This is my statement from last month. The 400+ pips retracement (?) in cable last month put my methodology in a drawdown. I have already made adjustment not to trade during a period of sentiment change.
Recap
I have nothing to say, at least for now.
Balance: $1.349,07
Open
Sell:
Position 1: 1.6331, SL: 1.6080, risk: 0%
Position 2: 1.6215, SL: 1.6080, risk: 0%
Position 3: 1.6096, SL: 1.6080, risk: 0%
Pending
Buy:
1.6331, SL: 1.6214, risk: 3%
COT
The lower table is COT report from USDX.
Chart
I just need to ride the trend. Iām ready to adjust SLs or exit early if trend changes.
Hey buddy!
Just dropping off quickly to say hi! I have came across your journal by accident. Youāre a bit heavy on math arenāt you ? Good luck !
Hi Rookie,
Thanks for dropping by! Lol, I hate math! I never scored above average in school. But then trading teaches me (the hard way) that if I canāt measure, I probably canāt be a good manager. So, here I amā¦ measuring. Or learning to to be exact 
Good luck to you too, mate!
Balance: $1.349,07
Open
Sell:
Position 1: 1.6331, SL: 1.6080, risk: 0%
Position 2: 1.6215, SL: 1.6080, risk: 0%
Position 3: 1.6096, SL: 1.6080, risk: 0%
Pending
Buy:
1.6331, SL: 1.6214, risk: 3%
I see USD weakens, but I havenāt seen GBP strengthens yet. I conclude from last week COT report that the sentiment is slightly bullish for GPB, and that there is a possibility for USD correction. Iāve already made the decision to cancel my last trade and move my SLs, so thereās nothing else to do. For future reference, if I see this pattern in COT report again, I may want to place buy order at the support level. I also notice that a new fractal appears. Iām ready to adjust my fib tool accordingly.
Update: 7/10/14
Balance: $1.432,07
Pending
Sell:
1.5973, SL: 1.6091, risk: 3%
I still havenāt seen GBP strengthens, the way I see it, USD weakens at a faster rate than GBP does. Price hits my SLs, Iām out with 8% gain. Yep, I definitely want to long this COT pattern in the future, though Iāll set TP for it since I see this as a counter trend trade.
This is how I get an overview of different currencies. Iām still developing a feel for all these, so I will post my findings too in this journal as Iām experimenting with these indicators. Currently, I see that gold still goes up. I conclude that USD hasnāt finished its pullback, and so I will not short cable just yet. I see JPY keeps pushing up. I conclude from last month COT report that JPY is oversold, and that it needs to go up first before going down. I think once JPY finishes its pullback, USD will resume its movement up.
This is the first time I see JPY goes up in real time trading. Iāve learned from babypips school that EUR/JPY can be used to gauge risk appetite. Therefore, if JPY strengthens, pushing the pair down, I conclude that risk appetite is low. Not the best time to be in the market I think.
Update: 9/10/14
Balance: $1.432,07
Pending
Sell:
1.6091, SL: 1.6208, risk: 2%
I see that there is nothing for me this time. Well, I couldāve placed buy order at 1.6091, but since I missed the earlier entry at 1.5973, Iām hesitant to go long in a counter trend move. From H1 chart, I see that price stops at 200 SMA. If it goes higher, I think itāll probably go to 1.6300ish. Iāve placed stop order at 1.6091 in case the down trend resumes.
Recap
Since I was not into any trade last week, I used the time to work on my methodology and myself as a trader. I took a test from Van Tharpās site here to learn more about my strengths and weaknesses. The test identifies me as an independent trader, whoās able to make logical analysis yet is in need of more orderly approach. To work on my weaknesses, I develop an order through which Iāll work with my methodology.
1. Define the question.
Iām a trend follower, so I buy strength/high and sell weakness/low. The questions I need to answer, therefore, are: āWhat is strength?ā and āWhat is weakness?ā. My objective is then to find a way to measure strength/weakness so that I can trade accordingly.
2. Gather information and resources.
I realize that measuring the strength of a currency is a near impossible task, because Iāll need to pay attention to every data coming out from a country (of which the currency I try to measure). So for this purpose, Iāll be using an index indicator, which I found here, that weighs a currencyās performance against the others. My preliminary observations show me that the tops and bottoms made by the indices coincide with the extremes in my COT analysis, so I consider that this is not too far off from what Iāve been doing.
3. Form hypothesis.
Iāll be using the indices indicators to spot strengths and weaknesses. I add levels there (0.2 and -0.2, 0.5 and -0.5, 0.8 and -0.8) to help me spot the changes in strength and weakness. I define strength as the period when a currency index goes up through those levels, and weakness as the period when a currency index goes down through the levels.
4. Perform experiment and collect data.
In progress.
5. Analyze data.
In progress.
6. Interpret data and draw conclusions that serve as a starting point for new hypotheses.
In progress.
7. Publish results.
In progress.
COT
I see large traders are bearish on GBP but, since I see USDX reaches an extreme and I think itās in a correction phase, Iām anticipating for a ranging period ahead.
Chart
My order was taken. As an anticipation of ranging period, I havenāt moved my SL though price already travels 50% of the range. Iāll do so once price travel to the next level.
Indices Indicator
I see USD index goes flat near the 0.8 level and GBP progresses through 0.2. My brief observation tells me that these levels are where the indices (not the price) may stall. Iām aware that price may behave differently (goes up or down instead of ranging as the indices indicate), and so I decide to observe more before I draw general conclusion. As a side note, I also notice that JPY has reached the -0.8 level on monthly time frame and gone up from there.
Balance: $1.434,17
I need to be careful with my expectation. Since I had been expecting a ranging period, I closed my trade when market opened on Monday because I wouldnāt have internet connection from then on until now. I see that now price goes my way. I feel left out and want to jump in, but I see bullish divergence on D1 chart and GBP index stalls at -0.2 (D1). I decide to wait for a retracement before going short at 1.5973. I briefly look at other GBP pairs and notice that thereās still room for shorting before a major support.