Learning from the experienced is an important part of getting better at something, and I have found that the odds of winning at Forex are greatly improved by learning from the experienced.
This time, I would like to tell you a story about a trade that a friend of mine practiced and showed me a long time ago.
The friend, who is not so talkative. He actually practiced it in front of me and told me, “The key to winning at Forex is simple and limited.
The friend had made a bit of a fortune in forex
My relationship with my friend had been estranged for a few years, partly because I had moved away at the time. Then, through another acquaintance, I heard that my friend had made a lot of money with FX.
As I wrote in my profile, I was in financial difficulties at the time, so I was like, “That’s the way to do it! I just thought, “That’s the way to do it!
At first, I thought of getting advice directly from him, or even asking him to teach me his trading techniques. However, my strange pride and vanity got in the way, and I could not act honestly.
I am glad I didn’t do so, now that I think about it.
He succeeded in Forex in a way that suited him, and it would not have worked if he had copied it.
He had no experience in teaching or educating others, and he was a lone wolf. If he had been forced to teach me, our relationship could have been in trouble.
Seeing friends for the first time in a long time
Well, about half a year later, I had a chance to meet him for the first time in a long time at an event. While we were talking about the old days, we naturally decided to meet at my house.
Later, he came to my house and we had a nice talk about this and that, and the topic naturally turned to FX.
I was able to ask him about the details of his actual trading activities, and it became clear to me that “that’s what he was talking about.
His trading style at the time
At that time, he was using MT4 for system trading.
However, it was not automated trading using an EA. He had developed a style in which he had his own programmed indicators generate signs and placed orders accordingly, swing trading using the 4-hour time frame.
I would repeat this style of trading several times a week, using the RSI as a filter for entry, and would hold a position for several days.
When he told me, “I had a bad experience once when I took a position over the weekend, so I would definitely close it on Friday,” I, who was very particular about risk management at the time, strongly agreed with him.
He was also researching various trading methods using MT4, repeatedly combining a small number of indicators to generate statistics.
He said, “If the profit factor of that methodology is above XX, it could be curve fitting, so I don’t use anything that performs too well in a production trade.”
From his appearance, it was clear that he had developed a methodology backed by experience.
What my friend said after seeing my trade
At the time, I had only been in the FX business for about six months, so I was still in the midst of trial and error.
I was still in the process of trial and error. I would get a good response and then try something that looked better.
I would say, “This is how I used to trade a while ago, and this is how I trade now”.
I showed him my trading record (chart screen) and began to explain my trading.
This is the average true range (average price range) for the past XX days, and when it breaks out 23.6% (Fibonacci number) of the range on that day, I enter and say ……”.
To which he responds, “I’ll tell you how much it will take to break out of that range. The question is, how many traders are paying attention to that range breakout?
For example, the “previous day’s high/low” rate is the point that traders all over the world are watching, and many traders will react to that break.
But how many traders are really paying attention to the range I set and its break?
He understood the importance of the collective psychology of the market, and in his own way, he taught me about the importance of making simple decisions in accordance with the collective psychology.
My friend did the trade right in front of me and showed me
“By the way, are you using MT4?”
With that, he quickly downloaded MT4 from the official MetaQuotes website and began setting it up on my computer.
He quickly downloaded MT4 from the official MetaQuotes website and set it up on my computer. “You can program your own plug-ins, too, so why don’t you give it a try?”
With that being said, he got a demo trade account on the spot and started trading, setting up charts as he went.
The trading rules were very simple
He opened a 1-minute chart, where only the 20 MA was displayed.
He says…
I chose the 1-minute chart only because it is the fastest chart. In a real trade, you have to verify and decide on the time frame.
He said, “The rule is to buy if the price is above the MA and sell if it is below. If it is close to a support or resistance line, I will wait and see until it moves away from the support or resistance line. Also, I fix the profit and loss at XX pips and close the trade.
He immediately entered the market and began trading.
Win or lose, enter the same way over and over again
Yes, I cut my losses. And since it is below the MA, I will sell next time.
In this way, the trades are repeated quickly and easily.
Sometimes, the market goes into a range and stays sideways forever. I do not do anything, but just wait for the profit/loss line to be reached.
I will enter the market with a sell position because it is a sell situation according to the rules, even though it looks like the market is going up.
He enters a sell position and, as expected, loses money early.
But he doesn’t care, and quickly makes his next entry.
Yes, the next entry was to buy.
I thought to myself, “If that’s the case, why didn’t he just make a buy entry from the beginning? However, I now understand that this is a “bad way of thinking, trying to guess the future and chasing short-term profits.
What he was doing was the exact opposite, “trading to accumulate total profit” in accordance with probability-based thinking.
After the trade
“If you trade like this, you can get by in forex.”
He said this while displaying the history of his account, which resulted in a small total profit.
He demonstrated exactly what he meant by saying, “You can make a profit if you trade like this.
He said, “In this case, I didn’t make much profit because I made up the rules on the spot, but in short, this is what it’s all about.
At the time, I was too inexperienced to understand the true meaning of his words. But now I understand that they are the essence of winning at Forex.
Later, over time, I came to understand his message and put it into practice.
One last word
Thus, I was very lucky to have a trader close to me who was actually winning.
If I had been a little more honest and understanding, I might have achieved results in Forex a little sooner, but, well, that’s the past.
At any rate, I strongly felt that the experience of watching how winning traders look at charts, make decisions, and trade – and learning from them – is a great advantage for success in Forex.
This is a story about a trade that a friend of mine showed me a long time ago, about how simple it is to win at Forex.
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Here are some recommended books that will give you a true picture of a winning trader’s trading style, methods, and mindset. Read this and get your “image of a winning trader” right.
- 著者：ジャック・D・シュワッガー
- 一流トレーダーたちの金言集。本当に強いトレーダーの本質に迫る一冊。
- 著者：マイク・ベラフィオーレ
- 強いトレーダーと退場していくトレーダーの違いが分かる、迫真のルポルタージュ。
- 著者：ティム・ブールキン, ニコラス・マンゴー, ジョン・ボリンジャー
- アプローチ方法とテクニック、輝かしい成功例と手痛い失敗例など、本音が凝縮された一冊。
