I’ve been studying forex trading for some time now, and while playing with demo trading stations and platforms is safe and nice, it is far away from the real thing. Everything is so easy on demo, and since there is no fear, there is no greed… So I had no problem sticking with my trading scenario and I made more profitable trades than not. So I thought – you are ready for the real thing…

Choosing a forex broker where I opened a live account is a story on its own, so I will leave it for one of the next posts, but let’s just say that a bit over one month ago, I opened a live account. On purpose I only wired in $400, as this was my first live account with forex (i do have 7 years of experience trading stock and options). I chose 100:1 leverage, and I noticed that broker only lets me trade mini lot size (0,1 lot – meaning every pip move is $1). I wanted to trade micro lots (0,01 lots – pip move translates to $0,1) but somehow i didn’t change that…

And so it began. On the next day my total was $480. Over 20% in 24 hours! I was thrilled and so proud on myself. Maybe trading mini lots is just a right thing! Why should I bother with micro trading – it will take too much time to make me a rich man I thought somewhere back in my head… Third day was when disaster began!

I left two buy EURUSD positions open over night, setting nice trailing stop/loss.. But during the night positions went against me, and  my broker closed my positions as I reached my margin limit! In the morning i see EURUSD where i wanted it, but – what’s that? my account total is just $370! Aaargh!

After talking with my broker, which explained professionally and with examples what happened (and i am happy with their response and level of service) as it was my fault not to read and understand margin calculation (every broker might follow different rules and policy) I began chasing my lost money by force… And now I can tell you - this is the stupidest thing you can do!! Next night I left open another position, this time just one (not to reach margin call so quickly) again with trailing S/L… But in the morning – shock! My account total - $65! EURUSD went way down (although there were no news) and my position closed again when margin limit was reached! I was sad.

But this got me on the right track… I requested my broker to change my account to 200:1 leverage, and to allow me to trade micro lots (0,01 lot size – or to control 10.000 currency). After that I was following my forex trading system. Fear was gone as I had only $65 to lose. Greed was gone as I accepted the fate, that it is very likely that my first live forex account was gone…

So in next 10 days I managed to catch some nice scalp trades, reaching $100 soon with just safe trades. Of course I had some losers, but I used money management furiously and never risked more than 2% of remaining capital… And when you are operating with $100 that is not much…

Today, 14 days later, I topped $160, and I began trading with hedge trades in opposite direction. This is against the US rules now, but some brokers still allow it (i will write about this in later post).

So here you have it – first month live trading – from hero to (almost) zero, and slowly back again… Knock, knock, knock… I’ll keep you updated… But do tell me – what was your first live forex trading experience? How did you do in first month?