Josh's Journal (JoshDance)

Update:

As of now my methodology is currently trading 15m charts, basic support/resistance and chart patterns, as well as Woodies CCI trades. I've found that this indicator setup has worked very well for me. As for 15m charts, they work just as well for me and price moves just as nicely as it does for daily charts, except that I get a lot more setups. Here is the first trade where I'm using my current methodology:

http://www.forexfactory.com/showthread.php?p=1608855

Original post #1 follows:

This will be my trading journal. It is currently for a demo account on InterbankFX. I have been toying around with trading and learning a LOT of information since March 2007. Almost too much to soak in... I am a full-time dancer, and I have still managed to sink in probably 8-10 hours a day on learning forex and markets. However, as dancing is my passion and forex is my vehicle to fulfill that, I will be trading mostly daily charts, although at times you may catch me up at 3AM (like right now) :-)

I have tried systems, systems, systems--all different kinds, every TF imaginable, every indicator you could imagine, I've traded the news, gotten heavily into fundamentals, etc., etc. But:

Major breakthrough #1 was when I discovered the James16 price action group, which focuses on price action, trendlines, channels, pivot zones, and the occasional fib retracement/expansion. It's simple, requires some know-how, but overall is flexible, works on any chart, any market, any timeframe. That's why I like it.

Major breakthrough #2 was when I purchased Mark Douglas' "Trading In The Zone" and read it all in one day. It helped me realize the key to successful trading, and that I already had it, I just had to harness it. Hopefully I will look back to this as the moment that put me in control of my trading and that enabled wealth to flow into my trading business.

Starting balance: $3000
Broker: Interbank FX, mini account
Platform: MT4, also in wireless PDA (AT&T 8525)
Trading TF: Daily, sometimes 4H, once in a blue moon Weekly
MM: Risk no more than 2% on each trade. Figure out S/L, than set position size such that max risk is 2% of total account.

My system at the outset of this journal will be as follows:

Entry: Pinbars, inside bars, and support/resistance to determine when to buy/sell. I will primarily trade with the trend, though if a really good price action setup comes along, I will counter-trade.

SL: SL will be placed above/below the pin for a pinbar, or at appropriate S/R levels.

TP/Exit: I will set an initial TP level that is fairly large, just in case a huge move occurs, but I prefer to manually move my stop so that I give price room to breathe and hopefully catch large moves. In general, I don't want to close a trade, but let my stops do it for me, or TP if that happens to be the case. I will be using ideas from mbqb11's "exit strategy" thread where he uses a two-bar count.

I will be updating my net pips, account balance, and all that good stuff every month, so check around the 1st of the month for a cumulative update.

All are welcome to post here, as long as it is constructive, and not off-topic!

USDJPY

Buy Stop @ 122.37, SL 122.05, TP 123.34, Position 0.17 lots

Rationale: Daily I4B, break above upper TL.

Trade Result: -32 pips

GBPUSD

Sell Stop @ 2.0459, SL 2.0544, TP 2.0377

Rationale: Daily IB

Trade result: Cancelled, due to price break the other way

Why not also have placed an order on the high side of the inside bar ?? Would have gotten some pips that way no ??? Two orders... cancel the one that doesn't hit...

Because there was a huge all-time high price level there that I wasn't really comfortable trading into. Maybe it would break it, but I was not feeling good about it.

GBPCHF

Sell Stop @ 2.4635 | SL 2.4770 | TP 2.4340

Rationale: Daily PB

This trade is against a recent weekly PB in the opposite direction, and last week's bar was a BUB, but it hit upper R, and to me it's a good setup for a move back down to the lower S level.

hi Josh, hope u don't mind. an after fact observation.

to me usdjpy is making lower high and lower low. it's more like down trend. for down trend sell has more potential.

Cheers

EURAUD

Sell Stop @ 1.5705 | SL 1.5750 | TP 1.5520

Rationale:

4HR pinbar

Progress:
7/23 3:00PM - Moved stop to 1.5660, locked in 44 pips profit

EURJPY

Sell @ 168.06 | SL 168.25

Rationale:

Thanks to Mike and all the others at the james16 thread for bringing this to my attention. All the JPY pairs gapped up over the weekend, and price is looking to fill the gap. Managing trades on low TF charts. This was a quick trade based on the "gut" feeling and good advice from experienced traders, so it is not part of my plan. I'm trying to get in the "flow" of the market and let it bring the pips to me. Ditto for the next trade.

Progress:

6:35 - moved SL down to 168.15
7:02 - moves SL down to 168.05 ... free trade now
7:13 - closed trade at 167.96 - did not like BUB

Result:

+10 pips

GBPJPY

Sell @ 249.66 | SL 249.95

Rationale:

Same as for Trade 005 above.

Progress:

6:35 - moved SL down to 249.75
7:03 - moved SL down to 249.65 ... free trade now
7:13 - closed trade at 249.59, did not like BUB on 5min

Result:

+6 pips

USDCHF

Sell @ 1.2058 | SL 1.2082 | TP 1.2010

Rationale:

This is a 1HR chart trade. Price has reached upper R and turned down, and a BEB has just formed. For this type of trade price action alone is not enough to convince me, so I put a 13,5,5 stochastic on the chart and the 15M, 30M, and 1H are all headed down, with a 1H cross in oversold territory and on the way down. Normally I may not take this trade, but the SL is only 24 pips, for a potential of 48, so it's a nice 2:1 RR ratio. This trade feels right, and I'm determined per my reading of Mark Douglas to trust my gut, embrace the risk, place the trade, and most importantly, to NOT WORRY ABOUT IT, as I have no control over the market at this point. I'm placing a TP because it's at a S level, and because I will not have the time or desire to monitor 1H charts today.

USDJPY

Sell @ 120.48 | SL 120.90 | TP 118.29

Rationale: 4HR BEB break below MAJOR S/R. I should have gotten in about 18 pips higher, but missed it. At any rate, unless this is stop hunting or just a fakeout, this thing should continue to drop.

GBPJPY

Sell @ 247.17

Rationale:

On the 5min charts, this was consolidating into a triangle pattern, and and inside bar on the 1HR charts. Price took off down and went about 60 pips in the course of what seemed like 10 minutes or so, so I took my profit.

Result: +56 pips

EURGBP

Buy stop @ 0.6720 | SL 0.6683

Rationale:

Daily pinbar at S level. Heavy confluence, as this is a monthly SR level as well as a daily/weekly.

GBPJPY

Sell @ 246.69 | SL 246.95

Rationale:

This was after taking profit from trade 009, and a retracement occurred. Thinking that a continued move downward would happen, I sold at this level, but price went against me. Probably a case of greed taking over, but I felt good about the decision, though it was against the trend, thinking that such a sharp downward movement would continue. Unfortunately this one didn't go in my favor. Oh well, next.

Result: -26 pips

AUDUSD

Buy stop @ 0.8840 | SL 0.8788

Rationale:

Huge BUOB on 1HR.

Progress:
- moved SL to 0.8830, currently up 28 pips

GBPUSD

Buy stop @ 2.0630 | SL 2.0550

Rationale:

Trend seems to keep going up. Daily pinbar going up, and a 2x4-hr proxy pinbar.

USDCAD

Sell Stop @ 1.0518 | SL 1.0580

Rationale:

4HR short pinbar at upper TL. Despite the recent moves up, the price has been in an up-and-down pattern still, with a bias towards downward movement still now. Price has already tested a few pips below the bottom of the pinbar, so if it moves down again it will be a confirmation that price desires to go further south.

Nice thread you have here Josh, I entered that USDCAD trade as well but closed and reversed after losing a little (if you call 30 pips a little ). Madness going on with the charts, I would stay out of the non-majors until the current storm is over because the behavior is much easier on the eyes - check out USDCHF and how pretty it was.

I do not count pips. (anymore) Why? Simply put, I can't buy a thing with a pip, but I can with money. It's all about money management and position sizing. If I win 8 and lose 4, all being the same amount of pips won or lost, but my position sizing on the 4 losers is double that of the 8 winners, then I've broken even. Not a good thing.

You know what? I'm going to be crazy and not even count trade wins and losses! I will attach a detailed statement if anyone cares, complete with consecutive wins/losses, drawdown, and all that good stuff. But again, I can't even buy a candy bar with a "winning trade," only with the money that I get from that trade. So if I have 1 winner and 100 losers, but I make money, isn't that better than winning 100, losing 1, and losing money? The answer is yes, and you can't convince me otherwise. :-)

Also, I'll be focusing on percentage of equity increased/decreased, rather than strict dollar amounts. Why? Take someone who says he increased his account by $100 this past week, and he's grinning from ear to ear. What's so impressive about that? Well, If he has a $100,000 account, you may not be so impressed. But what if he started the week with $100? Well, then you'd be impressed :-) (and also realize that he probably got lucky, and used a bad money management strategy, but that's beside the point...) A 2% gain in a week on $3000 is only $60, but if your balance is $500,000, then that 2% would probably pay your mortgage for a couple of months at least.

Finally, while I said the bottom line is the closed equity, any good trading system should be one that doesn't turn out gray hair after gray hair in the trader's head. In other words, drawdown is not good, and it's more soothing to build the account consistently than it is to do it all at one time, lose it all, win it all back, and so on (though, in the end, a positive account balance is the most important). Hence I will also post my equity curve. My hope is that it will be relatively smooth after a few weeks (during the first few weeks, the small sample size will mean that it will not be so smooth).