USD/JPY Scalping by Zyakusyo-Trader

Also, cryptocurrencies and long term trading!!

Learn to trade! About bankroll management.

f:id:zyakusyotrader:20201013214040p:plain

In this article, bankroll management made easy. 

Issued:2020/6/19

Thanks for coming!!

Make yourself at home(^_^)/

 

 

Bankroll management

Money Management (No Nonsense Forex)

99 percent of reckless traders

 99% of traders only concern entry and exit and do not manage their bankroll accounts.

Ruin by reckless trades

Case#1

50,000USD decreased to 40,000USD

To recover the bankroll...

Your yield should be more than 25%.

This yield is equal to Warren Buffett.

 

Case#2

50,000USD decreased to 25,000USD

To recover the bankroll...

Your yield should be more than 100%.

You should double your bankroll.

No way!!

 

This perfunctory bankroll management is called as 'Trading suicide.'

Ruin by coward trading.

Reckless trade leads to suiciding. Yes, we know it.

Then, how about trading in a little risk??

 

That is too coward at this time.

Successful trader's risk management.

Winners take lots of risks.

What is the difference in risk between 99% of traders' and 1% winners?

Successful traders can control their risk.

Winners can lessen their risk as much as possible.

 

Manage our bankroll and trading lots by Average True Range

Stop loss must be 1.5 times of ATR.

Supportive line, resistance line, or Fibonacci do not set stop loss.

pip Value = RISK /1.5ATR

RISK must be 2% of your bankroll.

Example

In 1-minute chart at 2020/06/19 21:34, the ATR is 20pips.*1

If the bankroll is 20,000JPY,

pip Value = (20000 * 0.02) / (20*1.5) =13

 

That suggests the trading lots should be 13, and stop-loss is 30pips all the time.*2

Then, one pip is 13JPY, and 30 pips is roughly 400JPY, 5% of 20,000JPY.

 

 

Less pip value is careful trading, and more pip value is reckless trading.

Risk Reward ratio (No Nonsense Forex)

You can dismiss the idea of the risk-reward ratio.

Don't you eat the broccoli right in front of your dish?

Even if you seek only for the feast, that will be in vain if you cannot get it.

99% of traders are greedy. The more the profit is, the better for them.

*1:1pips = 0.001USD/JPY, so 1pip is 1000*0.001=1JPY if you trade 1000 currency pairs.

*2:Note that one lot is 1000 currency pairs.

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