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\n\nToday, we’re going to run through more about his largest win and biggest loss.
\n\n\nAs you can read from his interview below, James does take consistently small positions.
\n\n\nAnd we count this as one of the top 5 strategies to generate the best results in a trading contest here.
\n\n\nWhat we found fascinating is that small position sizes don’t always mean small wins and losses.
\n\n\nJames’ biggest win was an incredible $455.65, and his biggest loss was $334.54. And this is despite taking relatively small positions on each trade.
\n\n\nIronically, James’ biggest winning trade was on XAUUSD (Gold), and in line with his preferred timeframe, he only held the short position for two minutes.
\n\n\nJames would have been happy with this trade as he only made 34 trades on Gold or 8.2% of his total trades.
\n\n\nJames’s biggest losing trade was on the Aussie dollar (AUDUSD), removing $334.54 from his overall equity.
\n\n\nAs fate would have it, and which happens all too often to all traders, James closed his position at pretty much the highest point of the session.
\n\n\nThe Aussie dollar then fell, which would have nearly halved the loss he took on the position.
\n\n\nBut any good trader will tell you, it is much better to close a losing position, so you can free up your mind to focus on other more positive trades.
\n\n\nPlease note that trading leveraged instruments is risky, and you can lose more than what you start with.
\n\n\nLet’s jump into the interview with Renee Li and James Hu below.
\n\n\nRenee: Hi, James. Thanks for taking the time to chat with us. First, would you like to introduce yourself?
\n\n\nJames: I am from Taiwan. I immigrated to Australia in 1993. I have been trading for almost 20 years.
\n\n\nRenee: What got you interested in forex trading?
\n\n\nJames: I am interested in finance overall and also would like to generate some profit from this interest.
\n\n\nRenee: What contributed to your ultimate success?
\n\n\nJames: I think the fact that I am good at foreseeing the big picture and predicting the trend really helped me in this trading competition.
\n\n\nAlso, particularly, I tend to focus on technical analysis more over fundamental analysis. Other than that, I guess, implementing a good stop loss strategy is very important too.
\n\n\nRenee: What about your trading methods? As you mentioned before, you tend to use technical analysis. Can I conclude that technical analysis is your primary trading method which helped you succeed in the stage 4 trading competition? What about fundamental analysis?
\n\n\nJames: Yes, fundamental news also affects my trading method and how I trade for sure, but I guess what I am trying to say is that fundamental analysis is somehow important but could be misleading as well.
\n\n\nFor example, if we predict the trends solely based on fundamental news, for example, the current US economy, we might expect the US dollar to go one way, but it actually went the opposite direction.
\n\n\nThis might be because the market has been manipulated by some big major players and led to price-in, which technical analysis could help us gain a better understanding of the market.
\n\n\nBut if we focus more on technical analysis and still take the fundamentals to some degree, there is a bigger winning chance for us to foresee the big picture and predict the market movements.
\n\n\nRenee: In terms of the forex market specifically, would you like to give some comments in terms of technical or fundamental analysis?
\n\n\nJames: Sure. For currency pairs, I like to predict the big picture and try to have a good understanding of the market movement in the long run.
\n\n\nHowever, when I actually trade, I prefer to trade based on my prediction of the next market movement in the short run.
\n\n\nAlso, only taking small positions is something I practice as well. Placing small orders is very important to me.
\n\n\nFor example, I would only place 0.01 lot for each order.
\n\n\nAnd of course, implementing a good risk management strategy via my stop loss rules is very important when it comes to forex trading.
\n\n\nRenee: Could you explain to us why you only take small positions?
\n\n\nJames: We all know that the transaction volume is huge for the forex market, which makes the market very volatile.
\n\n\nOn top of that, we have high leverage. So, I need to be very cautious about the positions I take, otherwise, it is easy to be wiped out of the market even before realising any upside.
\n\n\nHowever, some beginner traders trade forex like the way how they trade stocks, which is not a very good technique, in my opinion.
\n\n\nWe have to be aware that they are two completely different markets.
\n\n\nRenee: Can you tell us a little more about the size of the positions you take?
\n\n\nJames: The way how I traded and the small positions that I took enables me to have a good mindset in the trading competition and have a good risk management.
\n\n\nRenee: What instruments did you trade during the competition period?
\n\n\nJames: I traded the Aussie dollar, Gold, and the Nasdaq index. These are the products that I usually trade.
\n\n\nRenee: Did you use any indicators?
\n\n\nJames: Yes, I did. I used the Relative Strength Index (RSI).
\n\n\nRenee: Thank you for sharing such valuable information with us. And thank you for having the interview with us, James.
\n\n\nJames: Thank you!
\n\n\nInterview conducted by Renee Li, Content Specialist at ACY Securities.
\n\n\nClick the links below to catch up with interviews from our past champions.
\n\n\n· Interview with Wei Wei Wang – 3rd Place Stage 3
\n\n\n· Interview with Yuan Tsui – 2nd Place Stage 2
\n\n\n· Interview with Stage 2 Champion Zhen Wang
\n\n\n· Interview with Wen Bin Yang – Stage 1 3rd Place
\n\n\n· Stage 1 Interview with the Champion Mao Long Yang
\n\n\n· Algo Trading His Way to the Grand Final – Interview with Gustavo Correa
\n\n\n· Interview with One of South Africa’s Best Traders
\n\n\n· Interview with Mr Jilin Xu in the 2020 Trading Cup
\n\n\nAre you ready to join the next Stage? Click here to register an account.
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