EUR/JPY Evening Trader

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If you consistently have moves around +/- 10pips - then identify if your trading goals are these kind of fast profits - which it seems is not the case, or if you are operating with too much leverage - so that your stops are way too tight or you get too squeamish about the trade going negative.

I usually operate with roughly 1/3 - 1/5 of the potential profit as a stop. But then I immediately start trailing the stop when it moves into the right direction, because I want to catch that particular movement. There can be minor fluctuations, and I need to take that into consideration as well.

I trail with 20-30 pips when going for over 100pips moves, but sometimes I know there will be stalling around some special levels, where a retracement will happen back after the move resides and I need to tighten the stop past such levels - or there can be some resistance/support levels and for scalps I stop there if significant delays are apparent.

Of course this means that I adapt actively to every trade, and do not set levels with great rigour. Sometimes I miss out on "the full potential" of the trade, but it keeps me pretty safe more than half of the times. I also don't let the trades go negative when I first have the movement that I want. Then I rather take a small profit and see if the opportunity is still there, and if I can get a better entry - simply re-evaluate.

If you have many smallish losses compared to your targets, then you need to reconsider your entry strategy/signalling or your leverage, since you seemingly bail out so close to your entry --- as well as consider how long your trades should take. By the number of trades you do per session - it seems like you are scalping. 8 trades in around 2 hours is much more than I normally do, unless I am on a roll and keep getting it right.

When your first trades were negative, then you need to figure out if you are able to read the markets properly - or if it was your entry that was bad. In other words, take some time in between trades to analyse - in stead of doing your analysis before you start trading. Then you are much closer to the market situation and it is easier to predict. But by the looks of it - you are scalping and overtrading - evident by your last and biggest loss where you "gutted it out" or wanted to win by all means to make up for your losses, but thereby incurring more than half of your daily loss on pure stubbornness.

If you do your analysis hours ahead of your trading, but then do all your trades with just minutes or seconds in between - then your analysis does not at all match your trading style or vice versa - and your analysis efforts are completely wasted. You need to understand the mathematical and philosophical nature of prediction...
 
Gringinho,

Currently my goals are relatively fast profits. This is due to several reasons, including: limited trading times combined with the desire for consistency (over four trades in a session should begin to average out), and also not to give back profits. I don't mind holding positions, and I do sometimes, but I am trying to maximize profits and limit risks, so I am trying to have timely entries and exits.

My stops are very adaptive. They are usually based on PA, so I will have a hard stop below important levels such as bottoms (for long), and will otherwise just look for a signal that the trend is ending to get out. In the result of a very large move with signals I don't identify (and no real place with a hard stop), my stop is the middle of the 38.2% - 50% retracement levels of the entire move I caught (a safe stop that is pretty much my last use for fibs).

If I trail, it will usually be just moving up the stop to under the consolidation in the event of the trend continuing in my favor, or the fib stop moving up with it.

Not letting trades go negative -- this is perhaps one of the main reasons why I have a lot of trades ending near b/e. Many of them that have small profits came from larger profits (such as maybe 15 pips), that eroded away. I need to work on either my exits here, or I guess get better at finding larger moves so I have the confidence to hold.

My main strategy is catching the trend as the momentum is developing and then to ride it through until it stops. When the momentum fails or disappears, this is why I have a lot of small losses.

You are correct in that I needed more time to analyze the market. Once I made my original analysis, at least in the last session, I was stuck with it too much. Between trades I glance back at all my charts, but I never saw the explosion coming. I really should have seen the developing base for a breakout rather than trend weakness. After the initial break, I stayed with my original analysis and was looking for catching the knife.

My last and biggest loss was a combination of "gutting it out" like you said, but it was far worse than that. I was sticking with my original incorrect analysis of market direction and trying for the knife, simultaneously reaching for a profit for the day, an incorrect trendline and the mental mistakes I mentioned above (such as not paying attention to the scale once I stopped looking at the one minute, and the fact that I stopped looking at the 1 min). The stop was rather fair for the move, as it was above the last high and catching the knife of a 300+ pip move (and 900 pip rally) had large potential profits. However, it was not exactly my style of trading and it was another mental mistake to even think that way (the reversal did materialize with the next leg up, but I should have realized that it also would have taken more time to materialize).

I will begin trading more to get a better feel for these things, and to work on my mistakes. I appreciate the criticism :)
 
This is my money management plan. I saved it in .doc instead of .docx so I think it should work. Most of my rules don't apply as I am not changing lot sizing right now (only doing my single lot) nor am I withdrawing paper money, working with trading and living expenses, etc.

My focus is just trying to turn consistent profits, therefore; the losses/drawdown policies are the only ones that are currently applicable.

The other policies (with the exceptions of the career parts) will go into effect over Christmas break when I will have a few weeks to trade full time on both Asian and London session (will ease into London, but lower spreads and better movement sounds like a win-win). I may also be able to trade London next semester, as I requested courses that would give me Tuesdays and Thursdays off...

Feel free to comment.
 

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Today I worked on some more maintenance things that will count for next week's hours.

I worked on editing all my documents including my trading rules, market observations, long term list of things to do, goals, and several changes in the money management document I just posted (four straight losing days is now two watching days and two paper trading days with net profit before going live, rather than whatever I had before).

Monday will be my watching/studying session.

Good trading.
 
Today was a pretty good watching session. I saw some holes in my analysis which misled me at certain points, but also had a really good feel at certain times. I remember there was one point I was really confused seeing a bullish 1 min and a bullish reversal-looking hourly, but went through a very careful analysis after one of the swings down and realized what I should have been seeing – a bearish 3 hour, 30 min, 15 min, and also an overall bearish 5 min if I was looking for the right things. I also spent a good amount of time dealing with customer service at TOS and Oanda, as I am having small problems with TOS and a really annoying one with my Oanda charts. I will be back to trade tomorrow, I think.

My analysis above needs more time to play out, but I am now seeing a neutral hourly but still bearish on all the other charts. I will see how it plays out later.

Should election day affect asian session at all?

Good trading.
 
Mid-day Analysis

Wanted to reflect quickly on what resulted out of my analysis. It very much seems that my bearish re-analysis was wrong, but I think it was actually very good. Immediately following my watching time frame the market finished a developing swing down and then had another and making a new low before emerging with strength. Based on strong PA today, it was clearly in the process of a 1 hour reversal (which I said was neutral), but the signals last night were not yet showing on the three hour, and the 30 min to 5 min were in the process of the last leg down. If I were trading I may have missed the first part of the leg up, after the shorter term bottom, but overall I believe I did very well.

During Trading

Wanted to note that I saw the short originating around 7 Eastern, but didn’t take it as I was not finished reading my market rules or with market analysis. I also didn’t hop on in the middle, and was waiting for a pullback for a short to one of the major pivots.

I am in a trade, but I wanted to take a second to describe a recurring theme that has really been annoying me. I am not trying to scalp, but I enter a solid trade, let’s call it a short, and it begins to move my way. Then, there is a stupid little 15 pip spike that goes against me and puts me in a loss, and it will happen in maybe a minute or two. Then, a bit irritated, I exit with my loss, and then the trade just dips back much farther in the green than it was before, consolidates, then starts the process again. It is so responsible for a very large percentage of my losses, and yet the market volatility just ends up drifting in my direction (market down 40 pips since my first short at 7:44 Eastern, I have had seven shorts and no longs since, and yet I have a 21 pip loss – sound fun? I assure you it is). It is 8:44.

So why do I have small losses? That’s usually why. Small gains? Just means I’m right over a 20 pip move, have a nice profit, and then it evaporates away from me. That is a very simplified version of my problems, as my tight exits have saved my skin in times like last week when my market analysis was incorrect, but that is why I can’t make a consistent profit even when I’m correct in choppy markets.

Post Trading

Strengths: Letting missed moves run away, waiting for clear entries like double tops and clear PA organization at times rather than chasing moves. Showing a lot of progress with market analysis. Towards the end of the session, albeit there was a lot more volatility (fitting my overtrading style naturally), I was much more aware of the market, sat through several shakeouts, and had a great feel for PA.

Weaknesses: Showed a lot of continued immaturity early. Didn’t sit through any shakeouts, was clearly overtrading, and several others but it has been several hours since then so I can’t remember them all.
Results: Total +34.1 pips on 12 trades in about 3.25 hours of trading (after began looking for first move). However, I think it is important to note that I was 30.5 pips down at one point when the market was chopping me up (only 9.5 away from my drawdown limit for the day). My first half of the session was terrible, but I also made 64 or so pips in the last half.

Trades by profitability (in pips) and time held:

-12.7 (3 min), +10.8 (4 min), -12.6 (8 min), +10.9 (3 min), -9 (3 min), -8.5 (3 min), -0.9 (33 min), -8.2 (10 min), +17.5 (10 min), +28.3 (10 min), +17.5 (21 min), +1 (6 min)

These trades would have been around 24 pips (I believe it remained 2 pip spread the whole time, so I had 34.1 net pips and 58.1 gross pips). I strongly need to work on several aspects of my trading, but another positive step. What this session did tell me, however, was that I still have a long way to go before I am ready to trade, and may not be by January – although I was profitable and had a pretty good feel for the market, my mistakes early were extremely beginner-like and reflecting of my earliest mistakes, which shows my progress is still lagging in market maturity. I have posted my trades for the session in jpgs. Good trading.
 

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I'm not going to comment on your process growing up as a trader, although I see you've been receiving some good feedback from people who know what they're talking about.

I'm also trading the EURJPY, it's my absolute favourite pair, and I thought I could share with you some thoughts on it.

First of all, I'm somewhat of a discretionary trader - not looking at indicators, but mainly breakouts and move beyond support and resistance. And also reversals.

What I tend to do is follow the Euro and the Yen, and watch how they develop. When they're both looking to move in the same direction, I enter with buystops or sellstops. I pyramid the positions every 1-2 pips, so I use many orders to enter.

I prefer trading with an ECN, which in my opinion is the only way to go - the order book can at times offer valuable information, and gives you more precision as to hitting/lifting a bank that's slightly out of line.

One thing I couldn't care less about is the fundamentals. I do follow news however, and use a squawk service for that. Sometimes things happen, and you need to know what's going on.

I don't use stops, but get out as soon as I'm not comfortable and believe my reason for entry was wrong. Sometimes I scalp for 10 pips, and sometimes I'm pushing a position hard for 50.

I've been trading for a long time, and watch (and trade) commodities, bonds, index futures etc as some markets can be easier to predict and then other markets follow their movement.

I think this currency pair is fantastic, and has a lot of action and potential profits.
 
Quote from 4XQs:

I'm not going to comment on your process growing up as a trader, although I see you've been receiving some good feedback from people who know what they're talking about.

I'm also trading the EURJPY, it's my absolute favourite pair, and I thought I could share with you some thoughts on it.

First of all, I'm somewhat of a discretionary trader - not looking at indicators, but mainly breakouts and move beyond support and resistance. And also reversals.

What I tend to do is follow the Euro and the Yen, and watch how they develop. When they're both looking to move in the same direction, I enter with buystops or sellstops. I pyramid the positions every 1-2 pips, so I use many orders to enter.

I prefer trading with an ECN, which in my opinion is the only way to go - the order book can at times offer valuable information, and gives you more precision as to hitting/lifting a bank that's slightly out of line.

One thing I couldn't care less about is the fundamentals. I do follow news however, and use a squawk service for that. Sometimes things happen, and you need to know what's going on.

I don't use stops, but get out as soon as I'm not comfortable and believe my reason for entry was wrong. Sometimes I scalp for 10 pips, and sometimes I'm pushing a position hard for 50.

I've been trading for a long time, and watch (and trade) commodities, bonds, index futures etc as some markets can be easier to predict and then other markets follow their movement.

I think this currency pair is fantastic, and has a lot of action and potential profits.
More...

Very interesting. I am similar in trading -- I only trade PA and TL based along with pivots and a sparing use of fibs. I do not keep track of fundamentals, nor news, although I would like to eventually (just haven't had the time to keep up with calendars and track news announcements, and it is often easy to interpret them by the behavior of PA and spreads).

As a result, I have been usually sitting out when there is news, and I am fine with that for right now, but I will start up with it eventually.

Unfortunately, I haven't been trading the yen for several weeks or maybe two or so months now. Spreads started getting very bad (even though slightly better asian session movement) in comparison, and as the EUR/USD is most liquid market in the world I figure it should be my predominant pair for now.

Sorry for the confusion, and good trading.

- Greg
 
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