EUR/JPY Evening Trader

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TraderGreg

Welcome to my thread. I am going to attempt to put my trading reflections and and critiques in this thread as much as I can, as I have a trading journal I do not write in, a reflection document I only type in sometimes, and a trade-by-trade journal I get lazy with as I fall 10 trades behind in the trading day. I also need to fine tune things such as my patience and certain key elements I will go into further detail in another post.

Here's a bit of background:

I am currently a college student, and I have been studying the markets in-depth for about 8 months. This resulted in 30+ hours a week early, but unfortunately only about 10 so far in college. I am in my sixth week paper trading forex, during which time I have moved from longer intraday and swing plays down to what I like to call sharpshooting (I don't think I made this name up, but I like it), which is basically pin-pointing the point of larger intraday moves, or at least a few here and there I can catch.

A bit more to the point: due to obvious college scheduling problems, London and early American hours are practically untradable for me (definitely not a morning person at all...), as I am on the East Coast. However, a bit of research revealed that the EUR/JPY has good movement consistently between 6:30 and 10:30 p.m, and a fairly impressive spread along with it. I have been trying to trade or do trading work (such as studying charts, watching a trading session instead of trading, etc.) about 10 hours per week. I try to make my trading sessions on Monday, Tuesday, and Wednesday, but with Monday night football I will do my best.

Although I do have a few records of my profitability (so far slightly below b/e sharpshooting) and some reflections I would like to put on here, in the interest of time I will have to to this much later. 8 ams start in about 7 hours...

If you are reading, I hope you enjoy my thread.

Best Regards,

Greg
 
Regards...

If you don't already do so, you may want to study the EUR/USD and USD/JPY along with the EUR/JPY. I find that studying cross pairs and related majors help confirm analysis of crosses although not neccessary if one has a good system. E/U currently 1.3926 qnd U/J 107.04 leaving E/J at 149.03

E/U x U/J = E/J price

Harmless trivia. :)

All the best...
 
Quote from FXAnalyst:

Regards...

If you don't already do so, you may want to study the EUR/USD and USD/JPY along with the EUR/JPY. I find that studying cross pairs and related majors help confirm analysis of crosses although not neccessary if one has a good system. E/U currently 1.3926 qnd U/J 107.04 leaving E/J at 149.03

E/U x U/J = E/J price

Harmless trivia. :)

All the best...
More...

Thank you FXAnalyst! I have been taking brief looks here and there on the EUR/USD for confirmations, as I interpreted it as the dominant pair. However, I do think this was an oversight on my part, so I will keep the eur/usd and usd/jpy on a split screen. Thank you for your advice.
 
If I have not made it clear (and I don't think I have), I am trading paper right now. I will go live when two things happen: I get 9 of 10 or 10 of 10 straight profitable weeks (with such a short time frame on trades I think this is very attainable when I become good), and it is 2009 (brokerage assets will count against my financial aid).

Ok, I have a few minutes again before I study for my exam. These are my records on my overall account for six weeks of trading. The first week was longer intraday plays (and the time when every currency made their first several hundred pip moves after broken trends and s/r). Afterwards, it became predominately sharpshooting. Also note that I traded half of my account on 100:1 margin in week one, and have since been on about 1/8 of my account on 100:1 margin since (I would like to trade about 1/4 to 1/3 of my account when I go live, but I am trying to focus on charts now).

Week 1: +72.045%
Week 2: -6.630%
Week 3: -2.926%
Week 4: -2.199%
Week 5: -3.156%
Week 6: +0.264%
 
These are my trading reflections for the week. Feel free to read them if you wish. Do note, however, that I did not have an entry on Monday, which was a huge day for me (up about 30% on my trading account or something rather insane -- lots of volatility.

Tuesday 9/9/08
I have had far better trading days than today. I entered 14 separate trades in only one hour’s time – not very safe and protective trade management. I lost about 3% of my account during that time, only to end up realizing that I never read my trading rules before the session. A lot to work on here.
Tuesday 9/9/08
This was my second trading session for the day, as I had some extra time for the Asian session. Had some weaknesses, but definitely a better trading session than the morning. Firstly, I came out 1% of account ahead in two hours. Second, although I entered 14 trades again, it was spread out over two hours. Several of these were a bit jumpy, but I did show better control waiting for setups. However, I really need to have better awareness – knowing the overall moves and which time frames are consolidating, being aware of the key support levels, resistance levels, pivots, and not entering trades based on 5 sec charts. Use the 30 sec, 1 min, and 5 min to set up your plays, and the shortest ones to set up the entry point and laser vision of trendlines and reversals. Gained 8% on the 14 trades. Patience is key here; there were really only about four tradable moves during this session, which leaves near about 8 trades I should have been in (these moves include those against the trend, which I should be very cautious with). My profit for the day results directly from my understanding of acceleration on the 5 sec chart, and not as much with skill on the 30 sec, 1 min, and 5 min. Without that learned skill, it was easily a scratch or slightly under day. Work on it, but progress is good.
Wednesday 9/10/08
Today was pretty sloppy. Twenty trades in two hours with a -19% total loss on trading capital, leading to a 3 or 4% or so account loss. Many, many failed breakout trades with losses over 4% on each. Key problems – leaving the five second chart on my screen to look for chart patterns – my default chart should be the thirty second at shortest, with the 1 min being the most likely and 5 min also being an option if I continue to be too jumpy. I am also disappointed in my lack of awareness for the second day in a row. I entered a short before examining the weekly pivot levels, which it was right above at the time. I can’t let that kind of stuff happen anymore. Next trading session – trade off the five minute chart – see what happens. Calm your excitement. Your job can be fun, but don’t lose the level-headedness. On a good note – I took my losses in stride, continuing to trust my trendlines and entry points even when my breakouts failed (repeated checks for broader patterns on these failed breakouts did not turn up much to reverse my mindset, except again for the pivot level, and a few trades when I realized I had the 150 marked on my chart but was playing it as a pivot level). Also averaging well under commission losses of about 2% per trade at 1% -- not something to jump around about, but I am well on my way to b/e. Be more conservative, my number of trades is preventing me from analyzing them accurately for mistakes and possible poor strategy.
 
For all posts, please note that a trade is both in and out.

Now, anyone that has seen a EUR/JPY chart from 6:30-10:30 knows that there is no reason to make about ten trades in an hour. There are usually 4-8 or so 20+ pip moves over those four hours, so catching one in three entries would leave me about 12 trades for four, 24 trades for 8, and these are spread out over four hours. This is my key mistake -- since I have been only trading for maybe 1.5-2.5 hours at a time (pure trading, after about 30 min prep of trading rules, pivot calculations, etc.), I should really not be doing more than about 6 per hour near absolute maximum (no absolutes, but it should be in my mind unless there is good volatility).
 
If I may inject some advice - strongly consider reducing your margin and/or position size. 100:1 margin will only give you frustration - and weekly double digit percentage fluctuations in your account value is not necessarily desirable.
 
From this point on in the thread, I will be primarily posting daily reflections after trading sessions (Mon-Wed or Tues-Wed ideally, unless exam schedule conflict), and also some reflections on outside market work if I stay on top of things. However, I will continue to answer questions whenever they are posted throughout the week, if you have them. Thanks for reading, and I hope I can stay committed to this, haha.

Btw, my goals are to take my $1500 spare cash and never work another day in my life, unless I end up changing my mind and using my finance major (most likely being an analyst or prop trader). This is a flexible goal however, as I may need a summer job to preserve trading capital, and I may need an internship eventually to ensure my backup plan. I am a long ways away, however, as I about 3.5 months to hopefully be consistently profitable, and even then I only have to net about 4% per week, and I know how lucrative currency sharpshooting can be if I have the skills and the management.

Even so, it's not like getting a job would be the end of me next year. Another year of trading, and flexible trading hours (about 1 am - 1:30 pm for eur/usd or eur/jpy, and 6:30 - 10:30 pm for eur/jpy leaves me some flexibility).

Okay I think that's enough background, from now on I will primarily be answering questions and posting reflections.

Good trading.
 
Quote from datamerc:

If I may inject some advice - strongly consider reducing your margin and/or position size. 100:1 margin will only give you frustration - and weekly double digit percentage fluctuations in your account value is not necessarily desirable.
More...

Thank you for your advice. If you see, though, I tend to calculate daily fluctuations by my trading capital only -- so, losing 19% would have really been about 3% down on my account for that -- not good, but I think it's manageable -- I use the bigger number so that I focus on my mistakes a bit more.

I will continue paper trading with 1/7-1/8 of my account right now, and nothing at all is set in stone for my real account (I said I may move to 1/3, but I will have to paper trade at those levels first).

Money doesn't effect me, though. I am extremely hard on myself (not for being wrong on the market, but on making mistakes -- a 4% trade loss on a trade doesn't effect me as long as I took a nice setup and recognized the exit).

However, being hard on myself doesn't always mean success for me. I am wise, but a notoriously slow learner -- and I'm stubborn. This both keeps me unemotional, happy to be wrong (for some reason there is no better than being wrong but being determined and knowing you're going to succeed anyway -- it's what drives me), but also unable to listen to my constant warnings, i.e. entering too many trades.

I will respond to posts as well, not just questions.

Also: I stopped trading options because of the swings of which you are referring. A 1% move on the SPY being a 10% gain on my entire account is just ugly -- I can be a good trader and deplete my account on a few trades that didn't go my way -- too much risk. Too many regulations as well. Then I found forex!
 
Does anyone trade EUR/USD asian session? I've been fairly dedicated to the EUR/JPY, but I'm considering going to the EUR/USD. The EUR/USD certainly has less movement here, but it definitely has movement. For example, the EUR/USDs charts did have 60 pip ranges both today and yesterday (Thurs, Wed) during my trading hours of 6:30-10:30 eastern, while the EUR/JPY was looking at 110 and 95, respectively.

However, of course the commissions of the EUR/USD is a big plus. Percentages still favor the EUR/JPY, with .0060/1.39=.431% for E/U and .683% for the yen. What is the wiser decision in your mind?

I am using TOS right now btw, as I like their charts and platform. They have 2 pip Eur/usd spreads and 3 pip eur/jpy spreads. I do have Oanda and Hotspot on hand, but the spreads are little better. I could still use them though I guess. I know the eur/jpy goes down to about 2.5, and I haven't checked eur/usd in the asian session yet. They are 2 and 3 now at 12:11 am eastern though.

Thanks for your help.

Best Regards,

Greg
 
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