My Insane CFD Journey: Down 340 000 USD, Then Up 620 000 USD
So… After the post I wrote on Friday, I did the WORST MISTAKE you can ever make when trading CFDs. I decided to buy Dow Jones that was plummeting. RSI and Stoch showed overbought and the markets were about to close. I thought that we would see a quite rapid rebound effect as there are little macro numbers supporting such a drop except pure market psychology. And the last months trend were bullish. I broke two of my trading rules: “Never trade when you are done for the day” (will add this to the rules now..!) and “Have 0 active positions during the night”. I actually kept this position live over the weekend, this made me pay an interest fee of the borrowed amount – and the price fell sharply when the markets opened – I had no chance to close the position (very risky!) I made a big blunder, and you can tell I was feeling pretty stupid. I had eradicated all my gains the last 6 trading days and I had blown 75% of my entire bank roll in one single trade. Of course, the market fell harder than it had done in 2 years. There was no way we could predict that drop. Yet alone the 1500 points drop on Monday. So I had the worst position on the worst days possible. Unlucky, or lucky…
It taught me some important lessons and I’ve updated my trading rules to the following:
- Only risk max 2% of my bank roll per trade.
- Have 0 active positions during the night (first of all, I lose sleep, second; you are charged an interest fee for leaving a leveraged product overnight.)
- Always trade on last month’s trend including the previous day(s). If they do not correlate, I will not trade.
- If one position is lost, I’ll double the amount (martingale) and do a second trade. I’ll only stop doubling after 3 consecutive losses.
- Do not think about lost trade opportunities.
- Markets to trade: Dax & Dow (minimum spread).
- Stay updated on economic releases prior to entering a trade.
- Do not have emotional ties to the money. I like to call them “points”.
- Only enter a position when an asset is overbought or oversold shown by both RSI & Stoch at the same time.
- Always write down your trades and elaborate what went right or wrong.
- Never trade after you’ve said you are done for the day.
- Never bet on a rebound when the prices are falling or rising sharply over a longer timespan.
Here is the Dow Jones trade I did on Friday which I managed to cancel on Monday morning.
So, Should I just quit. Take my losses?
I felt angry that I didn’t short the market, which I did multiple times last year (ending with a big loss). I managed to keep these feelings to a minimum. I added more funds (that I also could lose comfortably), and started trading like a maniac. Bought the dips, shorted drops. By the end of Monday, I was up to previous high + 20 000 USD. And today, I managed to make 236,933 USD. Right now, I’m pretty happy that I managed to turn this around or else I would have been a bit devastated.
|Order||Entry Price||Take Profit||Stop Loss||USD||Bank Roll USD||% Change|
|Day 1||25.01.2018||Dax||Buy||13268||13274||13262||6 472,52||264 537,03||2,51|
|Day 2||26.01.2018||Dax||Sell||13342||13318||13392||7 642,84||272 179,87||5,47|
|Day 3||29.01.2018||Dax||Buy||13331||13336||13313||12 508,39||284 688,26||10,32|
|Day 4||30.01.2018||Dax||Buy||13226||13233||13176||6 625,94||291 314,19||12,88|
|Day 5||31.01.2018||Dax||Buy||13217||13230||13187||26 474,06||317 788,26||23,14|
|Day 5||01.02.2018||Dax||Sell||13291||13265||13327||10 834,58||328 622,84||27,34|
|Day 6||02.02.2018||Dax||Buy||12797||12825||12772||72 314,97||400 937,81||55,36|
|Day 6||02.02.2018||Dow||Buy||x||x||x||−340 000,00||60 937,81||−76,39|
|Day 7||05.02.2018||Dow & Dax||x||x||x||353 333,33||420 000,00||62,75|
|Day 8||06.02.2018||Dow & Dax||x||x||x||236 933,20||656 933,20||148,33|
x means that I’ve done multiple trades on a short timeframe.
Now a look at my stats using ProRealTime
USD is approx 7,8 NOK.
The stats are a bit skewed since it only started recording on February 2nd, while I started trading January 25th.
You can see that 7 of 10 trades are winning trades, which are pretty good. What initially brought me down was the single trade that just went horribly wrong. But that’s trading, sometimes you hit the jackpot, sometimes you just lose a lot of money. That’s the game, and you have to play balls to keep yourself together and win over the market.
I’ll open an academy soon
To train people that would like to know my trading style and what I do. Stay updated on Hacked.com for more information on it later.