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Diary of a FT trader: Part 1

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Written by   33
3 months ago

About Me

I made my first ever trade sometime around 2012 when in my early 20's. It was a currency trade. I remember it. Bought EURUSD. Top thing on the list of assets to trade. I didn't know what EURUSD was. I'd never heard the word "Forex" before, within a few years I'd wish I never had.

My first ever trades were using free bonus money advertised by some cheap and tacky broker. The amount was around $25. I quickly lost this and decided it was a great idea to try with more money. I then quickly lost a bit over $1,000. Then I enjoyed a bit of success before having catastrophic losses a while later.

Learning to trade as a main income is not easy. There are reasons most fail at this. Not only does one have to find some sort of strategy to give them an edge over the market but it's also required to create strong rules to protect yourself and stick to them, the latter is where most traders trip up. Where I did, certainly.

I'm very persistent. So I stuck with it. Over time my failures taught me to be more humble and my bad decisions highlighted to me the value of good habits. This enabled me to first generate profits for myself and later for clients as I became more focused and employed more professional risk control.

I now trade as my main source of income. From my start in Forex markets I moved on to learn about trading commodities. Then futures. Whilst trading commodities and futures I was introduced to options trading and now use that extensively as part of my trading portfolio also (Mostly selling options, not buying them).

What's This Diary About?

This will be a diary discussing my thoughts and trades through a spectrum of different markets. This will include insights into my analysis, explanations of my theory and trading phycology and discussion of real trades I am taking and the profits or losses these are generating.

I trade a full range of assets. From crypto, FIAT currencies, commodities, stocks and world indices. I'm trading these through spot markets, CFD markets, futures markets and options contracts. I choose between them depending on the situation, and I'll discuss why and when I pick certain ones over others (Or combine them).

I trade over various timeframes. A lot of my trading is day trading, but since this is harder to track most of my posts will probably be analysis of moves I am looking to trade over the next week or month rather than the next few hours. This is easier for me and more practical for readers.

My trading style is predominately based upon technical analysis. Reading charts. Using very basic "Classical" charting patterns and looking to exploit edges I've back-tested and found to be effective in many different markets. My fundamental analysis skills are limited, but I remain aware of big events happening.

I'll be updating my thoughts at least twice a week, sometimes more often is there are more interesting market conditions, for anyone who finds my posts useful/interesting and wants to track my progress. Please note, nothing I say should be considered investment advice. It's only my opinion.

Thoughts and Tips to Aspiring Traders

If you're reading this, you probably have some interest in trading. Trading has opened up doors for me that give me the prospects of living a life well beyond what someone from my sort of back-ground would be expected to live. I do not discourage people from it, but it's fair to give you the warnings.

Speculating, especially as a main source of income, is very hard. It's a stressful thing to do. Very few successful traders do not experience crippling failure at some point. Horrific failure is almost a requirement to re-wire your brain to have more respect for randomness/variance and higher risk intelligence.

Trading is not about being a brain-box that intuitively knows where the market is going. For most people it is about finding slight edges in the market and then repeating that process many times. Winning and losing along the way, but create an overall positive expected return.

Learning is a slow process. On average it takes five years to find consistent success in trading. "Consistent" is the key word here. It usually takes under six months to think you know what you're doing, and then it takes a few years of pain for you to learn how dumb most of the things you used to think really are.

For all forms of trading it's possible to trade with "Demo accounts". These will allow you to trade using fake money and it's useful for getting the basic ideas of strategies and learning about position sizes and risk control. It's always a good idea for newbies to use demo accounts for a period of time.

Helpful Resources

Here are a couple free training courses for those wanting to learn the basics of how some of these markets work.

Forex Trading - Babypips school.

Options Trading - Video course on options trading.

Thanks for reading.

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Written by   33
3 months ago
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