| Is Forex trading astrology for geeks? |
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| Written by Paul Whipp |
| Friday, 21 August 2009 15:40 |
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Forex derivatives are an exciting prospect for anyone interested in making money. That includes me. In essence Forex is an incredibly liquid market where you can use your PC to buy or sell currency instantly. The costs are modest and the leverage is substantial so only a small movement in the currency is necessary for your trade to become profitable. There are plenty of details available elsewhere describing this so look here if you want more background. Swing trading means trading purely off the fluctuations in price that are predicted using the price history or other immediately available historic data (such as trading volumes or prices of other currencies). Swing trading is intuitively appealing - when we look at a fluctuating price we see trends and it seems natural to believe that we could profit by buying (or selling) at the start of these trends and then closing the trades for a profit when the trends end. Reality is a little more tricky. When you are trading for real you can only trade at the extreme right hand edge of the graph - in other words you are guessing where the price will go next. Suddenly things seem a whole lot less predictable. If the market was perfect then all of the supply and demand and all of the fundamental factors (interest rates, politics, commodoties demand etc.) will determine the price from moment to moment and it would not be possible to profit by swing trading other than through luck. But... If enough people believe that the price is determined by its history and they buy and sell on that belief then the supply and demand that those people generate can indeed be predicted by using the same price history that they are using. If there are enough such people then perhaps enough of the variation in price can, at least sometimes, be determined purely using the price history. It is this tenuous possibility that keeps me looking at forex as a potential source of income. That, plus the fact that 3 trillion dollars a day changing hands makes it the largest virtual casino in history. After over 4 months of research I am still unsure if I can make money swing trading forex. I am still researching. I have reached the position that if someone can accurately describe a strategy that is based upon available forex data, then I can code an automatic version of that strategy and run simulations using real back data to verify whether or not it will really make money. I'm still looking to find a strategy that can actually make a consistent profit - sadly I know of no way to prove that such a strategy really exists but it seems possible. The moment such a strategy does indeed prove profitable, I can use the same code used to verify it to actually make trades. That would be very cool because it can make a percentile gain over time with no further action required on my part except for deciding how to spend the profits. I recently attended one of Greg Secker's empowernet driven seminars proclaiming to reveal the "ultimate forex secrets". The three strategies he promised to reveal (after you pay him) are all swing trading tactics in sharp contrast to Greg Secker's blog which suggests a focus on trading fundamentals. Greg tells me he is a real trader and shows me a video of him 'making money' and after two hours of pleasant anecdotes and some light background on forex he then asks for $12,500... no make that $8,000... ok specially for you if you sign up right now $4,000 for a 2 day seminar. Only then will he reveal the secrets I need. Well, if he had those secrets (indeed, if they even exist), he would be trading. Greg is a salesman and as he is selling himself in the seminar the only thing I could learn from him is how to sell - perhaps a good idea because people were queuing up at the seminar so he'll probably clear $40,000 or more for a couple of months work - hardly a traders fortune but quite a good living and obviously more lucrative than his own attempts at trading. I've learned that it is scarily easy to create trading strategies that are provably fantastic so long as they are proven on the same information that they are developed on. I started using the notion of channel breakouts where I judged that if a price has been roughly constant for some time and then starts to change it is likely to change by enough to make a good trade. Optimising this showed that I could double my money in a month using a 50pt high 15 bar long channel with a tight stop loss and modest profit. Fantastic! I did the test on two months of data, the same two months I did the optimisation work on. Guess what happened when I tried the same strategy with the same optimisation on the following two months: It lost around 30%. Hmm... +100% to -30% in four months. The reason is actually quite simple. Almost any strategy can be optimised and if you test it on the same data it is optimised on then it will perform well. Remember this if you are tempted to buy into a "proven" strategy or plan. Now I always test against different periods to those that I optimise on. As a result I am still searching for a strategy that can really deliver. Of course, when I do find a truly profitable strategy, you will be the last to know. Trackback(0)
Comments (16)
  written by Paul Whipp, November 06, 2009
Thats great to hear Mike, if you continue that for a year and only withdraw $2k per month, your $80k account will stand at $500k after a year and in three years it will top $80 million dollars! I hope you make it.
Of course Greg would be long past the billion mark assuming he'd invested even a small portion of his course revenues when he started. I wonder what keeps a billionaire flitting from hotel to hotel drumming up candidates for his courses?
 written by attilas, August 03, 2010
Mike, Iam just writing to you, because after 3 hours of trying to find some logical comment on Secker's scam, yours was the first one. Everyone else seem either to not care, or care only to comment if his/her methods worked for a few days. I am a hedge fund trader - being here for 6 years - and I have a few Masters, CFAs, the whole lot needed to be successful in the empty world of finance - making the 7 digit figures - all of that, and in my free time I am trying to find ways to critisize the stupidity of people that believe there is a system, that trading can be taught. Trading is just luck - some people, as always, are luckier than others, hence can make money for a few years in a row - they are still part of the distribution; if they ever have a system that can consistently make them money (which by definition is what Secker says), then they will be very stupid to teach it - because if they do it to a lot of people (and that's what Secker wants to do) - the system stops working. So either Secker is a very stupid trader - or - as he says - he likes to give - in which case (and I take the example of one of his traders/teachers, a guy called Max Idzik, who claims can make 3% a day!!), why doesn't he take a grain of salt, and just trade it for 200 days with 3% a day, that will make him 100mln in 7 years - and then he can give all he likes. Thank you for saying the obvious and I hope more people will take notice, and spend their free time in more meaningful ways.
written by Paul Whipp, August 03, 2010
I think you mean me not mike from the content of your comment.
We live in a time when its easier to make money by inventing something that doesn't work and putting the real effort into marketing it (rather than making it work if that is even possible) so people pay.
 written by Max Idzik, October 04, 2010
I have always admired people that obviously either have no clue what they are talking about, or are part of 95% of the herd in the markets that consistently loses money. It is very sad that you have to show publicly your frustration with your own personal failure.
And especially for atillas, it is actually 2.5% to 3.6% per day, and most days by 9:30 am. And yes, my target is 100m and i am well on a way to achieving it (from 20k account). I am sorry that you are part of the herd, lost in randomness, and under-achievement. Obviously your master cfa's are not helping. I suggest you spend less time 'critisizing stupidity' and more on research, and maybe, just maybe, one day you will really understand how the markets work. A tip here: try to get personal mentoring from George Soros...if you can.... and stop moaning. And Greg doesn't just sell a system that is consistent (9 years of forward testing), but it is a proper mentoring for several months, that delivers results. So before you write something, try to learn a little bit about it. Ignorance is a blessing, sometimes - but not in this case (see your random results)... Good luck in trading  And think about it, every time you hit a loser, most likely I am pocketing your money
written by Paul Whipp, October 05, 2010
Hi Max, we agree on the 95% losing money. However, the other 5% are certainly not using Greg's (or comparable trend analysis) methods.
You call me stupid and perhaps you are right but I did get First Class honours at Oxford University so at least a few people disagree with you. I believe its really simple statistics and common sense rather than stupidity. 9 years of forward testing would be fantastic. If successful, it would, of course, mean that Greg would be one of the richest men on the planet so its a bit strange that he is still spending his time presenting a very hard sell getting people to attend (and endorse) his expensive training courses. Bottom line for anyone: ask yourself "Would you have a full time job hard selling expensive courses if you have made literally billions of dollars?". Be smart not stupid. You might play his system and get a short run of winnings - with thousands of people paying him (and people like him) for the tips, some few dozens even hundreds will certainly win for a while - but even if you get lucky to begin with, you will lose in the long run.
 written by Rae Grieve, October 07, 2010
I am one of Greg's trading trainees and I do wonder why Greg battles the jetlag globetrotting giving seminars. I think he likes it. He also likes to think he is helping people to become a profitable trader. His system of providing coaching for traders over a long term (with Max and others) is the reason he succeeds I think - looking at trades and discussing how to improve trade selection, plus learning to use discretion as well - not just Greg's 3 trading strategies but building on these in a personal way. Success is nearly always a hard road but for those who keep steering towards it it does happen. May I suggest that many of the 95% who lose give up too easily. By the way Paul First Class Honours at Oxford doesn't give you an edge to be a better trader than the rest of us. Traders need to think outside the square - extremely outside the square. First Class Honours is certainly not a qualification that will make you money I suspect. Satisfaction maybe but not money. My degree never made me money for sure! If you believe everyone loses in the long run Paul you will indeed lose in the long run - or more likely the short run. Be smart not stupid.
 written by Man Li, October 08, 2010
Be a good trader is a long journey. I was one of Max's trainees before, I won't say I'm a good trader, but at least I can see where I am in this journey.
I can tell you, only few days course cannot make you become a good trader, that's for sure. But can make you find and see the path of this journey, and you can walk on it easier. After getting the basic knowledge and have a fine trading system (no matter they're from Greg or any other books eacherscourse), trading is mainly about psychology. Nobody can really change this part but yourself. At least you should get some trading psychology books, and you might find out what happened. No one but yourself, can make you become a good trader. And, no university can make you a good trader. AND, Good to see you again here, Max! It is such a surprise!
written by Man Li, October 08, 2010
why did the system eat my words...
(no matter they're from Greg or any other books eacherscourse),  any other books, teachers, courses
written by Paul Whipp, October 08, 2010
Not everybody loses money trading Forex in the long term. The small percentage that consistently make money do not use systems like Greg's. That is his way of making money out of people wanting to make money on Forex.
Professional traders make money either by using fundamental analysis or by using computers and facilities to gain a small speed advantage in trading trends. People following systems like Greg's will sometimes make money, particularly when the market is trending for a long period (as in the past few months with AUD/USD) but they are really just 'getting lucky'. If you have any system that uses technical analysis you can test it thoroughly on a trading platform (I use Go Trader MT4) with historic data. If doing this manually it is absolutely essential that you do not view any of the forward data while making your decisions for obvious reasons. Try this before you invest real money - don't fall for the 'having to use real money' line.
 written by Max Idzik, November 12, 2010
Dear Paul,
First of all your degrees with distinctions have nothing to do with success. Proof: 7 out of 10 today's billionaires have barely any education at all. And from the way you write I gather you are not a billionaire, are you?? I know the degrees do not work, as I have two of them with honors too (one MBA), and value them very low, even though they cost me a small fortune to obtain, and thousands of wasted hours of learning rubbish, just to give a job to some buffoon called 'Professor' at a very reputable Universities. SECONDLY: in one of your previous threads you write, quote:'... you will lose in the long run...'. On October 8th you write, quote: '...Not everybody loses money trading Forex in the long term...' I wonder, if you even know what you are talking about…. Trading works, funds (traders) make money in the long run. Proof: e.g. Duquesne Capital Management - Stanley Druckenmiller - 30 years trading, at average 30% return (only one down year – IS IT LUCK???), and recently at $12bn funds under management I'd say it’s good performance. $1000 invested 30 yrs ago is worth $500,000 today. Not to mention George Soros, John Paulson, and the list of LONG TERM SUCCESSFUL TRADERS is very long. Just because you are not able to make it, doesn’t mean other people can’t, especially taking into account your attitude. Overall your language of skepticism tells me a lot about you. You are a 'glass half empty' person, and that is where all this bitterness is coming from. I am very sorry for you. I suggest you do a seminar with Tony Robbins, it could help. I have invested about 12 min of my valuable time, in YOU, and I would like you to take notice of the FACTS stated above. Maybe, just maybe you will be able to improve your quality of life which cannot be great, since you waste time criticizing other people without full understanding of the subject. Again, your degrees have nothing to do with success or lack of thereof in life. And that is especially true in trading. You see, what the theory preachers at Oxford did not tell you is that trading is about mastering your emotions (85% success contribution) and not any particular strategy. But how would they know, they have NEVER done it. You can go and ask, how many trades have they placed… That is your answer why would Greg do it: HE IS REALLY QUALIFIED TO DO IT, AND QUALIFIED WITH PRACTICE, NOT THEORY RUBBISH TOUGHT BY BUFOONS AT OXFORD OR OTHER VENUES LIKE THAT (I have been thought by many of them). And one fact is that once you have made it financially, you fly around the World for fun. Once you have few REAL dollars to your name you’ll understand (not earlier). This is my last message, and I hope it is going to change something in your flawed thinking. Please, do it for me and others around you – GO AND SEE TONY ROBBINS – UNLEASH POWER WITHIN. Maybe then you will understand where I am coming from, and what is important (not degrees for sure) End of communication. Good Luck
written by Paul Whipp, November 12, 2010
Wow Max,
Sorry you had such a bad experience with your education. I'm not sure where the 7/10 number comes from but I do agree that there are certainly plenty of ways people can make money without formal education. I am sorry I confused you too. The people who make money on Forex do so with fundamental analysis and with advanced statistical techniques and very fast computers (and network access). I am afraid these things require more and different education to that which you have received from Greg. I believe traders using his techniques will lose money in the long run. You will never join the traders you cite by following Greg's training which is a simple form of trend analysis. The lack of emotion he pushes is a good thing though and it reduces your average losses to the ongoing cost of trading (the spread). Perhaps you find yourself thanking Greg for your wins and blaming yourself for your losses. I suggest that you begin your road to recovery by breaking just one of his rules. Use a demo account. If you find a system that works there then you can apply it to real money trading after you've proved it without using real money. If you succeed in trading without emotion then a demo account is exactly the same as a real money account except for the very convenient fact that it does not cost you any real money. In the long term you will find that trend analysis does not work. If you study the market in terms of fundamentals (the financial news, reports, announcements etc.) and make your trades on the bases of you interpretation these factors, you can join the successful traders but you will have to discard what I believe is Greg's misdirection to get there.
 written by Kev Richardson, December 10, 2010
Blimey Paul, I think you may have woken Max up there.
What Max has not mentioned to you while he is ranting on is that he actually works for Greg Secker and Knowledge to Action. I recently attended one of their free seminars and a lot of the literature talks about the 'Max Factor'. Max is apparently one of their trainers and a success story. So successful that he has time to teach. Having now read what Max has to say I must admit I am more than put off from spending any of my training budget with them. I dont think I would want to risk disagreeing with him.....lol..!!! I am sure Mr Secker is more than capable of trading and I am sure he has made a lot of money from it to date and will continue to do so in to the future. I think what he has set up looks ok for those of us new to Forex and wanting a taste for it. Its a journey and if nothing else it puts you on it....albiet at first class prices. I wish Mr Idzik could be given the chance to share another '12 minutes' of his valuable time with the students who are currently rioting in London. He seems to have the view that University and College are a waste of time. It was fun to see that the sentence he told us that was full of spelling mistakes..'HE IS REALLY QUALIFIED TO DO IT, AND QUALIFIED WITH PRACTICE, NOT THEORY RUBBISH TOUGHT BY BUFOONS AT OXFORD OR OTHER VENUES LIKE THAT (I have been thought by many of them).' Max, you may want to go back and listen this time. Dont not consider this Company for your trading. I am sure there are many people out there that will share a success story. Just pray you are not trained by Max. He is cross and not a good advert for what I am sure is an ok training package.
written by Paul Whipp, December 10, 2010
Thanks for the information Kev, it clarifies things.
When anyone takes a position based on faith, their position can only be supported emotionally rather than scientifically. This truism explains the extreme emotion we see in people following unfounded belief systems. It probably also explains the missionary zeal that often arises in proponents of such systems. A zeal that is sadly, but understandably, largely absent in proponents of grounded belief systems... there are no 'physics teachers' preaching to uncivilised tribes or 'Fundamental analysts' running shows like Greg's... Perhaps thats a topic for some research and another article
 written by travis hammond, September 28, 2011
I did a course with Max. I soon realised I was wasting my money - He is nothing more than an enormous bellied, uneducated, dodgey Pole who resembles an evil teletubby. I was told to think about being rich when i went to bed and soon the cosmic universe who 'make my wish come true' - He's a thing Maxitubby - I already was thinking about being damn rich before your nonscence course (thats why I damned well paid you to make me rich - doh! After which I received not a shred of support - phonecalls ignored, messages ignored until this lunatic lost his temper with me and threatened my family. - Do not have anything to do with his conman
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greg's system is the first system that has worked for me... maybe i just related it better? but im avging 500-800 PIP's a week - which is over $4k a week - Very happy, would recommend to anyone interested in learning & making money in FX.
P.s - the event i went too had 275 people attend - quick maths tells me that its about $1m+ - not bad if you can get it, but i dont care - it works for me and im playing more golf!
thanks
Mike