December 2008. and year end results

+121 pips
+8 %


Good month. I had trades on 13 days and I had only two losing days. I'm still counting my pips in terms of half size and full size pips, but it's little wrong because I never trade in "full size". So I had 242 pips but I call it 121. I stick with that and will probably continue to do so because of my perception. If I say I had 40 pips day I would be totally satisfied, but when I cut that in half and have 20 "full size pips" than I think that I could squeeze few pips more. Also when I'm in a loss and cut it mentally in half it's easier to steer correctly. It's just exactly as in retail where prices are quoted as 299.95 and not 300. It just works.



Year
-11.5 %

As far as year goes I'm down -11.5%, not much, but down. Again this was my best year so far. I had 7 profitable months and majority of loss is from blow up days. I made big progress this year in my trading. It's now much more stable than before. I got so much help from writing this blog and interaction with readers, it was crucial. I was many times in situation when I thought "I can't do that, what would people on my blog think about that stupid move". It really made difference. I'm thankful for that.

For next year my plan is to stick to the course that I'm going past two months. I proved to myself that I can be profitable with what I'm doing without some special bailout trading with averaging and risk of 20% all in trades. So I will look to continue with scalping and put more attention to trading with bigger size lifting it gradually but decidedly. My main theme will be "If I could trade profitably this month with this size than I can do it again next month with a notch bigger size".
Also I have plan of taking part of profits and paying myself. I never done that before because I trade with fairly small account and I'm net negative so adding up was only option. Now I'm in situation where size of trades can be issue for me, because I'm not so used to risk in a day what I earn in a week on my regular job. So there is no point in making account larger because I first got to get used to trade in larger size as far as money goes and not percentages. I think that sending profits back and turning them in money, in real bills will reaffirm things. Trading is to much virtual, percentages and numbers on the screen are not enough. Feel of real cash coming out from my trading activities will land things a bit and that is important, make it all more real. It doesn't matter if I had bad month before or will in future, in a month when I made nice profit part of that got to come in my hands. It's also thing of perception and perception is only thing that we have.

I wish you all prosperous and happy 2009.






Orionmachine started with vblogging and have a channel on youtube, and all you who read comments here know who he is, so check it out. I think it's very good way for him to express what he wants, better then to write a blog. It's just good medium for him.

Cluttered screen

It was quiet morning at work and I had my charts open. Well better to have it closed if you don't want to trade. There are always opportunities if you follow 1min charts and watch how day develop. Well it is hard to trade my way on small screen because I like to watch many things simultaneously, you can see how cluttered it was.
I tried for small scalp just to get something because to me it looked as good time for pullback. In the end it was full reversal.
Short trades in duration and profit were the ones where I didn't believe price action and as I hate taking losses I run away before it came back. +17 full size pips

Psychotic scalping

This is some weird trading about what I don't know what to think. First of all I was at work, trading of laptop and had to attend other stuff not just trade. So it would be better not to trade in that circumstances but I did. Second, money from this trading I'm sending from my broker to bank account. So last few days money that I earned will not stay in account to compound but it's going home. So I had different attitude, it was let's make some money today for me. It's silly but it was different. So I recognize two kinds of money, one for my account and second for me.
I was generally correct of intentions of price but I didn't had liberty to hold position because I was busy with other stuff. So scalps were short. In the end +22 full size pips.

Small profit

Not so intuitive moves today. I'm glad that I took home some win and not loss. On first trade I was contemplating going long at 50 two minutes before my entry, so when it drop 15 pips and bounced on 10sec I went long. Happy that 30 provided so good support. I didn't want to wait for any reversal and bigger win so took 10 pips asap. The trade maybe shouldn't be put on in the first place.
On second trade price just stopped on 10sec chart and I entered because of momentum. So it didn't look good and I run away from it.
+5 full size pips

Double up

Price was bullish, it looked to me that it will probe 500 and than suddenly came reaction down. I figured that was surprise for long side. I got at bottom of the move. So in the following time with price above my short entry I decided that I will double my position if move down materialize after all. It did and I took nice scalp. +14 full size pips

Blogroll

I updated my blogroll and make it in a way that they appear in order of the most recently updated first. Also I added two new blogs so you can check them out.

Capital is Scarce


Fxmadness

Bad trading and lessons for the future

Few things that I would like to mention today. First I found it amazing how I'm coward to risk in the direction of developed trend, but I'm so cool about stepping in to pick the reversal. I don't mind my counter trend trades, I just wish that I do some scalps in the direction of the trend. Second, I was timing my eur/usd with eur/jpy trend. So why didn't I trade that idea with eur/jpy? Just because spread was 3.3 and not 1.1 as was in eur/usd. Well you can see on chart how later eur/usd didn't move much on the downside but eur/jpy did. Bigger spread shouldn't be obstacle. If I'm willing to risk and have reasonable stop than trading higher spread pairs should be ok for me.


Third thing today is gambling. I judge gambling and that is the problem. The things you judge are just repressed desires. My risk aversion is connected to my judging of gambling. But I do enjoy gambling from time to time like in eur/jpy trade, but I feel guilty about it, as I'm doing some kind of sin.
Every trade on it's own is gamble, hundreds of trades with some edge are system. I'm just saying that I got to loosen up on that gambling thing and enjoy it freely if I want, not like this with some trade that shouldn't be put on in the first place. I should enjoy the gamble part in each and every trade I make because there is always gamble component. Than I wouldn't have to enjoy it in bad trades.

Well I wasn't very much into trading today. My choices were poor. Nevertheless I made some profit and I try to learn some instructions on days like this.
+16 full size pips

Strong Euro

It could be much more if I waited, but I'm satisfied. When I look for much more, and if I don't get it, I broke all the rules and risk all good that I've done. +13 full size pips

Quick reaction

It started bad. I failed to take profit on first two eur/usd trades and close both at -13 half size pips. I was under impression of yesterday bad trading and I wanted bigger profits contrary to what market gave me. Than I had nice scalp win in gbp/usd. Again trade in eur/usd around the same area. Suddenly Europe pairs started to lose ground quickly. I closed last eur/usd trade in a loss and re shorted. Also I shorted gbp/usd. Well you can see on the chart how did that go. I took profits and shot for another wave down. In eur/usd I tried for third. Well in the end I went from a loss for the day of -13 full size pips to final +20 full size pips.

I'm glad that I reacted so quickly when weakens came. I got back all today losses and majority of yesterday's. It would be better if I took profit on time in first two trades but I will not complain.

Foolishness

Every now and than I do something stupid. I was sitting in the bad trade for hours. I really didn't know what to do with it. I had opportunity to close it in profit, at b/e, with smaller loss, hours ago, well I didn't. I learned something. I don't have a need to average any more. Also I do trade like this when I have success in scalping as I had lately and than one of the scalps end up in big trend that I do not catch. Then on next trade I don't want to take scalp or get out reasonably but do stuff like today.
I learned that reason why I should stick only with scalping is because if I don't scalp I brake my rules, don't have discipline and end up in bad situation. I broke my rules today, stayed after -40 loss. I don't want to spend more time on this foolishness. -25 full size pips

Mixed experience

It was a bit hard today, market moved all around and different in different pairs making fake moves. First I got caught on wrong side in spike that looked like beginning of momentum down move. After loss in that I got in opposite direction. Kind of emotional trade because of unexpected sudden loss but I figured that up side momentum that managed to reverse downside probable move will not be gone immediately.
At my third trade I got again caught in momentum spike just when it stopped. Well I was late and I wasn't so concentrated on market. I decided to wait because up move was really strong so if it get going again maybe it could became major up trend. I got out because it wasn't pushing when it should and on other pairs it didn't look promising. So now I was slightly positive for a day.




Trade #4 I wasn't waiting for anything I just grab some profit asap.
At fifth things became very hard. I entered on some little momentum spike down because eur/usd retraced a lot and judging by the chart of eur and gbp things look like down side is open. Gbp/usd didn't retrace at all, it was in range looking to break down. Well eur didn't listen to me. I was letting it go a lot in negative territory on my trade counting on profit from earlier to offset part of the loss. Finally it cracked down. I got out too early but that is understandable after 40 minutes sitting in loss. In the end I'm more than happy to end day positive with +14 full size pips.

Rate cuts

Market acted somehow strange, I checked the news and apparently Sweden cut rates more than was expected and that stir things up with eur and gbp with rates cut scheduled today. On first trade I didn't expect that big drop so I wasn't waiting around after 12 pips. Sharp reaction from found support at 550 followed. I had other trades based on 10sec chart movements and clues about how things go around when sell off meet resistance force that bounce price back. There is always fresh wave of selling waiting at least to try to get market back down. So I was only looking for shorts and made few scalps more.
+12 full size pips

Trading in direction of the trend

I wasn't by the screen for first part of the trend down. Gbp/usd just bounced of previous day low, I was expecting it as temporarily bounce and quick resumption of trend. Well it wasn't like that, I had to wait 30min before position show me the profit. I did exit little too early, but I would take only 20 more pips max because news time was approaching soon. You never know how deep will fall be. In that situation I simply don't remember to trail my stop and not just exit. My finger is on exit button whole time and it's so natural to press it to guarantee yourself profit.
Later things bottomed and there was long setups developing. I was shaken from second trade in the day. Than I got stuck with buy at the spike up, and lost more than half of profit from the day in spike down. I was mad and entered revenge trade. I knew that it was bad, I knew that I was emotional as soon as I was in. Well I got lucky, because there really was pressure to go up. So I took my profit as soon as I recovered lost gain on that trade before and got few pips more.
After that I decided that I don't have any reason to stay trading when I was emotionally disturbed and show tendencies for bad trading.
I'm glad that in my first trade I decided to go with the trend even when it was already down 150 pips.
Trades were half size, +25 full size pips.

Today's trades

Nothing much but it's nice to be profitable after losing day yesterday. First trade was because at 72 was R1 pivot point resistance today and it just looked to me like we can get pullback and hit wave of selling judging by 30min chart. That is only shot for little scalp trying to pick a top. It's 50:50 trade, but I kind off like them.
Second trade was because of reaction on gbp/usd that bounce that instant from test of morning lows. It first pulled eur/usd down in a spike, when it bounced eur followed.
+ 10 pips

I need smaller stops

Everything started to fall and I entered my eur/usd short at the top of a bounce. I leave my trade run against me because everything except eur/usd was weak. I even gave it more room at -40 cut out level, but when it started to break to the up side I exit it at the top spike.

I can't do this any more. If I so far have fix my averaging problem, now I have to readjust my exit strategy further. I lose all the bullets on one trade. It doesn't matter if I have good reasons for staying in that trade it doesn't fit in my overall trading plan. I got to have scalp stop losses. In range 5-10 pips mostly up to 15, but not 40. It was hard to get used to trading without averaging but I did. Now I got to get used to small stops. It's just natural way to exit my trades regarding that I mostly have scalp profits. For example today I entered in good scalp manner and had 4 pips profit on that trade immediately. As price started to go against me I changed my plan. I started to look around at other pairs why I should stay with the trade. I found good reasons, no other pair was retracing much, so I kept giving my eur/usd more and more room. Well eur/usd made something that we can call full reversal and other pairs didn't. I lost. I probably have to make a rule that on any individual trade max loss is -20. Maybe better -15, because it will happen from time to time when I don't want to go out, like now up to 40. So maybe better to fix it at 15. The most important thing is to exit majority of losses at 5-8 stop. For me is just easier to concentrate on scalping than any other way of trading. Maybe I should exclusively trade like that. But I still can't let go idea of not taking advantage of trends and cut all my profits in 10 pips area. Maybe I should just use very big tightening of stop, so when I have 8 pips of profit and it looks like there will be much more, trail stop to 5 pips profit an leave it there. So I will get at least 5 and leave that trade alone. Well it will probably all get settled when I start with scalp exits on all my losing trades.

Now two hours later after my 09:33 entry eur/usd is at 2 pips from market at that time, gbp/usd 140 in short direction, eur/jpy 130, usd/jpy 100. I really found wrong pair to short today.

Well I still got to develop that idea of small stops but this is direction that I'm going to take.

-22 full size pips