What a mess of a trading week! My eagerness to improve on my stats and my equity curve before the end of the month led me to make some frankly stupid trades, ignoring clear support/resistance lines (which would have been evident from the use of envelopes as TP levels) and just plodding on with the trade, hoping for breakouts in line with the trend. So, Triple Screen + Impulse but totally ignoring the risk to reward ratio. The week started so - so, but rapidly got worse. I slipped into intra-day trading in an attempt to recover my losses, and initially made progress. However, ignoring risk-to-reward is likely to get you eventually, as it got me. The eventual losses wiped out my profits and left me shaken. That's where I should have shut my screen and walked away. I knew I should have, but I wanted revenge. The old beast surged up in me and prompted me to trade some more, this time with Impulse on 1-minute candles! Something I've never ever tested in demo or back-tested properly on my charts, I irrationally decided to try live. The results were great for about 5 minutes. I thought in an hour I'd have recovered my losses! As it happens, things turned on me, there was a spike against me, which I was totally unprepared for as Impulse swung rapidly from sell, to buy to sell, and I was caught like a rabbit in the one-minute headlights. The trades this week were so numerous and silly that it almost makes no sense to journal them. I will do so, if only to publicly shame myself and thus remind myself of the consequences of such idiocy.
Oh, I forgot to mention, I used the daily + 4 hourly charts often this week, as well as the 4hourly + hourly. Not a bad thing in itself, if I'd only paid attention to the risk-reward ratios. In fact the daily + 4 hourly might be even better for me than the weekly + daily, used properly with envelopes to determine TP levels. Not paying attention to the risk-reward in intra-day has proved very deadly indeed.
I have 2 large sell EUR USD trades floating, which could potentially burn me badly. While my outlook on the EUR USD is negative, these trades are not in line with the weekly trend and a possible deal on the Greek crises could see my way-too-high stops triggered in the short term. Even if I get out of these trades with a profit, I must view them as bad trades because of the level of risk to which they've exposed me. They are 'gamble' trades, born out of 1-minute desperation; orphaned impulse trades.
My rules do not permit me to trade manually for the rest of the month. I've lost over 6% of my account manual trading this month and so must return to demo trading for the rest of the month in order to regain my discipline and get back in sync with the markets. I will return to manual trading from the 1st of March.
My decisions for now, for when I return on 1st March are:
1. To use 2 time frames as my main (under triple screen): Daily (so weekly determines trend), and 4-hour (so daily determines trend)
2. To limit myself to the comdolls (AUD/USD, NZD/USD, USD/CAD) and their crosses, as the they are traditionally trending pairs
I have promised my family not to spend so much time after work glued to the screens preparing trade setups, so number 2 should help me with this, enabling me to focus on the pairs which have over time served me the best.
Autotrading: My Zulutrade providers had an even worse week than I did (from an actual money perspective), but this gives me no comfort, as it still affects my equity. -389 pips and a massive financial loss.
What a rollercoaster ride trading is. I'm shaken, but I'm still standing.
On Sunday February 19th, 2012 at 09:14AM by Amaterasu - Like - 0 People
Don't be so hard on yourself! You are now taking the right decision and you only have lost 6% of your account even after breaking several of your rules. It means you had correct money management and you will probably come back stronger after this experience. I suggest to chill out a bit, read (or reread) some psychology book about trading, take care of your family and come back to trading with a clear state of mind :)
Nice self analysis btw!
On Sunday February 19th, 2012 at 07:08PM by Brad - Like - 0 People
You probably learned something this week, so learn from it and move forward. One can make back 6 percent on one really good trade. But, that shouldn't be on our minds. Just make a the right sort of trade according to the rules you want to trade by and believe in. It is not so easy to stick to sometimes, and at some points, everyone diverges and has to learn from it. I used to only ever look at the higher time frames. It was like I was kind of afraid of the faster time frames. Then, at some point, I tried demo trading a strategy trading only the five minute charts. I made 20 percent in one day, and lost it all back the next. I learned that the five minute charts have something to tell me, but when only looking at the five minute charts, I have a very limited sort of perspective. It's as if I was an ant, and I can't see the people coming along to step on me. Anyway, most people have had a 6 percent drawdown. That's not much for a terrible time. People without good money management would have gone broke. Sticking to your plan, you can pull that back.
On Sunday February 19th, 2012 at 11:12PM by RazorX - Like - 0 People
If it's any consolation I took a 30% drawdown on my live account before I stopped trading live and went back to demo! I am still demo trading and have yet to make back the 30%. What has helped is I have gone from Make X BIG DOLLARS in 2 years to more of this is a long term learning process thats gonna take time. Once I accepted that taking losses has been eaiser.... despite the fact I still hate taking losses. (I mean who enjoys taking a loss? Hands up anyone?)
The good thing is that your an journaling this experiance and learning from it. You'll hopefully look back later and realise this was an important lesson.
On Monday February 20th, 2012 at 06:56PM by bundabergbear - Like - 0 People
Take it cool man. What matters now is your course of action for your next trade. And I am sure you will do fine with such a long record of your calmness in midst of the market storms :) Look at the bright side man. Cheers!
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