I would like to introduce to you, John a mid-50th old school punter and Gerry eager to learn anything new under the sun. They are both trading proprietary FX for their own accounts.
Gerry: “Hi man, how are you doing”?
John: “Hey man, fine I guess.”
Gerry: “Wrong side again eh”?
John: “No. This Market is just not going anywhere. You know it`s these computer guys they say. They call them Algo. Instead of hiring good traders they let machines for millions do their thing. That`s what Barney said in the Pub. You know, they just fired him and now he is gonna trade for himself. Well not that it makes a lot of difference. He was trading at the bank already for himself but got paid for it.”
Gerry: “John that is the difference. If you have to trade to pay your rent and make the misses happy and have no reserves, you are up the creek without a paddle when you’re into drawdowns”.
[Tweet “If you have to trade to pay your rent and make the misses happy and have no reserves, you are up the creek without a paddle .”]
John: “You have just got to relax man and don`t let the market get to you. Once it does you’re a goner. Look I am a flow man myself. If you wait and go with the flow and get out in time, than you are in business. You youngsters with all your analytical stuff! Did Marc Rich trade off charts, or George Soros, or Bank Negara, or… You bet they didn`t. But they knew the flows and the reason for it. That`s the true magic of the markets.”
Gerry: “Bollocks. The charts tell me all there is to know. I have the averages, indicators, market profile, head map and oscillators and of course for the bigger picture I look at Ishimoku now as well.”
John: “What, Sushi”?
Gerry: “You see that`s what it is. You are not prepared to adjust to the new things”.
John: “Here we go “28”!”
John: “Well what price comes next after “28” sunshine? What does all your technical stuff tell you”?
Gerry: “Well, I have to look at the different timeframes and draw some lines you know to see the picture”.
John: “But you only have this price in the moment, so what`s the next”?
Gerry: “What do I know”!
John: “Bingo. But if you know in which way the flow is, than you can assume the direction, i.e. whether it will go up or down. That`s why I am a flow man myself and have a plain chart”.
Gerry: “But how do you know, really”!
John (looking at his well-established tummy): “Well, it`s my stomach you know”.
Gerry (rolling his eyes): “Jesus John, you are telling me that you have just been trading by listening to your stomach. If you had pizza the Euro would go up and after a good fish and chips GBP would be on the move. Get off.”
John: “Well, I talk to my buddies in the market, read a little bid, have an open mind, don`t take this game to serious and yes I look at the candles, a bid as well I admit, but only the candles”.
Gerry: “Got you! So you also do some technical analysis”.
John: “No. I have made up my mind before I look at these colored things and when they confirm the flow and direction in the past, they still can`t tell me what`s happing next. But if I am open minded to what`s going on around me, I mean in the world as such, I will get a feeling where the future flows might go and then I am ready to go with the flow when its moving.”
Gerry: “Ok you wait for a trend and then you go with it. Got it! And what`s with your buddy”
John: “Well I will see him now for a pint. Have to do something to help him as he is an equity guy and owns breweries.”
For some more info on what not to do, check out “Common Mistakes One Makes While Forex Trading“
This article was written by: Gerhard Wildies
Winner’s Edge Trading, as seen on: