Good Morning Journal!
Good Morning Mike.
So, how you doing buddy? Vacation been going good?
Talk to me. What you been up to?
Well, I tell ya Journal, my body is feeling pretty good. Time off does wonders for the body. Mind also! And speaking of that, I was very productive this week. That is what makes me really happy! I got a lot accomplished, that I wanted to.
Ok. Well, let’s review the week. It was a short one though, cause it didn’t start till Tuesday. And, in fact, that’s when we kicked it off together, remember? Well, Tuesday ended up being the day that I had gotten a lot of stuff done that I just can’t do when I’m at work. Calling a company…visiting the bank…stuff like that. And also, that’s when I put together my office. That was fun. So now, this is where all the fun work takes place. (Which is different from where I parked it before). So, all I got to say is, it’s awesome. Change is taking place, right before my eyes. I’m so glad. And, it’s about time. It’s been a long time coming. The family is getting smaller. And, before the end of this summer, we’re gonna be kid less. Yep, her last one is moving off to college then (Aug). Man, Journal, this year is definitely going to be the year of change, for us. The only thing that won’t change is where we live at. Because, Trish now, has a completely new job. I’m changing careers. And our house will be empty. Except for our dog, Ben. Well, I guess we won’t be completely kid less yet. Even though he’s a big dog, he’s still like a child. But, we love him, just the same. In fact, his birthday is the 6th of this month. He’s gonna be 12. (Pointer mix) Yeah, I know, he’s getting up there, in age. But, when that day comes…then…it’s gonna get sad around here. But… man… what can you do. That’s life, I guess. Change takes place. Sometimes for the better. Sometimes for the worse.
Ok. That’s nice. Where was I? Oh, well, that was Tuesday. Physically productive. Wednesday was a good day, I guess. That was the day I spent mostly in my office. Watching the market. Oh, I remember. I was writing down a lot of stuff. Yeah, now I remember. I did a study. Guess what it was on? It was on the subject of how a Tiger prowls. I wanted the inside on that subject. I’m sure all traders have heard how we need to be patient, wait for the right time to attack the market. So, yeah, I searched all of the videos I could find on that. Well, that seemed to go on for such a long time that day. I didn’t want to turn into Jack Hanna or anything. But, when I took Ben out for a walk, during this time, I was looking down at him. And he looked like a Cheetah to me! I’m like, man, what a striking resemblance! ( Videos of a cheetahs prowl, and chase, is something else). But anyway, yeah, I was trying to make the correlation to my trading. I did write down a whole lot of notes. That is one thing I like to do, write, write, write. I have papers all over the place with notes after notes on them. Anyway, that was a fun study. You know…we can learn a lot from the animal kingdom. I guess it would be more like from nature. There’s always principles to be found in nature. You just have to look, and see them.
So, I did watch the market that day. But, I didn’t do any kind of trading. Cause, as I look back on it now, the market did quite a turn around. At the time, I didn’t know it. So, I didn’t know how to go about it. I just watched. See, it wasn’t moving along with the trend. I will show you later what happened. But, needless to say, it wasn’t a good trading day. For me, it was more of a learning day.
So, Thursday, was more of a family day. That’s when I went down to my daughter’s house. Got to see the little one. Yep, my grandson, Eric. The little guy is getting big! Not quite one yet, but boy is he close to walking. He can stand up on his own, and take a step or two, but, that’s it. Back on down to crawling. I’m so glad to have been there during this time. These are the moments that will come and go, during his life, that are monumental. There’s nothing like being on the floor playing with him. But anyway, I spent time with them and my son Ian also. We, then, all went out to the mall and had a good time together. Man…I remember those days with the stroller. Diaper bag and all. Seems like a lifetime ago. You know, it’s the little things…I loved watching him gnaw on a small french fry. Ha ha ha! …like forever! He has a few teeth in there. But, it was funny. It’s the little things. That are awesome! Needless to say, it was a good day.
So then, comes Friday. Yeah. This was the day for trading. It’s NFP Friday. This is the day that I want to learn something, about my trading. Boy, I have to say, I was quite nervous. After I bid Trish goodbye, I had an hour to prepare. So, there was a lot going through my mind, during this time. Like…what’s the plan? What do I want to get out of this? You better believe, I was writing notes after notes. But, was I going to practice? Like if it was real? Or, how about try to make some real money. On my live account. So, I was going back and forth on what to do, before time came. In the meantime, all I was doing was writing down the facts of what I know what’s going on in the market now, up to this point. You know, it’s the preparation period. All I know is – where has the market been, and what is the lead-up looking like, at the present time. Man…I’m trying my hardest to be objective about it. I know I don’t want any bias feelings! Facts. That’s it. So, I was concluding that the market ( JPY, for me. Cause I’m trading the one pair now, AUD/JPY) made a turn on Wednesday. I’m talking about risk-on. There’s no doubt there was a change. I just don’t know if it’s gonna be a big correction, or a definite change in direction. For the JPY. Which correlates with the risk-on / risk-off sentiment. Take a look for yourself.
Now, you have to remember, that last day there, I didn’t know the total outcome, at the time. But, on the hourly charts, I know, for a fact, that it started climbing sometime Wednesday. And, it kept on climbing. Even showing on the 4hr charts. And the reason I know this is because of my 5/9 lines, of an indicator. Anyway, that chart is the end of day picture. Cumulative 5/9 pip spread between all of the currencies, against the Yen. So yeah, they’ve been strong, but was showing signs of some serious weakness. Therefore, I had to conclude that the JPY could very well continue weak. And, I remember thinking, am I bias in any way?
I’ll show you. This is the week.
The open is the first red dotted line. And the US closing, thereafter. And…I’m not going to blow it, Journal. I only gave you what it looks like up to 8am, NFP time. First off, see, in the middle there, Wednesday. Nothing but an up day. That is why I didn’t want to trade. It was so against the grain. Well, at the time, I didn’t know what to think. Therefore, I’m out. But, what was I writing down, here an hour before NFP time? Consolidation definitely taking place. Boy…something is going to happen. I also noticed that this retracement didn’t quite go back up to where it started, at the beginning of the week. Uhhh…doesn’t that mean weakness? It didn’t make a higher high. I was wondering about that. And also, I wrote down the very question. What correlation does the USD have to this pair? If it was going to be good news, then what? With the USD/JPY, it would go up. And the JPY down. So therefore, risk-on right? Cause the JPY is risk-off. But, if the USD goes up, then the AUD would go down? Right? The commoditity currencies would suffer. A higher USD leads to lower commodities. I don’t know. Man…I was going back and forth about this. In the end, I couldn’t come up with a determination about it. I finally said "it doesn’t matter! Just watch my chart! So Journal…that’s all what was going through my mind, at the time. But, honestly, I was expecting it to go higher. You know why? Cause, in the minute chart, leading up to time, it just seemed like there was a bias to the upside. You would have these spikes to the upside. And I was thinking that some (money) wants it to go up. Again, through and through it all, I wanted to be unbias as much as possible.
So, time was ticking. It was getting closer. I was getting more nervous. Kept thinking about what I should be doing. Practice, or make some real money. Well, it was about 10 minutes beforehand, that I went on my real account, and decided to put in a limit order. Of course, I always start out with a pretty dog-gone small amount. 1k size. And where you ask? Well, look up there at the chart. You can plainly see where the resistance level is at. That is between 82.50 - 82.60. So, I placed it at 82.62. I figured, if I was right, then that would be a good start. I just would have to remember, that if it goes south, I would take it out. But, I wasn’t going to watch on my brokers’ chart. It was open though. So then, the plan was to watch what happens on my TradingView chart. I was going to practice. See, the way it really turned out was pretty unplanned. I realized what I should be doing as it all unfolded.
So, time came. I’ve watched many NFP’s before, so, this wasn’t any real big surprise. Sure, the final direction always is, but, not the back and forth that happens beforehand. But, the spike happened. And I remember thinking, within the first couple minutes, how there seems to be some serious indecision going on. It was like a whole lot of people (money) was wondering which way is the direction? It was interesting. Mind you, I was only occupied with this one pair, not what the USD was doing anywhere else. Maybe that was a good thing. So, I was focused. I kept an objective mind to it. You know why? I wasn’t emotional during the entire ordeal. I was mostly worried about what I should be learning, more than anything.
But, guess what, Journal? It did go the way I was thinking it should.
That’s the 1 minute chart. You can see the spike. And, isn’t it interesting how it wanted to go higher just 3 minutes before time? I think it is. So, I guess it took about 10 minutes or so, into it, that I got the idea. (Like I said, this was all unraveling as it went). I was like, Man…this is the time for me to practice. I need to take full advantage of this time. And that’s precisely what I did. This was the plan.
- I’m going north. Only.
- I’m getting in at the beginning of a crossover.
- I’m getting out at the reverse crossover.
- 1 min. chart.
- Clues, for the crossovers, to watch:
----doji small candles
----changing of the colored candles
- Mostly, wait for a definite crossover.
Well, Journal, let’s put it this way. For the rest of the day, I had such a great time! Talk about fun. This was the first time that I got a real sense that I can do this. You know why? Because I really didn’t have a losing trade. There was one, but, it was a mistake. It wasn’t a planned one. Stupid mistake. Didn’t lose much though. But look…to me, this was not about how much money won, or how much of the account got higher, or anything like that. It, simply, was all about how effective I can get in on a crossover, and get out at a crossover. Well, honestly, I know I can do this! It feels so right. I know I need more practice though. Just to get comfortable. I did quite many hours for the rest of the day. Not all of them, but, most of them. It’s a technique. And I’m gonna get good at it. Especially after what I did during this first session.
I do realize, that this was an almost no brainer of a market sentiment, going one way. I know the market won’t always be like this. But, what I’m really doing here is this. I’m following average price. Doubly. Cause, remember, this is on the Heikin Ashi candlesticks. And, of course, my 5/9 lines, which are where the average price has been. It’s so much smoother than what the actual price is doing ( I couldn’t imagine trying to follow live, actual price).
So, when I think about this. It was my break-though. It’s the way I get in, and get out. I follow. I don’t have to guess. And, I don’t always have to be spot on either. There’s some forgiveness. Hey, even if I lose every now and then, over the longer term, hopefully, I should be greater than 50%.
Man, that reminds me. Guess what? Do you know what the kill rate (success rate) for the Cheetah is, for getting it’s prey?
And for the lion, it’s soooooooo much lower. Like 17%. King of the jungle…Big, but no agility. One shot is all they have.
Anyway, if you look closely, on the chart up there, you can see where I got in at, and got out at. I took these other pics also, of my time during this session.
And trust me, I’m not concerned about the money yet. That is just a statement of being in the green, that’s all. That was every trade that I made during NFP and on, that day.
I do have much more to learn. And I want to touch on these things. Tomorrow.
- Specific time frame trading.
- Position sizing.
You know, I’ve always had it in my head that I need to get to the bottom of my money management system.
But, I’ve wanted to get my technique, system, way of trading down first. And, as you see, it definitely looks like I can move on to it now.
That also needs to be addressed when I bring up that other point also.
So, Journal, we’ll talk more about this stuff, tomorrow morning.