MAKE A DIARY OF YOUR TRADES to keep a written on-going track record of your progress. I cannot tell you guys with enough emphasis how important your trading journal track-record is, except to say that if you don’t keep a trading journal or at least regularly analyze your trading history and equity curve, you are extremely unlikely to ever make consistent money in the markets.
The actual process of updating your forex trading journal will help you stay disciplined and organized. This is part of developing the positive trading habits that are so crucial to becoming a long-term profitable trader. I don’t care if you think updating your journal is boring right now, stop complaining and start doing the things that YOU KNOW you need to do to become successful. I can promise you that if you keep screwing around by being unorganized and half-assing it, you are never going to pull the sort of money from the market that you want. You NEED to look at your track record on a regular basis to see something tangible that reflects back to you your ability or inability to trade This will work to keep you on top of your game.
We are traders and masters of risk. When you become pro you stop over analysing and all you do is sit there, and wait, and wait, and wait some more until you find the perfect trade. What I am saying is that the market makes all the decisions. Our only decision is to listen, feel, and respond to the market’s siren. Always and without exception. Remember, the market never lies. It is only we who lie to ourselves.
Friday, March 9, 2012
Taking a break tonight! March 09 2012 Thursday
Presumably, the renewed bid tone in the markets over the past 24 hours has been primarily driven off the fact that Greece has secured a 95% take up rate for the debt swap deal. Market participants have found comfort in this fact and the successful passage of the deal will help eliminate any added unwelcome uncertainty in a still shaky global macro environment. However, from here, we are not all that confident in the prospects for additional risk buying on Friday and things are expected to pick up into the latter half of the day with the all important monthly US NFP data, immediately followed by the EU’s final decision on Greece’s second bailout.
I don't see any setups tonight. Non Farm Payroll data coming out and that is a vital news release. We will sit on the sideways and take another break. Lets relax tonight!
I don't see any setups tonight. Non Farm Payroll data coming out and that is a vital news release. We will sit on the sideways and take another break. Lets relax tonight!
Thursday, March 8, 2012
Volatility Expected to Pick Up on Thursday with Major Event Risk
Markets have been mostly locked in some choppy consolidation following Tuesday’s sharp risk sell-off and things could continue in this manner at least until the latter half of the day where a number of major events could finally break the range trade and open a good deal of renewed volatility. The Bank of England, European Central Bank and Bank of Canada are all set to decide on rates and although none of the central banks are expected to change policy (0.5%, 1.0% and 1.0% respectively), market participants will be looking for any signs of added dovishness given the ongoing stresses in the global economy. Perhaps more importantly however, will be the Greek PSI deadline at 20:00GMT. Many now fear that the collective action clauses (CAC) could be triggered, which would force bondholders to agree to haircuts. With the participation rate only at 58%, well short of the 75% required, all eyes are fixated on ISDA to see if they deem this to be a credit event.
We made a one trade on Wednesday night. We will sit on the sidelines now. One trade a day is enough.
We made a one trade on Wednesday night. We will sit on the sidelines now. One trade a day is enough.
Trade Long GBP/USD March 07 2012 Wednesday
Long GBP/USD on 1 hour chart using cross over system. 43 pip gain.
Entry: 1.57468
Stop loss: 1.5731
Target profit: 1.5790
Units: 300000
Result: $1068
Wednesday, March 7, 2012
Ultimate Goal!
My goal in trading is to execute my plan perfectly. If I cannot find my edge or if I don't know what my edge is I am just gambling. Some days there are many opportunities and some days there are only 1 or 2 opportunities. Some days are just sitting on my hands.
Kevin
Avoid the Trading Seesaw!
Have you ever experienced a performance seesaw? Trading seesaw is the cycle of successfully making money for a certain period of time, and then becoming overconfident and careless, which then leads to bad losses.
The "seesaw" is completed when the trader tries to get back "in the zone" by making the necessary effort to execute trades well.
Unlike a kid getting out of simple seesaw though, getting off the trading seesaw can be extremely difficult.
When you are "up" and are winning trades, you easily become wrapped up in your trading results. Your string of winning trades can make you overconfident, which can tempt you to start cutting corners and stop doing the processes that initially made you win.
Once you have reached a very high level of success, you'll probably fall back down to earth on your behind due to mistakes and maybe even a big loss. It is only in this "down" stage that you realize your mistakes and return to what you were doing previously that made you profitable.
Take this trader friend of mine named Rob (not his real name, of course). He has been live-trading for around 2 years, yet he has to end a year with a significant profit. During the first year, he was up by 0.50%. On his second year, he was down 0.25%. Needless to say, his performance has been less than stellar.
When I looked at his month-to-month performance, however, I saw that he would have 3 to 4-month winning streaks where he'd gain around 5% to 7%, followed up by 2 to 3 months of 6% to 10% losses.
This prompted me to ask him if he found something odd in his performance.
His response was surprising. He simply said that it was just how the cookie crumbled-sometimes he'd win, sometimes he'd lose. But I did not see it that way. I realized that he was stuck in a performance seesaw.
If you think you're experiencing the same scenario I stated above, don't fret.
One thing you can do to avoid the trading seesaw is to focus on the process. Some traders continually check their trading and psychological journals for signs that they might be deviating from their usual strategies. Others even score themselves on each trade to make sure their trading plans are being followed.
Another way to avoid the trading seesaw is to make sure that trading isn't your only measure of your self-worth. Try to find a sense of achievement and satisfaction in your relationships, work, and other hobbies that you might have. This way your ego won't be tied to your trading performance and you'll be more emotionally resilient in winning and losing trades.
As I said last week, trading is a grind where focusing on the process is your best friend. Having winning or losing streaks shouldn't hinder you from doing what works and improving what doesn't work for your trades.
It takes effort, emotional resilience, and most of all, FOCUS, in order to avoid the trading seasaw and become a consistently profitable trader over time.
Read more: http://www.babypips.com/blogs/pipsychology/avoid-the-trading-seesaw.html#ixzz1oQLrSgnw
The "seesaw" is completed when the trader tries to get back "in the zone" by making the necessary effort to execute trades well.
Unlike a kid getting out of simple seesaw though, getting off the trading seesaw can be extremely difficult.
When you are "up" and are winning trades, you easily become wrapped up in your trading results. Your string of winning trades can make you overconfident, which can tempt you to start cutting corners and stop doing the processes that initially made you win.
Once you have reached a very high level of success, you'll probably fall back down to earth on your behind due to mistakes and maybe even a big loss. It is only in this "down" stage that you realize your mistakes and return to what you were doing previously that made you profitable.
Take this trader friend of mine named Rob (not his real name, of course). He has been live-trading for around 2 years, yet he has to end a year with a significant profit. During the first year, he was up by 0.50%. On his second year, he was down 0.25%. Needless to say, his performance has been less than stellar.
When I looked at his month-to-month performance, however, I saw that he would have 3 to 4-month winning streaks where he'd gain around 5% to 7%, followed up by 2 to 3 months of 6% to 10% losses.
This prompted me to ask him if he found something odd in his performance.
His response was surprising. He simply said that it was just how the cookie crumbled-sometimes he'd win, sometimes he'd lose. But I did not see it that way. I realized that he was stuck in a performance seesaw.
If you think you're experiencing the same scenario I stated above, don't fret.
One thing you can do to avoid the trading seesaw is to focus on the process. Some traders continually check their trading and psychological journals for signs that they might be deviating from their usual strategies. Others even score themselves on each trade to make sure their trading plans are being followed.
Another way to avoid the trading seesaw is to make sure that trading isn't your only measure of your self-worth. Try to find a sense of achievement and satisfaction in your relationships, work, and other hobbies that you might have. This way your ego won't be tied to your trading performance and you'll be more emotionally resilient in winning and losing trades.
As I said last week, trading is a grind where focusing on the process is your best friend. Having winning or losing streaks shouldn't hinder you from doing what works and improving what doesn't work for your trades.
It takes effort, emotional resilience, and most of all, FOCUS, in order to avoid the trading seasaw and become a consistently profitable trader over time.
Read more: http://www.babypips.com/blogs/pipsychology/avoid-the-trading-seesaw.html#ixzz1oQLrSgnw
Wednesday Could Be Day of Consolidation With Key Event Risk Ahead
After a huge sell off markets are moving sideways. ADP's Non-Farm payroll estimate will take the morning's focus, but watch near day's end for consumer credit which has been pivoting much higher in recent months. We will watch from the sideways and wait for market direction.
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