*Good morning/afternoon everyone!* The U.S. dollar is trading lower against most of the major currencies this morning as risk appetite improves after yesterday’s brutal selling. Stock futures are up, helping to bolster pairs like EUR/USD and USD/JPY. However as we begin the NY session, the decline in Treasury yields could also tip the scale and push USD/JPY lower. Yen crosses on the other hand will take their cue from stocks today. The currency most vulnerable to weakness is the Canadian dollar because oil prices are down more than 2% after President Trump tweeted that he hopes Saudi Arabia and OPEC will not cut oil production because he thinks oil prices should be much lower based on supply. Despite a softer Eurozone ZEW survey, EUR/USD is trading above 1.1250 on the hope that progress could be made on the Italian budget front. the expectations component of the ZEW surely also increased. The best performing currency this morning is sterling which is up on higher wages (despite a higher unemployment rate) and continued Brexit optimism. On the Brexit front, we are getting closer to a deal but with some counterproductive headlines, traders are still reluctant to overload sterling positions but when an announcement is made, we can almost be assured that there will be a strong followup rally. AUD and NZD are also up from yesterday but having risen strongly in Asian trade, they are mostly consolidating and even weakening slightly. We also have our eyes on the Swiss Franc which appears to be topping below 1.0130. *The MAIN THEMES I see today are* +EUR +CHF -CAD -JPY *Trading Biases* +EUR, +CHF, +GBP, -CAD, -JPY mildly +AUD, +NZD, -USD *Today’s Initial Trades* Here’s the summary – 1. Buy EURCAD at 1.4885, Stop at 1.4857, Target 1.4912 2. Buy EURUSD at 1.1247, Stop at 1.1219, Target 1.1275 3. Buy AUDCAD at .9531, Stop at .9503, target .9559 4. Sell AUDCHF at .7270, Stop at .7298, Target .7242

Swing

*Good morning/afternoon everyone!*

The U.S. dollar is trading lower against most of the major currencies this morning as risk appetite improves after yesterday’s brutal selling. Stock futures are up, helping to bolster pairs like EUR/USD and USD/JPY. However as we begin the NY session, the decline in Treasury yields could also tip the scale and push USD/JPY lower. Yen crosses on the other hand will take their cue from stocks today. The currency most vulnerable to weakness is the Canadian dollar because oil prices are down more than 2% after President Trump tweeted that he hopes Saudi Arabia and OPEC will not cut oil production because he thinks oil prices should be much lower based on supply. Despite a softer Eurozone ZEW survey, EUR/USD is trading above 1.1250 on the hope that progress could be made on the Italian budget front. the expectations component of the ZEW surely also increased. The best performing currency this morning is sterling which is up on higher wages (despite a higher unemployment rate) and continued Brexit optimism. On the Brexit front, we are getting closer to a deal but with some counterproductive headlines, traders are still reluctant to overload sterling positions but when an announcement is made, we can almost be assured that there will be a strong followup rally. AUD and NZD are also up from yesterday but having risen strongly in Asian trade, they are mostly consolidating and even weakening slightly. We also have our eyes on the Swiss Franc which appears to be topping below 1.0130.

*The MAIN THEMES I see today are*

+EUR
+CHF
-CAD
-JPY

*Trading Biases*

+EUR, +CHF, +GBP,
-CAD, -JPY
mildly +AUD, +NZD, -USD

*Today’s Initial Trades*

Here’s the summary --

1. Buy EURCAD at 1.4885, Stop at 1.4857, Target 1.4912
2. Buy EURUSD at 1.1247, Stop at 1.1219, Target 1.1275
3. Buy AUDCAD at .9531, Stop at .9503, target .9559
4. Sell AUDCHF at .7270, Stop at .7298, Target .7242

The Winning Way to Set Trading Goals

Boris Schlossberg

In life, if you really want to achieve something -- set a goal. Most people start out the New Year by resolving to lose weight or get in shape and fail miserably at those tasks. If on the other hand, everyone resolved to lose just 5 pounds or to walk briskly for 20 minutes twice each week, many of those resolutions would be kept.

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See How We Made +71 pips in 90 Minutes Live Trading the ECB

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In order to make goals viable and achievable, they have to be concrete and realistic. As human beings, we are very bad at abstract targets but set a hard number in front of us and we will go after it like a bloodhound on a hunt.

Yet when it comes to trading, many gurus will tell you NOT to set goals. The markets are utterly unpredictable, they’ll say. You can’t set hard targets on a daily basis, like a car salesman or donut store owner. Financial speculation just does not lend itself to consistency, so it’s not advisable to set targets, you’ll just get frustrated.

It is true that trading is not like any other business. Unless you are a dealer and have reliable customer flow against which you can trade, financial speculation has all the consistency of unset jello. Some days every trade turns to gold and other days you do nothing but bleed money. In that environment expecting to make a steady daily paycheck is woefully unrealistic.

But that does not mean that traders should not set hard target goals. It simply means that those goals should be measured on a longer time frame than 24 hours. If you are trading a high-frequency system, one of the best ways to measure your performance is to compare the actual results against results on a monthly, quarterly and annual basis.

By having at least 100 trades in your records, you will be able the law of large numbers tell you if the strategy is performing to spec or not. Looking at your trading from a longer term perspective eliminates most of the day to day angst of our profession and allows the trader to examine his performance in a rational, quantifiable way. It also creates the single most important aspect of goal setting — realistic expectations.

Just as no normal person would resolve to lose 200 pounds in a month, so too no real trader would expect to earn 100% in a year. Setting realistic targets against the backdrop of market tested results is the much more professional way of approaching the trading business. I recommend you give it a try.

Trader’s Drug of Choice

Boris Schlossberg

Why do we trade?

We like to make money.
We like to beat the market.
We like to play in the biggest economic arena in the world.

But let’s be honest…

We trade because we like the action. We like the volatility, the chaos the pure bedlam that hits the market when an unexpected piece of news appears on the screen and prices start to tumble like a stack of dominoes.

No forex trader ever said, “Wow did you see that 10 pip range in GBPUSD during the Asia session? That was really something!”

We love the speed.
But speed kills in so many ways.
I’ve already discussed the way speed kills through excessive leverage. Almost every retail trader I know (except those in my chat room) trade on way too much leverage. I’ve even created a risk calculator to help you determine how much you should bet on each trade so that you never lose more than 1% in a day. Feel free to check it out here.

But speed kills in another way, and no matter how careful we are with our size we are all highly vulnerable to this other force simply because we are human. When price moves fast in one direction -- what’s our first instinct?

To chase the move.

We can’t help it. We are programmed to react. FOMO -- the fear of missing out -- has been with us from the caveman days. Chasing price is almost always a sucker bet. Yet we all fall for it because chasing is the trader’s drug of choice.

Occasionally, chasing price works. The move is so huge we sometimes get lucky and get swept up in the wave. But luck is not a strategy. Successful trading is a game of playing the rules, not the exceptions. For every chase win, there are usually five losses as we get stopped out in the inevitable retrace.

The key to avoiding the chase impulse is to have an intelligent, well thought out structure that helps you enter the move SLOWLY -- away from the sentiment extreme. Recently, I modified one of our day trading strategies using the RSI indicator and the 1-minute chart to stop me from chasing price. It’s been working remarkably well. But the specifics of the setup are less important than the setup itself. You need a plan ahead of time. You simply can’t react blindly to every news bomb that hits the screen, because that’s exactly how every trader gets in trouble.

Trading is immensely fun, but chasing is incredibly stupid. Don’t let it be your drug of choice. Your account will thank you forever.

3 Tips for Day Traders

Boris Schlossberg

1. Trade in 100 trade batches.
You need at least 100 trades to determine if a strategy works or not, but unfortunately most traders won’t even make past 10. We get bored. We get scared. We absolutely hate bleeding money NOW even it means making money LATER. Mostly we just love to tinker. No one is more guilty of that than yours truly who would be much better off if I just let my systems trade.

One piece of advice that may help. See what is the minimum amount of parameters that would make you leave the trade the f- alone and try to reduce your system to those factors. Then just trade win, lose or draw.

Remember if you don’t have 100 of the same trade -- you got nothing.

2. 4X 4 Forex
What’s the maximum lever factor you should use for forex? You are looking at it. Four times. Four times MAX. So if you are trading $10,000 of capital your maximum trade should be 40,000 units. This assumes that your maximum stop is 25 pips. If your stop is bigger than that then you are not day trading -- you are day praying.

Why 4X? At maximum size and maximum size you lose 1% per trade which is not going to bankrupt you even if you lose 10 times in a row.

Try this for the next 100 trades you will do with your system and I am pretty confident you will still be in the game when the experiment is over.

3. Don’t lift the stop -- Ever. Chip away at your losses.
Oh it’s soooo easy. The FX market is always whippy. Prices almost always reverse and that loss almost always turns to profit if you -- Just. Let. It. Float.

Except when it doesn’t. And you keep adding and adding until the account is gone and you don’t even know how you got to that point from one single, stupid trade. When losing it’s ALWAYS better to stop out. If you like the trade you can always get back in and you won’t be carrying dead inventory if you are wrong again.

Painful as it is to take a loss, it always better to chip away at it even one pip at a time. It took me 6 trades today to recover from a loss and it was worth every pip, both mentally and financially. Resolve to never lift a stop and you will always live to trade another day.

RBA Meeting Preview

Australian Dollar australian dollar forecast Forex News Kathy Lien Reserve Bank of Australia reserve bank of australia intervention US Dollar

The Reserve Bank of Australia meets tonight and new central bank governor is at the helm.  Phillip Lowe, former RBA deputy governor succeeded Glenn Stevens and investors will be paying close attention to the new governor’s tone. Chances are he is going to play it safe and maintain the central bank’s upbeat outlook.  The last time they convened they expressed confidence in the trend of growth and labor market.  When Lowe spoke last month, he said the labor market is not as strong as the unemployment rate suggests and inflation is expected to remain low for some time. Taking a look at the table below, there has been as much improvement as deterioration in Australia’s economy since the last monetary policy meeting with broad improvements in China.  So while RBA Governor Lowe may be optimistic, the main takeaway will be patience.  AUD may fall on this but at a time when the central banks of the U.K., Eurozone, Japan and New Zealand are considering more stimulus, a neutral bias will make any declines shallow. In fact we believe the better trade is to be long AUD pre-RBA.

 

 

Lies Traders Tell You

Boris Schlossberg

1. Trade with a Positive Risk Reward Ratio

Of all the lies taught in trading this is perhaps the worst. Mainly because it sounds so reasonable. Who wouldn’t want to risk $1 to make $2? You only need to be right 40% of the time to win! It’s such a seductive pitch. Too bad it’s total BS.

Maybe that approach works on swing trading which is much more like a lottery type business model ( You catch one good trend and that can make your year). In day trading the positive risk/reward model rarely works. You need superhuman timing skills and it’s almost impossible to maintain your skill/luck over the long term.

What works in day trading is forgiveness. You need to give yourself lots of room to be wrong. You need to create more than one opportunity to resolve the trade profitably. And most importantly you need to trade with a very, very, very negative risk to reward ratio.

I know. One trade. JUST ONE LOSING TRADE! And you will blow a week’s worth of profits. Well yes that’s an extreme you probably don’t want to reach. That is probably too negative a risk to reward ratio. But one losing trade for two days of profits is actually quite doable. In my room I have guys who have gone two, three even three and a half weeks without hitting a losing trade. In the month June I managed to lose money on only two trading days banking 10% for the month, so it’s possible. The key to day trading isn’t cutting you losers short and letting your profits run -- it’s making sure that you can resolve each trade with either a profit or a scratch.

2. When You are in a Losing Streak the Most Important Thing to Do is Stick to Your Strategy!

Yet another platitude that sounds great when you hear it but crumbles under the pressure of real trading conditions. When you lose money the greatest damage done is not to your account, but to your psyche. There is nothing so fragile as a male ego (since 95% of traders are men let’s just focus on the lesser sex for this one). The moment you lose, you damage your confidence. I remember in the late 1990’s when I was trading stock index futures, I lost 18 straight trades in a row and stopped trading after that for more than 2 years. I followed all the rules. I stuck to my strategy and I basically wound up abandoning the markets because I destroyed the most important thing a trader has -- his sense of self.

So no. When you are on a losing streak the most important thing is not to follow your strategy. The most important thing is to win. If you strategy calls for a 10 pip take profit and you are 5 pips in the money -- take it. Do that two, three, four times in a row until you have your mojo back. Those trades do not matter. They are not part of your “sample”. You don’t use them to evaluate the long term statistical viability of your strategy. They are there for one purpose only. To make you a winner and to get you comfortable with taking risk again. Which bring me to my third biggest lie.

3. Strategies Matter.

Strategies do not matter at all. All strategies can be divided into two simple trades -- mean reversion or momentum. Everything else is tactics. Which is why the best traders in the world never really follow rules, but rather establish guidelines and constantly adjust against those parameters.

In my trading room we have a great mean reversion strategy. It works more than 90% of the time. Yet not one trader follows it exactly to the tee. Everyone has their own variations not only in tactics but in trade selection, time selection and currency pair selection. That’s why when people jealously guard their “secret” strategy I laugh. They may as well guard air -- it’s just as pointless. Share your ideas and they will only get better. Hoard them and they inevitably get worse.

In FX -Pro Traders are Dying, Retail Traders Rising

Boris Schlossberg

At the beginning of last week, Bloomberg ran a long story mourning the demise of the bank FX trader. “Take the pay cut, “ warned one veteran darkly. “Oh, and don’t wait for the phone to ring.”

The computers have taken over. The algos now do most of the market making and HFT firms like Virtu dominate flow whittling margins to a tenth of pip. Long gone are the days when you could take your mates for a beer and get preferential treatment on client flow. Or better yet when you could simply markup deals 20 pips or more for “non market” sensitive customers like corporates, pension funds and equity mutual funds. It was a great party while lasted, built on insider info, expense accounts and very little economic value.

Dealing FX still remains a cheaters game. Banks continue to pay their multi billion dollar fines for rate fixing and proceed in their tricks and treats. But the party is clearly coming to an end. Customers are much smarter, everyone has access to price information and competition has become fierce. FX will never be a totally clean market until it goes on exchange but it’s good enough at this point so that retail traders can play the game on mostly level playing field.

And therein lies the irony. The very same technology that is killing the pro trader is enabling the retail trader to compete effectively in that most unforgiving of arenas -- the FX day trading market. Right now as I sit and type this, I am looking at nine screens that give me the following services all for free:

Streaming dealable quotes as tight at 1/10th of a pip on euro and yen and 1/2 pip on cable. Just a few years ago I was paying as much as 5 pips spread for GBP/USD and now that’s often my profit on a trade.

Live Squawk box out of London that keeps me up to date on all the breaking macro and central bank news, so I can react quickly to any potential action.

An RSS feed from my buddies at ForexLive that gives me color on the market 7 days a week.

Charts, Charts, Charts -- you name it you can have it and all for either free or a few bucks per month.

A Live News Applet that gives me eco data as quickly as a Bloomberg terminal

MT4 -- my very own algo machine that lets me manage my trade inventory at the speed of light and takes all the sloppy trade entry/logic out of my fumbling hands.

Last but certainly not least -- Slack. The greatest software of the 21st century that allows me to trade in a chat room with traders from all over the world 24 hours a day 5 days a week. All of our trades are instantly uploaded into the room and we can discuss, analyse and get inspiration from each other -- just like a dealing floor but only better.

So as I observe the market changes over the past decade, I can honestly say -- it’s only getting better.

99% of Traders Can Do Better If They Just Do This

Boris Schlossberg

Everyone wants to be a big swinging d-ck.

Hollywood is full of stories of an underdog who takes on an insane risk and wins against all odds to becomes a hero for life.

All or nothing.
All in.
Let it ride.
Go big or go home.

We are all so familiar with these story arcs that we can probably recite them in our sleep. The emphasis in all these stories is always on winning it all. Indeed the central myth of America is winning. Just ask Donald Trump who has managed to make a career out of exploiting that myth for all its worth.

In real life however, and especially in trading, success goes to those who seek to win, but to those who learn how not lose. Like Warren Buffett. The difference in approach is exemplified by what I call the two models of trading -- the insurance model and the lottery model.

99% of us, whether we admit it or not, chase the lottery model. Have a hunch bet a bunch. Double your account in a week! Take $10,000 to $1 Million in…. You can fill in the blanks as easily as I can but you know deep down in your soul that its bullshit. The lottery is the ultimate suckers game, yet we all fall for it. Because we are all greedy.

I on the other hand try to spend all of my time being fearful. I love my trading models. They have served me very well, but that doesn’t mean that I follow them blindly. I never, ever, trust the market. Through the school of hard knocks, I learned that markets can always do the unexpected and they can always push prices beyond all reason and sanity. So I spend all my day passing up, rather than taking trades.

On any given day I must pass up at least 5 to 10 perfectly good opportunities to make money. Why? Maybe the price action looks a little too violent. Maybe there is news just a few hours ahead. Maybe I already have a very similar trade on the books and I don’t need to double my risk. Maybe the market just missed my entry price which happens so frequently that if I could bottle that frustration I would make my own line of cologne.

I’ve mentioned many times before that you can either predetermine your entries or your exits, but you can’t do both. I focus on entries because I can’t predermine exits. I exit early almost every time because of fear. Is that stupid? Maybe. It’s certainly easier to make 10 pips from one trade than to wring 10 pips from 5 trades that you closed out too soon. But you need to focus on the goal.

What’s the goal?

The goal is to make 10 pips moron!

Neither the market, nor your mother nor your family cares how you made your 10 pips. They just care that it was done.

In the very turbulent markets of this past week I’ve been running two accounts side by side. In my master account I’ve been trading like the meekest of accountants, blowing out of trades at any sign of trouble. In my beta account I just let it ride. My beta account had some really nice swings -- up as much as 2% on some days. Like the guy who hit 5 blackjack hands in row, I was living large!

But by the end of the week, guess which account was ahead? That’s right in real life the meek little accountant beats the big swinging d-ck every time. Because in real life lottery is for suckers and real money is made by the insurance companies who spend their every waking moment making sure they don’t lose.

Bernie Sanders is the new Ronald Reagan and Why Traders Should Care

Boris Schlossberg

Those of you old enough to remember, I want you to go back with me to the late 1970’s. The country was much more liberal then. Abortion was basically on demand. Environmental regulations weren’t just issued but were welcomed as a necessity and there was even talk of passing the Equal Rights Amendment for women. Oh and the NRA actually believed in responsible, restrictive gun ownership that required training and certification.

Along came a man who everyone said was too old -- way too conservative -- and whose ideas were far out of the mainstream. Also he was genial, charming and never said a bad word about his opponents.

Remind you of anyone? Of course. Bernie Sanders is the new Ronald Reagan and before you blow your red state gasket on my blasphemy, allow me to explain. Of course politically Sanders is the exact opposite of Reagan on almost every issue with perhaps the exception of immigration and guns but as a politician Sanders is the best reincarnation of St. Ronnie that I have seen in a very long time.

There is a reason why Reagan was able to get life long Democrats to pull the lever for the elephant and why Sanders in turn is able to draw massive enthusiastic crowds in the reddest of red states. Both politicians understood the power and discipline of a simple message. Reagan promised to cut your taxes and make America grow. Sanders promises universal healthcare, free secondary education and a $15 minimum wage that would allow workers to earn enough money to pay for food and shelter.

But here is what make both politicians unique and so successful. They don’t focus on anything else. Reagan and Sanders are both highly skilled and disciplined politicians who never waver in their message. No name calling of their opponents. No poll tested flavor of the day soundbites. Not even a moment’s thought to their appearance. Reagan -- the studio actor -- was perfectly comfortable in his all American suits and neatly cut jet black dyed hair. Sanders on the other hand has never met a rumpled shirt he didn’t like and a comb passes through his hair less frequently than through my daughter’s kinky curls. Reagan never tried to be a policy intellectual and Sanders never tries to be a debonair politician. Both men were supremely comfortable with themselves.

Which finally brings me to trading. You have a system. It works generally well. You follow its rules and more days than not it rewards you with a profit. So what do you do? Everything in your power to change it. Oh look one day it cost me 300 pips! I can’t possibly trade that again!

Learn the Trading Skills That Will Last a Lifetime

There is no greater sabotage in the market than self sabotage. And I along with everyone else am very guilty of that sin. The markets are constantly changing, so of course we feel that we need to change with them. But do we? Ultimately there are really only two ways to trade -- momentum or mean reversion. Every single strategy is simply a variation of those two ideas. Instead of looking for the latest and the greatest indicator that would help us to never-ever-ever-ever-lose-again we should should stick to and refine what’s working.

If there is anything that Ronald Reagan and Bernie Sanders have taught us it’s that simplicity works and that perhaps the greatest challenge to success is remembering to do the same thing day and day out.

Back to School – Trader’s Toolbox

Boris Schlossberg

It’s back to school time in the Northern Hemisphere so no better opportunity to tune up our toolbox and discuss some of the best must have resources available to FX traders.

Research

  1. Daily Analysis -- there is no better end of the day write up that from my partner Kathy Lien and if you don’t get her free research here is the sign-up link.
  2. www.ForexLive.com -- Adam and the whole crew of former bank traders and dealers keep everyone in FX world up to date on everything that happening 24 hours a day 5 days a week. Be sure to read the comments in some of the trade idea threads -- they often have some very interesting perspectives.
  3. www.Financialjuice.com -- A great aggregator of running headlines from all all across the web, but the true diamond in the rough is the free Live Sqwuak Box that gives you instant eco releases, news headlines and commentary. MUST have for anyone who day trades the forex market. It’s located on the top right corner of the page.
  4. www.Money.net -- haven’t tried it yet, but its billed as a Bloomberg altrenative and at $95/mo its a lot less than $2500 for the terminal.

Charts

There are a thousand charts packages available for FX traders and some brokers have nice packages as well, but I use two free packages that do the job just fine.

  1. www.Netdania.com Very serviceable java based package that allows you annotate charts and use all the standard indicators. If you want a multi-monitor layout you can also try their Netstation which is free and has lot of bells and whistles -- but like all java standalones it takes a bit of time to download
  2. www.TradingView.com It has many layers of service -- but the free version is just fine for me. Its biggest advantage is that it’s in HTML 5 and therefore very fast to appear in your browser. The biggest drawback is that I can’t get the chart to pop out.

VPS

If you use any time of MT4 EA you almost have to have a VPS (effectively a computer in the cloud) so that you can be assured of 24/5 uptime for your strategies. Several brokers including FXCM offer free VPS if you drop more than 5000 into the account. One of their offerings is www.beeksfx.com which is perfectly serviciable especially if you have only one or two strategies running.

If you want to have your own VPS I use www.atlantic.net which for $15/mo does a very good job of hosting the basic MT4 set ups. If you need more memory they have more expensive options.

Mobile

There is only one tool you really need for mobile and that’s MT4. The MT4 platform on Iphone/Android won’t let you execute EAs but it will let you place trades, adjust your stops and take profits, see quotes and charts -- and it’s all super fast and easy. If you ever catch me looking at my phone when I am on CNBC set -- that’s what I am looking at.

See how we try to harvest 50-100 pips.
Every.
Single.
Day.
Join the BK Trading Room

Next week -- I’ll take a look at more off the beaten path ideas for advanced traders. Any suggestions send them along to [email protected]

The One Mistake Traders Make All the Time

Boris Schlossberg

Here is a mistake we make all the time.
We are sick.
We are tired and sleep deprived.
We had an argument with a family member.
We are rushing to a business meeting.
And in all those situations we put on a trade.
Tiny.
Just for fun.
For sh-ts and giggles really as the Brits call it.
Inevitably this is a trade that blows up a month’s worth of profits.
How do I know?
Because I’ve done it a thousand times. And so have you.
In trading we are so conditioned to believe that success lies in “strategy”, in that one perfectly tested algo that beats the market all the time.
But in reality success in trading depends really on only one thing -- focus.
Like a good athlete, a top musician, a skilled surgeon -- we all need focus.
Knowledge alone is not enough. Markets are brutal. If you day trade, blink and the exit is gone.
Almost all good boxers have the skills to fight if they practice enough. Just like most good traders generally know how to trade their strategy. But what separates the champions from the rest is situational awareness, The ability to adjust, sometimes just by as an inch to the environment around them.
Great traders are the same way. They can “read” the market and respond appropriately. But that requires focus.
Very often we forget that.
Most of the trading mistakes are not a function of bad analysis, but rather the result of bad focus.
So next time you are sick, tired, angry, distracted and are on the verge of hitting the buy/sell button. Do yourself a favor.
BIG TRADES+DAY TRADES+24 HOUR TRADING ROOM -$145 All in
Don’t.

Real Traders Know…

Boris Schlossberg

One of the traders in my room said to me the other day, “I have this indicator I made, but I can’t use it yet -- it’s a still messy.” To which my response was -- it’s supposed to be messy, get in in there! That’s what trading is all about.

In the land of retail forex, chuck full of bogus and useless advice, the art of trading is presented as a simple act -- as easy as taking a selfie and posting it on Twitter. The broker ads show smartly dressed urbanites glancing at a pop up on their Iphone then pressing one button before smugly getting into their just pulled up Uber ride as they bank thousands of pips in between their daily appointments.

For those of us who risk real money every day, the reality of trading is quite different.

Real traders know that you haven’t really traded until you hit a sell button instead of a buy. Worse yet -- until you’ve sold a million instead of 100,000 and now watch in shock as a weeks worth of profits disappears in a matter of seconds.

Real Traders know that you haven’t really traded until you find yourself on the wrong side of a news release and watch as prices verticalize against you executing your stops 50 or even 100 points away from their intended origin.

Real Traders know, that at any given day, the ISP, the broker platform, the fiber optic cable between NY and London can all go down -- sometimes all at once -- leaving your orders floating in cyberspace for no one to execute.

Real Traders know that the SNB lift of the peg is not a “once in trillion event”, but pretty much what happens in FX every 5 years or so as the “world as we know it is about to end.”

Real Traders know that despite more computing power than is needed to run our nuclear defense capabilities, markets at their core are very human enterprises and therefore are messy by definition as they are subject to all the whims of sentiment.

That why I loved this other email I got this week that told me our service sucked because,”All I wanted was some precise and well analyzed trades with very high levels of accuracy and not guessing or speculations, which change all the time.”

Good luck.

Real Traders know that “guessing” and “speculation” is what we actually do for a living as traders.

Which is why Real Traders in my room make money every day. They are not afraid of getting messy. They are not afraid to “guess”. They are not afraid to lose. More importantly they are always open to finding new ways to play the Great Game.

See the VT Strategy Revealed in Live Market Action

Meanwhile all the amateurs continue to believe that all you need is “precise well analyzed trades with high levels of accuracy”. Haha.