Sep 6th 2016
Trade journal
Before trade thoughts
I will be using the benchmark price of the past SMA using 7 periods on a 1 day chart reading, as there are two economic events that will occur in the US & AUS that will impact the volatility, I will avoid trading at 2pm-3pm.
• As the MVA is 0.75560 on the 6th of September
o From the 19th of August to 31st of August there was a downtrend.
• As seen in the historial data, the past lows have been in the 0.75 ish. I will not enter trades that are above 0.76 with the exception of overbought sceranios which I will sell presented to me on the stochastic indicator that I belive have at least a 1.5:1 risk reward ratio.
• If I sell the AUD/USD, I buy USD and sell the AUD. When I buy AUD/USD I buy AUD and see USD.
After trade thoughts
• I opened a trade 0.76079 at 11.10am and closed at 0.76133 at -5.4 P/L at 11.30am. I was too focused on the stochastic as being overbought that I was not looking at the upward trend that was currently presented on the chart.
• Note that – that the stochastic reading did not align with SMA price that was indicating an upward trend. I failed to recognise the trend and the market sentiment had a positive outlook rather than a overbought sceranio. I also was too focused on the 15min chart and forgot to look at what was happening in the 1 min and 5 min chart.
• I will be implementing a stop/loss to my trade. Currently the AUS/USD market sentiment was optimistic from 10:45am to 11:45am and currently being overbought.
• Roughly between 1-2 which is 11-12 in AUS boxed in the 15 min chart was an upward trend. Also to note that on the Stochastic, there was a period where it was oversold, but hardly visible on the 15min chart.
Lessons from the first trade
o Never forget to look at the trend even if the stochastic is indicating an overbought screanio.
o Learn the elliott wave theory or harmonic price patterns as the one minute chart could of gave me a deeper understanding of market sentiment.
o Have an idea of the risk/reward and stop loss in place before you enter a trade. Look for high probability trades.
o Widen my use of indicators and not focus on one indicator.
o Also I did not implement my fundamental thoughts of both economies and relied on an indicator. Implement your research in your trades that align with your technical analysis.
