February 28, 2007
There is a new Investopedia article on removing barriers that may be affecting your successfulness as a trader. Here's my personal evaluation in regards to each:
- Learn to monitor your performance – I think I do a pretty good job at monitoring my performance right here on this website.
- Measure your behavior then identify what needs changing – Unfortunately, I don't think I do enough of a "deep dive" evaluating each individual trade that occurred in the past. I need to start doing this.
- Stay focused on what you need to change – I'm always doing this and always attentive to this fact.
- Identify how you will deal with losses – It's not always the easiest to deal with a loss but I'm getting better and better each month.
- Become an expert at one investing strategy – I get sidetracked from time to time but I think I'm accomplishing this by focusing my attention on short-term trading the GBP/USD.
- Learn to think in probabilities – I don't think I properly address this point. I think a lot of this involves looking at fundamental factors which I don't do.
- Learn to be objective – I think I remain pretty objective. I don't feel bound to any particular trading direction, long or short. If my system says long, I go long. If it says short, I go short. I'm like a robot when trading my system.
To read the entire article, visit Removing The Barriers To Successful Investing.
February 28, 2007
Yes, you read it correctly. I lost DI Pips. In roman numerals, D=500, and I=1. Like I've been saying all week, it was a pretty bad month for me mainly because the h-system performed terribly, losing 697 pips. What more can I do other than stick with what I have, which I will do in March.
See my results:
At least I ended the month on a positive note. I had a profitable h-system trade and a profitable reversal trade this morning for a total of 125 pips.
Once again, the Lien Schlossberg service didn't show much this month, getting me a total of 22 pips. I didn't take some of their trades though but I still consider these realistic results. When using a forex trading service that sends out 24-hour real-time trade alerts, you cannot expect to be able to enter every single trade. I get alerts sometimes when I'm sleeping, driving, in a meeting, or otherwise unable to access my trading system. Due to this, I don't expect to continue using this service past the 3 months that I paid for it. I'm sorry to say but overall I'm not impressed at all with their trades.
February 28, 2007
I mentioned this simple GBP/USD system a couple of weeks ago. Since then, I've been following its' progress and I've been using it live if I have time to check out the charts when I wake up in the morning. I haven't had many opportunities to do so in the last couple of weeks but I did today and I made a quick 30 pips again. These trading opportunities may not pop out on the screen if you don't perform one simple step before hand. All you need to draw are horizontal lines indicating the high and low of the GBP/USD from yesterday. This system does not require any indicators which I try to stay away from.
I've posted a picture with four trading opportunities generated by this system in the last week, all of them profitable. Let me just mention that I am still working on this to try to gauge what the optimum limit and stop/loss levels are but I'm never greedy. I always shoot for about 30 pips with a GBP/USD trade which from my experience is a very good target and not greedy whatsoever. The risk/reward on this trade is typically 1:1 but I've found from backtesting that it definitely wins more than it loses. Money management is still a quandary I face with trading the GBP/USD. It doesn't pay to be greedy and like I've said, I found that 30 pips is an optimum profit target based on my experience. But I've also found that anything tighter than a 30 pip stop is not recommended. There are other ways to go about trading this system such as using breakeven stops or multiple lots with multiple targets but it's still a work in progress and I can't really comment any further on it.
Here are the simple rules or procedures for a short trade:
- Draw horizontal lines on a 1-hour GBP/USD chart indicating low from yesterday.
- If a price candle closes below the low of yesterday you have a possible trading opportunity.
- We are now waiting for the price to reverse back into yesterday's daily range. Place an order to buy 6 pips above yesterday's low.
- Set your target at 30 pips and your stop at 30 pips.
I've circled 5 trading opportunities but the fourth is questionable because the price barely closes above yesterdays high.
February 27, 2007
In my journey to become a forex trader, I've been able to establish a pretty well indexed (by Google) blog. Due to this, a lot of people stumble upon my site on a daily basis. With this comes many offers to help. For this I am truly appreciative. A lot of these offers may be a way for them to get more exposure to my visitors, market their product, or just offer genuine help. I have no problem with this because there is much we can learn from each other and I really don't expect anything for free. If they do provide me with free knowledge, then I too should reciprocate.
In the last several days I've had some interesting and diverse offers.
- Harriman House, publishers of books, will be sending me a free copy of a new book titled, Ichimoku Charts by Nicole Elliot. When I was trying to learn how to use the Ichimoku indicator, I really couldn't find much information on the web or in the bookstore. That is why I'm interested in reading this book.
- Trade the News offered me a free account to access their Trade The News FX product (www.tradethenews.com) This service offers 24 hour audio to breaking news and analysis of the Forex markets.
- Raghee Horner sent me a nice email offering help. She does a morning chat each morning at 8:00am EST where she will allow me to listen to for a few weeks.
These are just a couple of offers I received in the last day or so. As always, any new information that I find helpful will be passed on to all of you as it becomes available.
February 27, 2007
February is beating me down hard and I'm looking forward to March. I lost on two h-system trades today and one yesterday. The British pound has been very indecisive over the last two weeks but I'm staying on my toes because I'm expecting a big fat breakout sometime soon.
I have to admit that I'm putting off the updating of my trade history because I know that my trading efforts from September 2006 until last month will be essentially wiped. To put it another way, my profits over the last five months probably won't survive the beating I'm taking this month. Was this all for nothing? I'd have to say definitely not. I've obviously still got a long ways to go and this month can be a great learning experience.
Stay tuned later for a post where I'm going to give you reasons why I've always been concerned with the h-system money management rules.
I actually had the best Lien Schlossberg trade last night when I shorted the CAD/JPY. I profited 77 pips on a 1 lot trade. Unfortunately, we were also short the USD/JPY but they recommended an exit with a 10 pip profit last night. Since then, the USD/JPY plunged a unusual 200 pips.
I still enjoy the challenge the Forex markets have given me so I'll accept my losses and move on. I'm not this challenged at my full-time job so I welcome it with open arms.
February 26, 2007
I'm posting this for a loyal visitor who is tired of Oanda's spread hikes. I too have had issues with their spread hikes mostly during economic releases out of England. Anyway, he's looking for feedback on any Metatrader brokers that others are using for live trading. I personally have no experience with any Metatrader brokers. If you do, please post a comment on your experiences.
February 26, 2007
Yesterday and part of today, FXCM had technical difficulties and their trading platform was unavailable. Anyone who had open positions from last week couldn't manage their trades. They sent out an apology today and offered to reimburse those clients who suffered a loss on open positions during the outage. They pretty much stated that they haven't done enough to address reliability issues and wanted to ensure everyone that the technical issues were not indicative of FXCM's financial stability or health. Do you believe them? Click [Read More] to view the entire email that I received because I have monies deposited with FXCM. They are my backup broker.
February 24, 2007
February 24, 2007
I was thinking about what went wrong this month with my trading and I've come to a couple of conclusions. Unfortunately there are going to be months where I just don't perform as I did in the past because of market conditions but I still feel like the following factors contributed to my failure this month.
- I tried to balance my day to day life and my forex trading but unfortunately failed due to the overwhelming factors involved. It was hard enough performing my responsibilities at my full-time job. Like I said last week, if you find that you just cannot continue your trading routine, I personally would recommend putting it on hold until you can.
- I tried to incorporate the GBP/JPY and GBP/CHF into my everyday trading routine. I just feel like I may have been hasty in doing so because it took my focus off of my core trading pair, the GBP/USD.
- I lacked patience this month. Instead of forcing trades or forcing a system on a currency pair that wasn't fully backtested, I should have done my due diligence before going live.
- This could be a continuation of #3 but my performance over the last couple of months has forced my hand in doing things that maybe I shouldn't have. In November, December and January, I profited 295 pips. I felt the pressure of showing more profit so that my final goal of trading full-time could be realized quicker.
There are still a couple of trading days left in February but I've accepted the fact that my consecutive profitable month streak will end at 5. What am I going to do differently in March? I'm going to scrap my trading plans for February and go back to trading the GBP/USD only. I'll will continue to trade other pairs if I receive a signal from Lien Schlossberg. This leads me into talking a little bit about this trading signal service again. I don't feel like this service is benefiting me at all. They really haven't shown a bit of profit and the text messages come in at weird times when I'm not ready to trade. I find myself scrambling to either open or close a trade. I paid for 3 months of the service so I'll get my monies worth and continue until the end of April. I'll re-evaluate the entire service at that time.
I have not been concentrating on finding another trading system. Currently, I only have the h-system but I want to find more. I've been content with the performance of this system over the previous months but I'm putting all of my eggs in 1 basket. I also feel like I need to do more price action studies. It seems like I do nothing but enter orders based on my 1 set of rules, close my charts, and pretty much call it a day. While this sounds like the ideal job, with only 19 months of forex trading under my belt, I still haven't acquired the experience to perform long-term. I need to continue learning.
Lastly, I want to thank everyone who sent me emails and comments over the last couple of days. They are both inspiring and appreciative. Good trading…
February 23, 2007
Phil McGrew sent me a note to announce his release of a Forex calculator. This calculator is pretty handy, particularly the position size tab which will calculate position size based on input variables such as equity, currency pair, risk in %, and risk in pips. The following are the rest of the features:
- Interest rollover calculations based on currency pair
- Currency pair correlation for three different durations, 5 day, 20 day, and 100 day
- Currency quote
- Margin calculation
I know there are probably other calculators out there that perform the same but he and his programmer(s) took their own time to develop this and offer it for free so I figured I would mention it. It is a windows application (not web-based). If you're interested, you can download here: