Hansbrocks' Journal

Hello everyone!

Trading plan


Objective

My primary objective in FOREX trading is to do a consistent amount of money. I want to be able to enjoy life, have more freedom and to help other while not having to worry about money issues. Also, I want to have a backup plan in case my professional life took a stab (either from me or from the job itself).

My objective is to achieve 50 % yearly return. That is approximately a weekly 1 % growth. I do not know how possible or realistic that is right now. But that is a nice figure to start with and I will do everything in my power to achieve and go beyond it.

Trading style

I am currently searching my real trading style. Although, right now I am trading intraday, trying to catch daily move. I am using both discretionary method, with Fibonaccis, trendlines and support and resistance levels. I also just began developing a more mechanic one, but most aspect of it are still in construction.

My primary strength is my capacity to be a never-ending learner and find new distinction that can lead me to the ultimate success.
My primary weakness is my attitude of fear toward money and getting little too much emotionally involved in my trading. This fear is causing me to diverge slightly sometimes from my goals and plans.

I made a plan to involved myself for at least 4 hours a day in FOREX studying and I am going to keep that for at least 4 months. I will not trade if :
-I am emotionally tilting.
-there is majors news coming .
-I cannot feel the market in my guts.
-I just don’t feel like it [When that happens, find out what is wrong and correct it]


I am trading the GBPUSD at this time, but I am not tied to that pair and I keep searching for the best market for me. I will trade from 2:30 am to 6:30 am, then to a report of the day at 19:00 pm. I am also developing a more mechanical one (Ozboll)[See below]. Also, I am learning the fundamental , but I cannot at this time use it effectively.

Each day, I will enter my trades and shows chart of what I was thinking at that time, and why I entered a particular trade. I will also input everything I think it is worth seeing. I will write if I followed my plan or not.

After a win, I will write exactly what I did and try to see if I can recognize patterns in my winning trades.
After a lose, I will write exactly what I did and try to see if I followed my plan (find new distinctions that can improve my plan) and try to see if I can recognize any pattern in my losing trade.

Each week, I will review my 5 days of trading and highlight sentences I wrote that I think are important and that I must get back on and analyze what is the best action to take.

Each month, I will review the highlighted sentences and unanswered questions and resolved then. If I cannot solve then by then, I will do it the next month.

Money Management


At this time, I don’t have a clear money management, but I am trading never more than 0.3 % of my capital. I am trading that amount or lower, depending on how sure I am of my trade.

My risk-reward ratio is usually : risk 1, gain 2.

I am still deciding if I should use trailing stop-loss or just let my stop or my take profit get hit. {To complete, see pages 21}

Trading goal


My first goal is to learn to be consistently profitable. I am putting a small amount of my capital (20 % of it) in learning Forex. After some times, when I will be experience and have a better understand of the market, I will be able to put a bigger amount of my capital and trade the same way I do. When I achieve my goal, I will have another goals even bigger that myself.



Welcome to my Journal. I am currently developping 2 journals.

1- One is my personnal trades on the GBPUSD.

I trade with charts :
1-2-3 : big fibs, small fibs, tiny fibs,
4-5 : Trendlines, prices action on GMT period
6-7 : Experimental Triangle and fork chart
8 : Sane chart ( the sanest chart).

You will be able to see them throughout most of my entries.

2- My second journal is my Ozboll system.

Daily Chart setup :

SMA(200)
Bollinger’s Bands 20 period, 0 shift, 2 deviation(BB)
Accelerator Oscillator(AC) + Stochastic Oscillator (5,3,3)(STOCH)
Bollinger’s Bands bandwidth(BW) + Commodity Channel Index (CCI)

The SMA(200) is just to see the general direction of the trend.

A – The bands is tight
1- Price is touching the lower or upper bands. This is the main thing we are looking for, because price won’t usually like being on a edge or crossing one.
2- We are looking to find nice smooth symmetrical half hills (2-3 day) on the both the AC and the STOCH. Full hills are usually 2 week long.
3-(¿ To confirm) Only trade on the opposite direction of the band you are near. STOCH and AC must follow the direction.
4-Exit when you reach the middle band or AC-STOCH goes against you

B –
1- The band is large and price is touching it.
2- STOCH and AC are following each other AND beginning or on the first day of a new hill formation.
3- Trade with the direction of the trend and bands you are near.
4- Exit when :
a - the bandwidth lowers
b- The STOCH and AC hill
c- Price don’t touch the band anymore

The CCI is just to confirm the general direction, and that there is not any divergence in the price.

Live with passion !

This post is reserved yet again! (Last one )

Entry #1 - January 13, 2008


I have just opened an account with OANDA. I am pretty stressed out about the whole thing, but hopefully thing will go nicely. OANDA is the most vouched broker I have yet seen. I have opened an account in CAD, since I am from Canada. I have sent my ID confirmation stuff (Driver License, Credit Card bill). Hopefully this also goes good!

Live with passion !

Entry #2 - January 17, 2008



Finally the GBPUSD came back to his old patterns. I was able to get a nice trade this morning. I was waiting for the Asian session’s high or low to break. I set an order to :
buy at 1.9657, SL 1.9625, TP 1.9694. I was a little scared of 1.9652 Low fib level, but it did not seem to care really much. Open then hit target pretty fast !


This entry was also made using my tiny fib chart. In the following chart we can see the 50 and 61.1 level of the 300 fibs. There is also a trend line there. It followed pretty nicely.

+37 Pips

Live with Passion !

Entry #3 - January 21, 2008


Today prices cut through a low on the cable. I put a short order just after 1.9480. We can also see on this chart that the price break through that level pretty fast ( 20 pips in a minute, no news) and went straight to pivot point support level 1. How surprising !

{See Image below}




The red line represent big support level.

I think the cable is due to go down a little more before retracing back up. Although, that is not CERTAIN and I will be very careful for this week and next week, because cable has just been raging a lot last week ( Indecision).
===========
Maybe my stop-loss was a little to tight. The price retraced up to 1,9480 and hit my stop just above. Although, I still think we are to see a general down direction. Also, I might have been a false break-out. I should take profit when it stop going down at the 1.9460 level ( the support 1 pivot). Lessons learned J, might as well be happy with fewer, but CERTAIN pips.
===========

Yes ! I send my funds to OANDA and they received it within 2 business day ! That is really fast ! Now the real game begins. I will begin with small lots, because I know I will be emotionally affected by my results (both positive and negative). I must keep a cold head and think straight in every situation. I must not let myself "tilt". I must not listen blindly to other, but analyse what they are saying and incorporation it in my strategy. My way to become rich is one step closer !

Entry #4 – January 22, 2008

Well today I did my first real trade. It did not end up really good though ! My idea was to enter when a new low would be made, so I sent a sell order at 1.9343, Sl 1.9373 TP 1.9273. I thought it was going to break through a new low, but I failed to realize that the market has been going down for 100 pips for the last 8 hours. I also thought that my trend line in the char was going to get break, although it ended up being a false break-out.

I think I should have not waited before the London opening candle, as Frankfurt had made a slightly big move down over the last 30 minutes before London opens.


I also just realized that there were severals big news that I did not know of, did not help. But it’s my fault, I should have watch more carefully for the news and read about economics news. But it’s gonna be ok, tomorrow is just another day !

Entry #5 - January , 2008


Today not much action, price whipsaw in a 30 area for 2 hours. There was not much to do. I did an error and entered on tilt. I think what caused this whipsaw is that there was 2 major news release (which came out with not much impact). On these news, OANDA spread is 20 pips. Maybe the whipsaw indicate a consolidation for a future break-out ?

Entry #6 – January 24 , 2008

Well, I don’t know what is up with the market, but I cannot seem to get a grasp of what is happening. Price don’t want to follow a single direction, it just doing lower highs and higher lows ! Again this day wasn’t really good for me ! Let’s hope tomorrow things will go a little better.

{See image 1}
Also, this morning I tried to play the EURUSD, although that wasn’t a good idea and I lost a few pips.
===============================================
I manage to do a little scalp on the 5 minute TF. I saw a double top. When the price broke the previous low ( between the double tops), I sold. My target was the next 50 fibs, as well as the daily pivot level. {See image 2}


I realize today that playing with real money is much harder than a demo account. Although, I think I am seeing the same pattern as when I began to play with a demo account : I try to enter many trades, on panic, just to try to catch a few pips, with very tight stop loss, then get scared and get out too soon. I think this is what is happening right now. I need to keep following my strategy : catching London open moves for ~70 pips, and put a bigger stop loss and let my trade run, not look at the right fearing every little move happening.

===============

My thought from earlier yesterday, “Maybe the whipsaw indicate a consolidation for a future break-out ?”, well the break-out actually came, but I was working and could not take him. The break-out even completely made the USD positive news look like crap. Well another lesson learned I guess !
{see image 3}

Live with passion!

Entry #7 - January 25, 2008


Today I followed exactly my game plan and got rewarded. I decided to enter when my discretionary system told me, not go into the 5 minutes timeframe and get scared of any little move, not listening blindly what I read on the forums.

First, I wake up too late and couldn’t take that move at 2:00 am EST (the various Asian high getting break for 47 pips).{See image #1}

After that, most of my minor Fibonaccis were broken, so I waited for price to go up until it reached another resistance. My resistance were trendlines from a while back {See image 2 for close-up, image 3 for zoomed-out} I managed to do a nice little 30 pips right there when it hitted the trendlines. My target was the fibonaccis high from January 17.

{See image #2 and zoomed out on #3}

Live with passion !

Entry #8 – 28 January , 2008

Today I entered a trade based on my trendline system and price action chart. I made a buy order at 1.9826, a little over my trendline. Also, since 3 am, price were moving up for 3 hours, thus indicating (usually) the direction of the trend. My exist area was at 1.9863 {see Image #1 , look for magenta rectangle for entry and exit).


My prediction for tomorrow : I think price will go up, if they are breaking powerful trendlines. {see Image #2}

Entry #9 – 29 January, 2008

4am - Today I really thought that price would skyrocket high. I had several reasons to think so :
1-Price are breaking 1.9878, which is a support level.
2-Price are breaking the trendlines and obeying support trendlines
3-My tiny fibs retracement shows a weak retracement to 61 level

I don’t really know why price aren’t moving very much. I thought that near trendlines price would do at least some major upward or downward movement. Price are scared to move !

I also see the beginning of a double top formation from yesterday high to today.




===========================

5 pm
Well price did in fact do a break-through upward (see Entry #8, image #2). Although, this breakthrough was hold up by insanely positive USD news. Still, the major resistance trendlines (yellow and blue) now becomes support level. Price also break the 1.9878 fibs low. Price is long term long, but I still watch out for a little retracement down. {See image #3)

Here we can see that the asian session in the retangle. The fibs there marks high and lows. When highs and lows break-out, price reach the 138 area J. {See image #4}

Entry #10 - 30 January, 2008


2 :50 am : I think today price will go down, as I see a lowerhigh, and also prices need to go down at least for a day. Many majors news though, must be careful. I will wait for a break-out of my intraday fibs, as usual.

3 :15 am – Price action and fibonaccis : I entered at 1.9908 and TP 1.9928 at the yellows fibs high. Target hit 2 hours later. {See image 1}
==================================================

6pm : For tommorow, I think that price will generally go down. The prices have been going up for a while now and are due to retrace, as there is a nice candle formation today on the daily chart {see chart 2}

Entry #11 - 31 January, 2008

5am - So today I decided not to trade, because the asian session had been chaotic and there was several major news coming today. I like to trade when the market is ranging in the Asian seesion. Also, a news came positive for the GBP, but there was also no move whatsoever.

6 am : well, I decide to stop the trading , as I was seeing almost no action. But then price break the high of a fibs and proceed to go to 138 ! {see image #2}


6 PM : As for tomorrow, I think price will go down ( same as yesterday, see entry #10 chart #2). Also, there are so major line resistance going on right now {see image #3}

Entry #12 -1 February, 2008

2 :45 Am : I have just put to limit order to buy and to sell when the trendlines are fibonaccis are going to get broken. I will probably cancel them at 4 :30 if they did not hit, as there is a major news coming for the GPBUSD. Refer to Entry # 6 Chart #3 . Pretty much the same thing is happening right now I think.

Buy @ 1.9928
Sell @ 1.9889
{See image #1}

Also, seeing the price action right now (price action chart), I think that the market will break the support trendlines. I predict the cable will go down (see yesterday). Although, since we are before a major news, price probably won’t break any of those trendlines. Price usually consolidate before a major news occurs.




----------------------

Well my buy hit, but I think it was a false break out. I got stopped just before news ( and the news didn’t help either !).

------------------

Next day : I think I should begin to play on the higher time frame. I only try to catch small 20 pips move. My risk:reward ratio is more than 1. Also, I just did a trade against where I thought the market would go, and that is a scalp, too much risky. I must widen my stop loss and take profit and reduce my lot size. I will probably go for at least 50 pips SL and a R:R of 0.5, thus a take profit of 100 pips.

Also, I need to re-think my overall strategy. As I wrote earlier, I thought that price would go down today (it turns out it finally did, after a 3 days consolidation) and I still made a buy scalp, although I didn’t realize in the moment that it was a scalp. Lesson is : Only go in the direction of the trend, or at least in the direction of the higher time frame I think the price will go.

The worst is that after my buy hit, I completely erased my initial thought that the price would go down today and canceled my sell order. {See image #1}. The big move indeed came (250 pips down). LESSON LEARNED !

Also, I realized that the loss I took today, I began to questioning myself my FOREX was actually a good idea. I began having bad emotion and stupid emotion. I even predicted I was going to do that. I must keep an positive attitude, keep learning, LEARN FROM MISTAKE ( they cost a lot) and keep my objectif in mind : financial freedom.

On a side note, the break-out was really beautiful, when right through trendlines and stop at the next big support level {see image 2}

LIVE WITH PASSIONS!!!

Entry #13 - 4 February, 2008



2:45 – I took a sell on the EJ. There was many reasons for that : Trendlines, Daily Bollinger, general price action, fibonnacis, Oz signal. I think that entry was a good idea, and we will see where that leads. Stop loss and TP are widened, lot size decreased. { See image #1}

6 :00 – Move SL to BE.
6:25 Stop loss hit.


============


3 Am : Well once again I entered too fast on a trade. Although, I widened my stop loss and lowered my lot size. My reasoning is that there was a huge move up on Frankfurt, and what usually happens at that time, when the moves are really big ( more than 100 pips), the price will usually retrace down a little , and then will choose a direction. {see chart #2}

4 Am : I just closed my position for 6 pips : I don’t know what is the next direction of the market on the GBPUSD. {see chart #2}

=====================

4 am : I just realized that I must bring some new elements to my trading. First, I need decide on what direction I think the market will go, find my entries , SL & TP, then wait. Simple as that. Like for today I thought the GBPUSD would go up. I didn’t put any order and a big move up came. I must wait another time because the move I wanted to catch is gone.

Also, I need to ask myself a new good question : “What would I do if I was [Long|Short] in that situation ? Would I hold my position or close it ?” I think that will help me better understand the market.

Also, I just realized that when a position is going for me , I instantly think about adding bigger position. I don’t think it is a good idea, and will ultimately bring me to my demise if I continue to think like that ! On the other side, I’m fearing every move I see against my position. I don’t exactly know what I should do : keep studying charts to increase my experience and knowledge, or go do something else ?

=====================

19:30 – Well today I did something unusual : I went short ( again) on the EURJPY, I still think this is going down. I took once again a smaller position, with wider SL &TP range. This will be a first time ( as I am going to sleep soon) having a trade on while I sleep. Let’s see if this bring positive or negative result. No matter what happens, I will still be a winner because I will have learned a lesson either way. {see chart #3}

I will probably be careful on the cable tomorrow, as there are 2 majors news directly concerning the pair. I might as well take this downtime to study and increase my knowledge.

Entry #14 - 5 February, 2008



2 Am – I woke up and my overnight EJ trade was negative. I still think this will go down soon.

4:30 am – I finally catch what I wanted on the EJ. I would normally close right here at +30, but I am going to let it run. Let’s see what will happens : I must learn when to close and when not to close. For that, I must experience both. As for now, I only experience closing too early. Although, I would have LOTS of reason to close right now.

4:39 am – Well I decided to go out, maybe not the best decision but here is my thinking. Price when to 138 fibs projection and 50 retracement, both at the same place. Price will probably retrace soon then go down some more. I am going to have to come back on this trade and analyse it real good.{See image #1}

18 :00 PM : Well looking back I see that I am just a big chicken for not taking this huge move. I had predicted it for 1 week and only caught a small move ! Note to self : Review the market at that time and see what happened, because I am pretty sure that I can find another similar pattern on other pairs. Pretty exciting ! I am still happy that I was right though.

I do think though that I have trouble letting a trade go into the positive. I must work on that.

I think that before finding another of these pattern ( on the daily chart : fibonnaci, trendlines, price action[Consolidation), Bollinger, Oz indicator), I might as well check on the other related char if a similar move is to happens ( Like EJ and EU)


Finally, the price right now is at a significant fibonnaci 50 level. It will probably go to 38 no more if it continues on its momentum. Although, if it’s ranged near 50, going up. { see image #2}




=====================================


19:00 As for the GBPUSD( and every USD pair), I really don’t understand why it went down with the hugely negative news for the USD. I don’t understand.


For the first time, I am gonna try to predict the price reach for tomorrow. Might as well try to predict to gain confidence.

For the GBPUSD, I predict price will go UP tomorrow. Although, price may try to do a false break-out south to touch ± 1.9600. After it kills its momentum, it will go up to 1.9675, and if really strong 1.9700, but no more. Cable usually like to follow the 50 fibonaccis. It is also the current 161 fib on the intraday. {See image #3}

Entry #15 - 6 February, 2008


3 AM – I took a small lot trade against the trend after Franfurt big counter move. It was not a good idea, as the strength of the momentum was still on. In my back-testing, on 1h chart, I saw that London’s open usually goes against Frankfurt. Although, what I might not have seen, is that the movement usually continues for a little less than an hour and then goes up.

I think that instead of entering the market near 3 am, I should wait a little and enter the market a little later when the direction is clearly seen. Also, if a big move happens before I can catch it, I should be a lot more careful and NOT enter, because then I am jumping in a moving train, which is dangerous.

I did not trade again today. I have no real reason has why I didn’t.
{See image #1}.
20 :00 pm = Well coming back to my yesterday’s prediction, We can see that I was wrong big time. Although price did hug 1.9600 a lot today. As for tomorrow, here is what I think :

There is a red news coming at 4:30 pm, thus the market will probably be slow between 2 and 4:30. The market will probably going down a little more, probably until

==============
I have also just begun a new demo strategy on the daily chart. I am taking numerous chart image of 9 pairs and predicting where it will go. Mostly based on the chart on the Entry # 14 Chart # 2

Entry # 16 - 7 February, 2008

I wake up late because yesterday I went to bed late. I couldn’t trade very much. Although I tried something new

4:30 am – News came out negative for the GPB. I decided to go short after the news with a small positions.

6:30 am – I would close at +30 pips, but I want to ride the interest rate news. Price also cut trough a channel on the daily {See image #1}

17 :00 pm : well something funny happened : My TP on my trade hit even before the news, kinda funny ! This is my biggest win yet, +100 pips ! I did trade the news, and here is what I thought : The news ( at 4:30),came out negative. But there wasn’t a humongous move by it. Also, the price were generally going down ( in my mind) and I also had predicted yesterday on my Ozboll system that the GBP was weak. We can also see that it broke a 2 week ed-channel.{See image #2}

My Ozboll is getting really tight ! If anyone is interested, it is a chart journal on 9 pairs with a written journal summing up what I think the market will do. I will begin to post in on the first post of this thread.

I just update my first post.

===========================
Ozboll system prediction :

Well the USDJPY shoot up as I predicted J this is getting to be a great system. It also gives a general idea where the market is heading up around the world.

Today the market is again globally against the JPY. The EURUSD is also going to you up strong. The USDJPY is also probably going to go still up today.

I am really consume on which to take long : EURJPY or EURUSD. EU is at strong resistance, but the USD might still have moment. The EURJPY moment is probably killed at this point. So , if I had my life on the line, I would pick EJ LONG.

Entry # 17 - 8 February, 2008




4 AM : Today I did not enter any trade, I wasn’t feeling the market, and there had been major movement yesterday. Anyway here is interesting thing I saw :

The GBPUSD did it’s usually “break asian high and goto 138 or next resistance.” {see chart #1}

Also, I should have take this trade, because my Ozboll daily system indicated that the GBP was going to go up on GJ and GU. It would have been a great direction follow break-out scalp.

19:30 PM

Well that is gonna be it for today. The week end is here, time to relax (yeah right). Here is my prediction for next week on the GBPUSD :


+++++ (positive):
1- My ozboll system, same as yesterday, is telling me the GBPUSD is going to go up next week. { See image #2} That is mostly the same for the GBPJPY.



------- (negative):
1- there is a 2 week old resistance trendline {see chart #3}. Unless this is getting broken solid, I am getting torn apart going long on GBP..

2- Fundamentally, -0.25 cut rate is really NOT good.

========================

As for my Ozboll strategy, here is what I think will happen next week :

The UJ is bandwidth is getting tight as hell, it’s getting scary. Much indecision with it. I will avoid any JPY pair.

GJ & GU are both in minor indecision phase, with a bias toward going up.

The king this week will be the EU. The EJ would be a good choice too, but the JPY is scary. The EU bounced off the O-TD and is ready for major action up !

A- Reviewing everything I have highlighted in my journal :


1-Do not trade the news, at least not until I am good a predicting them.

2- When price is doing whipsaws, doing lower high and higher lows, that is simply a triangle pattern for a future breakout.

3- Do not enter a trade on tilt. Predict the entry in advance.

4- Widen my stoploss and takeprofit. Use higher time frame. Do not do scalp.

5- Don't trade when it is too much chaotic.

6- Don't get emotionnaly involved with the trading ( both negative and unhealthy random excitement)

7- Don't look at the market constantly ( see point #3 and #6)

8- Be more confident in the trade I set.


B- Unresolved issues

I just reviewed some of my early entries and found out certain thing I don’t know if they are true. A while back, I wrote :
“[…]might as well be happy with fewer, but CERTAIN pips.” That brings me to another question :
“- When and should I bring my stop-loss to break-even ?”