Friday, July 15, 2016

Week in Review: 11 June to 17 July 2016

I've finished this week near breakeven. I had one winner, one loser and one breakeven trade. 


I opened this trade on Monday, feeling very confident. The AUDNZD had just broken downwards and retraced back to the previous support level. I went short at Friday's high using a sell limit order, but the AUDNZD rocketed upwards and eventually took me out.


I spotted a two-candle reversal pattern, and went short at the break of the low. I wasn't too happy about the low probability of this setup, and only risked 1% instead of my maximum of 2%. My problem was the close proximity of two support levels, which had to break to reach my profit target of 1R. After a few days, I decided to get out near breakeven (technically I was profitable, but my profit was only 0.1R, which is nothing). I should've avoided this trade in the first place. 


This was a straightforward trade. I saw a bullish pinbar and went long at the break of its high, and aimed for a reward of 1R, just below the next resistance level. The trade hit my profit target the next day.


Don't trade a setup just for the sake of trading. IF you must trade, only risk a small amount. And if you do something stupid and realise your mistake, get out. 

Saturday, July 9, 2016

Week in Review: 4 June to 10 July 2016

The market has calmed after the 'Brexit' referendum, and now I'm back to trading normally again. 

This week has actually been pretty busy. I closed five trades, with three winners, one loser and one breakeven.


This was my "big" Brexit trade that I opened the previous week. 

Shorting the GBP was an easy decision. But short it against what? I flicked through my charts and decided that the GBPNZD provided the best trade. It offered a good setup AND offered the best overnight swap rate. Since I knew the trade could take weeks or even months, I felt the GBPNZD was ideal. 

My short hit its profit target at 1.80000 a few days ago. My reward was 0.5R. I could've aimed for more, but 1.80000 is a significant support level, and a 0.5R reward is profitable, according to my backtests, so I got out here. However, if 1.80000 breaks and I see another bearish setup, I'll happily go short again.


I opened this trade the previous week, after spotting a pinbar in line with the bullish trend. This trade worked out perfectly, and I hit my profit target on Monday, banking 1R reward.


I identified a pinbar setup and felt there was room for the USDCHF to fall. However, the market moved against me right after my entry, and hit my stop loss on the same day. Looking back, trading in FAVOUR of any European currency (EUR, GBP, CHF) was probably foolish, in the context of Brexit.


After losing on the USDCHF, I identified a bearish engulfing candle on the EURUSD, and went short. This was three days before the release of NFP, and I was hoping to hit my profit target before then.

Alas, by the time of NFP's release, my trade was still open. I decided to exit at breakeven and avoid NFP. My reward was only 0.75R, and since major news are unpredictable, I thought it best to sit out.


I also shorted the EURAUD, after spotting a continuation pattern. It looked like the EURAUD wanted to break down further, so I aimed for a reward of 0.75R, just above the support level at 1.45000. Price came agonisingly close to my profit target on Friday night after NFP, but then stopped falling. At that point, I felt it was better to take profit at 0.6R, as the markets were closing for the weekend.


It feels good to be back at trading.

GBP should continue sliding, although I think some news traders who went short will begin to take profit (as I've done). Alot of GBP pairs are hitting long-term levels of support / resistance now, but once these levels break (and I think they will), the GBP should freefall. I don't see much political leadership in the UK at the moment, with David Cameron resigning and Brexit leaders Nigel Farage and Boris Johnson walking away from the mess they created. 

Monday, July 4, 2016

Semi-Annual Review: Jan to June 2016

Whew, we're halfway through 2016 already! That means I've got six months worth of trading performance to review for your pleasure. :)

Trades opened: 63
Account growth: 18.17%

The first few months were choppy. I initially focused on only trading the majors, then added the minor pairs halfway through February. The equity curve picked up after that. (Protip: ignore the "expert" advice about trading the majors only. If you trade the minors as well, you have a greater selection of setups to choose from.)

I've been pretty conservative with my position sizing, and tend to risk between 0.5% and 1.5% per trade. During the last few months, though, I've increased my max position size to 2%. I'm still committed to my drawdown rules (my general rule is to halve my max position size after a losing month, and double it after a winning month, up to a max of 2%). 

The last few weeks of June were really quiet. Because of a cluster of events like 'Brexit' and numerous interest rate decisions, I chose to sat most of June out. Psychologically, I began to lose touch with the market, and my research and backtesting slowed to a crawl. Keeping engaged with the market is crucial, even during "downtime". 

Week in Review: 27 June to 3 July 2016

I returned to the market this week, and opened two trades. I went short on the GBPNZD, and long on the NZDUSD. Both trades are still open so I can't post their summary until they close. 

Sitting out of the markets for a few weeks has made me lethargic towards trading. I noticed that I've scaled back my backtesting and research ALOT. With markets returning back to normal, I hope to get back into my stride.