(binned per thread starter’s request) GEfx Trading Journal

Hi auxesis, thanks and hope you are well.

Two quick charts from this mornings analysis (so far). Both are E/$ 1H charts. Chart #1 is where we've been and clearly tells what the market has been up to. Note the squaring process and that it is completed for the time being going south. Chart #2 is where we are now.





No trades on yet; watching.

Okay, I've made three trades so far today: 1 in the $/CAD was -1.2 pips, and 2 trades in the E/$ for a grand total of +8.8 pips. A net of 7.6 pips! I think all three trades were up a total of about 40 pips collectively, but that of course does not count. Typical of a "no follow through" day.

A few comments about risk. I have been a little sloppy in my use of the word risk. I think there is a tendency to refer to risk when what is actually being discussed in the amount of loss a trader is willing to accept in their trade. At least, that is how I used the term in the posts I have made in this journal. Actually, I am trading with the following "risks" in mind:

1.) The amount of money I will risk in a single trade, which I have capped at 1-2% of my trading account. Note: I will raise that to 3% this month, give my trading record in 2011.

2.) The risks that are present in the market, which, for example, are locations where PA may show some reaction. I use TA to id these risks and then plan my trading around them. This is a daily effort, and is meant to replicate the things that market makers are seeing on their charts that day, or have reacted to in the past.

3.) Fundamental risks, where a planned or unplanned announcements that change the expectations of the market. These risks are the primary reason to trade with stops (at least a catastrophic stop).

For me, it is very difficult to make trades without these three thing in clear perspective. I then apply my experience in TA/PA as I enter, manage, and exit trades during the day. This is one component in analyzing my trading, and gives me a reason for good trades, and a reason for bad trades (which usually are due to lazy TA). If you are going to be a serious trader, you must get over the idea that risk is a trade going against you, and adopt the idea that risk has much more to do with not doing the proper TA, not dancing with PA, and having little or no notion of what the bankers are doing.

Note: I will raise that to 3% this month, given my trading record in 2011.

Congratulations. Looks like you had a very good year to increase from 2% to 3%. I like to see friends do well especially when they share their ideas about trading so generously. I am using your approach to fibs to stop doing rescues too early and to stay in attacks a little longer. Kind regards, Ray

Hi Ray, thanks and hope all is well with you. Just keep what fti teaches about the dance in the front of your mind, too. Take care!

I have a 20 pip loss on the GBP/$ this morning (1/2 normal position on break out), but am in the E/$ (full size position) in the following trade:



I've protected 20 pips to cover the loss plus a small profit, and am now waiting for the target at 55 pips to be hit. Here is the progress so far...

Final result was a +25 pip trade on the euro before it pulled back below 1.2790. Back to waiting for a better entry but a clearer picture first.

I am no longer chasing the E/$ north. Too much risk above for a clean move, until a breach of about 1.2823. Looking at other pairs now.

Here is a 1H E/$ chart with a summary of this mornings trading chart. Equities, gold, and oil are all up so far this morning, with FA risk on the calendar today. There are risks going north here and I am sitting on the sidelines for the time being. Waiting.



Pretty much the same situation with the GBP/$, AUD/$, and the $/CAD.

Well, here we are at several important technical levels on the E/$. PA clearly shows that traders know where these levels are located and are respecting them/trying to deal with them. There is a good chance that PA will continue to push north, but only time will tell.

E/$ 10M chart. Trend wall is holding for now, but there is oppty below.

Now short the E/$ at 1.2756. First target is 1.2717.

Edit: European equities have turned negative and US equity futures are falling.

First target hit and now protecting 1.2746. Next target is 1.2679.

Edit: square at 1.2715. Looking for a small pull back to re-enter for the second target.

I am also short the GBP/$ at 1.5310, protect the entry, and long the $/CAD at 1.0205, protecting 1.0215.

Edit: do not like the PA on the GBP, so am square at 1.5300. Hanging on the the CAD and still waiting for a pull back on the euro.

Edit2: Protecting 1.0235 on the CAD.
Edit3: Square now on the CAD ahead of the announcement at 1.0245.

Ahead of the announcement, my CAD trade was +40 pips, GBP +10, and the Euro +41.

Short the GBP/$ at 1.5292, protecting 1.5252.

nice trades.

I had a hunch when price failed to hit my upper stop line that this baby was gonna go down but honestly i didnt see it coming so i didnt trade.

but you are pretty good at trading sir

Hi Red, I must remember to send a thank you note to S&P for downgrading France. That got things rolling today.