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Have to Learn to Take Loses

 
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tmbfavor

Have to Learn to Take Loses

I have completed approximately 80% of Silver 1 and I still have difficulty taking loses. It takes me hours to accumulate 20 to 40 pips. I do take some loses:however, once I rebuild  my pips, here comes a fast moving candle that would wipe out every pips I have accumulated. So what do I do, I remove the stop and hope and pray that market will return to my buy or stop order. Fifty percent of the time it returns after a day or two. The other fifty percent, I wished i would have taken the lost. I have a plan, but when the candle moves so fast i do not follow my plan.

Can anyone give me some suggestions on how to handling taking loses or videos that I can watch

Striving to become great at trading

tmbfavor

 

Thu, 02/11/2016 - 9:45pm
 
Richard K

Know how many cents cost you one pip for every pair. Calculate how many dollars you put at risk for every stop loss that you set on the new position. Compare it with your average loss in your statistics. If dollars at risk are greater than your average loss don't take this trade, seek another one. Then you can smile while watching your position getting killed. You will sleep much better.

 
tmbfavor

Hi Richard K
How do I determine the cost for one pip for every pair? Is that determine by the spread? I know when trading the EUR/USD pair the profit is 40 cents less.

 
Jason Mertz

that's one of the hardest things tmb... You just have to come to terms with there is no holy grail strategy that yields 100% wins. That means even the best traders in the world take losses. Doesn't mean you have to like the losses though...haha...

The key is to have an entry plan...and an exit plan to take profit...and to cut your losses.

Psychological items like this are just flat out hard. Also know, just because you get stopped out, doesn't mean you have to forget that trade. Sometimes, you get stopped out and can reenter a short while after with a better setup. OR, maybe you change directions...

As you gain more and more experience, you will learn many little things that will help you. Be very observant. Understanding chart patterns may help you also....Flag patterns, penants, can be deceiving if you aren't aware...

For ex, you may be short because you see it making lower highs and lower lows....but it might just be retracing in a flag pattern before it breaks out again. and then you typically have a fast moving candle. If you can see these things as they develop, it will help you a lot...because you will see the same patterns over and over.

 
tmbfavor

Thank you so much Jason Mertz. I will have to stick to my plan and learn more about patterns

 
tmbfavor

Thank you Sokha

 
Jason Mertz

thank you Sokha. That is good to have.

 
Richard K

There are different ways to find it. One of them is by using the following calculator: http://www.fxpro.co.uk/trading/calculators/pip#
If for your trade you intend to use Quantity of 0.01 then for trade size unit enter 1000. If you want to use 0.1 for your Quantity(Volume) then enter 10,000 for trade size unit. Example: Currency Pair: AUDCAD; Account Currency: USD; Trade Size (In units): 1000; The conversion price automatically is displayed when you select the pair. Now click on Calculate and you will get Pip Value (USD) as 0.07226. It means that 0.01 of quantity(volume on MT4) on AUDCAD one pip will cost you little over 7 cents. If you trade AUDCAD pair and set the quantity to 0.04 and have set stop loss distance to 30 pips then: 4 x 7 x 30 = 840 or $8.40 is the value of your stop loss or dollars at risk. With small spread and cost of the spread being fixed regardless if my stop loss is 20 or 80 pips then for small volumes I simply ignore cost of spread. With one lot or more of quantity and with a greater than 2 pips spread I would include cost of spread. I hope, I am correct. I am also a student of trading and not a professional.

 
Richard K

Sokha, thank you for your links! You have made your post while I was still finishing typing mine.

 
Sokha

You guys are very welcome.

@Richard--

It happens to me all the time. No sweat. The more resources, the better. We need all the helps we can get. It's a good idea to see different approaches.

 
Richard K

Another quick and "dirty" way to calculate cost of a pip is to read your open position simultaneously displayed value in Quantity, Pips and Profit columns. Example from my screen: Quantity = 0.01; Pips = 67.80; Profit = 6.91. I divide Profit by Pips: 691 cents by 67.8 pips = 10.19 cents per pip. It differs little from official tables but often approximation is good enough and the exchange rates are fluctuating anyway.

 
Richard K

If your quantity is 0.06 and not 0.01 than your profit will be 6 time greater for the same number of pips and you need the final result divide by 6 to get cost per pip.

 
tmbfavor

Thank you everyone, The links and explanations were very helpful

 
dr.dbeams

These rules have helped me:
1. Be very selective about the trade set up.
2. Allow only 1 -2 set ups at any given time.
3. Set the stop loss to the most obvious support line.
4. Only consider working with pairs that show obvious trend and some moderate movement.

 
tmbfavor

Thank you dr dbeams I like all of your rules

 
hakchinoy

"I do take some loses:however, once I rebuild my pips, here comes a fast moving candle that would wipe out every pips I have accumulated. . . . I remove the stop and hope and pray that market will return to my buy or stop order."

The Benjamin formula gives us a precise way to plan, structure, and manage our trades.

Even the fastest moving candle doesn't have to wipe out all of one's previously accumulated pips. To ensure that, one needs to keep one's number of losses/wins in balance with the average mount of one's losses/wins. Stated another way, one manages one's trading into either deeper losses, or bigger gains.

Whether one places 1 or 10 trade(s) at a time, one can structure one's trades using the Benjamin formula to ensure that that/those trade(s) won't erase all of the previous gains.

Of course, after one has slipped up, one also may leverage the Benjamin formula to plan, structure, and manage one's trades to dig one's self out of that hole.

 
tmbfavor

Thank you Hakchinoy, I am going to review the Benjamin formula. My goal is to learn to make $100 a day trading.