Ok, stupid question but I just started playing around with forex… I don’t get how people can lose their whole account so quick.. Aren’t the odds of winning or losing a trade close to 50/50 if you set your stops far enough? say I have a $10,000 account and trade 10,000 units of eur/usd every trade so thats $1 a pip and set my stops at 50pips and every trade I do the same thing. THen I flip a coin and say heads I buy and tails I sell and do this over and over.. it should still be close to 50/50 right? Now what if instead of a coin I increase the stops to 100 pips and just follow the trend using simple fundamental techniques? This should be a good way to win right? What do you think?????
simion-yes I know, there’s of course reasons why the market moves the way it does but the coin does not know or care. So if the USD suddenly decides to turn around and I sold the EUR because that 50/50 coin toss decided tails then I make money. The chance is still 50/50 because the chance of hitting either stop is close to equal. I don’t see what leveraging has to do with it this. If I use leverage to increase my buying power I don’t go full leverage because that’s the easiest way to kill yourself, that’s obvious I think you’re just increasing your chance of getting margin called especially with 50/50 probability. The only factor swaying the 50/50 is the spread. THank you for your response though I am just trying to figure out and this was just my initial view of the market.. I’m far off from learning fundamental methods of trading, it will take me years to understand it and even then I don’t think that knowledge will pay off if I don’t have the fortitude to make confident trades.
yaguru- iam not competing with the likes of soros just like walmart doesnt compete with the guy selling homemade trinkets at venice beach. I don’t think big fish like them don’t care about the seasponges like me. with $2 trillion in trades a day I’m a drop in the ocean.
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you will be broke in a few weeks. Do you think you can compete with the PHD mathematicians who buy billions of dollars worth of currency????
Because, there are truly so many fundamental variables built into each traded currency, it’s not really 50/50. So many outside forces directly sway the market so that there is no true randomation in said market.
For instance if I flip heads one day to buy said currency and their government decides they are going to print more money, the value drops and you lose. Ok now that’s one day event.
Now imagine I flip the same coin on the same day and for a month consecutively. Odds are that half the time my coin will say heads and buy and the other half will say tails and sell. If there happens to be a long-term variable pushing the market in either direction, then you are pretty much screwed and for several reasons.
First you are leveraging, or at least most Forex accounts are, so you are using money you don’t really have and there fore don’t have as much control over. If the market changes drastically to your disadvantage you have to stop. If the market runs to your advantage than you may miss out if you have your stops set to close.
I guess the best way to say it is do your homework before you make a trade and know what your doing, random odds don’t work in a market with so many variables.
If you are just starting out you may want to try your strategies on one of the foForex accounts where you don’t really play with money.
Any way good luck and if you find something that works well let me know.
The important thing in forex trading is money management and not overleverage
Most people wipe out their trading accounts because they’re not aware of the true risks of Forex trading.
It’s like entering into a jungle without knowing how to protect yourself against the predators.
If you’d like to find out more, check out my free report at
The truth is your BROKER hunts your stoplosses by either selling or buying huge amounts in order for price action to take it to your stoploss. As soon as it hits the stoploss, they cancel the trade and price action moves normally. I read this in many articles and have seen it myself.
I also found this blog that has saved my forex trading
Hope it helps!