Trading Journal of a new FX trader

[asi212]

I've finally decided to start a trading journal because I believe the different perspective I get while looking back in a journal, over my trades, will be greatly beneficial to me as a trader. I also would love to hear many criticisms and suggestions from more experienced traders (I want to understand how the successful trader thinks).

A little about my journey so far.. I started trading about 4 months ago with 500USD with an Alpari-US account. I did do a demo account.. for about 2 days before I decided I was 'experienced' enough to trade live. I lost 50% of my account within the first 2.5 months, but I feel that the best experience is 'real' experience, so my minute losses are well worth it. I really loved the MACD indicator. I would look at the 4hr chart and trade basically just off the MACD.. I had a stop loss, but no price targets. I traded way to often, It was like an addiction. I lost 60+% of my trades. This wouldn't have been that big of a deal but I always held onto winning positions until they lost profit, so my losing trades averaged more than my winning trades. After I shrank my account all the way down to 250USD, then I decided I needed to get serious because i was NOT going to fail at forex (i've never failed at anything I've actually tried in my life). I started to scalp eurusd during the day off my phone using no indicators while I was taking classes at college. I grew my account about 7% a week for around 4 weeks while the EURUSD was in a nice bearish trend (from 245USD to 322USD). The next week I had a minor losing week, phone wasn't executing trades fast enough and the trend was changing but I was still shorting it. I took a break for a week and realized I don't have enough time for intra-day trading and that trusting my phone while I wasn't around a computer with a reliable internet connection was foolish. So now I'm trying swing trading, hoping to finally find a trading style that fits me (I do enjoy scalping when I have the time so I'll be practicing on a demo during my free time while I swing trade with my current account).

How I will be *Attempting* to trade:
- No Indicators (I can't use indicators any more. I hate stuff telling me what to do. I always trust my instincts no matter what. I know that with experience, I'll know the market and if i know the market, I'll be able to profit from the market.)
- With the weekly/monthly trend. If I feel and see evidence of a reversal, I'll be trading that (I'm bullish long term on USDJPY for example)
- Support resistance / Fib levels - Just recently started using these with success scalping.. once again, I've really grown to HATE all these stupid indicators (I'm sure they work for many people, but its just not my style. Can't do it)
- Aggressive risk management (until I have experience) - trading .01 lots (which is about 3% account risk per trade.. thinking about adding more money to get that number down to 1-2%)

If anyone has any critiques please let me know. And any good book suggestions on discretionary trading would be greatly appreciated!




And now to start the actual journal part.

Week of June 25-29, 2012:

Long AUDCAD - Entered this trade by accident honestly, because I'm bearish on the Aussie, but I'm glad I stayed in it because I was up 100 pips at one point. I choose to stay in it because it made a higher low on the 4hr and there is no clear long term direction evident for the pair so I figured I would just stay in and see how it plays out. The EU meeting reaction sent it skyrocketing and took me by surprise because I wasn't sure if the pair would be able to break though the 1.04 level (I was actually hoping it wouldn't because I'd rather be short). I would have closed at the 61.8 fib level from the February highs but I missed it while I was asleep. I'm neither bearish nor bullish for the short term so i decided I would keep the trade over the weekend and either 1. close it when it bounces off the 61.8 again or 2. close it at a much higher level after it breaks through the 61.8 level (I don't want to think about option three :'/ ) - As of Close 6/29/12 + 61 pips

Short GBPUSD - I'm very bearish about this pair. My stop loss was 150 pips away and I still got stopped out by the EU reaction. I decided to open another short on the EURUSD after, because for long term, I'm very bearish on the European currences. - -150 pips

Short EURUSD - Opened this at 1.265 after my GBPUSD trade was stopped out. I'm expecting prices to go back down next week. Hopefully the spike just gave me a nice high level to short from. - As of Close 6/29/12 -15 pips

Long USDJPY - higher highs and higher lows on the weekly and daily charts. I don't really have a strong opinion on the fundamentals, but deep down I just wanna believe its overdue for a long term rally upward. As of Close 6/29/12 + 44




Already, just by writing this first entry, I feel that I need to do much more research and plan my entries much better.. Any criticism is appreciated.

And for my entries from here on out, I will be posting pictures of the trades and giving more detail about my reasoning behind them (I didn't this time because I'm tired of typing!).



- Austin

[asi212]

Mistakes Made:
Earlier today I excited out of my USDJPY trade for around +15 pips after it had been around +60. It went down because of comments made during a news conference, that the US might be heading into an economic slow down. This was after the manufacturing PMI came out. No new information or anything was released, it was just the re-iterating of information that the manufacturing PMI had already told us. The market began to head downwards.. I should have realized that 1. This was a drastic , seemingly unjustified reaction to me (because it already came back from the PMI release) and 2. The pair is trading in an up-channel and that it had support below. Well, after I lost the 50 pips, I closed out my position. Immediately afterwards it hit the trend-line support and shot back up 50 pips to where it started. I was hesitant to get back in the trade and by the time I did, it was in consolidation again.

-- On furthur examination of the trade, the fundamentals seem to be in favor of the yen now and the trade hasn't really moved in days so I'm exiting.

Lesson to be learned:
-Exits should be thought of ahead of time so as to avoid emotional decisions.
-You must look unbiasedly at fundamentals and news frequently. Fundamentals change, don't be slow to notice.
-If your going to exit then exit. Don't sit there debating whether to exit or not, while watching your money disappear.
- If a trade starts going against you - and it's very close to resistance/support -Let it test it.. Chances are you can close off the retracement for more pips


So enless it starts a bullish rally, I'm now looking to short if bad NFP data comes out--
Japans data looks pretty good. US's.. not so much. If NFP is weak, will it push the pair down over the next few weeks? I think so, but I'm inexperienced. Anyone care to weigh in, from experience, on what I should expect over the next few weeks, if NFP is much weaker than expected?