My FX Journey... From Dream To Reality

macilme · May 1, 2019, 1:55pm

Hi @jairusmaloba, you’ve got an analytical mind, I like that.
You’re very much correct, I could practically have as much as 50% of my equity tied up in both active trades and margin. My broker’s margin requirement is 2% based on how I set the demo account up (I had the choice to choose my preferred leverage and chose 50:1).
There are two way to look at it though:

Having relatively wide stop loss levels doesn’t always equate to huge losses when they get hit. I say relative because a 150pip stop as you’ve mentioned might be huge for an Intra-day trader, but not for day and swing traders. If I had a position open with that 150pip stop loss for example and risking 2% of my account equity ($200) the loss per pip movement against me is only $200/150pips which equals around $1.33 per pip, or 0.13% of equity per pip move against me. If the stop were to be 50pips only , the pip value would rise to $4 per pip.
In both cases above, if my stop gets hit, I only lose my $200 or 2% risk on my account. In the worst case scenario (losing on maximum of 5 open positions or 10% value of equity at risk) my loss will be $1000, it’s huge but not enough to even get a margin warning. What would happen is the $1000 loss deducted from my balance and the remaining margin is returned.

Thanks for the compliments on the Journal my friend.

macilme · May 1, 2019, 1:57pm

thanks @ponponwei, I hope you find the details as interesting

jairusmaloba · May 1, 2019, 2:19pm

I especially like the description of each reason a trade was taken. I was previously making a wholesale prediction on a currency and entering a trade without jotting down the nitty griity that made me enter it. Ive now changed to your style. Its more productive.(Im the pen and paper type)

macilme · May 2, 2019, 9:55am

DAY 43 UPDATE (MAY 2ND 2019)

Hey Journal…

No of Trades so far: 11

No of Active Trades: 1

Profit Trades: 4

Losing Trades: 5

Break Even Trades: 1

Just a single chart update this morning (we only got one trade open after all).

CADCHF Short

TP one came within reach quickly enough on this one and we snagged our first half profit on the trades, this is now a free trade with the Market’s money on the table as we’re moved to breakeven by now. It’s not looking as likely as yesterday that that BE stop will hold though as that retrace is getting too close for comfort. Guess we’ll see what it does.

Some new things in the works guys so watch out, if I manage to make a decision on them anyways. I’ll update soon enough.

And that’s the short morning snap review… Catch you guys larer

HASSAN
NIGERIA

jemilutr · May 2, 2019, 7:28pm

Am Happy To See My Fellow Nigerian Here Doing The Doings, I Just Started My Journal Trading This Month Though I’ve Been In Forex For Like 5 Months Now But I Started Making Profit From March And Am In My Final Demo Trading Months Which Is May Since Am Getting Profitable Everyday With 1:2 Target Per Day Am Thinking To Go Live By Next Month June I Hope I Made The Right Decisions?

macilme · May 2, 2019, 8:12pm

Nice to see you around my guy…
Hope your journal helps you on your quest as well…

jairusmaloba · May 3, 2019, 5:24am

Heart1010 · May 3, 2019, 10:24am

@macilme I really like your trello approach/look/…
Problem with trello is you can’t do stats/calcaluation in it, can you? You have to calc all your statistics about your trades outside trello (excel, libre calc,…) correct?

macilme · May 3, 2019, 12:43pm

You’re correct @Heart1010, that is a limitation with Trello. However for someone like me, Excel can be pretty boring as I have nowhere near the skills needed to make look as aestethically appealing as what Trello offers (I’m very visual and not confident I can keep up my journal on a sheet of simple rows and columns haha )

The upside to this is that Trello is more than just a board to write things on, you have many different tools (Trello calls them “powerups” ) you can use to link your Trello Board to Excel, this way, according to whatever your settings are you can do a number of cool things.

I’m working on my Trello board for instance such that whenever I update a particular currency pair, Trello copies all the new details on my Google Sheet I have linked to it, cool right? Problem solved, except you really gotta know how to do that so I’m still working on it and will have it working pretty soon. I’ll update in here when I have that set up so you guys can have a look :).

Do you keep a Journal as well?

macilme · May 3, 2019, 7:50pm

DAY 44 UPDATE (MAY 3RD 2019)

Hey Journal…

Late post it is today, sorry Journal

No of Trades so far: 12

No of Active Trades: 1

Profit Trades: 5

Losing Trades: 5

Break Even Trades: 1

How is NFP day guys, hope no one got kicked in the butt ?

I didn’t, I’m always out before NFP…

So what’s new on our journal today?

We did talk about how the CADCHF short was getting too close for comfort yesterday. Yeah, it really did get too close, close enough to get me out of the trade at breakeven:

Total anticipated R:R on trade at entry 1:3
R:R at trade exit 1:0.4

Much lower than what I was expected but had I stayed trade with full position I’d be out with no profit at all. This is why I love multiple TP’s, except ofcourse on the flip side, price could race all the way to the last TP and you would actually be making less than what you would committing full position all through to the last exit. I decide it’s better to protect my trades when I can and take profits as the market makes it available.

AUDUSD Long

We got in on a new trade today on the H4 chart on AUDUSD, trade is counter trend (on the lower TF) so I was being careful and moved my stop to BE as soon as I could. Pin bar trade this one, we could get a really nice R:R on this trade if price decides to rally back all the way to the top of the daily range, Remember though, that all trades taken on the H4 are always based off daily levels already identified on the pair. See below:

I’m learning about pyramiding, good concept but can only start implementing that in trades when its fully incorporated into my trading plans. It’s pretty advanced stuff, what do you guys think of that?

So that’s it, one trade in the bag for a not so bad profit and another doing okay as we speak. Let’s see what the coming week holds in store.

See you on Monday Journal.

macilme · May 6, 2019, 10:31am

DAY 47 UPDATE (MAY 6TH 2019)

Hey Journal…

Another Monday, What do we got?

No of Trades so far: 12

No of Active Trades: 0

Profit Trades: 5

Losing Trades: 5

Break Even Trades: 2

So guess what happened over the weekend, this:

Price gapped 60pips below last weeks close price, well below that daily support level, thankfully the BE stop took effect and got us out as planned. Price has since managed to cover the gap back to just below support which also doubles as an important psychological price level of 0.7000. Nothing looks like a likely trade for me at the moment, except for this one:

CADJPY 2bar reversal but I worry about trading into that gap above so I’ll pass until I maybe get better at stuff like that.
If you find a good PA set up that I missed do let me know :).

justshell · May 6, 2019, 3:20pm

cadjpy had an awesome buy setup. Did you take it?

macilme · May 6, 2019, 3:30pm

No I didn’t… I haven’t got much of an experience trading setups with gaps as you can see on my chart above… yours didn’t have it as I can see… otherwise it would have been a go for me.

I’m on mobile now but I’ll post a better image of how my chart looks compared to yours once I’m back on the computer… thanks for the heads up though, really helpful

justshell · May 6, 2019, 4:08pm

yea i think it has to do with the broker you have possibly. There was a large spike on Audjpy last week , that wasn’t on my group mate’s chart, and we had different brokers so that’s possibly the reason.

macilme · May 6, 2019, 5:08pm

Yep, you’re right @justshell, different brokers will show different price movements in situations like these… I’m back at the computer now and you can see what I was referring to earlier:

Naturally, price tend to recover gaps such as these but I didn’t feel like it was something I can explain with my strategy so I passed… it’s likely gonna head back to the level it gapped over (dashed green line) on the chart I’m watching the level highlighted in purple for bearish PA so I can short from there. How are you managing the trade right now?

justshell · May 6, 2019, 6:19pm

Okay I see, I use oanda and hugosway. But , I didnt take that trade, i had it marked up but missed the entry. I’m in GBPAUD, and UCAD right now

macilme · May 6, 2019, 7:01pm

Ah nice then… goodluck with those two buddy👍

macilme · May 7, 2019, 11:33am

DAY 48 UPDATE (MAY 7TH 2019)

Hey Journal…

Today seems to be just as interesting as yesterday even shoots out a few trading opportunities finally

No of Trades so far: 12

No of Active Trades: 0

Profit Trades: 5

Losing Trades: 5

Break Even Trades: 2

Yeah , so nothing changed from the statistics above but it will pretty soon, we got three pending orders waiting to be triggered, hopefully going the right way haha .
Alright, let’s jump right into the mix:

CADJPY Short
Yesterday we talked about the gap down on this pair and how I would have loved to take that 2BR at the daily support, turns out it would have been profitable, at least all the way back to the broken support levels anyways. Do I then regret not taking the trade now in retrospect? Nope, I wasn’t sure about the trade so I passed, maybe when I have studied enough gaps like this and know how the dynamics work in such situations I’d be taking such trades in the future.
So why are we still talking about this pair now? Well:

CADJPY H4

Just what I was watching out for, price, after recovering back from the gap down has returned to the now new resistance and fired off a Bearish Engulfing Bar (BEEB), If you looked just three candles to the left there’s a valid Bearish Pin bar as well , but I passed on that as I now prefer really big pin bars or ones with the wick showing on the other side of the marked level on the chart. I have limit orders set on this pair already and they’re not triggered yet, we’ll see how it plays out, PT, SL and Entry are as seen on the chart.

AUDCHF Long
Almost all AUD pairs fired off really strong candles earlier today, and we finally settled on two, AUDCHF is the first:

AUDCHF

This candle not only recovered the gap down completely, but managed to close above the daily resistance level, you can see that subsequent candles have been small (showing price consolidation or minor retracements) and also staying clearly above the marked key level, in the process price has formed a Bullish Inside Bar (IB) Pattern right at the level, inside bars signal continuation or reversals depending on the price context behind it, in this case we are trading the pattern as a continuation. Entry and exit levels are as seen on the chart. It’ll be the first time trading this pattern so we’re watching to see how this play out as well.

EURAUD Short
Because we found so many AUD pairs showing Inside bar signals and settled on two of them, we have split the risk between the two (1% each) and as such regarding both trades as two halves of a single trade (sometimes one can do that to either minimize risk or just not to miss out on two correlated trading opportunities). Here’s the chart:

Strong bearish candle at resistance level zone followed by a small inside bar, we took it . Hopefully it works out this time. Entries and Exits are as seen on chart.

As I am typing, CADJPY Short just got triggered and looking good so far. I’ll be here tomorrow to tell the rest of the story.

giphy
See you tomorrow Journal

jairusmaloba · May 8, 2019, 10:26am

I strongly feel that the AUDCHF is in a downtrend. The window has been closed and the downtrend may resume towards 0.7076. The CADJPY window may also be closed in the same AUDCHF manner and you may loose out on potential pips or if you’re order has been triggered than you may be abruptly stopped out. Also I noticed your SL is larger than your TP one. Is this OK with you??

macilme · May 8, 2019, 2:16pm

DAY 49 UPDATE (MAY 8TH 2019)

Hey Journal…

It’s been an interesting day

No of Trades so far: 14

No of Active Trades: 2

Profit Trades: 5

Losing Trades: 5

Break Even Trades: 2

Well two trades in one day, it doesn’t always get busier than that. What do we got:

CADJPY Short

I talked about how this trade set up was snagged up right as I was typing in the Journal update yesterday, well it didn’t disappoint. Price moved pretty smoothly down all the way to the bottom at support and hit our first TP, we have since closed out half position and watching that level, price is currently struggling below that level as we can see. Hopefully it holds as new resistance and we can get more out of this trade.

AUDCHF Short

Things changed since I last posted an update (and pending orders ) for this pair. We were going to trade the Bullish Inside bar set up after that strong bullish candle seen to the left of the chart, however the setup became invalid even before the limit orders were hit (the strategy requires price remaining always above the IB low as the stop is going to be just below it as the trade becomes active) the candle that invalidated this setup is a Bearish Engulfing Bar occurring at key resistance, a little less smooth than we’d have liked but still valid according to the BEEB trade strategy so we switched from a long bias to short. Limit orders were set below the BEEB formation and the trade has since been triggered and active.

EURAUD Short Canceled

Same rule, price closed above the inside bar high in the Bearish inside Bar formation and we have since closed pending orders for this one as well. Watching this one as the long upper wicks of recent candles show bearish loading on this pair.

All entry and exit levels are as seen on the charts above.

@jairusmaloba, nice observation on the charts posted up yesterday, I agree completely with you on your bias about the AUDCHF and CADJPY pairs. We considered a long trade for the Inside bar on the AUDCHF because that system is more or less a mechanical trading system with very little room for subjectivity, it’s still new and has only two trades under its belt at the moment and we will know how well it has performed (and where, if any improvements should be made) when there is enough statistics on that particular strategy to analyse.
You will notice that the trade never got triggered since price didn’t manage to close above the Mother Bar.

Most of my trades have no fixed R:R ratios as they are price action based, usually having multiple TP levels. the idea is to have a really low failure rate at the end of this journey so that it ensures profitability in the long run.
Appreciate the inputs as all good trading systems needs scrutiny (all the better coming from a third party) if it is to be effective so keep watching and let me know when you see something off the PA turf in here my friend.

So that’s it for a late afternoon update Journal
How’s trading going for everyone today, good?

Catch you guys on the other end of these trades (hopefully) tomorrow.