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.