First Three Trades

Well, my first three trades have all hit their stoploss...sadly.  This is a very bad start to my first live account.  Let's review the trades:  the first one was USDCAD (sell), the set-up that triggered this trade was an IB Fakey combo on the daily chart.  It didn't 50% retrace before it started to take off, so initially I wasn't going to get in to this trade (I felt that I had missed the boat so to speak).  But after speaking to one of my friends, he said that frequently price will at least retest the break of the pinbar on the fakey.  So, I decided to set a pending order.  There were many IB Fakey combos on daily charts that day!  I felt that this showed confluence that we were about to see a correction (dollar devaluation), also known as "risk on".  So, there was one more trade that I took a chance on AUDUSD (which displayed an IB Fakey combo)...setting a pending to buy on it, as well.

Unfortunately, I decided to set my stoploss for the USDCAD trade at the 50% retrace point of the pinbar (remember entry was at the break of the pinbar) because I felt that price wouldn't reach this point.  I was wrong and got stopped out when price moved back up to test that level. 

Still believing that this level was holding, I decided to open another trade, this one a buy on NZDUSD (which also had an IB Fakey combo).  When the dollar strengthened it gave me a better entry point for that trade, so I kind of felt like I was getting a bargain for getting in.  Then, my friend who I had been talking to about my trades said that he was getting into the USDCAD trade going short (same as I had done), but now price was at a better position...so I decided to try it again.  Actually, everything seemed ok for a bit, price was moving as expected...then it changed direction.  Basically, price started moving beyond the high/low of the pinbar on the fakey.  So, now I had to decide whether to move my stoploss a little (which I did) or let it close out and lose the money (which I eventually did) because I don't know whether these were false signals now at this point.  They SHOULD have worked out nicely, due to the confluence I was seeing all of these signals among many pairs...indicating the dollar was going to fall.  Also, the IB Fakey combo is normally a very good signal (including pinbars!), AND the price level that was being tested hadn't been touched in months (March/April/May timeframe)...so I really believed that we were seeing a correction about to take place with the USD. 

The AUDUSD trade is still open btw...it was less volatile due to some good news that came out regarding their economy on Thursday I believe.  AUDUSD has gone nowhere near the high/low of it's pinbar.  Still, the trade is currently in the negative. 

My account has taken a hit as a result of these three trades, and mentally, I need to stabalize.  I am staying calm, but I need to make some changes here.  First of all, I shouldn't have had three trades going at once (risking 2% each)...and all of them majors which makes me triple exposed to the USD.  I am decreasing my risk limit to 1% (unfortunately, I'll be building up slower this way...but also will lose more slowly if I am wrong).  And I won't expose myself to more than one trade on the same currency unless I see that it is already moving in my direction...(building momentum). 

The problem I face at the moment is, I still think I might have been right about the direction of the price movement concerning these USD pairs...price basically dipped down, stopped me out and then reversed (at this time anyway).  So, now we are heading in to the weekend and this is no time to enter new trades when there is no clear direction.  I am going to close my AUDUSD trade before I lose anymore money on it.  This is tough, but it appears that I made the wrong call here.

One last thought, we are entering into what will probably be a crisis reminiscent (or even worse) than the crash of 2008.  In reviewing what price did during that time, the USD skyrocketed in value...so maybe what we are seeing here is the beginning of that?  I HATE that I lost my first few trades, especially when the signals were strong and setups valid...but maybe this is why price didn't seem to be following the rules here.  If we are seeing the beginning of a movement where price chooses a definitive direction, that presents a BIG money making opportunity.  So, I guess if that were to happen, I could pyramid trade and build up my account quickly...so, that would be the brightside of this scenario.

Live account opened yesterday!

Alright...I finally did it.  Started my live account with a $2000 balance...didn't make a trade yesterday.  Set a few pending orders, two of which have triggered (USDCAD sell, and AUDUSD buy)...so cross my fingers...and my toes...will be posting the results of course!

Trading update

Well, the CNBC contest isn't going so well...stocks keep falling in value.  Don't really know what to do about that.  The market is just doing that at the moment.  Overall though, I don't know enough about the stock trading side of this contest which is unfortunately 9/10ths of it.  So, I am feeling rather defeated on that front.  Oh well, there is next year I suppose.  I did order some books from Amazon on trading and forex...supposed to be good ones, so I look forward to learning more!  On a positive note, I plan to open my LIVE forex account on Monday :)  So, that is super exciting!  and scary to be honest...but I can't wait.

Day 2 CNBC Million Dollar Portfolio Contest...update

After the first day, I am ranked at 95.33% (meaning I am in the top 5%).  All I can say is, how do I stay in the top?  I have chosen my stocks...I will work on building the forex side of the account as quickly as possible, but it is only 1/10th of the total account (to begin) anyway...I am not sure what my strategy should be, but sensing I must be aggressive and take risks to win this.  Of course, if I stick to my medium risk plan, I can hope others burn out and I take the lead that way...

Wine Tasting...

Tonight, I bought a bottle of  Williamette Valley Pinot Noir (Oregon) which was recommended to me by a customer last night.  I don't have much experience with wine but i must admit that I like this!  It's not too dry or bitter, kind of fruity but not really sweet...and smooth.  Will definately get it again, and my curiosity has been peaked...makes me want to try others.  The only other wine I ever liked was a sparkling Shiraz (can't remember the name)...John says it has a black label with fruit (grapes?) in a backwards L-shaped pattern.  I'll look for it again at Hyvee...pretty sure thats where they carried it before.

Starting my live account

Starting my first live account in a about a week!  Pretty excited that I can finally call myself a real trader.  Will also be starting the CNBC Million Dollar Portfolio contest, so I hope that these two projects benefit each other rather than being too much to focus on at once.  Lets hope that through risk management, and wise decision-making I can be a success...even if it takes a while to get there.  I will keep this demo account open to use for experimental trades, and things like that, but I will no longer post about the balance of it and such as I don't want to be confusing.  I will only post about my "live" account or my CNBC account results and will be clear as to which one I am posting about.  As for my live forex account:  I will be more specific with entry reasons, price, stoploss and take profit levels.  My method will be price action, primarily looking for pinbars, hikkake patterns (Inside Bar breakouts), hikkake/pinbars (Inside Bar / fakey breakouts), support and resistance levels, confluence of pairs, gartley patterns (wave harmonics) <--- CONFLUENCE OF ALL THESE THINGS MAKES A GREAT TRADE.   Only trade off of daily and H4 charts.  Always trade with the trend whenever possible.  Must be trading on what I believe is a retracement move.  Avoid big news events.  I am looking for a minimum of 2X reward on my risk per trade.  I have decided that I will risk no more than 3% of my account at any one time.  This can be 3% on one trade, or 1% on three trades...as I see fit.  This is a medium (aggressive) approach.  Many people suggest risking only 1% maximum, but as I am starting with a smallish account ($2000) I want to build it up reasonable quickly.  This also applies to the CNBC account, because the point is to make the most gains and winner takes all in the contest.  I will make the same trades on both accounts, so any "homework" I do will apply to both accounts.  Also, I have faith in my methods as they have proven to be accurate about 75% of the time, if I STICK TO MY OWN RULES.  This blog is a form of journaling and analyzing every trade, the good and the bad, and I must be honest and thorough if I am to learn from it.  So, I will try to meet that goal which is no easy thing...

Damn...grrrr

Ok, so Friday I got a little overconfident after my two successful trades based on the gartley patterns (butterflies and bats, oh my).  I opened 4 trades that looked promising:  buy on gbpjpy (why?  because it was approaching the record low of feb. 2011 and i thought it was showing signs of reversal...a line of support around 123.200 and some reversal of price) which probably would have went well, if Greece hadn't been all over the news this weekend with what looks like the "end is near"...default, exiting the eurozone, panic, etc., etc...which leads to two other things that are bad for me.  A flight to safety currencies, yen and usd.  Lets just say that this trade stopped out, and I voluntarily closed out my two other trades that were shorting the dollar.  Cause that is out the window for the time-being.  I do have one trade still open USD/JPY (short) so yen is beating out the dollar for the moment.  That one is about two-thirds it's way to profit, so hopefully it makes it.

Update...the USD/JPY came within a hair of the take-profit goal and then reversed.  I decided to close it out while it was still positive.   Account balance:  $2950.85

Success!

The Gartley method worked for me today :)  I didn't have the guts to stick it out to my TP though, I closed out early with a profit.  I marked lines where I closed out though and will watch the charts to see what happened.  Account balance:  $2,976.16

Trying out the Gartley method

This is a price action method based on wave patterns...got two trades open that were signaled by it and are both moving nicely so far :)  They are AUDUSD sell...and GBPAUD buy.  Will post updates soon.

CHF pegged to the Euro

Well, SNB decided to peg their currency to the euro somehow...not really sure what that means, but it caused a huge spike in CHF pairs (and USD as well for some reason).  CHF pairs will not behave as usual due to this intervention so I will not be trading them for a long while, if at all.  USD reaction caused my USDCAD trade to hit stoploss.  Thats two losers in a row for me, account balance is:  $2,951.82.  I don't see anything good on the charts for trading, this is just one of those times where you shouldn't trade, and wait for the charts to show you something good.  So, I will practice my patience and wait.

GBPUSD hit stoploss, new trade USDCAD sell

GBPUSD hit my stoploss, just not a good signal I guess as it didn't work out to anything.  Decided to go short on USDCAD because the price bounced off of a downtrend line, and is at the top of the channel it's been trending in, and it displayed an indecision candle.

Happy Sunday night to you!

The forex markets start back up Sunday nights at 4pm for my time zone (Asia open), so I like Sunday nights :)  Not seeing much in the way of trades at the moment to be honest...most trends seem to be about to retrace (against their trend) - not an ideal place to get in a trade.  I did decide to go long on GBPUSD, mostly because there is a good pin bar there, and even though it is against trend, I think there is enough room in that retracement for a profitable trade...then I'll switch sides and try to ride it down.  Ok, that's what would happen in a perfect world.  We'll see what actually happens!

Great quotes about conviction, determination, belief...

People may doubt what you say, but they will believe what you do. (I don't know who said it)

Another good one:
Watch your thoughts - they become your words...
Watch your words - they become your actions...
Watch your actions - they become your habits...
Watch your habits - they become your character...
Watch your character - it becomes your destiny.

And another:
Stand up for what you believe in, even if you are the only one standing.

Confucius said:
Wherever you go, go with all of your heart...

NFP Friday

All of my trades (USDCAD buy, USDJPY sell, EURCHF sell, and USDCHF sell) are currently doing well and in the positive...however, I am not very happy with them.  Every single trade was quite a bit further along overnight until the NFP data was released and now pinbars are forming indicating the they may turn around on me!  Well, I moved my stoploss to BE on EURCHF and USDCHF, so at least those two are no risk trades...the question is do I let them ride over the weekend...or close out now with a profit...what to do...?

Update:  decided to close out USDCAD for a small profit because a IB fakey combo is setting up in the opposite direction from my trade...account balance now $2939.78

Update:  decided to close out all trades for the weekend...looks like they are continuing to lose value...but still got profit on all three...current balance = $2963.30

Review of my current trading method

So, here is what I am doing so far:

I am a price-action trader (95% technical, 5% fundamental).  I am looking for cues in the charts to tell me what is LIKELY to happen next.  I manage my risk (no more than 5% of account risked at any given time), seeking at least 2x profits on my risk.  I only trade off of the daily and H4 charts.  I use the weekly time frame to get perspective on trends and S/R levels.  I am first and foremost looking for pin-bars, inside-bar fakeys, and indecision-bars.  If I see these I look for other signals to validate the trade (support and resistance, trendlines, bias, confluence with the same currency bases, perhaps fundamentals, and currently - I am testing out this supply and demand aspect).  I watch all the major pairs.  That in short, is my system.  I don't use any indicators at all.

jumped the gun...

Well, the three trades I closed out yesterday (EURCHF, USDCHF, and GBPUSD) all went on to drop further so I could have made more if I had held on to them...but oh well.  At least I traded them profitably...I decided to reopen EURCHF and USDCHF on the basis of this supply and demand system that I mentioned a post or two ago...I want to try that out.  USDCAD trade is going well atm, so that is good too.  Oh, and whoops!  As I said before, I have been watching USDJPY (thinking it may have hit a bottom).  However, it developed a pinbar on the daily today, which indicates that it may drop further, so I meant to put a sell limit order on it and clicked sell (as in immediate) on accident, so I didn't get the best entry position...as soon as it went positive (by $.46), I closed it out (account banance now $2936.69).  Will redo as a sell-limit order as I originally intended.