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  1. #1
    Rookie Member Zwoki93's Avatar

    My story, our lovely emotions, strategy, I want to improve !!!

    First of all I would like to say hello to everyone.
    Secondly... I will tell you my experience with binary options. I first came across binary options in July 2015. I was immediately interested. I have done some research (well, not enought, but some) and tried to trade on platform which offers free demo without deposit just to get first impression and to see how things works. I tried few different strategies and found one I liked the most (It is descriped down below). I was successful. Normaly I doubled my account in one week (4-5 days). Trading 10% of all account balance (too risky, I know that now). I lost sometimes too, learned some things, but my aproach to this demo trading was not serious enought. At that time I had the feeling that binary option trading is not that hard at all.
    I chose EU regulated and recommended broker and deposited 250eur (minimum) - at the end of October 2015. Tried their platform on demo for 1 more week to make sure that my strategy works. Well, I more than doubled the account balance in 5 days with my aproach, 10% and some martingale (no need to say, to what this aproach leads to...). Well, thats the naive part now... I though that I can double the money every week almost without the problems. That means 250-500-1000-2000-4000 etc. Every Monday starts with 10% per trade... Yep, that would be nice.. but not in this world.

    First day of trading with real money: lost all the money (250eur). Yea, emotions, that was the first time that I started thinking about emotions. Made another deposit 250 eur again and in 4 days made to 633 eur. I thought my emotions are under control now and was sticking to "doubling plan every week" - still blind. On Monday I lost again: 633 eur.

    Then I stepped to the real world and learned.. that chasing money, and "doubling plan" is too much risky and can not be really reached every week. And I finally realised that trading with 10% is too risky.

    I deposited 500eur (to trade with 5% of the account balance). My plan was to return losses (I was not impatient). I wanted to get to 1500eur, to withdraw my total deposited money (1000 eur) and to continue trading with "their" 500eur.
    I reached 1000 in 2 weeks but having hard times to get to 1500. Many times I was on 1400 then lost to 1000 and so on. Mostly because of emotions and over trading. First week of December and my last trading week I made some big mistakes. Because of the losing strike I "throw" 100% of all the money in to single trade... but luckily I won it. I was under stress and happy and the same time..and said to myself... Never again. My account balance was 1200eur. Because of that experience I was cautioss and in 4 days I made from 1200 to 1900. Thats good. But my mistake: I did not follow my first plan, to stop at 1500 and withdraw. Because I made 700 eur so quickly my new plan was 2000. To left 1000 in there. Greed. 700 eur in 4 days, thats 175 per day (some day 90, some day 130 etc.). My plan was 100 per day or 3 winning trades. I exceed that. But.. I did not look to that weekly. My aproach was like that: "No matter how good day was yesterday (earned 200eur) I just wanted to make at least 100 today" mistake again...

    And there comes my lucky Friday... Account balance 1900. Earned 80eur already that day. But I wanted one more trade... to make it 100 of course . I placed the trade and made another well known mistake - placed the trade to the similar currency pair at the same time. That means... doubling the risk (I knew that from past experience, but I still did that, why? I dont know, I just did). Of course.. I lost both and lost 100 eur. Then placed another trade.. lost that too. Then I wanted to return all my loss ASAP put 200 eur to trade, then 500 eur.. lost lost lost.. finally placed 100% of all capital into the trade... I did not follow strategy. I was in fog. Just random, throw. Lost. Everything. Very stressful. I was under the stress all the weekend, waiting till Monday to deposit 1500eur, to get back, get back as soon as possible. My mind was not clear. I was afraid, afraid. There was no confidence...I was not ready to trade. But I did it. Deposited another 1500eur. Well. Probably I would get back those lost 1000 in 3 weeks but that was to much.. because I was mentally in a fog. What I did? I throw 1500 in one single trade...and lost it... Lost 2500 of my money. If I would win it would be fantastic.. but thats pure gambling. Emotions... I knew emotions are problem. Most of the time during my trading I had emotions under control (not perfect yet)... but then suddently I lost control, all control over myself...

    When I lost all the money I was sad... but not under stress like before.. because I knew its over for some time.. there is no money left to spend, no money left to trade... and fear, there is fear. Need some time.

    Now... I would like to show the strategy that I used.

    - Metatrader 4
    - Double screen setup (charts on one screen, platform on another one)
    - 1 minute chart of 12 currency pairs (too much, but thats what I was doing)
    - Using Fibonacci retracement (important levels: 127, 161.8, sometimes 261.8)
    - indicators: RSI with sound alert, on levels 70 and 30 (overbought, oversell thing)
    Stochastic, levels 80 and 20 (overbought, oversell thing)
    Optional: Average directional moving index and Parabolic sar, trend moving....
    Zigzag to make easier measurements with Fibonacci
    - Expirity time: 5-10 mins (Fibonnaci above/under 127 - 5 min, Fibonnaci above/under 161.8 and 261.8 - more than 5 mins.

    How to use it:
    You respond to the RSI alert, for example, overbought. Then you make fibonacci retracement (where? well, there is more options... they alway say the longest previous trend, but I just made sometimes more measurements and watch what price is doing, lets say feeling...) You wait for the price to go above 127 level on fibonacci OR BETTER wait for the level 161.8 (not that risky). I did mostly 161.8. When candlestick stops above fibonacci level or 2 candlesticks stops, then trade down, put. Tried to enter when price is at its highest level (or lowest if trading up). Yes, stochastic also has to be overbought and it has to get straight - horizontal or start to move down. This is reversal trading. The problem is... It is hard to know exactly when then market is going to reverse. I know it is going to reverse (95% correct)... but there is question, when exactly and for how long until it bounces back up/down again. Sometimes 2 candlesticks stops above those leves, sometimes 5...and expirity time... sometimes you would win with 5 min experitiy, sometimes with 7 min, next minute will be lost.

    It is hard to explain for me... Everyone see those charts a little bit different. We are human beings not robots.

    This is the picture of a setup.

    Click image for larger version. 

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    Why I am writing all this? Well. You can say everything you like of course but I would like to know whats your opinion about strategy, is it possible to improve it? How... How to eliminate those bad trades. The use of martingale... I would not like to use it. I was using it almost all the time (some kind of martingale). There is a way, trading those steps. If price does not reverse at 127, it will at 161.8 if not at 161.8 then on 261.8... But sometimes, it just goes up and up.. or down...It was stressful. I want something more.. reliable, long term and with same risk per trade. I was thinking about learning.. price movement and manual trend lines. Maybe to combine with this strategy... I dont know yet. I like Fibonacci retracement but indicators... they are really lagging.

    It worked for some time.. but emotions.. the emotions were the main problem. Maybe just have to improve myself not strategy?

    I joined CommuniTraders, skype group.

    I want to improve, I want to get better.

  2. #2
    Legendry Member Okane's Avatar
    Thanks for sharing your story!
    This is a great example of why the percentage of winning people are so small
    in the trading business. Not because of scams and brokers, there are good ones but because
    people just go crazy ape shit.

    We've all been there & done that too. The worst part is that once you have lost
    that much, you are more likely to keep chasing losses instead of focusing and
    that's what happened to you. You need to forget losses and see it as many that is "there"
    and not actually lost. I know it's hard once the account is fully blown. In my case I was lucky
    enough to not blow the account and I managed to make up for the losses.

    About your strategy, please share it in the members war room, create a diary and show some trades ( on a demo ) so we can evaluate and help you out!
    Live Webinar: Hidden Content
    Join My Skype Group: Hidden Content

  3. #3
    Moderator Kolyo's Avatar
    Hi Zwoki and welcome to CommuniTraders!

    Your story seems familiar to so many traders. We’ve all been there and only strong and patient people can surpass such devastating events and continue improving themselves in trading. You are right that the problem you experienced was mostly psychological and not dependent on your strategy. You became overconfident because your strategy showed you some profits, however every trader should be aware that after good streaks there are bad streaks and nobody can predict the next trade. The absolutely necessary things you should do is to take a relax and don’t think about the losses. Think as they didn’t happen and than start trading on demo, CT demo platform in our community is a great place for that! The second thing which you should follow 100% is: Never use martingale! It is a mirage that you can make a lot of money that way. Risking 100% of your capital in a single trade is a pure suicide, trade with fixed risk of 5% or even 2% of the capital. There have to be no rush to make the money back. You need to take trading as a learning experience. I can say from my experience that nobody can become a good trader in few weeks or months. You need more than a year to develop your style and even than you still have to learn. Trading is a continuous learning game, and we have to always be prepared to trade the next day. So on first place you should have capital preservation and only on second place capital growth. If you follow these guidelines you will surely succeed!

    PS Joining the Skype group will also help. It is alway better to have somebody over your shoulder and watching what you are doing!
    "The goal of a successful trader is to make the best trades. Money is secondary." - Alexander Elder

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