So you want to be a gun Forex trader?
In the past, the pathway was to get a job at a major bank, but that pathway no longer exists.
Instead, the wannabe Forex trader is left with some free charts, and an online minefield of mis-information to wade though. Rarely do they get contact with someone who has actually successfully traded for any length of time, which is exactly what the bank environment provided.
If they are lucky, the trader will manage to make it on their own, through books and sheer determination. But most Forex traders never get that far, and the landscape is littered with the barren trading accounts of those who never got the advice, or the experience they needed on their journey.
But for you, this time is different.
You are taking the steps you need to leverage the training and experience of people that have “been there and done that”. Through Forex trading signals, not only do you get trades with an edge, but you also get to be exposed on a day-to-day basis to the thought processes and methods of some of this generation’s premier traders.
And you get this in the context of a complete trading frame-work that teaches you all the elements of successful Forex trading – as any good trader will tell you, the actual entry is only about 10% of the equation.
Why discretionary “rules-based” trading is essential in today’s market environment
Discretionary “rules-based” trading is trading within a framework of rules that allows the trader to react effectively to what is going on right now in the market.
Van Tharp, Market Wizard and trading coach, suggests that 90% of all successful traders fit this category. The other 10% are system traders, who use computer technology to trade for them. The opposite of a “rules-based” discretionary trader is a “no-rules” discretionary trader – one that trades on whim.
FX Renew’s Forex trading signals are “rules-based” discretionary. This means the traders are acting with-in the frame-work of a comprehensive trading strategy. Indeed, the level of planning involved is equivalent to a hedge fund (one of the traders is head trader and portfolio manager at a major global hedge fund, while the other is equally diligent in his planning).
Why is a rules based discretionary frame-work so critical in today’s market environment? Now, as much as ever, the market environment is not static; rather, it is very dynamic. As things change, you need to adapt your positions and ideas. This could be adding to (or scaling out of) the position, or it could be exiting the position completely.
It could letting it run once it hits your profit objective instead of closing it. This is how traders are successful, and how the traders providing signals operate. The market is fluid and they will help you adapt.
Why it’s your objectives that matter more than your entry
One of the most compelling reasons to trade using discretionary Forex trading signals is that you retain control of your trading objectives and your position sizing. This gives you a significant advantage over using some form of copy trading service or managed account.
Because you retain control of the elements of your trading strategy that generate the returns. It’s the “how much” you trade that matters, far more than your actual entry. Think about it.
Say you place a trade in the EUR/USD and make 50 pips. What are those 50 pips going to be worth to you? It could be $5, or it could be $500, or $5000 depending on the size of the trade.
Can you see how important this element of trading is?
And the current “risk 1-2% of your account per trade” risk management technique that is so pervasive in retail Forex trading is far from up to scratch.
Rather, top traders:
- Carefully construct their position-sizing model to achieve their objectives
- Have a comprehensive risk management frame-work
- Swing big when the stars align
If you give up these elements, then you give up much of the power in your trading. Instead it’s much better to follow and model the practices of experienced practitioners who have, over the years, mastered this practice on a very subtle level.
Why you should “outsource” your entry and exit decisions
Many traders and educators obsess over the techniques for picking when to enter into their trades. They study charts until the cows come home, and they are willing to pay big bucks for the latest and greatest analysis technique. It’s the Forex equivalent of obsessing over stock-picking.
But of all the areas of Forex trading you could pick to focus on, it’s probably the most challenging to actually master. The fact of the matter is it can take years to develop the savvy to read the market with the degree of ability that professional traders can – and these guys are your competition.
And it’s not just experience you need to gain. It’s access to information.
It’s difficult to compete with traders who can legitimately boast this type of profile and market access – somebody who:
- Sources trades through a mixture of technical and market factors, using proprietary FX trend and mean reversion models to aid in the decision making process.
- Through his hedge fund, acquires all the best market and analytical information.
- Is privy to information on flows as they happen, and the important levels indicated by sell-side order books. Has access to a wide array of bank research portals / trade ideas, and direct contact with leading strategists
- Brings together these technical, fundamental and information based insights to generate trade ideas.
(By the way, that is taken from the profile of one of our signal providers)
Instead of focusing your time on your entry, focus it where your edge lies. And your edge over institutional traders is in your position sizing. You’re small, you’re nimble and you can enter and exit the market without impacting it. This gives you a degree of flexibility in your objectives and position-sizing model that others just don’t have.
So why not “outsource” your entry and exit rules to the people in the best position to provide accurate and timely trades?
Forex trading is ultimately about making money after all, so free yourself of any mental constraints that limit your performance, and use the advantages available to you.
Entries, exits, edges and expectancy It’s important to understand the roles of the entry and exit in your trading plan. The entry and exit are two sides of an equation that generates an edge over the market, over a series of trades. For example, you might have 10 trades, and only 5 of them win, but if the winners are bigger over-all than the losers, then the entries and exits can be said to have a positive expectancy (an edge). This is the true role of the entry and exit rules in your trading plan – to provide your trades with a positive expectancy.
What to expect from FX Renews Forex trading signals
FX Renew is a premium discretionary Forex trading signals provider. As a subscriber to FX Renews Forex Trading signals, you can expect the following:
- Each week you will receive between 4-6 short-term “day trade” Forex trading signals from Steve Lucas.
- You will receive 2-4 swing trades a week Jim Langlands and 888.
- The signals are monitored carefully to ensure the optimal time to exit.
- Each signal comes with position-sizing recommendations and trader comments.
- When a signal is exited you will receive an update alert indicating the profit or loss on the trade.
What the signals require from you:
- Don’t feel the need to take every signal. You can take signals as you have time. We recommend you look to take around 20 signals a month depending on your goals, though you are free to take less or more.
- There may be times when not many signals are sent through. The traders are only going to send through quality signals, and if the market presents no trades there will be no signals.
- Limit your monthly risk to 3% or less. We are not the place to be if you are a high-risk trader. To do this, you can use or modify one of our custom position-sizing algorithms.
- We require subscribers to place the stop-loss given with each signal. The market can move rapidly and we will not always be able to update you at exactly the time to exit trades that go against you.
- It’s important you understand the concept of edges and expectancy in the box Entries, exits, edges, and expectancy above. Not every trade is going to be a winner, it’s what happens over a series of trades that matters (a series is at least 30 trades).
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