This was my NFP day trade. I took 30 pips on UCHF in the morning but stayed away from the market because I like to trade the markets after NFP.
I trade NFP but I dont put in speculative trades with a SL and hope for the best. I wait for NFP news event to be over and then hit a contra trade against NFP move, provided the move was against market bias. I split 10% on both GJ and EJ and took 50 pips each in about an hour.
If you cannot picture what I said about contra to bias movement, then I would suggest you let it go for the time being. I will come back to it on a later stage.
Now for todays market.
EU D TF
EU H1 TF
Now for those of you who had read post 12 of mine, you would remember that I was talking about correlation being out of whack today.
That coupled with NFP news made me stay out of the market for most of the day.
Anyway I could not resist an entry after prices had fallen so much, especially since yesterdays candle stick was a pullback on D TF. That and AU was a buy signal. Only problem now was GU was still showing a sell. There was no pullback candles or reversal pattern on GU for it to be a confirmation.
I took the trade with a small SL at the bottom wick of the previous day on the H1 chart… This trade was taken at 5% risk because I could not see for sure where the price was suppose to go.
Without a correlation on all three pairs, I am thinking, I am judging, I am therefore hoping and wishing, which makes it gambling on a position.
So to balance out the need for a few pips on a Friday and not risking too much, I reduce my risk size and put in a SL.
8.30 pm GMT +8 NFP comes in and pushes the market up, and I was a happy chappy thinking that the news was going in the direction of market bias. I was happy also because since I am in profit now, I can move my SL to BE for a 0% risk trade and add another 10 % to NFP news trading on GJ and EJ.
So back to EUs trade, it shot up by 90 pips at the hour end. This is where taking what is on the table is important. 90 pips in the first candle. Daily TP target is 60 pips. Holding out for more more often then not causes you pips and money.
That is why you should have a table detailing out your targets both in lot size and amount of money targeted.
Hit a target? Get out. Wait for next trade with increased lots. Compound your earnings. Not hope for more pips. Greed always causes you to loose out in the end. Always.
So candle closed on the second hour and I had 70 + pips so I took it.
This is another reason why I close my trades on a daily basis.
What happened next was something I did not expect. The market shot down and now the D TF candles look like they are a continuation of a sell.
This is what I mean when correlation is out of whack. Only take trades when it all looks good. Preemptive trade triggering causes losses. Patience is very important. Wait for the candle to close. If you are new, dont be preemptive, especially with real money and wait for a confirmation candle.
My 70 pips on EU today was sheer luck.
EU D TF as of Market End
Thought it would go up now didnt we?
So I hope you can see what I mean by watch correlation for confirmation.
I hope we will get some chances next week to observe some days where correlation is all in sync and movements are cohesive.
I wont take a trade on a Monday, and definitely not on a Monday that is going to start with things being as messy as they are now.
Until then, have a great weekend.