Like live trade videos? This is a cool one, a quick 30 pips gain on GBP/USD using just a reversal candle and a psychological level. Next video coming tomorrow I will explain exactly how I took this trade.

Enjoy this post? Then leave a comment and say thanks!

Hey Guys,

Here is this weeks analysis guys..

Do not take any of these trades unless you have downloaded and read the free e-Book explaining my method.

Hey Guys,

Here is the analysis for this week. I’ve been very busy for the past few weeks. As I said in my last post my mum came over here to Edinburgh to see me. I hadn’t seen her for 8 months so. So I spent most of my time out and about showing my mum the city.

Anyway back to trading this week… enjoy the analysis.

Do not take any of these trades unless you have downloaded and read the free e-Book explaining my method.

Oops sorry guys. Last week I made a post that for some reason never actually came through to the blog. I just rewrote it now. Hopefully this explains why I haven’t been posting much this week and last…….

As most of you probably know I was born in Australia to Italian parents. In Feb this year I went to Italy to visit the rest of my family and spend some time over there. I spent two months there and then went to Scotland. I decided to live in Scotland for a while and have been here for 8 months now.

Two months ago my mum decided to fly to Italy to visit her family. She just arrived yesterday and she will be coming here to Scotland this week to visit me. So last week I was very busy preparing for my mum’s arrival and this week I will be busy taking her around Scotland. This of course means I will not be able to do the weekly analysis.

The analysis will resume next Monday though.

By the way guys I move back to Aus mid November. Can’t wait to get back to the warm sunny weather.

Sorry about having to skip the analysis but I will try throw up some other posts and live trade videos. Also tomorrow I will be releasing making a very important post so be sure to check back.

Hey guys,

I know how much everybody loves these live trade videos so I shot one today.

This was a great trade. However, it was a little tough and I didn’t end up hitting target. In this video you see something new though. You see me using the 15 min chart to manage my trade. This is a new way to manage trades that I have only begun doing recently. thanks tot he 15 min, I managed to pull pips from a trade that if taken on the 4hr would probably not have worked out.

Especially with current market conditions it is getting tough to get a full 70 pips on a trade. So I have started monitoring my trades on a 15 min chart. This allows me to spot possible reversals in the trend and get out before the price reverses and hits my stop.

This reversal trade was an awesome example of my utilization of the 15 min chart to trade the 4hr chart…. enjoy!

Enjoy this post? Then leave a comment and say thanks!

As this year draws to an end, I have to say it’s been a tough one. Overall, I am still profitable by about 2800 pips. This is a huge contrast to my normal 5000+ pips. This year has been the hardest to get through, since my first, and I have learned some valuable lessons. Two of which I will share in this post:

Lesson 1: Have Backup Pairs – While I still believe that newbie trades should only trade one pair to keep things simple I have learned that backup pairs are important. Some periods this year my bread and butter pair GBP/JPY became a less efficient pair to trade. I went from profiting on 8 in 10 trades to profiting on 6 in 10 just because of how GBP/JPY was moving.

So I started looking at other pairs EUR/JPY and GBP/USD. When GBP/JPY wasn’t doing very well either both those pairs or at least one of them was doing very well.

So now I have changed my tactics slightly. I still only trade GBP/JPY week to week but I always do my EUR/JPY and GBP/USD analysis. This way I have them as back up pairs. If GBP/JPY starts to falter I can always move to trading the other pairs for a while.

The reason I do analysis on them weekly is just to keep myself familiarized with the pairs. I rarely trade line breaks on those pairs as I only like to concentrate on a single pair.

Lesson 2: Manage Trades on 15 Min Charts – I used to think it was useless to drop down to a lower timeframe to manage trades. I was wrong. When I take a trade I always enter on a 4hr chart. As soon as I am in the trade though I switch to the 15 min chart. The smaller timeframe allows me to see price action more clearly.

If for example I am in a short trade and it plummets down and the price action indicates that the bears are in control then all is good. However, if I am in a short trade and on the 15 min chart I start to see indecision (reversal) candles forming, I know that this trade might not go my way.

This has allowed me to close out bad trades before they go back and hit my stop loss. So instead of losing 50 pips I can see a potentially negative trade coming and close with a 30 pip gain. Or I can close out half my position with 30 pips to counter losses, if the trade ends up going bad.

These two simple lessons have helped change my trading and make me more profitable. I do consider myself a pro trader but I do still have things to learn. So if you trade my method take note of these two lessons. If you trade another method and things haven’t been going so well don’t give up. Look at your method and make the changes needed to improve it’s efficiency.

Demo accounts have three uses:

1. For brand new traders who need to learn the basic concepts of trading i.e. pips, long and short positions.
2. Testing out a broker’s platform before going live.
3. Primary testing for a new method.

That is all demo accounts should be used for PERIOD!

My email inbox is scary because it’s full of horror stories. They almost always start and end the same way. A newbie opens a demo account and triples his pretend money. Thinking he is a super trader he goes live with lots of money and loses it all.

Why?

Well think about it this way. If a little 8 year old boy pointed a toy gun at you and said “give me all your money” you would laugh. If some big tattooed grizzly bear looking guy on a Harley points a real gun at you and says “give me all your money” you would probably hand over the money. One is a small unintimidating child with a fake gun the other is a big intimidating criminal who robs people for a living.

The difference between demo and live trading is the same. On one hand, you got an unintimidating fake market on the other an intimidating live market in which you trade real money.

Even if you get a kid to point a toy gun at you 10 times a day for 6 months when the big dude on the Harley points his real gun at you, you won’t be prepared and you will hand over your money.

Many people use the flight simulator metaphor to advocate the use of demos. They say some rubbish about how pilots being trained on flight simulators relates to traders being trained on demo accounts. Talk about a flawed concept. Would you trust a pilot who has only ever flown on a simulator? I wouldn’t! All pilots have to log 1500 hours real flight time. Just as all boxers have to spar with real opponents and soldiers in training have to fire real bullets.

Demo trading is bullshit so let’s take a look at why:

1. You Don’t Trade Real Money – It is impossible to have that same sense of uneasiness on a demo account because it is like playing with Monopoly money. Think about it:

• It’s not real money on the line.
• There is no real risk.
• If the trade goes bad you won’t lose anything.

Every trader who has traded a live account knows about the ugly emotions live trades dredge up. Emotions like:

• The fear of a possible loss.
• Questioning of your analysis whenever a trade moves against you.
• Nervousness and anticipation of the end result.

While some of these feelings might be felt when demo trading, you will not feel them to the same extremes you would when you’re trading live.

Pro traders like me learn to control the nervousness. They do this by building up their confidence through live trading. The more trades you take the more confident you become and the more numbed you become to those negative emotions.

When a newbie first puts real money on the line those all those ugly emotions rear their heads. Since newbie’s have not learnt control the emotions can wreak havoc on their accounts. So a newbie has to learn to control those emotions before becoming a profitable trader.

Trading with Monopoly money cannot give you that same rush of destructive emotions. In fact, traders trading demos tend to take trades more liberally and they build up a false confidence. This often leads to developing bad habits such as risking too much.

It doesn’t matter what you tell yourself. The emotions you feel when the Harley dude points a real gun at you are different to the emotions you feel when the little boy points a fake gun at you.

2. Losses Don’t Feel as Real – I remember when I first started live trading. Whenever I entered a trade I would watch my charts like a hawk. This was especially true when a trade went against me. I would sit and watch, 2 pips, 3, 4, 5, 6……. With every pip that ticked away against me I could feel a little more money falling out of my pocket. I felt it, that stinging sense of loss, because it was real. When the trade finally hit my stop I was $200 poorer.

Would you feel that same sting of loss with a demo account? No! You might feel upset, annoyed even. However, you have the same amount of money in the bank as you had an hour ago. So that feeling of losing your hard earned cash doesn’t show up.

That sense of real loss is an important lesson for a newbie trader. You need to feel that loss to grow as a trader. You also need to numb yourself to that feeling. Every trader has losing trades and learning to accept losses is a valuable lesson a trader must learn.

To learn to accept loss you need to experience real loss.

3. Demos Are Rigged – This is certainly not true of all Forex brokers but much more brokers than you would think rig their demo accounts. Being slipped on entries and exits during volatile periods is a part of live trading. It happens and it’s the nature of the beast. We pro traders know that and deal with it.

However, many brokers out there offer demo accounts in which you get little to no slippage. This gives traders a false sense of how the market really works.

Personally, I would love to never be slipped a single pip on a trade, all traders would. However, sometimes broker just cannot fill you at the requested price. Sometimes you might be slipped 2 pips other times 10 pips. Slippage can eat into your profit margin significantly on some traders.

Many demos give you a false representation of the broker’s performance. So newbies who trade demos for 6 months are trading a much safer market. The real market has snares and traps that can catch or strangle the life out of an unaware newbies account.

Alternatives?

Easy, you just open a small micro account with $100 or more in it and trade live. This will allow you to:

• Trade real money and learn to control the negative emotions such as fear.
• Actually feel the sting of a loss and learn to deal with it.
• Experience actual market conditions and become accustomed to things such as slippage.

So if you’re a newbie who has been trading a demo for more than a few months it’s time to open a real account. Heaps of brokers offer small accounts and micro accounts, here are a few:

• GFT Forex
• Alpari
• FXDD
• Forex.com

GFT Forex are my personal favourite and I have been with GFT for about 5 years now. You can open a mini account with $250 USD.

When Demos are Ok

Demo accounts can be useful at times. You should only use them for the following reasons though:

1. If you’re a complete newbie and need to familiarize yourself with Forex basics such as going long and short you should definitely mess around with a demo account for a few weeks.
2. If you are considering going with a broker but you want to test their platform before committing.
3. If you have developed a new method and you want to do some primary testing on the method to see if the concept works. However after primary testing you should thoroughly test any method on a small live account.

If you’re trading a demo account for any other reasons, it’s time to find your courage and commit to a live account. Do not open a live account with your life savings. Instead start with only an amount you can afford to lose.

Agree or disagree? Discuss below. This is a very important subject so I would like to hear other opinions.

Hey Guys,

Analysis is a little late this week. I have had a ton of internet issues, in Australia I had no internet problems, in the UK I get ten drop-outs a day. Anyway, this week you can catch me in the chatroom every London session, I will be:

- Doing daily live analysis.
- Taking some live trades (if they occur while I’m in the room).
- Discussing me new trading method which is based on live price action analysis.

The live analysis in the chatroom will be recorded and posted to the blog.

Ok, on to the weekly analysis:

Do not take any of these trades unless you have downloaded and read the free e-Book explaining my method.

Ok guys after almost 250+ applications (for some reason 70 or so came via email instead of being posted as comments???) it came down to two people. I couldn’t pick between the two so I decided to pick both. I am going to mentor one at a time. Before I reveal the winners I am going to go over a few things. When I first made this post I set a 30 words or less but for whatever reason 70% of people decided to ignore that limit. I am sorry but I had to disqualify anybody who went over 30 words. I did not count “Hi Nick”, or sign off’s in the 30 words. I set the 30 word limit because I was looking for somebody:

1. Who pays attention to detail and can follow clear instructions: I didn’t want a lapdog who would follow my lead without questioning me. However, at the same time I didn’t want somebody who would ignore me and not listen to me. This is going to be a mentor/mentee relationship and things will go much more smoothly if the person I pick sticks to what I say. So the 30 words or less limit was a test.

2. Who was innovative, laid back and funny: I really wanted somebody who could sell themselves in 30 words or less. I was also looking for somebody who made me laugh. And I wanted somebody who could bend the rules. If I am going to spend 2 month training somebody I don’t want to be bored to tears, so I was looking for humour not sob stories.

So my first pick is NavyGirl, she’s in the Australia Defence Force.

Submitted on 2009/09/30 at 11:07pm, NavyGirl:
Nick,

Ima 27 year old chick from Melbourne. I serve in the Aussie Defence Force as an officer. Love the Navy but would love to learn to trade too. Pick Me!

Sirena

I love my country, visiting the UK and the rest of Europe  has made me appreciate just how amazing Australia actually is. For example I could wake up with a headache, drive to the doctor with no appointment and see the doctor within 30 min, all at no charge. Here in the UK you need to make an appointment a week ahead to see your doctor and you can only see a doctor you’re registered with. How does that work? “Hi Doc last week I had a headache”….. bullshit!

Also, our politicians are not corrupt assholes, we still have many freedoms that in recent years been stolen away from the Brits and the Americans by their leaders. So, I have unending respect for anybody courageous enough to put their life on the line to protect my amazing country. Thanks for serving in the Defence Force NavyGirl, you’re my first pick to mentor.

Ok time to step off of my soap box. Guys I know that had nothing to do with Forex but I hope you understand my reasons for picking NavyGirl.

Ok the next mentee I picked for a different reason. This guy obviously paid attention to my post stating 30 words or less. However, he was able to bend the rules in a funny way. He is a perfect fit for my trading method since my method has little to no rules. Most traders make the mistake of setting unbreakable rules for themselves, the rigidity of this form of thinking usually leads to failure. If somebody is able to bend the rules they’re much more likely to make it as a trader. None of you guys saw this image because for anti-spam reasons images do not appear in comments. However, the words in the comment were visible:

Submitted on 2009/10/01 at 6:31pm, Scott:
I put a lot into this… I hope it works!!! I don’t want to have to rely on my looks!

I love how Scott bent the rules in a funny and innovative way. Also, all the time Scott spent on making this image proves that he will be a dedicated mentee.

I want to thank everybody who took their time to leave a comment. Like I said I was absolutely astonished with the response. Almost 300 people applied to be mentored, it was almost impossible to pick only two people.

I am going to find a way to help out everybody who applied. While I obviously cannot privately mentor everybody I am considering shooting a few free videos on my new method. I will give everybody more details in the near future.

Thanks again to everybody, and thanks for the many kind words.

Nick

ADDITIONAL INFO – I am looking for a mentee who can read and  who has common sense. This post is an UPDATE to the original post! If you wish to apply for the mentoring please reply to the original post. Any responses to this post will not count and will be ignored.

Hey Guys,

I have to say I am completely overwhelmed with the response to yesterdays post. My last post was only made 18 hours ago and already 130 people have responded! I have never had so many comments to one of my posts. I really wish I could mentor everybody but that would be impossible.

Rainer made a post asking about a Skype conference call.

Hi Nick

a brief suggestion!
when you do your mentoring, I would be very interested as so much other, why isn’t is possible to do a conference Skype call and only one at the time can ask questions, if the listeners do not obey the rule you kick him/her out of the conf. call.
just a suggestion, because i as so much other would be very happy to be your guest.
thanks for considering.
the best
Rainer

On paper this sounds like a terrific idea but the truth is nothing really compares to one on one mentoring. Group sessions end up sucking and you cannot really build up a proper mentor to mentored realationship. Thanks for the suggestion but I have tried similar things before and it just doesn’t work.

Guys I have not picked a winner yet and wont until Friday this week so keep the comments coming to the previous post.

Believe it or not I have read all of the 130 or so comments. Here are some of my favourites so far:

MrPippin:
Pick me or I’ll punch you in the face.

Michelle Neisler:
HI Nick!
What a lovely offer! I think I’ll take you up on it!

You should pick me. Pick me! I’m a San Diego personal trainer, I’m tall, blonde, fast approaching 50 yrs of age and I am absolutely fabulous. I am fascinated by Forex trading. I love the volatility and the income possibilities that exist with trading currencies. I am looking forward to learning from you and expanding my horizons, not to mention my designer handbag collection!

Remember, pick me!

Cheers

vinomaker:
What a dream come true! I have been wanting a mentor for some time now. I believe what you think about comes about and my motto is “Thoughts Become Things, So Choose the Good Ones”. I have attracted this opportunity into my life as I continue to create my own reality each moment. I do not live in the past or future, I live NOW in this moment. I have the time, concentration, and desire.

There are a few more I like but I don’t want to list them all. We also have a ‘Moron Award’ to hand out. Despite my saying no sob stories some guy wrote this…..

Vinesh:
Hello Mr Nick,

I live in India and I hurt my back in a work catastrophe 9 month ago. I was told I am never to work in manual labour again. I have one son and my wife is pregnant with second child. If I cannot make money in Forex I must go to live in the street and my childs grow up homeless.

Please help me Mr Nick.

Bye

The funny thing is, this guy is not from India. I see all the IP addresses of people who leave posts. This guy is from Texas in the United States…… So Vinesh or whatever your real name is you have won the coveted Forex4Noobs Moron Award. By the way…. If you were selected for the mentoring oppurtunity how on Earth did you plan to fake a Indian accent for 2 months?