will move. I learned "trade planning" and "management." By October, I made some profit on GBP/AUD in a very risky move, where I drew all the remaining money from my bank account and sold GPB on the very top – that is, I bet that the price would go down. As I predicted, the pair started to drop precipitously, beautifully, and I managed to make some considerable money for the first time. The profit taken, however, was nowhere near able to make up for of what I had lost until then. But was enough to renew my hopes and to push me into new trades. My following move was to go short (down) on EUR/USD and buy (bet up) USD/JPY. The Dollar dropped in free fall. In February 2018 the dollar was still falling and I held practically no money after paying the deposit for a new and cheaper box room that could barely fit me inside from head to toe. But "If I win a good trade, just one, everything can change!" So, I made the decision to use part of the money I had just brought from my home country to open a new trade position… in the same direction! And I lost. No God or demon would turn the market in my favor and I was not able to turn my trades in the direction of the market, because I was too scared that something suddenly could change and I missed the move. In fact, I was trapped. And so it happened. In the beginning of March 2018, The Broker closed out my remaining position because I had not money enough to maintain it. Without margin to open a new trading position, even the smallest one, I had to throw in the towel. Game over.