Today, I had to take a moment to remind myself that right now, I’m focused on trading correctly. That means most of my trading activity is just observing–not actual trading.
Just watching, waiting…
This is the time to be patient. 98% waiting, 2% trading. When I looked at a given month, each pair only had one trade. Just one. Some of them, not even a full trade. Either an entry or an exit. So, that tells me most of my days observing the market will have NO trading.
Patience, young padawan.
There are a couple trades that I missed, (including the one I ruined by moving my SL to BE too early), and I realized that they’re actually part of my short-term strategy, which I shouldn’t be trading now anyway. I should be focusing on my longer-term strategy.
So, I’ll 50% forgive myself for now. But once I start trading my short-term strategy, I can’t use any excuses; I’ll really have to be more aggressive, and walk myself through how to do it.
You are in “learning mode” don’t dwell on the past , write it in the journal and go forward, bear in mind that you can’t extract all pips from the market.
That’s a hard pill to swallow, but you’re right. Doing so will only result in more losses, not wins.
I feel frustrated that I’m back practicing my long-term strategy, but I’m glad about it at the same time.
I’m seeing things that I didn’t see before. It’s kinda like studying Pipsology. The first time, there’s so much information, so it’s difficult to digest and understand everything. But after some time goes by, and you study it again, it’s as if you see details that weren’t there before.
It takes time to digest/internalize the first batch of information. After this, we can compound more information on top.
With one of my trades, I think price might hit my SL, but I’m not sure. In my strategy, moving my SL to BE sometimes prevents loss, and sometimes it ruins a trade. So, I have to leave my SL in its original position.
And that’s what I did today. I thought about moving it, but I remembered my rule, and I left it. I have to follow my strategy, and let the market do what it’s gonna do–regardless of the outcome.
Also, I’m almost done practicing my long-term strategy. Next, I have to revisit my short-term strategy.
Once I practice my short-term strategy, I’ll be open to taking a more trades. Not every single signal, but more.
I got so focused on these two strategies, that I had forgotten that I have another strategy to study. Sometimes, price will bounce S, and you expect it to hit R. But how about when it ignores R? That’s what this forgotten strategy is for.
There’s an entry that I missed earlier this month, and it fits this forgotten strategy. So, I’ll have to add that to my list of what to study. I thought I could skip it and the other strategies could replace it, but they can’t; I’m gonna have to study this one as well.
I hope I’m making sense here. haha
I have four strategies. One of them is for a setup that’s really really similar to my long-term strategy, except it’s more rare and probably only happens a few times a year. So, I’m not worrying about that one too much. I should focus more on the ones that occur every month or so.
It’s frustrating because when I miss a trade. Even if I haven’t studied that strategy yet, I still feel like a fool for not taking it. But that’s only seeing the positives and not the inherent risk/loss of trading a strategy prematurely.
There’s a movie called Southpaw.
I like this movie a lot. Basically, a guy named Billy fights angry and kinda boxes crazy. Then he meets a new trainer, and the new trainer tells Billy that he’s all power and no precision. He explains to Billy, ¨You’ve got two weapons: a shotgun and a grenade.¨
So, he starts training Billy, and starts him off by just LIGHTLY punching the punching bag. Tap, tap, tap.
I’m trying to do the same thing. I’m breaking myself down, and starting from scratch. I’m building myself up, one layer of strategy at a time. Sure, I’d love to go for the knockouts, the big profits, big swings. But how in the bejeezus am I gonna do that if I’m trading recklessly and losing money?
The money will come. But I have to trade correctly. I have to know when to wait, where to draw S/R, when to keep trading, etc.
Patience, young padawan.
This is embarrassing, and I don’t even feel like writing this. But I’m trying to be honest with myself about my development as a trader.
So, for the past two weeks I was practicing my long-term strategy. It’s pretty much for trades that last over 30 days. I was practicing this strategy with my chart samples, and I was learning how to trade this set up. I was really trying to drill it into my brain, and understand what the candles are trying to tell me. And I was doing pretty well with those chart samples. There were several charts that I just couldn’t understand why they did what they did, but the majority I understood.
Then, I was looking at a random chart with the same setup that I had been practicing, and that one chart had me questioning everything I did for the past two weeks. You could say it was just one setup.
But that chart had exactly what I had been practicing, and the strategy failed. It was one more example on top of the other questions I had about other practice charts.
And then I remembered something. I had found a big clue to modify my strategy, about two or three months ago…I’m not even sure. But it was a significant development.
And somehow…I had simply forgotten about it. That’s it. I forgot. I had forgotten and just fell back into a previous technique and I just ran with it.
I can’t believe I forgot. That’s my excuse: I forgot.
So, yesterday I started doing some analysis on this strategy. I could only work a little bit at a time because my frustration and cognitive dissonance was pretty high.
I collected some samples, and now I have to examine them.
The good news is that this approach could simplify this strategy as well as another. I’m gonna have to collect some samples and prepare some practice charts.
Patience young padawan.
Last week, I correctly identified a fakeout sign. I didn’t trade it because there was no entry sign for the strategy I’m trading now.
This isn’t big news, at all, but it’s a positive sign that I read the chart correctly.
Patience, young padawan.
The view of my live charts are a bit different from my practice charts.
My practice charts are more zoomed in. When I look at my practice charts, I only feel slightly uneasy–because I’m stepping into the unknown, and I don’t know if I’m gonna trade well or not. But looking at live charts makes me even more uneasy.
I wanna close that gap between how I approach my practice charts and how I approach my live charts. Is it the way I label the charts? Is it the different zoom?
I don’t know.
But I have to be willing to look at all these different things.
I’m still collecting charts for practice. I feel like the collecting has gotten out of hand. Usually, my practice batches have about 30 charts.
Collecting them takes time, and editing them takes even longer.
I did something a little different this time to help my understanding. I have some charts that focus on the entry, some that focus on the exit, and some that are fakeouts.
I said before that I wanna add more fakeouts. The problem is that I have more charts to add, and I already have about 100 charts. It could take me two weeks to edit these!
This is for my long-term strategy. I’ll have to do this again for my short-term strategy. But in the interest of time, maybe not. Perhaps I can just add to my previous batch. My short-term strategy hasn’t changed at all. That’s a relief.
I expect this batch of practice charts to really help me out, and get my brain accustomed to the small adjustment in my long-term strategy.
The goal after this is to be more aggressive/brave and take the trades according to my strategy. Rather than feeling nervous, and missing good trades.
I collected about 95% of the charts I need for practice. I thought it would take me two weeks to edit them. So, I’ve been trying to buckle down and edit as many as possible each day. I turned off my internet and finished the bulk of them.
It was a lot of work. I wanna feel good about getting that done, but it’s really nothing to feel accomplished about. What I want is to accomplish steady profitability, and I don’t want any kind of substitutes.
The past couple days I’ve been thinking about practicing, these charts and when I’m gonna start trading each strategy. I think I should start trading both strategies (short and long term).
I have to think about it more, but I might wanna trade them while practicing…
I’ve been wondering about Japan’s economy lately, and I found this article.
https://www.stlouisfed.org/on-the-economy/2023/nov/what-lessons-drawn-japans-high-debt-gdp-ratio
I’m curious what’s in store for Japan in the future. Its domestic debt is at a high, and its birth rate is at a low. JPY is dropping.
When will it go back up? What policies have have to be in place to make that happen?
The outlook is not looking good. Japan needs to call Dave Ramsey.
You could say that Japan needs to increase its debt in order to decrease its deficit. That’s playing with words, no? Taking on more debt to decrease debt?
How about stop borrowing, then tighten your belt and rearrange your finances?
@SmallPaul @Mondeoman @SovoS @ProfesorPips What do you think? How can Japan improve its economy?
Hi @dushimes, Interesting issue! 
I guess the core of this issue is “how much is too much?”. People have been scaremongering about the US national debt level for decades now - and it still just keeps increasing:
Our Debt Clock : About : Truth in Accounting
… and we can worry in the same way about Japan - but is there cause to be worried?
Well, as anyone with a credit card knows, too much is not how much you borrow but when you can no longer meet the monthly repayments!
That is clearly not a problem with either Japan or the US and so the real issue is what they do with the borrowings rather than rushing to pay it all off. There are big variations amongst the gurus about how high the debt-to-GDP can be without causing problems and, as in the article you included, the simple debt-to-GDP ratio is not the whole story at all, anyway!
The inherent weakness in these positions is that the total debt is largely financed by short-term instruments that are being constantly refinanced as they mature. So, theoretically, if there was any concerns about the risk with these instruments, interest rate levels would rise and investors would start to turn away. But it is not so likely that either the US or Japan govt’s are going to be downgraded as risk factors!
However, one other factor could be a deliberate withdrawal of funds by foreign investors as a means of applying pressure on the govts. But in the case of both the US and Japan, a large share of the national debt is held by private individuals as well as various govt agencies etc (as detailed in that article).
I believe that the main foreign nationals’ share of the US debt is held by Japan, China and the UK. None of these are likely to try rocking the boat by withdrawing their funding, and even if they did the amount involved would not prove to be insurmountable.
In the case of Japan, their problem with an ageing population and low birth-rate is serious in the longer term and not easily resolved speedily. I suspect this is an issue to other countries too. The health costs rise astronomically whilst the working population servicing these costs with tax payments is diminishing. Not a very stable equation.
A strong dollar is favourable for Japan and China as it means higher interest rate returns on their investments as well as favourable pricing of their exports to the US. Therefore, there is a kind of lid on the ideal value of the Yen v. the USD.
It was interesting to read that Japanese individual ownership of govt debt instruments is so high and that they accept a low rate of return (perhaps even forced to, as the article suggests).
Fundamentals is not my strongpoint in general and Far East fundamentals even less so! So the above is just some thoughts from an amateur - but if it stimulates thoughts in others then fine!
You know what? That’s a fair point.
Perhaps this is a more serious problem than their debt.
Another good point. Using USD means higher returns vs using JPY, but when JPY keeps dropping, it makes it harded to afford the same prices for imports–as Japan imports considerable amounts.
This is concerning as well. The country is losing its own means to pay back the debt. It’s the equivalent of having high credit card debt, and your job is cutting your work hours.
Same here! haha
Japan is one of the world’s leading countries, and I’m curious what’s gonna happen. Eventually, their economy is gonna rebound. But I wonder what will make that happen…
I took a moment to schedule my next two weeks. One week to practice my long-term strategy, and, after that, one week for my short-term strategy.
Then, I’ll repeat that at once more. I may carry this out until the middle of July.
While I’m practicing I’ll be trading both the long and the short-term strategies. My biggest problem is not the strategy itself, but taking the trade when I see it.
I continuously see it in the charts, and I’ve noted it in this journal several times: the setups look so easy.
So, that’s what I wanna work on. I wanna work on taking action. When I see a sign that looks very obvious, I’m gonna take it.
Of course, I have to keep practicing the strategy, but it’s meaningless if I don’t have proper execution.
I thought of staying out the market, again, while practicing these strategies. But I wanna keep trading. Then, I thought that would be rushing myself. Afterall, I keep telling myself to be patient.
But patient doesn’t mean passively waiting. I also have to be proactive and push myself forward. Patience just means not being reckless. So, I’m gonna push myself forward, keep trading, and practice hard. And I gotta keep in mind that it takes time.
Hi!
I think a stronger requirement than being patient would be being disciplined? Afterall, you are spending a lot of time and effort on your strategies and that is diluted if your active trading is not matching them in a strictly disciplined manner.
Although that sounds easy, it is not!
I am not an expert on this field, I can only write my personal opinion, what I would do in this case. Japan faces two huge problems, debt and an aging population, it is correlating. Firstly, I think they should focus on population growth, which will rebuild the working class, and then they think about how to pay off the debt, but this would take years. As @SovoS has already mentioned, Japan is a lender to the USA (USD 912.4 billion) and there is no way to repay the debt in a short time, and the USA itself is drowning in debt. Every postponement of repayment comes to an end, the fact that Japan has been doing it for 20 years does not mean that it will always be like this. A threat to us, retail traders, may be a drop in liquidity like on Black Thursday 2015 for the Swiss franc.
This is not an easy issue at all for govt’s. But is certainly a real issue when combined with an ageing population of pensioners.
For example, in the UK, The number of 100 year olds with driving licences has apparently more than trebled in the last ten years and there are currently over 500 centenarians with a full valid driving licence and the oldest is 108 years of age!
The problem with low birth rates seems to stem largely from changes in social structure and career ambitions amongst women. The range of human relationships are broadening widely and becoming much more short term in nature. The term “til death us do part” has become more like " for the time being"!
If women are more generally interested in career ambitions and see personal relationships as short term then there is not much room for babies in that scenario!
Things are changing very rapidly nowadays and the bases upon which we form our opinions and expectations are shifting radically.
For example, let us fantasize for a moment: Afterall, what is fantasy/sci-fi today is often the reality of tomorrow…
Let’s consider this fantasy:
The global population is over 8 bill people. But how many people do we actually need to run this world effectively? We are currently facing a showdown on a global scale between autocracy and democracy. If the world is run by dictators how much do we need care about the surplus population?
Another major development is the explosion in AI. What if we combine advances in AI with developments in robotics. A huge amount of even complex work currently carried out by humans can be handled by AI robots - and even much more reliably and effectively.
Can we already accept a home-help robot assisting a sick elderly patient 24/7 and who is in constant contact with a central medical centre from which it receives instructions for the care requirements?
And then it is a small step in an autocratic state to allow AI health centres to decide when it is no longer worth continuing care and switching off services…
At the same time, can we already accept maternity wards where the work starts with embryos in baby farms. Controlling numbers, sex, even DNA characteristics?
The stuff of sci-fi films? Yes, but, on the other hand…
of course, we can’t skip technology impact on our life but in the other hand we don’t know how technology will use, for us or against us. Fortunately, I am not on Japan place
I think to make any sense out of any economy, we need to look back to before you were born. Let’s say - 50 years?
The Nikkei 225 index for the past 50 years. Only in 2024 did it finally exceed its previous All Time High of 38,916 in 1989, and it took 35 years of recession in terms of stock market values to do that.
Now let’s look at the USD/JPY rate over the same 50 year period. 2024 is the first year in 35 years since 1989/1990 that the USD has been stronger than at any time since, around the 150/160 level. For the last four years, USD/JPY has been increasing year on year. Is it likely to continue?
To be continued.
Continued edit.
Now let’s look at the last decade - the USD/JPY on a monthly chart basis is on the rise, as can be seen by the 200 EMA and the 50EMA on the next chart image.
If I were to wish to take a long term position, I would be long USD/JPY. Some believe that in recent years, both the USD and the JPY are risk off currencies, so besides the obvious safe haven status of the USD, the JPY is also in the same category. Do we seen exports diminishing from Japan? Hardly likely. Toyota is the biggest motor company in the world and that supports the YEN. However, the continued status of the YEN as a “zero interest” currency still attracts the carry trade in favour of USD/JPY.
to be continued.
Continued edit.
Looking at the weekly chart now over the past 3 to 4 years, the 50EMA crossed the 200 EMA back in March 2021, and the 50EMA is increasingly divergent from the 200EMA and is quite close to the ATH from 35 years ago.
From Jan2011 (USD/JPY about 75) to May2024 (USD/JPY about 160 ATH from 1990), the USD has doubled in value against the JPY. That would support a long position except for the 160 resistance (psychological perception).
If I were to trade USD/JPY for the remainder of 2024, I would be looking to short the USD/JPY upon a weekly dip for a short term trade (for me, short term is a week to a month), on the basis that into election period in Nov24, I would be supportive of the narrative that there will be two rate cuts before the end of 2024.
At this moment that is not at the top of my list of ideas for Forex trading in 2024, but it is worthy of more analysis.
