An interesting approach to trading- My newbie approach with discipline

Beginner Questions
22

How Well Did I Do On My Trade?

Someone had a discussion with me on this- the whole concept of analyzing your wins and your losses after every trade, and learn from it to increase your learning speed. So what do you look for? Unlike the contrary oh I messed up here and there edit edit path, I have learned that the most important thing is to figure out if you had a good trade, or a bad trade. Fix bad trades. I have learned and adopted from someone else the idea that you have several different kinds of trades- two kinds of good trades and two kinds of bad trades. You can have a good trade and win/lose, you can have a bad trade and win/lose. Ideally you would want a good trade in which you win, but the most detrimental is when you have a bad trade and win, because that will lead you to bad habits. Here are the rules I ask myself when I analyze all my trades:

1)How is my entry? Did I enter at the location I wanted, or did I “make compromises”?
2)Did I follow all the rules of discipline in making the trade?
3)Was I patient and did I take my time in planning out the execution?
4)Did I follow proper risk management?
5)Was there any fundamental flaws in my analysis? (Meaning did I just look at an uptrend and thought it was down, did I forget the name of a candle formation, etc)
6)How was my emotions during my trade, and did I manage the trade objectively?

If I do everything right, win or lose its a good trade, and will lead me to more consistent profits. Hope I did not forget anything, if I do I’ll add it later. Feel free to leave a comment. :slight_smile:

23

I have not posted anything on how I trade, so I thought I should show you my trade of the day.

This is the USD/CAD for today. As you can see my entry was at the very top marked in green arrows. So here is what was going through my mind as I made my analysis.

  1. since 9/22/11 usd/cad has been caught in a range, and there are no major news events coming up to break it out of its range. Its currently at the top of the range == > short

  2. The entry point was at the start of the asian session. Asian session is ranging session. No volatility = no breakout. ==> short

  3. fractal have formed at my entry area. Usually goes either or, but in this case supports my short.

4)I never use the stochastic, but this is one of the few times where it looks like its doing its job. Its in overbought territory from M15 to H1, which makes sense due to the strong bullish movement that led to its recent top.

There are two entries, because I was wanting to enter now at the current tip, and another partial position at its actual top of range, but I ended up fading in when there was a brush of bearish momentum.

EDIT:: Exited out of the trade. I averaged +23 pips for this trade, from a high of ~45 pips. Head and shoulders pattern on fiber is taking effect and its affecting my pair negatively.

Current winrate : 4/5 = 80%

24

Thanks for sharing your reasoning…more notes to add to my ever expanding list to practice

25

TRADE UPDATES:

This trading session (I trade LONDON/NY, sometimes set entries during ASIAN) I was watching AUD/USD, GPB/USD, USD/CAD, and EUR/USD. They seem to be my favorite mixup this week. Every pair but GPB/USD was hitting critical regions, and so the entire LONDON session it did not move from that area in either direction. I was waiting for some form of confirmation and basically sat out the whole time and watched (pretty proud of my self control there). By following my rules of discipline, I was looking for bets against the buck today… BUT FOR SOME REASON all my analysis was pointing to the opposite! This clash was what led me to sit out, because my stuff was not in-line.

There was one important thing in this equation though… the use of correlation. I’m starting to see it now. I decided to wait til the wednesday USA high impact reports to “rock” the pairs out of the congestion zones, and use that to find my direction. When the impact came, it supported my technical analysis so I entered with a short (following 2 relatively thick confirmation candles). Since my entry point was not ideal, I reduced my lot sizing, and placed my stop loss at the peak of our ~7 day ranging zone.

I resulted in +55 pips, or ~ 1:1 return rate of 1%. YAY! I originally thought of holding the position for longer, but due to me watching my correlations, I exited out of this trade and entered USD/CAD short. I had this planned out from the previous night, so since it was NOT a rush decision, it was fair game. However, I did break one rule===> wait for the candle to close.
If I had, I would have entered at a much better price. My current short is entered at the top of the USD/CAD range, with a 30 pip stop loss above it. So far i was 3 pips from getting stopped out (due to my not so ideal entry), but currently the guys running strong, at +18 pips. We will have to see where this is going to go, since theres a long asian session ahead of us.

CURRENT WINRATE: 6/7 ==> 85.7%
NEWS REPORTS SUCCESS RATE: 2/2 ==> 100%

Pips gained for the week : +175

Running positions:

SHORT 1.03779
SL: 1.04080 (just above the 1.04 handle, avoid those psychological numbers right?!)

UPDATE:: Got stopped out at -27 pips, due to spiked volatility caused from german retail reports.

CURRENT WINRATE: 6/8==> 75%
Pips gained for the week : +148

26

It looks like your waiting for a pat n the back or for someone to tell your doing good for the good trades that you have, if you can score 180 pips on three different pairs I think your ok. I’m not a fan on trading two or more different pairs but if you can pull it off good for you. I think if you can concentrate on one pair whith more lots it will be more profitable but good trading, keep it up

27

Thanks for the pat, but its not necessary. If I only concentrate on one pair there are not as many opportunities for me to enter, and my goal right now is not to enter more lots. When I become more consistent I will naturally and slowly increase my risk back to what it was before (I traded 3%, currently I trade 1%). I think if I increase my lots right now, it would probably be detrimental to my growth.:smiley:

28

what time frames are you trading , because you would only be risking 1% on a higher time frame whith one pair . I’m not saying your doing wrong infact your doing great so are you looking for advice and help or do you have it all figured out;)

29

Of course I don’t have it all figured out. Im still a very bad trader. I look at 5m, 15m, 30m, 1h, 4h, and daily time frames. My 1% risk is just based on my actual setup, which is usually on the M30, 1H, or 4H time frames

30

Trading is about confidence,you have it that’s why you started trading. So stop sayin your a horrible trader, look for advice but stay true to what works for you, that’s what we are all here for TO HELP. Try your plan whith a higher time frame and calm down. One trader to another.

31

And here comes the end of the week. First things first, I need a new rule.

11)NO CALL OF DUTY DURING TRADING!!! So #$%^& distracting

As you guys can see, Call of Duty has distracted me from trading yesterday. More specifically, I saw a small handful of short-term trades I could have ridden for ~20 pips each, but obviously, I did not. On the positive side, I can see how the “be patient rule” is taking fruit, because I still managed to trade, even though I missed some. Its not the NUMBER of trades you squeeze in, but the QUALITY of each one :slight_smile:

My results for this morning:
(SCALPING)
EUR/USD: Long +3 pips ( I made a quick play based on indecision in the market, due to it being stuck in the congestion zone for the entire london session)
AUD/USD: Short +7 pips ( I made a play inside the range, based on indecision in the market with a short bias, I entered in this short when price rose after a retest of the bottom of the triangle, with no break)

And finally, the primo trade that I was rooting for finally took place between 5:30 - 6:am my time (12:30 ish GMT)

Short EUR/USD at 1.35002, took profit of +78 pips.

Initially I took partial profits at +80 (half my position), but then 30 minutes later I realized that the markets are CLOSING and I don’t want any open positions! So I closed down the rest. NO sense in risking my entire profit by letting it float over the weekend!

Reasoning behind the trade: I was short bias, and looking to make my entry after a breakout down south (with current euro conditions I did not think there is much room going up). This was one of the many times that i completely ignored the use of my only indicator (stochastic), and just looked at price action only. Watching the correlated pairs play out their dance the entire night (8pm - 5:30am PST), I saw the pair finally hit its “break point”, and I entered in at market value at the 1.3500 handle, a re-test. If it had not re-tested, I dont think I would have hopped onto this trade.

End of Week 1 results:

Winrate = 9/11 ==> 81%
Pips gained: +263
NEWS: 2/2==>100%

32

funny to think that some of well known businessman or prime minister playing computer games … i mean u should stop playing games while working (i was hardcore FPS player myself 5 years ago and pretty good international level but then i grew up… not mentioning that every now and then im thinking what would happen when i would stick with it and become pro. gamer like “fatal1ty” guy who makes lots of $$$ with it :50:)

edit: quick video -> Fatal1ty - Practice time - By Mr Positivity - YouTube

edit2: jwlee lets stop trading and become full time players !:18:

33

lol I suck at FPS now because i stopped playing in college, my kid brother on the other hand, seems to always be #1 in every single game with insane kill/death ratios. I’m so jelly!

35

Good trading I also saw that nice setup on the euro, but call of duty is also dfun

36

when u arrive at home look this short video and delete this post . Who is Rupert Murdoch? - YouTube

about balfour declaration Israel belongs to the Rothschilds - YouTube

and if u havnt seen “money masters” then u should watch it aswell The Money Masters - Full - YouTube

and about FED and Rothschilds ( good video. explanes almost everything in short video ) Rothschilds and the Federal Reserve - YouTube

that should be enough videos for a weekend :51:

edit number zillion: Gaddafi gold-for-oil, dollar-doom plans behind Libya ‘mission’? - YouTube

37

I think I’m going to watch these vids

38


Daily

4Hour

1Hour

30Min

39

This is an update on my Monday morning trades! Since I had 4, I will breakdown this one (my best setup), so you guys can have an idea of how I trade. As you can see from the chart I took 80 pips off this guy. I always look from the slowest timeframe first to the fastest last.

On the daily chart you will see orange circles. These formations indicate to me strong bearish momentum. Seeing that blue line is the 200 ma, you can see we are in a daily downtrend for the moment. Green box is a region of strong consolidation previously. From this chart I think “Okay, I’m going short. Got to mark where my day open is with a red horizontal line now. Marked. Now onto 4H.”

On the 4H chart I marked off the region of interest between two purple horizontal lines. I circled off consolidation area within the daily consolidation, which is of interest. At this moment price action has brown past the bottom purple line.

On the 1H chart, I circled the areas of consolidation within the consolidation within the daily consolidation (wut?).I drew the black line so you can see the general shape the price is telling me. Those angled lines at the tips of these mountains show me price is going DOWN, not up. Right now I’m thinking “Okay, there was been strong movement downward. If I enter at market my risk is increased because I’m farther from stops. Where would be a better price? Well I expect today to be a red candle day, so where else would be better than the daily open?”

On the 30 Min chart, you can see that trendline I drew. The area before the entry was consolidating as well. In my rules it says to be aware of any news that could affect your trade. In this case, the ISM USA reports. And as you can see, the news spike activated my short, giving me my 80 pips for this one trade.

Please post your thoughts and criticisms :slight_smile:

40

Well thats 1 of my 4 trades.

My GPB/USD short trade got stopped out at +5 pips before it continued its southbound rally of ~50 pips. I had found another re-entry point and took +25 pips on top.
My AUD/USD(shown) was +80 pips
My USD/CAD long trade was exited at +43 pips

Pips for the day: +157.5

Current Winrate: 13/15 ==> 87%
NEWS TRADING: 2/2==>100%

41

I am doing very similar top down analysis and overlaying trendlines but did not get into one trade today even though was looking at the one you posted.

Hoping you can share with me…
Are you drilling down below 30min?

Are you using any other confirmation tools (CCI, etc)?

Are you identifying your area and parking the trade in the system as set and forget or are you manually managing it and entering trade real time?

How wide of a stop are you using?

…happy to see someone else on here doing similar analytical work as me…and succeeding!
ET

42

When I “set and forget” I dont go below 30 minutes. When Im there watching and managing my trades I go all the way to 1 minute for high volatility and 5min for regular chart watching. The only confirmation I use usually is just candle stick patterns and momentum, which is gauged by breaking down a long term candle (like 4H) into its smaller components (seeing what happened in 15 min to form my 4H candle, for example).

I both set longer time trades for trades not near the recent price action (i.e. don’t expect them to activate anytime soon). Since I spend probably 10-12 hours a day on the charts, what I like to do is set up price alerts at what I deem “important levels”, so when price hits that area I can go through the time frames and see if I like where the price action is going. My stops range from 30-200 pips.

Good luck to you Enchanted Trader :slight_smile: