Day Trading & Scalping Systems

By: Monica Hendrix

The biggest myth of forex day trading systems is they are a low risk way to make profits the reality is there odds on to lose you all your equity - lets look at the evidence that shows this.

When you see a forex day trader who claims to have made money longer term check the small print and look at the disclaimer. You will normally see one like the one we have printed below, or a very similar one which, just means the track record has been made up and the system has never been traded - here it is:

"CFTC RULE 4.41 - Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown".

If you have read the above, you will see that a track record that has this has supporting evidence of profitability means absolutely nothing, in terms of the profit potential of the system, when you use it.

There is a huge difference between making money when you have all the prices at your disposal and trying to make them when you don't.

You can't make real dollars in hindsight!

Most day trading systems are sold by marketing companies and not traders - if they were traders and they had confidence their system worked, they would present an audited track record of real time profits.

The question you need to ask yourself is - if the traders doesn't have the confidence and doesn't want to trade it, then why should I trust it?

Day trading is a great story - but that's all it is, it doesn't work.

The time period is to short and all the volatility is random in short time frames - longer term your odds on to lose.

Forex traders are attracted to day trading because they think its low risk but the opposite is true its very high risk.

Sure, you only take small risks per trade but the chances of being stopped out are huge. On the other hand, day traders never run their profits and they can never cover the huge percentage of losses they take.

Day trading will make you lose and if you don't believe me, try and find a real time track record supported by the brokers statements over the longer term - say, 2 years and you will never find one.

So the truth about day trading is it is likely to see you wiped out not make regular profits over time that the vendors who sell systems claim.

If you want to win at forex trading forget day trading and trade the odds and that means trading longer term. Concentrate on this, get the right forex education and you could enjoy forex trading success.

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