Hi, my name is Mick and this is my - hopefully - 'common sense' trading journal. I will be trading on paper for a while untill I sort out and firm up my strategy and start producing some decent profits in demo mode.
I started it for a few reasons the main one being to keep me honest, it's just too easy to change your mind on what your strategy is half way through a trade
. The other is I was starting to take up band width on capilist88's journal
. Have a look over there as he has some interesting reading at his journal and web site.
A bit of background -
I'm 38 and have been studying stocks for a few years using daily charts, then I stumbled onto cfd's and now forex, there's a couple of reasons for this pattern, the first is I don't have a lot of money so finding a viable trading instrument where fees are less likely to encroach on profits with a small account was a major consideration. The other is that in Australia, it has only been recently that cfd's have come onto the market as well as other derivatives to the general masses. I have seen forex before but was a little bit overwhelmed by the fast day trading/high risk image it portrayed but now I know it's no different to any other market, it's just structured differently with a different behavior - one that I like!
Why do I want to trade?
Obviously there is trading for money, that's probably the driving force behind most traders, myself included, but there is also the challenge.
For instance, I also do a bit of programming. I started with vba and eventually got to assembler because I just had to know how it all worked! It was all just one big puzzle and the markets to me are very similar in that there's always something to study, learn and implement.
I don't program in assembler but I know how it works and it has helped my programming immensely. Learning about the markets is the same thing, while you might not use techniques that bankers do it still helps to know how it ticks.
Although I think I could play demo's forever really, it's great fun, if I start to turn out regular 'high scores' I will then start playing for real.
Why Common Sense?
While I don't have any real trades under my belt I have been around long enough to realise a few things about trading the markets:
- Price action is king, while historical patterns and support/resistance are no guarantee of a move in your favour, the price action before and 'at' these points is very important. After all, how many other people see the same patterns and act on them whether right or wrong?
I also like to see things in higher time frames and drill down to lower time frames to 'see' what has/is happening to give me a better look at which way I'll play it.
- Money management is paramount, not just risk (capital preservation) but money maximisation strategies as well. IOW, cut losses small and maximise profits. I seriously believe this is where to make money and will be my main focus over everything else, the market holds no guarantees as to direction but if I'm prepared with a good money strategy I'll be set for when it moves in my favour (IOW, when the market comes to me).
- Indicators are 'old news' (i.e. lagging) but are handy to perhaps confirm a move or to use simply as another way of looking at price action and 'help' determine entry and exits. I use mainly the stoch for OB/OS levels as a price direction indicator and CCI channels for entries and exits. I have only just started with CCI's but they look promising as a filter for better trades.
Have a look at bobblongs thread for some more info, it's a great thread.
Anyway, I'll write some of my strategy down with some other criteria for my trading decisions shortly, feel free to jump in if you have any questions or advice along the way, both are very welcome.
What I would ask though is that this is my journal, not a system and is subject to change as I see fit so please don't ask me to carve it in stone for you, besides I really believe you need to make your own, there is no use following something you don't completely and whole heartedly understand and believe in. It won't be your system and it won't work, just pick up bits and pieces from here and other threads and piece something together that works for you - and stick to it.
Cheers,
Mick.
I started it for a few reasons the main one being to keep me honest, it's just too easy to change your mind on what your strategy is half way through a trade


A bit of background -
I'm 38 and have been studying stocks for a few years using daily charts, then I stumbled onto cfd's and now forex, there's a couple of reasons for this pattern, the first is I don't have a lot of money so finding a viable trading instrument where fees are less likely to encroach on profits with a small account was a major consideration. The other is that in Australia, it has only been recently that cfd's have come onto the market as well as other derivatives to the general masses. I have seen forex before but was a little bit overwhelmed by the fast day trading/high risk image it portrayed but now I know it's no different to any other market, it's just structured differently with a different behavior - one that I like!
Why do I want to trade?
Obviously there is trading for money, that's probably the driving force behind most traders, myself included, but there is also the challenge.
For instance, I also do a bit of programming. I started with vba and eventually got to assembler because I just had to know how it all worked! It was all just one big puzzle and the markets to me are very similar in that there's always something to study, learn and implement.
I don't program in assembler but I know how it works and it has helped my programming immensely. Learning about the markets is the same thing, while you might not use techniques that bankers do it still helps to know how it ticks.
Although I think I could play demo's forever really, it's great fun, if I start to turn out regular 'high scores' I will then start playing for real.
Why Common Sense?
While I don't have any real trades under my belt I have been around long enough to realise a few things about trading the markets:
- Price action is king, while historical patterns and support/resistance are no guarantee of a move in your favour, the price action before and 'at' these points is very important. After all, how many other people see the same patterns and act on them whether right or wrong?
I also like to see things in higher time frames and drill down to lower time frames to 'see' what has/is happening to give me a better look at which way I'll play it.
- Money management is paramount, not just risk (capital preservation) but money maximisation strategies as well. IOW, cut losses small and maximise profits. I seriously believe this is where to make money and will be my main focus over everything else, the market holds no guarantees as to direction but if I'm prepared with a good money strategy I'll be set for when it moves in my favour (IOW, when the market comes to me).
- Indicators are 'old news' (i.e. lagging) but are handy to perhaps confirm a move or to use simply as another way of looking at price action and 'help' determine entry and exits. I use mainly the stoch for OB/OS levels as a price direction indicator and CCI channels for entries and exits. I have only just started with CCI's but they look promising as a filter for better trades.
Have a look at bobblongs thread for some more info, it's a great thread.
Anyway, I'll write some of my strategy down with some other criteria for my trading decisions shortly, feel free to jump in if you have any questions or advice along the way, both are very welcome.
What I would ask though is that this is my journal, not a system and is subject to change as I see fit so please don't ask me to carve it in stone for you, besides I really believe you need to make your own, there is no use following something you don't completely and whole heartedly understand and believe in. It won't be your system and it won't work, just pick up bits and pieces from here and other threads and piece something together that works for you - and stick to it.
Cheers,
Mick.