Yes! This is the goal. And one thing I’ve learned is that I’m not trying to catch a profit–I’m trying to catch an idea.
Let’s say I expect GBP/EUR has been bearish for three months, and I expect it to reverse and turn bullish. I get a great entry, and it starts going up for 4 days. I have a decent little profit so far. What if I see a bearish engulfing candle? Not a big one, but just engulfing enough for me to be concerned.
In this case, I can’t close my position. Depending how far price has gone from my entry, I can only move my SL to BE. If price hasn’t gone far enough, I may need to keep my SL in its original place to give price room to breathe in case it wants to retest my original entry price.
If price is retracing, I can’t close because I would sacrifice my entry. I might have to take the loss, and watch for another entry signal to present itself.
If I chase money, then I’d close at the retrace and lose my entry on a two-month swing.
I don’t have it perfectlly, but I’m improving every month. I can look back at how I was trading just one year ago. Those demons are still there. Taking those trades compromises my venture in trading.
I seriously believe that the market can literally become an ATM. The money is there!! You just gotta know when to put your hand and, and when to take it out.
I’ve taken so many bad trades. Trades that it felt like I was grabbing for coins in a blender.
Then, I had a month where I was stacking 10% profits PER WEEK!! I that’s a lot of profits for me. I was like, “This is it!!! Here comes daddy!!!”
Then the following month, I gave ALL those profits back. ALL of it, and more.
The profits were nice, but not replicable. There was nothing steady about it. I forget how many trades I had that month, but it was over 20. How can I be right over 20 times, and I can’t seem to do it again? 20+ winning trades is not luck that’s skill. Isn’t it?
How could I have done so well, then do so poorly? I decided to assess my losses as usual. But this time, I assessed my wins, as well. The winning trades were made AFTER bounce confirmation (for the S/R bounce trades).
I took more and more losses before I realized that something wasn’t working. Adversity introduces a man to himself. I was starting to beat my desperation into submission.
For me, I learned that just because price bounces something, that doesn’t mean I have to trade it. I can’t draw a bunch of lines on D1 and trade it because price bounced it. Often that happens by coincidence only. I have the red numbers in my balance sheet to prove it.
So, I take less of those trades now. Sure, profitable trades can turn you arrogant and wreckless, but taking bad trades will set you back so far that your profitable trades won’t even get you out of the red.
If I enter a good trade that lasts one week, and during that week I take 5 bad trades costing me $100 in losses, then the one good trade yielding $100 only brings me to $0 profit. What a waste!!
This is what has been killing me. The bad trades. I had to identify which are the bad trades, and what was their nature? What was happening in the charts at that time?
I started studying charts again. I would stare at the same chart for 45 minutes. Drawing lines, taking notes, taking tallies.
I had pieces of paper scattered on my desk. But the charts don’t lie. Everything I need is in the chart.
I tried watching a price action video online, and after the first 10 seconds, I realized I didn’t need it. I just needed the chart. It’s all there. I just have to learn to read it.
I don’t want someone else’s interpretation. I want to dissect what I’m seeing. Following my thought and mixing something faulty will create incongruency in my thought process. I needed to do this alone.
Doing something alone is scary. But it’s empowering. Trading and trusting only yourself is quite a nasty process. I don’t want to hear someone else’s opinion about whether or not EUR will go up or down this month. Sure, we could talk about it, but I have to follow what I see in the charts.
I don’t care if the talking heads are right or wrong. That has nothing to do with me. I need to make the decision on my own. I’ve had problems with that in the past–doing what people told me and not thinking for myself. The best way to think for yourself is to shut out the world. Go silent, and do your work. If I was right, I need to know why I was right. I need to know why I was wrong.
That’s why I don’t like taking straddle trades anymore. If I think price is going up, then I should trade it that way. Most of the time, my strategy doesn’t allow for straddle trades.
Oh man, this is really long…time to stop for now.