Weekly wrap up

What a week. I ended up slightly negative on the P&L for the week but consider it an overall success. I've been listening to 'Mind of a Trader' podcasts downloaded for free from iTunes, keeping an actual trading journal, setting a clear goal for each day, and being patient enough to almost completely avoid the 10min charts all together. Not too bad. This is a business and I am structuring my business in a way that I feel will lead me to success. The EURCHF trades are still working, they're just few and far between due to the extremely low volatility in that pair recently. My focus on the longer time period charts has slowed down my trading significantly, and I'm ok with that. I remember Richard Regan of Pro Trading Course saying that if he doesn't take a single trade all day, he's done his job well that day. Part of the 'job' or 'business' of being a trader is to protect your capital. If I'm vigilant and don't take a trade then that day was a success. Mack, from Blue-Point-Trading's stream likes to say that "there's always another bus". Dr. Steenbarger continues to be a great resource with his blog and I intend on reading all of his books as soon as I can free up some time.

Patience

Today marks the second day in a row that no trades were taken. Now, yesterday was only a partial day since I took most of the day off to celebrate Veteran's Day. However, it is still important to note this lack of trading activity? Have the markets been stagnant? No, I've just been much more selective about my trading plan for the past 2 days. I've decided that my string of recent losses reflects an incomplete understanding of what I was specifically looking for so the best idea seemed to be to slow everything way down and focus on one specific trade setup on one time frame. With the help of Mack from the Bluepoint trading stream the one hour chart has become my new best friend and I'm only looking for reversal candles that are the color of the direction I would be trading (red for a topping or green for a bottoming reversal). There have been a couple opportunities for this, most notably in the euro and aud yesterday morning, but I wasn't completely comfortable with either setup so no trade was initiated. Hindsight being 20/20 the euro trade would have been stopped out and the aud trade would have gone to my take profit point for a successful trade. Not taking these trades was a success in and of itself because the ability to walk away from a potential trade had escaped me over the recent weeks which I believe has contributed significantly to my recent drawdown. What tomorrow holds I do not know but my goal will be the same as it has been over the past 2 days, to only take trades with this specific setup. Once this becomes a habit I plan to slowly introduce other trades or time frames, but to remain patient and only take whatever setups I am committed to for that day.

Happy Veterans Day!

Only watched the markets until 8:30am and then went about my annual veterans day celebration rounds.

Learning Curve

My learning curve is still much steeper than I had hoped at this point. Yesterday I took a total of 3 trades, none of which were exceptional. The first was a valid signal but I miscalculated the entry point a little low, which had I done it correctly would have kept me out of a losing trade. The second was an emotional trade based on the entry to the first and my expectation of a dollar rally, the candle was the wrong color for its position but I entered anyway for another loser. The final trade of the day was the right color in the right position but the entry signal didn't come until 2+ bars later and ended up going the wrong way for a final loser. I'm becoming more patient but there is a lot left to learn, and my eurchf trades are not making up for these other loses so I'm staring down the barrel of posting my first negative month. Meanwhile I'm waiting for the next bus.

Better

Today my trading showed some signs of life with 2 of 4 trades being good. Actually, one of the good trades was a loser. How could that be? I've been spending quite a bit of time this week listening to podcasts about trading psychology. They make it very clear that if you only define your success as the dollars made that day you are setting yourself up for a self-worth roller coaster. Initially counterintuitive, it actually makes sense. My focus all week has been on making one good trade. This doesn't mean the trade resulted in profit. Rather it means that I followed my trading plan to the letter and set myself up for financial reward. Beyond that there is nothing else we can do as traders. We can't control where the market goes once we've opened the trade. We can manage it to the best of our abilities but the end result is quite out of our control. The trade in question was a short usd/jpy which, if you watched the market today, would almost half to be a loser since it went up all day along with the broader market. The reason I consider it a good trade is that the 1 hour chart was showing the pair in a downtrend with price staying between the inner and outer bolinger bands (i use 2 with different settings) for a few hours. There was a reversal candle, which I should have taken, on the 10 minute and the pair consolidated for a little while. Then there was a bearish reversal candle at the 50ma on the 10 minute chart. This was a signal that he current longer (1 hour) term down trend should resume so I entered a short position. The price only went down a few pips from there and a while later I was stopped out for a loss. I'll take that loss because more often than not the current trend will continue in that situation and the exact same trade would result in profit. Follow the trading plan? Check. Good trade. Not a great trade because there was an opportunity to cut my losses once a certain price had been achieved and I didn't manage accordingly, but a good trade nonetheless.

Tomorrow's plan, one good trade.

Greed is (not always) good

Today was a reminder that greed can be bad. There's a saying on the street that 'Pigs get fat and hogs get slaughtered'. This rang true for me today. I was long the AUDUSD pair with decent size, for me anyway, going into the FOMC rate announcement. Shortly before the announcement there was a small pop that could have given me a nice 30 pip gain on the trade. Instead of taking this profit and going on with my day I decided to stay in and look for more profits after the announcement. My eyes grew wide as the whip saw action took the pair up to a point that would have netted me over 120 pips on the trade, so I tried to close out and lock in the profits. Unfortunately I didn't get my close order filled all the way back down to break even where I decided it would be best to keep it open. The pit stop at break even was just that, a pit stop. The pair proceeded directly down and hit my stop loss turning a potential 100 pip gain into a 60 pip loss. Lessons are becoming abundant this week, and the most recent ones are to take a gain when you can, and don't count on being able to close out a trade during heavy market action.
Results for Wednesday: 1 good entry long gbpusd at a short-term reversal candle with the 1 hour trend, bad short eurusd against the trend, ok long audusd mentioned above, bad short audusd right after green long wick reversal candle. 1 for 4.

Questions

Tuesday was not the day I was looking for. My mission, as mentioned that morning, was to make one good trade. Unfortunately I made 2 ok trades and 4 bad ones. Not quite the performance I was planning. Now the question is why. Am I overtrading? Entering too early or late? Am I misreading or misinterpreting the market and/or my signals? Am I not managing the trade effectively and giving up profits? These are the questions that I must consider going forward. One Good Trade.

Poor results yesterday

Yesterday, as I posted on Twitter, was not one of my best days. Post losses of more than 80 pips is not a great way to start the week. However, my issue is fairly common and was an issue last week as well. It seems that I enter the week with nothing buy how much money I need/want to make this week in mind and start off trying to get to that goal. This is an attitude that served me well in my previous career, but is not suited for trading. Dr. Steenbarger and the guys over at SMB Capital focus a lot of effort around the concept of "One Good Trade". Their point is that all you should focus on is making that one good trade, and not on the money you are trying to make, have just made, or even just lost. I've been thinking about this concept since roughly noon yesterday and it has become my mission for today. My goal today is to make one good trade.

October wrap-up

This has been a challenging month. The challenge hasn't been from an excessively unpredictable market, but rather from my own personal challenge to grow as a trader. Trying new things always causes some level of discomfort and stress, but when you put money into the mix those results are magnified. I'd been practicing new trading tactics on a micro account and had mixed results. When I was patient and focused the results were positive, but when I got distracted from my plan things didn't go so well. This past week I decided it was time to move forward and start trading these new tactics in my regular account. Looking back on the week I'm glad I made that decision because I probably learned more this week than the previous 3 combined. Some pretty good trades were taken, and some really bad ones were taken as well. However, with each experience I've become more confident in what I'm trying to do and my ability to continue to grow as a trader. Thankfully some people in the chat room at www.blue-point-trading.blogspot.com have offered of themselves and their knowledge to help me grow. I'm very excited going forward at what the possibilities could be.

Weekly wrap-up

This past week went quite well. I booked some profits on the EURCHF and am holding 4 short positions over the weekend as the pair holds near 1.5200. Also, my newer trading strategy work well and I was able to recover half of my losses in that strategy from the past 3 weeks. It is becoming obvious to me that an area of my trading that needs development is the mental side. I find myself taking trades early at times, and also not booking profits when I should. My main area of focus this coming week is going to be taking some profits once the trade goes 10 pips my way and then moving the stop on what ever remains of my position to break even or 1 pip positive. My entries seemed to be getting more accurate towards the end of last week so hopefully that continues and I stop trying to hit home rums each time and take what the market is giving me. Richard Regan from ProTradingCourse.com says that "Entries are a science, and exits are an art." I think this is a great way of approaching trades.

September wrap-up

I've updated the results graphs for the month of September. Overall it was a good month as the volatility picked up towards the end. My learning activities have evolved quite a bit as I've found another way to trade that makes sense and focus much of my time on that plan. I'm only trading $.10/pip on that at this point but plan on increasing that as my skill set improves. The new trading style was negative for the month and is reflected in the posted results, but I see that as nothing more than the cost of experience and information. October is off to a good start and I'm looking forward to seeing where my trading goes from here.

Daily Activity 9/23

This week I've been continuing the focus on building my trading toolbox. After a few days of watching my moving average cross idea it became apparent that I need a way to discern between valid breaks and small retracements. Remembering something that Mack from Blue Point's trading room had said about using two sets of bolinger bands I decided to add that to my charts and see what transpired. Over the past three days I've attempted to trade the AUDUSD using two sets of bolinger bands and 2 moving averages. The bolinger bands are set at 2 and .8 standard deviations respectively, and the moving averages are the 50 and 200 period. I watch the 10 minute and 1 hour charts and look at both for entries and exits. So far I've had mixed results but not due to a poor trading strategy, but rather because I find myself going against the strategy too often. Today for example after being away from the markets for almost 3 hours I took a short trade after only looking at the charts for a few minutes. My entry was based on the price being at the top band on the 10 minute and having moved sideways for the past 2-3 bars could be rolling over. However, I completely missed that the 200ma had just been broken and i was shorting into it. I got stopped out quite quickly. This is the type of mistake that is keeping me from being more profitable. The day did turn out to be profitable because I shorted the AUDUSD after the big pop from the Federal Reserve announcement at 2:15pm. I exited the trade at the lowest bolinger band on the 1 hour chart, which turned out to be just a pause as the pair continued down quite a bit further. 56 pips is not bad at all and there is no reason to be greedy and try to get top or bottom tick. The man who introduced me to the markets 7 years ago used to say "Pigs get fat, hogs get slaughtered".

Weekly wrap

Last week was ok. I made a tactical error by opening a short two days before the SNB rate announcement, and then closing it the morning of the announcement for a loss. Also, I missed an opportunity to close my long position for a nice profit immediately after the news. My errors resulted from having a bias going into the move that something of substance would be said and the pair would react accordingly. This was incorrect. If I would have thought about the strong moves over the past 6 months it would have been obvious that they come at a much lower price than the pair was trading at the time. I was positioned well for a capitulation, having both a long and short open at the time. However, my bias prevented me from taking advantage of my positions.
Going forward I see the pair trading in a range until something important happens so my plan is to short at or close to 1.5180 and buy at or under 1.5150.
I am still working on the EUR/USD moving average cross trade. More development is needed and I will keep refining my entry and exit strategy while trading mini lots. While on Blue Point's trading room another member that goes by the handle "Mack" shared with me some techniques for using long term moving averages and bolinger bands on the AUD/USD pair. I've been watching this pair recently and will try to incorporate his tactics, possibly taking mini lot trades this week. Basically, I'm still working on my trading toolbox to better maximize the assets of time and money.

Daily activity 9/16

Started the day reviewing some video and written posts by Don Miller, a pro e-mini trader. He doen't really discuss tradings tactics, but rather talks about trials and triumphs. I find myself drawn more towards this type of topic lately. I pay as much attention as possible to the musings of both Don Miller and Dr. Steenbarger. No trades were taken in the EURCHF so I'm holding 1 short and 1 long going into the SNB policy announcement at 8AM EST tomorrow morning. I did take 2 EURUSD moving average cross trades this morning and both were closed at 10+ pips profit. Wednesdays I drive to Ann Arbor for class so unfortunately I missed a good trade while on the road but that can't be avoided. The rest of the afternoon session was tame so that was all the trading activity for the day. While on campus I usually get to use a Bloomberg terminal which does seem to put my mind at ease as far as news goes. The charting isn't anything special, and I still have to have my laptop to run the trading system software for FXSolutions and DBFX. However, the immediacy of the news and ability to look up an immense amount of data is quite nice. While I was trading the sounds from the e-mini s&p pit were playing through Kurtosis' site, and I sat on Blue's trading room.

Daily Activity 9/15

I spent the day on Blue Point and Kurtosis' trading rooms. Also, I watched a video from the OrderFlow blog about his trading on Monday. This concept of Market Profile is very interesting and warrants further investigation. The EURCHF was biased to the long side all day and I closed 2 long positions in profit. To capture some quick pullback action I initiated a short position but set my profit target to low and it was missed in the overnight consolidation. Now I am holding 1 long and 1 short EURCHF. My 5 EURUSD trades resulted in 3 losers, 1 break even, and 1 for profit. The break even trade could have been my biggest winner of the day but I was looking for more based on a news rumor which made me keep the position open too long. Lesson learned don't trade the news/rumor, trade the price action.

Daily Activity 9/14

Yesterday I spent the majority of the day sitting in with both Blue Point and Kurtosis' trading rooms. The market was in a range and no EURCHF trades were opened or closed. So far I've initiated 2 EURUSD trades based on the moving average cross, 2 losers and 1 break even. Some of these initial results have to do more with exit strategy than trade viability. The break even trade went my direction almost right away and I moved my stop to break even when the price reached 1:1 reward to risk, then immediately retraced back to my stop. The entry still appears to be sound, but much more development is needed on handling the exit. Richard Regan of ProTradingCourse.com says that entries are a science, while exits are an art form.

Daily activity 9/11

Today I listened in on Blue Point's trading stream. The EURCHF was quite muted throughout the day so no trades were opened or closed. Having watched Kurtosis' Trading stream for a few days I've noticed his combination of moving averages can act as a signal of sorts on a 15 minute EURUSD chart. After doing some quick visual backtesting of this idea I've decided to move foward with a small live forward test. My plan is to look for 15 minute bars that start above or below all of the EMAs, and then moves through all of them. I am not going to wait for that bar to close, rather I will enter as soon as the farthest EMA is crossed. My stop loss will start at the opposite EMA, with a target of twice the pips risked. I'm only trading 1k lots @ $.10/pip, but I feel that the live trading will shorten the learning curve.

Daily activity 9/10

The day started off quite well. I closed my short and opened a long which hit my profit target withing a couple hours. The first lesson learned is to have my computer up and running at 9:30AM EST, because if I had then my old long position would have been closed for a nice 40+ pip profit. Live and learn. The rest of the morning was spent opening a couple more long positions and starting the Bloomberg Certification process. Its a series of videos you watch and then take a quiz over the contents. So far I've completed the introductory series but am planning on going through the equity, forex, and fixed income series as well. As I become more familiar with that product it is apparent how valuable it can be to the right person.

Daily activity 9/9

Today's market didn't produce any trades. Also, I didn't open any demo trades with the Fibo's I wrote about yesterday. This morning I started out watching a video on OrderFlow posted to a blog that I follow. I did, however, spend hours starting to learn new software. Through my mba program I have access to a vurtual trading room a couple days a week. They have quite a few different software packages available, but today I only looked into 3. There was ESignal Pro, FactSet (I think thats the name, but I'll check tomorrow and update this if not), and finally Bloomberg. Each has different strengths, weaknesses, and applications. My intention is to become proficient at all three.

Daily activity 9/8

Today was less active in the market than I expected. No trades were opened or closed. I watched the StockTwits Brunch show from Saturday with RatioTrader where he showed how to apply Fibonacci ratios to many different markets. It was quite informative and helped me to create some preliminary rules for a new forex trading strategy. It appears to me that there are two primary ways to trades based on these ratios. First, RatioTrader looks at whether the 38.2%, 50%, or 61.8% retracement level works as support. If so, a break of the swing high can go to the -23.6% level or beyond. This is the first setup I'm looking for. The second is to take the retracement as soon as its confirmed. I draw the Fibo from the swing high/low to the current high/low. When the next bar opens I watch to see if it breaks the line drawn by more than 5 pips. If not I'll look to enter the trade as a short term reversal. I look at 1 hour charts, set my stop loss for 10 pips beyond the recent high/low, and am watching the following pairs: eur/usd, gbp/usd, usd/chf, aud/usd, usd/cad, usd/jpy, eur/chf, eur/gbp, eur/jpy, and gbp/jpy. I want to keep a 2:1 or higher reward to risk ratio and only risk .50% of my account balance per trade.