London Session
Trade 1: LONG GBPUSD
I saw and took a textbook FK, but noticed that news was coming out in 15 mins, so I bailed, but not before picking up +8.2 pips. :) Trade Summary +8.2 pips
NEWS RULE: Do not trade 15 mins before or after news.
...Then it happened
Trade 2. I saw what appeared to be Bullish divergence, so I took a long trade. The RR was great, and I felt like a boss, looking to buy at the bottom. I was already thinking Nobel Prize... lost 20 pips. Then watched as the CAD proceeded to drop like a lead balloon.Then I looked at the CAD again, and saw I missed 3 opportunities to go short.
All of a sudden, feelings of revenge trading set in! I have NOT had a loss in 2 days!. I cannot take a loss! I need to get my money back!!! Sound familiar? Once I realized that I have become emotional, I decided to walk away and return when my head was clearer, and when I was not thinking and acting like a newbie. On of the greatest elements of The MESA Trading Method, is the risk control. My risk is so small, while the potential is HUGE.
Challenge: So, on the 5 minute time frame, should I try to watch 2 pairs, or just one? I would like to hear YOUR thoughts on this.
I will be back at 7:00am CST for round 2. TO BE CONTINUED...
UPDATE
I am replacing the CAD with the USDJPY, because the CAD has exceeded it's ADR.Changing Horses, Bad Company and a Psyched Psychic.
Today was the WORST trading day of the month. Why? Not because the market movements were huge and limited my trading time as well as opportunities. Nor was it because I took three ( 3) losses that resulted in a portfolio loss of just shy of -6% .It was because I changed horses, entertained bad company, and a psyched psychic. . Let me explain.Changing Horses
In The FAPWINNER Live Trading Room, I trade *exclusively* The MESA Trading Method. The method prepares you for ANY Possible Trading Situation, if you follow the rules. Up until today, we had not had a losing day this month. Imagine my joy at having no losses for two days. How was that possible? Because, up until today, I followed the rules for trading 1 of 3 "Initial Entry Patterns". If the pattern did not show up, there was no trade. Simple. Today? I decided to get cute, and trade one of the most risky patterns that The MESA Trading Method teaches. 3 times. Each time, it was a loss.Up until today, I followed the trend. I was not trying to get in and the top or bottom.
-I was not looking to counter trend trade.
-I was not trying to make a killing. ( Today I was...)
-I was not changing horses, in the middle of the stream.
-I was trading one pattern, and waiting for that ONE PATTERN. Even if I had to sit 8 hours, I was waiting for that ONE PATTERN. As long as I waited for that ONE PATTERN, I made money.
I would not have lost money, if I had not decided to get cute, I would not be sitting here consoling by battered account and bruised ego. It was not broke, so why was I trying to fix it?
What is the moral of the story? Stick to what has been working.
Bad Company
At the start of today's trading, I noted there were three (3) pairs, that all had over 100 pips ADR.Normally, I select two pairs, and later discard the other once a trade has opened. I have repeatedly said that trying to trade more than 1 pair on a 5 minute time frame is too mentally challenging and taxing, but did I listen to myself? Nope. Why would I try and trade 3 pairs? Well, here is what happened... Both the GBPUSD and USDCAD reached their ADR, and a rule I have is, once the pair has exceed its' ADR, stop trading that pair. So far, so good. The GBPUSD later in the trading session reached it's peak, so I started watching the USDCAD. Then, when it hit it's ADR, I started following the USDJPY. Here is where trouble comes. I begin jumping back and forth between 2 pairs, not paying the proper attention to what I normally trade, and end up missing 3 profitable trades, trading the ONE SETUP that I always trade, and has made money! It gets better....
A Psyched Psychic
By this time, the GBP has blasted to the moon, and both the CAD and JPY have dropped like a ton of bricks, so now my Psychic powers kick in. I have this premonition that the market is about to reverse. I see divergence. So, I put my swami hat on, channel the great trading god, and begin to go forth and act on my profound insight and superior tape reading and experiential experience (read forcing trades, hoping these work out, cause I am losing money, and I am also very emotional right now- almost on push buttoning auto pilot). I go long the JPY! Loss. Surely this time, the market will bend to my will! I GO LONG! Another loss. By this time, I am down an onion skin above my absolute loss limit of the day--5.44%.I don't need to say anymore. You get the idea.
This was also the best trading day of the month. I was reminded that the market is still king, and I am a mere serf that every now and again may be given crumbs from the table of mighty king FOREX.
I will get back into my place, assume my role and never ever again do what I did today... Scout's honor.
MY RULES.
1. Only follow the top 2 pairs with 100 pips ADR.
2. Only trade one MESA TRADING METHOD pattern. Do not get cute, clever or inventive.
3. When I feel the urge to become cute, clever or inventive, re-read rules 1&2.
I will post final stats at the end of the week.
Here is the carnage from today. -123 pips or -5.48% loss.
See you all tomorrow.
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