My account took a pretty big hit last week as I pretty much had my bear glasses on the whole time. Of course, having bear glasses on wouldn't have been so bad if only the markets were actually bearish. Unfortunately, that wasn't the case. Risk was on and that made it a bad time to be a perma-bear.
Of the 5 trades that I took, 4 were short, and it wasn't until the end of the week that I finally decided to go long. Sadly, by then, the move was exhausted and even my long trade turned out to be a dud.
So what was the problem? Well, I think my ego got in the way. I found myself trying to call tops, which was basically like trying to catch a falling knife. I got cut time and time again. Rather than acknowledging defeat and recognizing that the markets were operating in a risk on environment (by then, most pairs had recorded many green daily candles already), I stubbornly kept shorting. Basically, I WANTED to be right, even though the markets were clearly telling me that I was wrong.
I suppose it was my ego that blinded me from seeing the obvious. I mean, it was pretty clear that the rallies had a lot of steam behind them. I just wanted to be RIGHT so badly, especially since the previous week didn't yield good results for my account. I should've just gone with the flow, rather than fight the current.
I think my main mistake last week was that I failed to take into context the technical setups that materialized. Looking back, I can see they were all sound, most being retracement plays that favored shorting. On its own, the technical setups made a sound case to sell. But taken in the context of the risk-on market environment, I can see now that they're a bit more iffy.
On Wednesday October 19th, 2011 at 04:27PM by Brad - Like - 0 People
I can understand and relate to what you are saying. Last week I was highly bullish. Take a look at NzdUsd daily. On 10/7, it produced a nice looking rejection on the daily chart with trend. So, that would make me bearish. But, I am not too trusting that a Friday signal like that is going to hold up. So, switching to the H4 chart. Notice no price action really signaling that the momentum was shifting down once we get to 10/10. Instead, there was an up move and a pullback. The pullback created a beautiful upward signaling candle on the H4 chart. It actually pulled back to pretty much exactly 61.8 on the fibonnacci retracement. I missed that one which kind of ticked me off. I was thinking I should give up this bad sleeping habit. Just joking. Then, it pulled back again, and I entered early and lost. Then, I entered at the right time, and won, and took more than I lost. Anyway, just thought I would share what my point of view was for the week.
On Thursday October 20th, 2011 at 11:50AM by obiwan23 - Like - 0 People
It's sort of like spending your whole week chasing after something.. and when you finally catch it, it stabs you in the belly. Haha. Hope we get better results this week. Market sentiment has been quite difficult to gauge lately. One day risk is on, the next it's off. Meh. Can't wait until all these gloom and doom economic problems are behind us.
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