Tuesday, December 20, 2011

Two of my trading heroes talk about Support and Resistance and Risk Control

"When you are fully focused on doing what you enjoy, you are in the flow, and it is then that you are most likely to make successful decisions free from doubts and insecurities."

Shane MurphyDoug Hirschhorn

Hey! I can't believe the year is almost over.  I had decided not to trade for this whole week. Yes, it is the holiday season but I know the markets are still trading! And yes, I am still watching $EURUSD for any potential moves.

Thursday, December 15, 2011

Waiting for a setup is really hard to do.....

"You can succeed in trading only when you can think and act as an individual."

Alexander Elder
Trading for a Living: Psychology, Trading Tactics, Money Management (Wiley), 1993

Waiting for a trade is one of the hardest thing for me to do.

Here I am (at the start of the London session - 09:15GMT) ... sitting on my hands. Trying very hard not to jump into this beautiful $EURUSD swan dive. It's painful watching all these pips go past.

Tuesday, December 13, 2011

I am consulting my crystal ball today....

"Don't think you can predict the effect of an unexpected event on the market. Stand aside and wait for clear indications...."

Catherine Davey
Making Money from CFD Trading : How I Turned $13k Into $30k in Three Months

Yesterday, my friend and trading mentor Rob, asked me if I gazed into a crystal ball before I put up my charts. My mind immediately conjured up images of me with a gypsy costume with the flouncy off-shouldered dress. Complete with the hoop earrings and bangles.

Monday, December 12, 2011

Taking that leap of faith with $EURUSD by doing what has to be done.

"Know what you are going to do when the market does what it is going to do."

Michael W. Covel.
The Complete Turtle Trader, Harper Collins, 2007

Excuting a trade is a bit like jumping off a ski slope. 
Sometimes you just got to leap off that slope when it shows itself to you. I was sitting and watching $EURUSD just before the London open. Bossilator reading was at 350.

Wednesday, November 30, 2011

Here's an Idea on How to Keep Out of Choppy Markets

"It is absolutely necessary to have an edge."

Jack D. Shwager
The New Market Wizards: Conversations with America's Top Traders [Paperback] 1992

Wouldn't it be nice if you could get money to flow into your head continuously? Or else, maybe I could get ideas that would make me money all the time - instantly.

Tuesday, November 29, 2011

Fear and an Earlier Counter-trend Entry on EURUSD 1Min ...creates a Reverse Trifecta.

"You can use your fear as a cue to examine your trade more deeply and adjust your confidence in the idea, up or down."

Brett N. Steenbarger
The Daily Trading Coach: 101 Lessons For Becoming Your Own Trading Psychologist, 2009, (Wiley Trading)

I have been working hard at reducing fear when I take my trades. Fear creeps up on me - usually after a losing streak. Come to think of it, even after a winning streak because I am wondering when I will give it all back.

Wednesday, November 23, 2011

Swimming upstream, and following the flow of the market.

Salmons swim upstream, re-adapt their bodies to fresh water and then they spawn.

My trading life is not as dramatic as the Alaskan salmons. I certainly am not looking to spawn and leave my body as bio-fuel for my kid. I just want to collect some pips. But there are times like today when I do change my spots and go with the trend.

In all honesty,  I was waiting for a counter-trend trade...

Monday, November 14, 2011

I'm fighting back ...in the direction of the trend.

"What counts is not necessarily the size of the dog in the fight - it's the size of the fight in the dog." ...Dwight D. Eisenhower

For the last week and a half, I have been having some pretty strange trading days. It's been a roller-coaster ride with break-even days and loss days.

Notice I didn't say win-days.

Thursday, November 03, 2011

Camping out with a counter-trend $EURUSD on Monday morning

.Trading is a lot like camping.

You pick a spot. You set up a tent. And you might even build a fire.
Really, all you want to do is to enjoy the great outdoors.

But.....sometimes there are bugs. Sometimes you can't find a loo.  And sometimes it even rains.  Sounds familiar?

Friday, October 28, 2011

All Hallows "AUDUSD and EURUSD" Eve

What-up $AUDUSD?

What is up with the $AUDUSD?
London markets opened, US just opened. $AUDUSD is just sitting there and resting on that EMA62 fence. Kinda like Humpty Dumpty before the great fall?

Thursday, October 27, 2011

Where's $AUDUSD going today?

Hey you  $AUDUSD, where are you going? Can I follow you down?

 Hi, it's just after London open. Here's the picture.
  1. Boss reading at 866
  2. Since the morning Asian Session, it has traded up about 170 pips (more as we speak)
  3. I've put in my trendlines - so it's a question of whether they will break?
  4. And will stochastics stay overbought for the SELL down.

Monday, October 24, 2011

All eyes on the $AUDUSD...again

Bossilator on iPhone
I am still not trading today but I can be watching.

I just love the new Bossilator radar screen on my iPhone.

Look at that $AUDUSD 15M Bossilator. That's 1180 candles away from the SMA800. That is what I call a WOW! reading.

Forex Trading Lessons Learned ...the hard way

I am not trading today. And hey, what the bleep.... I didn't trade yesterday either.
Well, it's not because I didn't want to.

Ever since I started the Bossilator Course, I have become more aware of when I am in a trade, that I probably should not have placed in the first place. And that, is a good thing.

Thursday, October 20, 2011

"I am always wandering around in enigmas" ...MC Escher"

Oh what a day! 

Have you ever had one of those days like the guy on the escalator? 

I sometimes wonder if maybe M.C. Escher was a forex trader before he found his specialization in mathematical art. How else could you explain how this statement, "I am always wandering around in enigmas" would fit so well in a a day of a forex trader.

Monday, October 17, 2011

Anatomy of a Murder Forex Trade

Do you remember this one? A great 1959 courtroom adult drama set in the Upper Peninsula of Michigan (yes, it is called that and yes, the Great Lakes are amazing).

Anatomy of a Murder was filmed in the quaint little port-side town/city of Marquette, which (would you believe) is the largest city in the Upper Peninsula. Population 21,300 - no, I am not kidding.

A few years back, my "extra special friend" (yes, he is..."the one") Richard introduced me to this extra remote part of the US. Having lived in cities all my life, it was a totally new experience for me. Every year, when we go back and visit, my mind comes back cleared because it is filled with this restorative calmness that you can only get when you really "get away from it all". I often wish I could order it "To Go".

Friday, October 14, 2011

"You have to be different?.... ...I'm not!"

Life of Brian (Monty Python, 1979)

Brian: You have to be different! 

The Crowd: Yes, we are all different! 

Small lonely voice: I'm not! 

Thursday, October 13, 2011

Zen and a No-nonsense Trading Philosophy

" I know it’s easier to take 30 pips out of an available range of 100 pips than to take 30 pips out of an available range of 30 pips."....Jennifer.bz

How much more zen-like and no-nonsense can you get in a trading philosophy? I used to always get angry with myself when I took only a small part of a large move.

Tuesday, October 11, 2011

Aaaarrgggh....Painful Emotional Trading

I really am in pain!

Today I am sitting out on a few trades. Actually I am putting myself on a strict regime of 1 trade per day. Yup, too much trading will make your trading account blow up!

Monday, October 10, 2011

C'mon Aussie, come on....$AUDUSD Setup

Come on Aussie, Come on!    Good Morning Asian Session Traders!

Man Carrying Beer to Cricket Match

Do you know that song? It's a great Australian Cricket song. I used to hear it every summer, all the time in my misspent youth...all the way Down Under in the Land of Oz!

Hey, hey, hey. Starting a great new course on planning trades better.

Hey, hey, hey...it's a brand new day....

Monday is my no-trading day! So I use it to make notes on what I have to get done for the rest of the week. Which is probably why you have seen so many "thought-provoking" posts in one day?

I had to put this out before I head to the land of Nod - it's midnight here while the rest of the world is starting to stir.  I am really excited that I get to start learning how to trade longer term charts. Jennifer (yes, the calm one within the eye of the trading storm) just launched her new course.

"Though this be madness, yet there is method in 't."

Sometimes when I am trading, I feel like I am trapped in a Spock mind-meld. I can't do what I am supposed to be doing and yet...I can't get away.

Usually when I go through a losing streak, it makes me question my choices with a vengeance.

And then I trawl the internet looking for answers, fervently typing in google searches for things like "How to handle losing trades", "trading psychology",...the list goes on.

Not too long ago, after bouncing around the net for awhile I found a great forex trading blog by a person named Jennifer (no last name.. at the time) who was just putting up trade setups for free on the internet. The setups were simple and what was evident was that she was a very consistent trader. She also had a great following at the time. I did like what I read but since I am an ADHD type of trader, I decided it wasn't for me because she traded off longer timeframe charts e.g. 1-hour, 4-hour and daily charts.

Recently, I was drawn back to the blog because I was wondering if I should change my trading style to look at longer timeframe charts. Well, Jennifer's blog has recently evolved into a joint blog with Rob Booker (yes... the irreverent one of the BossilatorWallabot and Adventures of a Currency Traderfame) to become piptoring.com

Just so you know, I have been taking the Bossilator course since August, so you will find me hanging out daily on piptoring.com and the Bossilator forum. You see, I am trying to navigate through this part of my trading life without having to endure too many painful drawdowns in my account (yeah..those ouchy ones like last week's trades). So I am constantly on the lookout for wise words and directions from the usual Trading Gods...oops...Gurus.

2 weeks ago, in late September,  I discovered this wonderful gem titled "You already know" written very simply and aptly by  Jennifer (just Jennifer...still no last name...a mere Trading Mortal) on her blog. I liked it so much I put it into the iBooks app on my iPhone.

I really like this phrase from Shakespeare:
Though this be madness, yet there is method in 't. 
(Hamlet, Act II, Scene 2)

When I find myself trudging through trading madness, Jennifer's article "You already know" is where you will find me...trying to find my way back on track.

Sunday, October 09, 2011

Hhmph....Breakfast and a morning $EURUSD setup

What is hhmph?!!!

I woke up this morning just before 6am(!) to make breakfast for JD (10 years old) who has to be in school by 7am. So after making a nutritious breakfast of; two perfect soft-boiled eggs (7 minutes soak in a large cup of boiling water... and they really are perfect), some toasted and buttered home made bread and an ice-cold chocolate for drinks, I asked: "How was that Buddy?"


Friday, October 07, 2011

Whoa there! It's Non-Farm Payroll today.

This is not your usual Maths equation....

2 rambunctious but generally well-behaved 10 year old boys cooped up in a 600 square foot apartment on a rainy day for 4 hours + 1 30-minute car ride = 1 slightly frazzled, wanna-be forex trader mom

It's days like this that Something's Got To Give...

Thursday, October 06, 2011

Insanity...how I lost control of the trading day.

I think insanity runs in my family. It's my only explanation for choosing to trade forex and continue to do it for these last couple of years without a nett positive year! (I am quite embarrassed to put down how long I have been doing this)

After 2 weeks of very good and disciplined trading; and following all the rules and identifying setups (Gosh! Horrors - I actually planned a trade - many trades in fact). I killed it all.

Wednesday, October 05, 2011


......Powerbook G4, iMAC 24", iPhone 3GS, iPhone 4, Macbook Pro 2.4Ghz, Airport Extreme, Magic Mouse......

Thank you Steve Jobs for making my life a wonderful, fun, -filled world.
JellyMuffin.com - The place for profile layouts, flash generators, glitter graphics, backgrounds and codes
You Rock!!

Tuesday, October 04, 2011

All eyes on the $AUDUSD today

Good Morning World....

Yup, I missed a nice trade while I was asleep...it happens...and I am learning to tell my brain that ....it happens...

Note to Self: Missing on a trade just before you shut-down for the say doesn't mean that you have go crazy and force an impulse trade the next day. It might seem logical, but sometimes my brain doesn't work that way.  

Back to business and something I have never done before: I am waiting for 3 setups on 3 different timeframes - all going the in the same direction on the same currency pair $AUDUSD. G'day $AUDUSD!

Actually waiting for setups is something I have never done before - at least up until the mind-blowing Bossilator course.

Setup 1: 1M $AUDUSD - Trifecta - Trend - Buy
Bossilator is at 291 so it looks good for entry.
Looking to buy when $AUDUSD closes above Fib levels 23 ($AUDUSD @ 0.9550) and 33 (9531). The target is Fib 0 (9596). I might also wait for the EMAs to sort themselves out. I like it when they are in a nice order - at least when price is above EMA13 for a buy.

As I write, $AUDUSD was testing the 9500 at Fib50, it didn't touch the SMA800, so I'm still good to wait for the setup. If it touches the SMA800, I'll take this off my watch-list.

Setup 2: 5M $AUDUSD - Stochastics - Counter-trend - Buy
Bossilator at 999 as I write - good enough for counter-trend.
Looking for a buy when the Stochastics get to 20 and above.
I'm just waiting to see a place where I can get a significant low that will provide a nice enough risk/reward. 2:1 according to the rules.

Setup 3: 15M $AUDUSD - Stochastics - Counter-trend - Buy
This is my favourite because the Bossilator is so hugely extended (1700 and above now). This was also the trade I missed last night. It may or may not setup again because the trade is already in play. I am also aware that $AUDUSD may be twitchy so if I do get into this trade; I may just take out the planned 30pips or close to it since I may not be able to sit in the trade for that long (I have "ants in my pants" syndrome when I am more than 20pips in profit - I really am trying to work on this.)


If you can't tell from the tone of my voice, I am taking it slow today since I did well yesterday. I am too cognizant of my ability to think I can rule the world after a couple of quick wins. I took another trade last night but had to make a quick exit to run some must-do errands - that added 9 pips to the pool for a total of 29 for yesterday. Not a bad way to start the week...even if I say so myself.

That's it for the morning. Sorry for the long post. I really need to have my morning cuppa Joe now....

Happy Trading!

30 pips per day

I've decided that I will try to do 30pips per trading day.  At least that's the plan - there will be days in the week where I will not any trades. I've learnt from many hard knocks that sometimes the best trade is to not trade at all.

This morning I took a counter-trend on $AUDUSD. $AUDUSD has been on the watch-list since it has been in a long "down-trend" (1400 15Min bars away from the SMA800 as of Monday this week).

I set it up for a 2:1 risk/reward - Buy entry was at 9499, target at 9541, stop loss at 9477. Break-even was at 9521. Around the 20pips profit mark (Close to 1:1 risk/reward), I was starting to get jumpy so I took it out and closed with +20pips. Point to note, when it hit the half-way point to the target, I changed change the stop loss to break-even. This is another new step, recently included into the New and Improved Trader Mom's Set of Rules to Trade By.
AUDUSD 5Min/15Min

Here's a funny point about this newly added "set to break-even" step of setting the trade:

Every trading book worth it's weight will have a chapter titled "money management". And I have read these chapters in all the books that I own. Well, it took me all of 2 years to understand what it  actually means and how to implement this in trading!
Happy Trading!

I'm Baaaack!

I'm back and trading with a vengeance.

No not really, but I am back and trading. It has been a long break. June and July in the US. Back home to Singapore and then a quick day surgery in early August. I won't bore anybody with the gore and guts but it was gory - at least for the next 2 weeks after surgery.

Last weekend - a quick trip to Saigon. My first time in Vietnam, interesting city!

On the trading front, I just attended a week of forex trading webinar's FX-AllStars set up by Boris Schlossberg and team. My brain is still digesting some of the materials.

But my best present to myself has been attending Rob Booker's Bossilator  course which started in late-August. What an eye-opener! What amazing fun! I have always loved all his books and free e-stuff available on the web. But this course just tops it all.

Not only has he put up the how-tos for trade entry and exits and stop losses. He also has trading strategies for counter-trend and trend-trading. So you can pick and choose depending on which type of trader you are. Webinar's are once every 2 weeks but help is available on live chat and the built-in forum.

I just received an email to say that it was still open to registration so if you are still looking to tremendously increase your trading performance then head on down to http://bossilator.com.

All my posts from this point on will have references to the Bossilator which is plain speak for the distance a financial instrument spends away from the 800 SMA.

And so she wrote....

Friday, June 10, 2011

Hard to know when to stop

Sometimes it's hard to know when to stop....

Just before ECB release at 02:45EST, I took a quick trade for a fast 12pips. Sell at 4485, exit at 4473.

I hung on long enough to see a green 5min candle appear before I made an exit.  I decided to exit earlier since there were 2 news releases coming up Trichet's release and French Industrial Production. Also London was opening at 03:00am EST.

$EURUSD 10JUN2011 0630GMT 15Min

It reversed and went back up to EMA26 on the 5min chart to 4496 which did make me feel better. Earlier views of the 5min chart showed that it had been hitting resistance at EMA26, the earlier trade was a good one since it was also a retrace (18pip) from a significant low - 4480.

The 5min chart shows a clearer picture of the day's behaviour. Maybe I could have entered a bit earlier but I did like the 4pip red candle down as momentum.

$EURUSD 10JUN2011 0630GMT 5Min
The usual question is "when is it a good time to stop trading" since I had already hit today's target of 10pips.

$EURUSD started to come down after London open, that last green candle actually painted red at the end of that 5min. I wasn't sure whether I should take another trade but I did jump on the wagon and chased it with a quick SELL at 4460 to 4454. It was clear that it was heading towards 4450 but I just couldn't make myself hang on any longer for the ride.

Sometimes it's just too hard to hang in there...but the 1min ADX was topping off and the red line had entered no-man's land (middle zone). Maybe I would have done better if my senses was a little bit more numbed with a couple of beers. 

21pips is just under 2 hours is pretty good. My account is back up a little bit to where it was; after Tuesday's trades. But not anywhere close to where it was; before Non-Farm Payroll beat me down. 

I think I will celebrate this as a small victory.

Wednesday, June 08, 2011

Fear keeps me out of pips.

Non-Farm didn't work too well for me last Friday. 

My two mistakes were:

  1. I traded when I said I wasn't going to take any trades for the day
  2. I went against the trend...that contrarian nature in me took over and I learnt my lesson
For the last 2 days, I have been trading defensively trying to get the account back to where I was pre-Non-Farm. I am also working at trading in the direction of the trend for the day. Back to basics by looking at points of support and resistance in the smaller timeframe charts.

Sometimes defensive trading and fear keeps me from getting more pips. The fear of the previous losing trades keeps me from two things:

  1. Holding on longer to a winning trade
  2. Taking too long to enter into a trade when the setup appears
Today's trades brought in 10pips - average daily target achieved for the day but in typical greedy trader form, I think I could have done more.

A quick view of the charts showed downtrend since Asian session. On 1min chart, $EURUSD has been bouncing down from resistance at EMA62 and SMA200. Both trades were Sells. Started Trade 1 (4614 to 4610 for +4pips) at 14:42GMT, exited at 15:01GMT. Trade 2 (4602 to 4596 for +6pips) entry at 15:09GMT exit at 15:10GMT.    I usually expect $EURUSD to trade in the direction of the day until half hour before London close when it gets choppy. This was a safer time since there was no more news for the day since it was just after announcement of US Crude Oil Inventories.

$EURUSD  8JUN2011 5min

It's obvious from the 5min chart that I could have waited for the pullback in Trade 2 to exit instead of prematurely pulling back before the end of that 5minute candle.

The 1min chart ADX was rising, which meant that I could have held on until the red line crossed the signal line. 

$EURUSD 8JUN2011 1min

I know I didn't check this before exiting and if I did, my brain could have somehow ignored this. I remember thinking I was "feeling the Fear" since there was a pullback 3 hours ago at 4598. So when it broke past the 00 level, I was waiting "fearfully" for a pullback. Even thought the pullback didn't happen, I pulled the trigger and killed the trade in its track.

Next time I might have to sit a little bit further back from the screen and maybe breathe a little bit more.

Thursday, June 02, 2011

15 Minute Charts

I am seriously going to look at the 15min charts for trade entries and setups. So far I have been looking at 5min setups which will probably get me to break even. But yesterday was a great trending and the momentum was fantastic leading up to today's Non-Farm payroll. If I took 15min setups, and Key Levels support and resistance, I might be able to escape some of the whip-saw trades that I am getting.

Yesterday was break-even (-4pips) considering I started with a loss of 14pips in the early Asian Session. And then didn't trade until noon of London session and later in US session. I recovered to break-even after all the US news.

Just after London close, I entered wrongly into a SELL even though I was waiting for the 50% retracement to enter on a BUY. This cost me a loss of 8pips. I quickly bought back following the major direction of the day which and recovered 10pips from 4429 to 4439. Decided I had enough after when it stalled at 4440. It was way after midnight and I couldn't stay awake.

$EURUSD 15min on 2Jun11
See all those 2 candle resistance after a 40 to 50 pip run. It happened at the 4300, 4480, 4450 and 4500. 

I have also been noticing the support at EMA62 and SMA200 Quite uncanny, I've also seen this  appear on the lower timeframes e.g. 1min and 5min.

Monday, May 16, 2011

When Not to Trade

I've been sitting at the screens for the last 4 hours and so far I managed to get a few pips. Got it on the twitter feed http://twitter.com/mengfong

Thoughts for this session:

Only consider 15 minute support/resistance candle at key levels 00, 50, 80. The single spikey doji.

Try not to get in too early - this is my biggest problem.

Going to sit it out until London opens. Back to cooking see if that calms down my trigger finger.

Wednesday, May 11, 2011

Super Quick Scalps - EURUSD

14:57hrs London time.

Phew...what a day.

Got stuck in the pre-release of the CAD and US trade balance numbers. EURUSD was in a very tight range. I stopped the trade both times when a big 4 pip M1 candle appeared. Losses were about 10pips and 8 pips.

Got right back into it but with 1 mini-lot each time. After breaking even, EURUSD traded down to 1.4300. 2 quick scalps of 4pips each around the support 1.4300 number closed the gap. So I made my 10pips for the day. Bought against the trend of the day so had to get out really quickly. Hold on for 3 M1 candles. No more.

I wonder if I can do that regularly in congestion areas...50s and 00s. Something to think about.

Tuesday, May 10, 2011

When not to trade...

2:46 am London Time.

EURUSD seems to be range-bound for this Asian and Aussie Session. The Tokyo open didn't budge it very much. I am looking to see that it will have a range of 30 to 40 pips before I get into the market.

Going to try to be strong aka disciplined - and stay out for this session.

Monday, May 09, 2011

Waiting for a Trade Setup

Yesterday, EURUSD created a daily doji. Support at 1.4250.

Looks like it is still trying to go down today.  I will try to wait until it re-test 1.4350 before taking a sell.

This will be hard...I had to force myself away from the 5mins chart so that I wouldn't take a buy trade at 1.4330. I think I am built to trade counter-trend and inexplicably trigger-happy. it was downright painful. I started up my twitter feed to force myself to follow the rules. 

Yesterday was a good day. Hit 25pips on 3 quick trades. All 3 trades were sells (in the direction of the trend)

Definitely trying to work on going with the major trend this whole week.

Here are the rules for the week:
  1. Go with major trend
  2. Confirm support or resistance at 15min chart
  3. Exit at 7 - 1 min candles or when it hits major support/resistance e.g. 80, 00, or 50

Trading Forex and Cooking

You might wonder what forex trading and cooking have in common. Frankly I am not sure except for the fact that since I started cooking, my trading has improved.

I went from cooking once a month to cooking meals about twice or three times a day. I find that after slaving away on a hot meal, my brain and body uses up all the restless energies I normally carry around. And when I see my trade setup, I try harder at checking my rules and then I am take it with less hesistation.

Is my trading account better for it? Yes, up until 3 weeks ago when I blew up all the good work I had done for the last 2 months. I know why....Revenge Trading was the culprit.

Now I am starting back to "10 pips a day". A wonderful strategy from Rob Booker. I love his books, they give light to all the monsters that you find hidden within yourself when you start trading forex. And they give hope that to be successful in trading, you need only work away and accumulate small, very small profits daily.

At 10 pips a day, I managed to triple my mini-account in 3 months. But a week of losses wiped it down back to it's original value.

Trading is hard. Cooking is not as hard...but for some people, it's insurmountable. I am working at both.