One technique I wanted to add my arsenal is for what I call the “touch and go”.
Sometimes, price will perfectly bounce the MA. It will touch the MA then bounce.
This would be a good time for a tight SL with minimal risk. It’s just a way to possibly add another position with maybe little risk—maybe 0.5%.
It would be the same profit as a wide SL with 1% risk, but a tight SL would carry a lower risk.
Haha I’m not sure if I’m making sense.
You can easily begin with a trading journal to keep a track of your trades.
Very true. My problem is using a format that is most convenient for me.
Something fast with just the essentials.
I’m getting there.
I have a spreadsheet where I enter my trades: the date, pair, entry, exit, profit, loss, reason for loss.
Then, in a word document I have a screen shot of the loss, and an explanation for the loss.
I think this system is a step in the right direction.
I just finished my analysis of my losses for the month of April, in tally form. You can see what mistake I made and how many times I made it…as well as which is my most frequent mistake.
My most frequent mistake is misreading the chart. That means I saw one pattern, but there really was another. Sometimes, there was the case of seeing two patterns. In that case, I could have just traded one pattern in one account, trade the other pattern in a different account, and wait for one of them to hit the SL.
Anyway, the good thing about keeping a journal (regardless of format) is that you can see the pattern in your mistakes. If I didn’t, I wouldn’t know which aspect to concentrate on.
Based on this tally, I misread the chart 7 times. So, if I had just zoomed out or taken the time to draw trend lines based on a bigger picture, I could have possibly reduced my losses greatly.
I’ve had a lot of losses this month, but my emotions aren’t down. Obviously I’m not happy about losing money, but the more important aspect is the lessons I’m learning. The money will come. I just have to be patient, follow my corrections, and manage my risk. This is very encouraging for me.
BTW, I just took a look at my profit vs losses in the form of “return on investment”. I’ve been in a negative since I started but, April was a great month! In March I had that EUR/USD trade I was so sure I couldn’t lose that I was literally throwing money at it! I was so foolish, and I can laugh at it now.
ROI %
January: -2.30%
February: -6.20%
March: -18.81%
April: -2.96%
In March I fully funded my account, and I lost big. During April I screwed my head on straight and utilized better risk management. So, even though I was trading more in April than March, I had waaaay less loss.
Perhaps I’ll celebrate with some ice cream! haha
Wasn’t January a “better” smaller loss at -2.30%?
And if you had a smaller equity balance in January was it not a smaller loss in absolute terms also?
Just splitting hairs! 
Enjoy your ice cream!
You seem to be making good progress! 
Yeah, I had to go back and edit it. April wasn’t my best month. Correct. I changed it from “best month” to “great month”. haha
Yes, It was a smaller loss in January! haha
That’s why I went back to correct myself. However, from February to April my trading has improved. I’m closing in my “break even” goal.
In January, I think I was mostly trading range breakouts. I had much less experience then. As you can see, though, my loss skyrocketed, then came back down even though in April I put more capital into the market than ever.
So, I put more money into the market, but reduced my loss. Small steps, great distances.
This morning was pretty good. I checked my open trades, updated my watchlist, and opened some additional trades in the minors after not seeing anything I liked in the majors.
I noticed I get scatter-brained sometimes and start looking at random charts. I have to check back to my spreadsheet to see what I’m supposed to be looking at.
Also, I’ve started writing a schedule each morning.
If I have three hours free, I write down how I plan to spend those three hours. Today, I didn’t do it, but I was still productive.
Regardless, I still didn’t do it. Back to it tomorrow.
I had an EUR/USD trade that I lost. But it was a 0.5% risk. I was long on D1 and the W1 was bearish. I should have seen that…
This may seem like a vicious circle, but I used to want to trade the W1, and then I stopped.
Now, I’m considering it again.
I think the reason I stopped is because I wasn’t looking for the right opportunities. I didn’t see anything that made much sense—or I didn’t have the patience to see.
I was looking at the W1 again, because I added a step to my routine.
Reassess the charts after the closing of each candle on the D1, W1, and M1.
This can help me see what’s on the horizon.
Now, I see trades I could/should have taken. I also see trades that I could have waited two weeks or more for the right entry and done very well.
As a matter of fact, I could have not traded at all, and just waited for one or two of these trades that look good on W1 and D1, and done better. I would have higher liquidity.
But all my mistakes teach me something. Just me paying tuition.
I’m still watching GBP/USD, AUD/USD, and AUD/SGD. These look very good to me on the D1. GBP and AUD both look good on the D1 and W1.
This week was a bad trading week for me, as far as profits go.
Good in terms of psychology, however.
I had about 8 losses. And two winners. The winners were the two trades I moved my SL up.
It was good psychologically because it didn’t bother me nearly as much as it used it. Also, those trades were 1% or less.
I also started using an excel spreadsheet as a journal. It seems easier so far. All the info I need is more condensed.
Tomorrow morning, hopefully, I can do some analysis of my losses. I’m working late tonight, so I don’t know what time I’ll wake up.
But seeing all those losses in a row is not good. Perhaps I need to add some elements to my checklist.
When I review my losses, I should not only look at what went wrong, but also WHY. I want to compare the D1 and W1 charts.
I really like trading channels. I really do. Trading S/R zones is a good fit for me. But I need to improve identifying channels sooner, not later; and waiting for safe entries. Also, knowing when to admit when I’ve missed an entry and just let it go.
One of my rules is not to enter a trade mid-range or mid-channel. Anything can happen once price has bounced S/R. Jumping in once the trend is in mid swing, this is asking for trouble.
These are things I need to think about and control.
I’ve been thinking about some of my mistakes.
I mentioned before about the problem of mixing strategies.
I’m still doing it. I was looking at a range, later realized it was a channel, but kept waiting for an entry signal based on a range trade.
I mixed up my strategies without realising it, and I ended up missing a GREAT entry. I’m gonna step away from range trading and triangle trading on the D1 and focus on channel trading. We’ll see how this goes.
This is turning into Jeet Kun Do trading: keep removing what is unnecessary.
I like channels as well. I actually posted about weekly channels here
Patience has by far been the hardest thing for me to learn. Up until I started trading Forex I always considered myself a very patient person. Boy was I wrong!
I saw one particular post, but I’ll have to take some time to read it thoroughly. Thanks!!
Perhaps, I could review trading channels.
I like trading ranges as well. But, I think I want to focus on channels.
And I think including the W1 in my strategy is wise.
Draw my channels, S/R lines on yhe M1, then adjust them a little on the W1.
After that, see where things are on the D1, relative to the W1.
But, I understand trading the W1 can be slow, and yet a lot can happen in a week. I’m gonna keep analysing this to see how I can improve.
If nothing is going on in the majors, there are plenty of minors, crosses, exotics, etc.
And if there’s nothing there, I should be looking for what COULD be coming soon. Then, if I have two or three weeks before anything comes up, perhaps I cam start looking at trading breakouts on the London session. Perhaps…
I’m starting to understand that when trading S/R lines, you gotta keep an open mind to what can happen. When you become too focused/confident on what could happen, the market will be giving you clues to what is really happening, and you’ll ignore them.
S/R lines can be bounced, broken, or even blurred (the most annoying of them all haha). Sometimes I forget that S/R isn’t always a fixed number, but a zone.
Price will make a move and I’ll think, “That doesn’t make sense! Why is price going that way? It’s supposed to be going this way!”
It’s very difficult to have an idea and a plan based on that idea, then scrap the whole thing and trade it as you see it with a new plan. I have to keep an open mind to what COULD happen. Price could bounce resistance, then bounce it two more times, then break it. Meanwhile, I’m long and don’t wanna short because I’m stuck on the idea of the pair going bullish to the moon.
I’m considering slowing down, and maybe not looking for any new trades at the moment.
Or at least wait for something that looks like an amazing set up.
I have some chart analysis and back testing I’d like to do, but I have had trouble making the time for it.
I suppose I’m getting FOMO. Yup.
Currently I’m watching AUD/SGD on the D1. There’s been some nice consolidation, and I’m waiting to see how it develops.
I want to backtest and see how to adapt ask the market gives clues to where it could go next.
I was backtesting and came across this price movement. It’s quite scary. This is around April 2013. There’s a very large gap, 150 pips approximately.
If you were shorting this down channel before going to bed, you’d have a bed morning.
The last two mornings, I follow my routine.
Check on my open positions
Check out my watchlist pairs
I’m not looking for new trades. Actually, I’m backtesting. Observing charts and trying to understand how they move.
I want to understand what I should look for, what type of things can happen, and how to understand what the market is trying to help me.
I go back and forth often about the crypto thing.
Part of me wants to get in on it and get a piece of the action.
But, to get involved in crypto I would have to study/trade less forex.
I’ve had problems in my past due to quitting. I start an endeavor, then something comes up, and I change to something else.
Always starting from 0. This time, I want to stick with it.
I know crypto is hot hot hot right now. And part of me feels foolish for choosing not to get involved.
In the book Hagakure (and the movie Ghost Dog) there is a verse that goes something like this:
When a hawk has chosen a bird as its prey, it doesn’t change its mind. Even if the hawk enters into a midst of birds, it only focuses on its first mark.
Another saying would be: if you try chasing two rabbits, you won’t catch either one of them.
For now, I can only chase one rabbit.
If you think that you can ace the market by depending on someone, you may not actually be able to succeed. Forex trading requires a trader to be focused and patient to be able to first understand what is happening and then react on the basis of that. Reacting before you actually understand the market can be harmful.
I’ve been feeling a little frustrated lately. Not related to the markets, but to my routine in the morning. It takes me two hours to check my open positions and update the notes on my spreadsheet, and check on my watchlist pairs and update them on my watchlist.
This morning for example, I was looking at my open positions and started thinking about adding additional positions or not, where to set additional orders, etc.
I noticed that I’ll start thinking about additional positions when I’m supposed to be just updating my notes. Additional trades comes after—not during.
So, I want to try to figure out how to move my routine along a bit faster.
