$500 to $5000 challenge

$500 to $5K FX Challenge

Unlike most people who make their resolutions and goals on the 1st of Jan every year, I like to set challenges on my birthday, which is today.

I call them challenges rather than goals as it removes the feeling of dread that comes up when I haven’t progressed as much as I had imagined (for whatever reason). Turning them into challenges, makes it fun, allows me to learn something and more importantly, increases the likelihood of me sticking with it for longer.

These challenges that I partake can be anything, learning a new skill or gaining more knowledge on a topic. This year, I’ve decided to make it public on this blog to:

1. Motivate me

2. Have a place where the challenge sits so I can look back on it in the future.

The parameters of the challenge:

Dates: Starting Feb 23rd 2024 until Feb 23rd 2025.

Challenge: Turn $500 into $5,000 USD in one year through trading. This is a return of 10X so it’s extremely challenging but it will be fun.

Rules:  The only rule here is that I will trade FX, Crypto, Metals or Indices. I wont add all of my trading parameters as that will limit the types of trades I can take, so this will be a mixture of rule based and discretionary.

Platform: I will use MT4 for this challenge.

I will post an update every three months, with a summary of the best and worst trades I had, why I entered those trades and what I learnt from the process.

Here we go!!

Update – 23rd May 2024

The challenge is going extremely well so far, and I have an account balance of $2,295. This is down from the highest I’ve hit in the challenge which is an account balance of $3,308.

This is due to a successive number of losing trades which was due to my attention and energy being spent on my day job, which confirms once again, that trading is an endeavor in which you have to be 100% focused and committed.

Here are some of the highlights:

The Good

  • The entirety of the profit essentially came from a Gold trade that I entered on the 4th of March 2024 and closed on the 9th of April 2024 for a total net profit of $2,545
  • The second best trade was on GBPNZD with a net profit of $514. I entered this trade on the 10th of April 2024 and closed on the 16th of April 2024
  • The second best trade was again on Gold with a net profit of $268 that I entered on the 9th of April 2024 after taking profits on my other position. I closed this trade on the 12th of April 2024.

The Not So Good

  • The worst trade was another Gold position where I was trying to catch the bottom of the retracement, instead losing $500. I entered this trade on the 23rd of April 2024 and got stopped out on the 30th April 2024.
  • The second worst trade was AUDUSD where I lost $125. I entered this trade on 1st of May 2024 and got stopped out on this trade on the 3rd of May 2024.
  • The third worst trade was AUDCAD where I lost $107. I entered this trade on the 17th of April 2024 and got stopped out on this trade on the 19th of April 2024.

What Did I Learn?

  • I mentioned it earlier, but I’ll mention it again. Trading isn’t something you can excel at without putting the work in. I knew this already, but it’s good to have a reminder.
  • The Gold trade moved me up to $3300 balance, and I took my foot off the gas entering poor trades. Why? I reasoned that I was passed the half-way mark and could take some risks.
    • This was obviously the wrong thing to do, as I now have a drawdown of $1,000 staring me in the face.
  • I need to pay attention to the alerts that I set on the charts. I put them on there for a reason. Whether to indicate that I should enter a position or exit one.

Lastly, here are the screenshots from MyFXBook for the past three months:

Overall Progress

Account Details

That’s the first three months done. Let’s see what the coming months bring.

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