My 30 pips Daily and my 45% Weekly Journal

ohwell, a bump in the road. The better countertrend option was funnily at the bottom with the Pin Bar then IB combination (a personal favourite) that had a very small risk and would have run at least 3x R/R. Back to it I see your short again. Daily has a Pin bar, albeit very small in comparison to the larger move the day before but it is at a PZ of previous S/R. I hope it works out well for you

RT

I am not that bad at PA. I am always looking to learn though. The learning curve for me never stops. About the process Ive been through im sure most begin this way. Its the persistence, the willingness to accept you're wrong and be willing to learn that allows some to be successful and others to fail.

Revenge trading undid my previous account from 20k to 7k so its one thing I'm not ready to repeat.

All the best with your trading man. Thanks.

Hi Razor. Please explain this post. I am a little behind with these terminologies. Thank you

Hello traders. Today is Thanksgiving day in the US and the markets have decided to sleep so I guess its time I took time off and replied to my emails and go have a good time out.

I have closed out three trades today for a profit of $308.20.

Hope to make some better money on the break-out.

Happy Thanksgiving Everyone!

Comments were just observations.

For me the better entry long would have occured at the base of the swing with the Pin bar and then Inside bar following. It is a personal favourite of mine because I like to trade Pin bars that are confirmed by the break or have something that shows there is a better chance that the previous direction has come to a halt, the Inside bar being one of these. The Inside bar offers a variety of trade options when combined with a swing low/high pin bar but thats a different topic and while it all looks good in hindsight, I do take these when they present themselves. On this occasion I was fresh out of bed and on my way to work when they occured but alas thats they way the cookie crumbles.

The risk on the tradecould have been relatively low. In fact you had the Pin bar, Inside bar and then 2 following bars with long tails (wicks) which just compounded the evidence that a break up was possible, then sure enough you got the break, a retrace back and then the move away. Classic break, retrace to previous support/Resistance then move away. I still like EUR short but there is a pin bar on the daily at an extreme low, previous points of S/R and I would not be surprised if the market moves up some.

The bigger question is, was the last move up a retrace from the Greece fallout and lows of 1.2 or is this move down the retrace of the last swing and we are now on our way back to 1.43 and above. That is why I love trading. Just when you think you have something sussed out, BOOM you get a swift roundhouse kick to the head by USD/Chucknorris (that last bit you may not understand).

Take care

RT

I have to admit, the only part I got is the USD/chucknorrris part. I would like to hear more on pin bars and IB. Can you explain or refer me to a detailed documentation.

Thanks.

Its 0238hrs, Friday, November 26, 2010 local time as I type this. I have always said I'm fond of the Tokyo session and that's why I'm awake this late. The Tokyo Session opens in about 22 minutes. I just wanted to type out here a few thoughts about traders' patience and also touch on the issue of taking profits. I wanted to put this up on my blog but I also want this thread to have some informational material so here I go.

I have the last couple of hours just been staring at charts, the EURUSD to be specific. Over that time, one thing comes to sight and mind. The obvious trends. They are TOO obvious. Why then, do we make losses during these trends. Is it because we are trying to pick tops and bottoms in the middle of a trend. Or are we that desperate to see the trend change?

One of the tenets of the Dow Theory tells us that a trend is assumed to be in place until it gives a definite signal that it has reversed. Why then do we assume that we can outguess the market? Newtons Law of inertia. An object at rest will continue to remain at rest until some unbalanced force acts on it. A body in motion will continue in such motion until some unbalanced force acts on it. This is very true with the markets.

In my observation of my own trading tendencies, I think the answer boils down to patience. Patience in two ways:

 

1. We are never patient with our winning trades and are always afraid that the trend might reverse and we are always too patient with our losing positions hoping that price will reverse or
2. We are too patient with our winning positions and expect the trend to last forever allowing a good winner to turn into a loser and we are never patient with our losers meaning we take too many unwanted losses.

How then should a trader deal with these issues? My opinion would be to have a system with a defined edge as the first step. Know the mechanics of your system. Know why it actually works. Know when it's most likely to lose and avoid trading during those times. The reason traders lose sometimes is because they are using the wrong system for the prevailing markets e.g., using a trend-following system during ranging periods.

Once you have the system with clear entry point, define the exit strategy. Know the exact reason why you will exit your positions. Having a stop loss set somewhere is not anywhere close to having an exit strategy. Knowing why the Stop Loss is where it is, is the strategy. That way, even if price moves against you, you will be patient until the SL is hit or until the trend signals it has changed direction to your satisfaction.

The issue of Take Profit is one of the hardest nuts to crack. Now, there are several ways to take a profit

 

1. "I'm up 50 pips. OMG, I must take this profit before it turns into a loser!" Don't laugh, I'm sure at some point in your trading you've done this. Taking a profit just coz its there or what I'll call uninformed discretion.
2. Set Pip target. Like my system. A target of 30 pips per trade. The TP will always be at 30 pips. The advantage with this system, and a great advantage at that is that you get your goals pretty easy. You know from experience that your system will most likely hit a TP of a certain pips at least 80% of the time, so you apply that strategy. This strategy can help you grow your equity rapidly. The disadvantages are; what if price gets to 29 then reverses, what then? Or what if price hits TP then proceeds another 370 pips? Will you be tempted to re-enter without a valid entry signal?
3. Stop and Reverse. This is another common exit strategy. This strategy keeps you in the market 100% of the time. The advantage is that you gain a certain level of discipline because you know it's up to the market not up to you. If the market decides we stay long for the whole of 2011, then that's it. Another advantage is that you get to catch all the market moves in that particular market. Like the 1000 pip move in one week. Problem is, this requires that you watch as the markets eats up all your profits until you confirm reversal. Its quite a test and patience is required here. But if you are like one trader whose aim is 8% per year, then this should be no problem. i guess you must have quite a huge capital base to live on 8% per year. Like say $1,000,000. Then 8% would be $80,000. I could live on that (without kids)! Oooh, I lost focus, sorry. Back to where we were! Another disadvantage is that you will probably get whipsawed a lot when there is a range just before the break-out. Some fine-tuning should however deal with that.
4. Another way to put TP is to use a Trailing Stop. I have never been a fan of this method but those who advocate for it say that it locks in profit. I say, unless you give it enough room to breathe (which is giving up too much profits), you are bound to get out with less than you deserve. Secondly, after exit when the TS is hit, you will have to exercise a lot of patience as you wait for the next valid entry set-up. This BTW, could mean watching as price goes in your direction for a very long time over a lot of pips. The agony! However, if this is your strategy and it helps you achieve your trading goals, keep it.
5. Its now 0315hrs here. I am long the EURUSD and I'm -32 pips. My system tells me to keep that long position until it reverses and until I'm satisfied that it actually has. Stochastics are still above 50 and price is above the daily Pivot Point and above the BB MA. Unfortunately, i do not have have any exit stops on that position. This leads me to another method of TP. Informed discretion. This means that you are looking for some condition to happen for you to exit. Well, for you to take profit that is. I insist that all trades should have a SL. Do not enter a trade unless you know the exact level you will put your SL and why. wait a minute.......... I just put a SL to my open position at 1.3285. This is just a couple of pips below the previous low. I know I wont let price get there because in the next couple of pips further down, the market will have proved that it is resuming its bearish move. Then i will be able to exit and reverse with a very nice R/R ratio. But here we were dealing with Take Profit. A trader can decide, due to his previous experiences to take a profit at a certain level. Maybe due to some chart patterns or some other reason. This requires some of the best traders.
6. Another famous way is to use S&R levels whatever you perceive them to be. You will set your TP above or below these levels. The advantage is that prices really respect these levels and more often than not your TP will be hit. However, if its not hit, then we have to go to square one.

My take on these two issues is to have a sober mind. Have a really good reason why you have entered a trade and how and why and sometimes even where you plan on exiting that trade. That way, your emotions wont come into play in between. However, if you just enter trade because there is a nice entry set-up, you might find yourself losing it when price goes against you. You will however keep your cool until you have a reason to exit. A reason you had before you clicked BUY.

I hope this article helps someone someday.

Anyway, back to my trade. we are now at -26. I know very very very well where I will exit that trade with a loss. However, I am yet to decide where I am going to exit with profits. i have already made my 45% for this week so Im just using these trades to learn and get a feel of the markets. I have very many hours on the charts but I never get bored with them. I sometimes even look at the charts at the weekends. Just to see how it went down,hahahaha.

Oh my, seems like price really wants to go the other way. No wait, I cant exit until price closes in the direction of the reversal. As I always say, and I repeat here for emphasis, wait for the close. Always wait for the close. Let this phrase reside in your heart and soul and mind. Say it over and over again to yourself. I know some of you don't work with closes and it's alright but I need to remind this to myself over and over again.

I will be giving some pointers later on in my blog about stops. Topics covered will include:

1. Going Beyond The Noise
2. Maximum Adverse Excursion
3. Tight stops
4. Using A stop that Makes Sense
5. How To take profits
6. Purpose behind profit-taking Exits
7. Simplicity and Multiple Exits
8. Just using Your Stop and a profit Objective
9.What To Avoid
10. Exits Used By Common Systems I and II.

Be sure to join me then.

My exit strategy is for price to close below the BB MA and stochastics to cross below 50. I have to admit, My entry was a little off on this trade. I did not wait for the candle to close when I entered this trade and this might cost me an additional 15 pips. but its fine with me, its the process and cost of learning and instilling discipline.

Well, its now 0338hrs local time. I have been typing for a whole hour and I have to pen off. Let me leave you with the chart as it looks. I am contemplating adding to my long positions if price closes above the Daily Pivot and CCI moves above blue line!!!!!

Happy trading everyone. Happy Thanksgiving!

Morning traders. its Furahi -Day at last. Furahi is a swahili word meaning happy. Its been a slow night in the Asian session. I took my loss at -45 pips on the Long trade, a loss of -$45.

I have gone short since then. All my indicators tell me we might be seeing quite a drop today. Don't quote me though!

Trade 1

Short @ 1.33336
SL @ 1.33900 (55.4)
TP @ ......(Not set yet) Looking for at least 90 pips on this trade.

Happy trading everyone.

I took a quick nap but Im back up again. Seems like my 90 pips Tp would have been quickly hit!

I am now looking to see if we will hit 1.31925 but Im looking to close open trade by market close later today.

I have put my TP @ 1.31925 (241 pips)

Here is the updated chart.

Machiavelli,
Thumbs up for you buddie, very organized trading and a very nice attitude.
Your journal is a good example of how it must be done.

I wish you all the best.

Kind regards.

Red.

Thank you. Wishing you lots of pips too.

I just modified the first post of this Journal

The weekend is finally here. I've gotta repay myself for all those hours in front of the screen. Not that I hate it, but i gotta remunerate myself,no?

I have closed the short trade and opened a new trade. The trade I closed made me 93 pips equaling $1858. I have entered a 0.2 standard lot trade short on the pair though, just to ride the rest of the trend. Once I go out, i don't like thinking about my open trades and I'm sure a 0.2 trade cant pinch that much. The trade is currently - 20 pips.

The week In perspective

I'm just about heading out to start my weekend. So lets see what happened this week.

http://machiavelly7.mt4stats.com/

Principal: $6,255.00
Net Profit: $6,728.17
Balance: $12,983.17

Percentage Gain: 107.56%

Maximum Drawdown: 15.92%

Winning ratio: 65%

Total Trades: 15 {3 per day}

I have to admit it was a pretty generous market this week. A good 280 pips move did the trick for me.

I know my system aims for 30 pips daily but Ive been listening to some of your advice the likes of Razor, Dr zeus, Edonya and jag1966 and I have devised a way to let profits run. Its still a working progress but as you can see its made me quite something this week.

The good thing about this thread is that I broadcast my trades when they are still open, some even at the open. My statement is live. The criticism is real, the stress is there, but most of all, the reward is just all too obvious to see.

I hope that we can continue this trend, the learning curve, gathering pips here and there, some paper as well and I also hope more and more traders become involved in this thread. That's the idea I have in mind. Who knows, i just might feel generous one day.

Have a great weekend everyone and take care and let's meet right here Sunday night!

Good job mate,

I was relaying your story around a few like minded friends during a 5 hour spa session (drinking of course) and the topic got to people who have turned small accounts into phenomenal wealth. It is improbable, I have said it a million times, but not impossible and it takes someone who can step back emotionally from there money and trade. The difference is the risk. If someone was trading you exact signal but with 2% risk they would cop little if no flack at all but because you take the bold stance of risking 10%+ per trade you will either find riches or the recycle bin.

Unless one starts with a bold amount of capital it is difficult for them to make progress. Unless you account has the sizing requirements that can allow compounding to build whilst being able to withdraw for living expenses without damaging that compounding process then you really are going backwards. In your case, you may get lucky here and there and you can build at an incredible rate with well executed trades then after a certain point you can withdraw some fund, possibly the original deposit plus some and then effectively you are trading with money you have made through trading.

Getting back to the earlier point, and this is something I have mentioned before. It is regarding the time component that you input and the results that manifest in relation to your account size. We all have to learn but there is a point where the hours you putting in need to see some results. Now you could then theorically put in a few K but in our minds we want to see a result that pays us off. 2% of 2K isnt going to feed that need, plain and simple and what happens is those people over trade, they look for ways to make more money and losses take away because no one likes to work for free let alone work whilst paying out of their pockets.

In the end it comes down to individual choice and you will either find yourself in the riches column or the more probable bust column but at least you have given it a go and hopefully not staked an amount that will cause financial burden.

RT

And I have always agreed with you. It is very possible but unlikely. Okay, I don't mean to be cocky or anything but the people who try this kind of trading and fail, have the following characteristics:

 

1. Novice traders with less than 2 years trading with the concept of get rich quick. I wouldn't say I have that mentality. Yes, I do aim for 30% per week but that doesn't mean Ill always get it. I have learnt to live with losses, which are magnified in my case. I have even devised a way to minimize them on my system's page.
2. They have little capital.Its not possible to live off 8% of that per year, now is it? I started out small for obvious reasons as I explained http://iangitiha.com/2010/11/24/my-o...st-four-years/. With 100 dollar accounts. I blew them of course. The moment came and here I am. Most of the money I trade isn't mine really.It belongs to investors. If I had that much money, Id probably not want to trade for anyone. But my commission should be enough to create my own account in several months. I want my account to be something over $50,000. Then, I won't need to make 30% per week. Since I started posting here, I started with $5,000 seven weeks ago. I have grown that account to the $12k its now at. I have also withdrawn 1k. That's not necessarily 45% per week, its more like 15% compounded. As i have staed earlier, 45% or 30% is just an goal .Its important to have goals. At times I will make 30%, maybe more maybe less.
3. They do not want to accept when they are wrong. A couple of weeks ago I made some mistakes and the likes of Dr Zeus pointed them out. I was willing to listen and decided to incorporate their advice. I am willing to learn. that's why my journal is here; for sharing.

You know something Razor, it also has to do with your belief. If in your guts you know you can't do it, don't try it. If you know you can, and you have done it over around 2 years, then why not. I have been doing my maths, since January 2009 when I started with $250, I have made over 10% per week compounded. Well, I didn't make the Milli but one day I will get there. I am only getting better.

If I could do it on a $250 account, I can do it on any account. With a $100 I'd probably go slow, you know, risking around 5% per trade due to the limited space but I believe it CAN be done. I am in the process of eliminating my emotions. Like the last trade I took. It looks very easy from hindsight but it wasn't. But I took it anyhow and went to bed too.

About the time component, I have said its a goal. I could make less or more. I could have a losing week. It doesn't mean I'm not trading well. Its all part of trading. But considering Ive had less than 4 losing weeks in 2010, I would say that is well taken care of.

Hi bro,
I can see the passion you have in writing and trading. I read each and every post you write here.I know that very soon you will become a full time trader. Your journal explains everything you are doing with each and every trade you take and how you manage it. I have the same goal of having an account of 100000$ and above i started with 200$ and now i am over 1000$. Although my journal concentrates on one account i have other accounts.My problem is that i am a bit lazy in updating my journal, but i usually update after taking any trade with that one account. I also analyse all the trades i took the whole week over the weekend so that i can improve on the setups i take and the ones i ignored.

You have the heart of taking it on and i can agree 100% that it needs experience and time to make it in this business.
When i started i thought that in 5 months time i will be driving a big car but it has been over 4 years and not yet. This is a business which needs to be managed well, one needs to know the nitty gritty of a business before you become successful. In a business if you get frustrated most people quit and they never try again and they continue depending on the 8-5 jobs.

Continue with this venture of trading and giving us trading tips. I like and them and i have learned a lot from your posts.
Regards and nice weekend.

Thank you for your post. I agree with you. Its not a get rich quick business (although I make it look that way). It needs skill and experience. Skill here refers to mastery of emotions, position sizing, entry and exits, money management and a lot of other things.

Im glad to hear you are making progress on your account. Thats the spirit. I have been going through your thread but unfortunately I cannot reply there. I will be replying here whenever I find something I think I should comment on. I hope you don't mind that.

This applies to any other contributors of this thread who have thier own threads. I'll just copy what you said and comment here. Its unfortunate but that the price of being a commercial member.

About typing and writing. i am a journalist (in the making) remember?

All the best.

Thanks you
your journal help me to understand why many people blow account that fast: because of their ambitious profit and lack of knowledge about market

Could you give your indicator settings. I am a bit confused. Thank you. RH

Bollinger Bands (50,0.5)
Stochastic (34,5,5)