Friday, November 28, 2008

November 2008. results

+ 85 pips

+ 5.6 %

For me very interesting month. I had trades on 14 days. I was hoovering around break even all the time. Slightly in loss, than back up. Majority of winnings came from that great day this week. That is not important. The most important thing was not p&l this month but discipline. I managed to get away from averaging totally this month. My biggest fear was always that my pure trading without averaging will be just simply negative. Well jumping around zero is better than expected. Also when I look at my big losses this month, they are all exaggerated by stubbornness and staying in trades until -40 pips. Clearly I could see before that number that the positive development is not and option and that I'm staying foolishly in.
I breached my discipline boundaries on two occasions. In the beginning of the month when I entered trade when I was already down on the day -36 half size pips and lost -24 half size pips more. Other time was in that big winning day when I let my loss past -40 because of near support. That trade finished as -20, it would be better if I exit when it was -20 first time.

pips/day cumulative
38 38
-30 8
10 18
-20 -2
-12 -14
10 -4
14 10
-20 -10
10 0
7 7
10 17
61 78
-2 76
9 85

Three worst days were as bad as they were because of my stubbornness to capitulate on time. Be it bad trade or bad attitude. So there is progress to be made. But I had a month without averaging totally. I never had it before. I thought that I can't trade without it, and look I can.

Again I have to mention that mental shift day. I just didn't have a day like that before. I never stay and hold profits and do it for few times in the row. Before if I could grab something after loss I would get out at b/e or at +20 or something. But this was different, this was trading without my usual mental limitations. That's why I call it mental shift.

So I'm very happy with the month. My focus isn't on p&l but on work. I know that I don't have all the answers but addressing problems from the past and managing them proves to work. Bad mental attitude is biggest single problem, maybe only problem. This month I had it under some control, at least I made sure to put boundaries on damage.

Under the radar comes the fact that I had positive month without averaging, which I would swear deep inside of me before that it's impossible. That belief was probably only reason why averaging was out of my control, nearly as unconscious action. I think that is the key why that mental shift day came. Changing beliefs is the only thing that works and the hardest thing to do. We are what our beliefs make us to be. There is no point in trying to change our actions if we didn't change our beliefs.

Now I was just reviewing my result posts from before and in July I had 5.3% up with 148 pips. My leverage this month is up, near double from than and by using half size trades I make it manageable so I got around same percentage with just 85 pips.

I wish to thank all the people that are following this blog and participate in comments. It really is working good for me and interaction with you guys make me better and more responsible trader. It's common work and probably replacement for a work with mentor. You all are my mentors, thank you for that.


Well this is what I like. Scalping with 10sec and 1min charts based on fast moves in the direction of the trend. It's always hard for me to shot the first trade in the day. If I started with first trade earlier it would be even better. It's like getting in the water, first there is hesitation because of the temperature, but when you get accustomed it's no problem. I'm getting used to just take scalps and not aiming for swings. It suits me better and after each trade I'm like reset and ready for more. Not much but with half size trades I managed to gather 9 full size pips.

Thursday, November 27, 2008

Morning chaos

Well it wasn't chaos, but when you look at that chart..
I was scalping, so I should have take profits when I have them. No matter if it's just 3, 5 or 8 pips. On few of the trades I had profit but I didn't take it. I than got out at b/e or I got stubborn like with that trade marked purple. I let nice profit turn in a loss, 27 pips from bottom to top. I was looking for bigger swing but market didn't want to go down. Why did I short in the first place?
Because that uptrend wasn't the thing that I would like to buy. Before 9 market was moving down so I expected to resume. Price didn't move strong, it all looked like as it can fall apart any moment.

I wasn't by the screen for that brake up after 10:30. Gbp moved 70 pips in 4 minutes after 1 hour of 10 pips range.
On those last two shorts, on lower picture, I was looking to lot's of charts from chf to gbp/jpy to time them. I decided to use lesson learned, take scalp profits when you have them and don't wait for the swing. With last three positive trades I brought down loss for the day to -3 half size pips.
I was probably under impression from two days ago of big swings, so I neglected taking scalp profits. Well trading isn't about trading, it's about profits.

Tuesday, November 25, 2008

Mental shift

I never did something like this

It started as gambling. I came home and when I saw action I wanted to trade. No thinking, no nothing. It sometimes get's me like this and I don't like it because I usually lose. Well first I did today. I lose quickly and got bit lucky with the pullback, so I got out on better price for a loss. I broke my -40 pips rule, but didn't average or went mad. Just there was previous low on 1min chart and it was foolish to get out at -40 with low not violated. So I stayed. I stayed as long as price was going back up. When it broke uptrend on 10sec chart I took a loss of -20.
All trades were with half size.
Than I decided to go in direction of the trend counting this as pullback and now resumption of a trend. It really did fall and I got in profit. It was tempting to just take 20 and have break even gambling day. But I stayed with the trade and I got out probably because profit of 50 pips was really good and I wanted to book it.
Whole time today my eyes were on dow jones and s&p chart to guide me.
Than I wanted more, and got short because bounce from the lows after second trade was so quick and bigger in currencies than equities. It was too early, I even went negative on the day losing more than 30 pips on that trade at some point. Fall resumed I stay with it and got another winner. Than everywhere price just refused to fall more and it was time for long direction. Winning side didn't pick up quickly and it was hard holding that trade hoovering at 10 pips profit that could evaporate. I wanted several times to take 10-20 pips but I decided that now when I have nice winners so far I can stay with this and risk that small profit. Well that was nice winner also and when 10 sec chart start rolling I got out.

Now I don't care where it will go. I'm tired and don't have concentration for more trades. I'm totally surprised with my trading. That I pushed so hard for profit, I can't believe that. It's so not me. Well the first part is me, where I got in just for the sake of action, but after it, it's mental shift. I never stay to take that big profit, I was milking last two trades as best as I could. I didn't lost my composure with open losses, or booked loss. I didn't panic with big loss nor big gain. I'm pleasantly surprised. Also I don't remember when I had that much profit in a day, it was more than 100 half size pips. It's 60 full size pips, crazy for my usual scalping of 10 pips.

Monday, November 24, 2008

Dow Jones

Apparently there was rally in Dow Jones which pick up eur crosses. Last days I always look at something different to trade. When I want to trade eur/usd I look at eur/jpy. Now at the Dow. I didn't get it right away why eur was slowly going higher so I wasn't participating in that. Everything came close to morning highs, eur/jpy at 121. Dow started to slow down so I took a shot at eur/jpy short. Got out because it was around 1R and you never know is it reversal or just retracement. +10 full size pips

Friday, November 21, 2008

The contrarian

Today I wasn't in really good frame of mind for trading. I early recognized that so I didn't go by my contrarian need. So I didn't short the uptrend, which I really wanted to do, but I put lines where I would short it (purple). Well you can see how would it go. Cyan is place where I would go long. Funny.
I guess that I'm intimidated by strong trends. I don't want to be part of them, but I want to go against them. Don't ask my why, I dont' understand it. I noticed that before so I didn't got myself in difficult position by going short.
In the end I did take part of reversal in eur/jpy. Not very good trade, but I made some profit in it. + 7 full size pips

Thursday, November 20, 2008

Hairy top

Today I knew where is my stop. It was just above the high. I entered the trade because of those hairy 5min candles which showed resistance to the upside. With small risk of ten half size pips I gain in the end 2R.
I exit at that point because 515 level was before in the morning resistance and than support figure. I even thought of adding one more trade if it brake it strong on the downside at that price. When it started coming back I took my profit.
+10 full size pips

Wednesday, November 19, 2008

There was no break out

I entered break out before break out occur. In the end there was no break out, it happen to be resistance. I didn't for a once thought that there will be no break out until it wasn't too late. I didn't have slightest idea that it can than prove as resistance if there is no break out. I wasn't cautious as two days ago nor handy as yesterday. I was over confident and sloppy. When position never come in to a profit I tend to give it more room. Luckily I have that rule of max loss for a day and I stick with that. Without it it would be perfect candidate for averaging and few hundreds pips risk. I really didn't think of it as short opportunity when it started to slide down. I just got stuck in opinion. Problem was because gbp/usd stayed in range as before, but eur was just sliding. Now I don't care what will happen next, I lost today and that's it. -20 full size pips.

Tuesday, November 18, 2008

Heavy scalping

Well it really was heavy early morning scalping. Funny thing was that I first wanted to go long gbp/usd at the area marked with yellow arrow but. I thought that it will go up to yesterdays high at 85, but I was afraid to do it. I was afraid of having a loss so early, not knowing yet how the market is behaving. It's really funny because I have that first trade stage fright and after I get all mad throwing trades all over the place. Well that idea would get me nice profit, but it only stayed as idea.
Probably because that thing worked I wanted to trade, than I usually go in opposite direction. As I did in my first trade, but man, it was 20 pips off the high, it's no place to short strong trend. So I got out immediately because it was just bad trade.
I went long in gbp/usd in second trade because eur/usd was really pushing up and I knew that it will pull gbp/usd back toward highs. You can see that on 10sec chart from which I was taking all of those trades.

Than up move started to look fishy to me and I shorted eur/usd. It made a run up so I exit 3, 4 pips before the max stop of 20. When I saw that it didn't go up and that I wouldn't get stopped out I throw another short 7 pips lower than my loss point. At that point I was really deep in scalping mentality and trading on 10 sec movements. The big drop started and I jumped in, didn't know what it was so took sure profit. Sometimes it can go up as fast as it falls in spike so no reason to stay in and guess, and I was scalping so I had nice scalping profit.

Next trades I all ready lost my concentration and I was jumping in and out. Onada with it's great spread of 0.9 pips made for all those 3 trades sum of -1 pip, and last one was small profit. Than I decided that it's enough and that I'm not in the shape to trade any more. I have concentration span of goldfish for scalping.

I'm pleased with all of this. Market is like back in normal way of behaving, spread is normal and I scalped nicely. All trades were half size so total of +14 full size pips. Later there was more nice opportunities but I wasn't feeling any want to trade more so I rather stayed out.

Monday, November 17, 2008

Patiently waiting for opportunity

First entry was for testing morning high. It didn't test it and I decided to get out because all of that got prolonged and 14:30 got close and I didn't want to have open trade at that time of wider spread in fast gbp/usd. At the time it also looked like the price will be around my entry and stop, not higher in profit as it later actually was.
Second trade was pure momentum driven. I decided to exit at that moment because all pairs started to fall against jpy at that time and there was no up pressure in eur/usd like in gbp. It's not very good environment to stay long gbp. So I took scalp.
I would be more happy if I took scalp profit in my first trade when I had it. Best value entry for that gbp/usd retracement would be 900 area. Price wasn't for very long below it, so it showed nice support tendencies.
Trades were half size, so +10 full size pips.

Wednesday, November 12, 2008

Thrill seeking

I'm guilty of sin called thrill seeking. I think that majority of my trades have element of that. Even if I do get in a trade for good reasons usually I overstay if it's not going my way. In that overstaying I get thrill in waiting will it come back again. Today I entered trade that at it's best is coin flip. Had another one for some trendline bounce try, but all in all it's thrill seeking.
I'm little disappointed with all of that because I say to myself that I'm here because of business and money, but it's not entirely true. I fool myself I think because I don't approach this all seriously. I don't wait any more for real setups where I see something that is really going on. That all isn't flattering but it's true.
-12 pips

Tuesday, November 11, 2008

Unprepared for a down side

If I'm going in the trade based on momentum I shouldn't let it slide against me so much. That's being unprepared for a down side. Having just the widest stop isn't that good as a strategy. It was fun to watch how 730 area was defended for that long time with my stop 2 pips below it. One thing that I'm learning is to stay with a stop as stupid as it looks. My old me would move that stop, maybe average or something. Now when the price rebounded as I write I'm in "I told you so" thoughts. But I really do want to learn trading with discipline. I got to learn that I will be stopped out endlessly and that no averaging will save me. Than I will maybe more proactively manage trades and not just get in and hope for the best.
-20 pips

Monday, November 10, 2008

Long ride

I got myself into position and after it was half an hour in profit I got married for it so I didn't want to let her go. I would stop myself out if top around 930 was broken to the upside. Reversal came and I was sitting tight, but after news I got shaken out and missed the ride toward 800.
All in all this let's say swing trading isn't for me. It's boring and I always get out too soon or too late. It was half size trade and it felt small to take 10-15 profit when I had it in first 10 minutes.
Well I'm better trader for taking just 10 pips than more but I always convince myself otherwise. It's easier for me not to be in the trade, so I can think more clearly. With this position on I was hypnotized for the whole move.

+10 full size pips

Friday, November 7, 2008

Good news and bad news

Bad news is that I lost today, good news is that I was disciplined and trading inside of set rules.

Just when I wrote this I broke my rules by having one more trade in which I get punished very, very fast. Still I'm going to stay with headline and will not kick myself over that. Before that last trade I was -18 full size pips and now -30 full size pips. The thing that I recognize now that it's important to accept the rules and that I broke them but that I'm not going now on revenge mission throwing all away.

OK, I had this triangle drawn, but I have something against TA because when it start to go as it suppose to I don't believe it. So I didn't short the brake, but I said to myself I will short the test of the line. But to get it short price got to go up there, so let's have a long scalp up to that line. Well as you can see my logic doesn't have firm foundation in this case. To make things worse, I lost all perspective of broken triangle and what is going on, I was just reversing my trades as momentum dictated me. But that whipsawed me a lot. Red lines are losing trades and blue is winning.
So that all eur/usd was half size and was in boundaries of my plan with -18.
Than I put momentum long on gbp/usd and got a nice loser very fast. Well I'm glad, because that trade didn't have a room to be put on with 4 pips spread on gbp/usd, I was breaking my trading plan. Better that I got punished than rewarded on that.

The best thing is that I recognize broken rules and will not now make things worse. That is nice rule also.
I kept cool and I like that.

In day like today when I trade really wrong it's great that I have decision of closing all when I lose my 40 half size chips. There is far more probability that I can do bigger damage than remedy things if I keep trading.
Also I can see that I feel pretty ok when I lose small half size trades and that I should go for more opportunities. Not only like today when I got stuck in bad mind frame to trade so much.

Wednesday, November 5, 2008

Finally some new trading

I had two sets of trades, small loss in eur/usd and nice win with add on trade in eur/jpy.

I get back to trading with half size lot's but got leverage up a bit. Half size because I feel comfortable when I'm losing on half size trade. I can better grasp what is going on and decide do I want to take a loss or leave it some more on. If it's going my way than I can add another trade easily. That's especially handy now with big ranges. Leverage is now around 7 for full size position. As I like structured trading I decided to start a day with 40 half size chips available to spend. It's like going to casino, you can lose as much as you take from home but not more. So I have 40 available pips to lose each day. On the other side I cap my winnings at 80 half size pips. For me it's far more appropriate not to go after more because in my trading history I never really get any big days. But many times I'm trading like I aim for big gain and usually I lose at that time big. That is a range of -1.5% to + 3% a day which is ok with me. I want to feel comfortable losing those 40 pips and want to be safe that when I have nice day like today that I hold to my winnings.

I'm still little afraid of trading and losing because of my last very bad days so lets start slowly.

Today +38 full size pips. I could stay in eur/jpy longer but it gave me just before my exit 25-30 pips in a spike and I was around my daily target so I just took the profit.