Forex Trading Review – Week 46

This week was another small step in the right direction.

It wasn’t quite as exciting as last week, but I’m happy to have backed up one solid trading week with another.

Today’s journal entry is going to be short and to the point as I’ve been spending a lot of time working on content for the website these past few days, and my arms are getting sore from typing so much!

11th November – 15th November

Trade #231

Reflection:

This was a fantastic trade on AUD/JPY.

The daily chart had just reversed off a major resistance zone and (barely) broke and closed below the trendline that was forming.

When price began to fall steeply, I actually scaled out some of my position by selling half of my remaining half position. That left me with a quarter sized position to trail my stop loss with.

I was hoping that previous support would hold as resistance and this market would move much lower. But instead price reversed in the middle of nowhere and has been retracing ever since.

Overall this was a solid trade and I’m glad I used some discretion to take some profit off the table when I began to feel that price was getting over-extended and hadn’t left me with any safe structure levels to trail behind.

Trade #232

Reflection:

This was a promising potential reversal trade on this timeframe. Price had just reacted bullishly from a daily level of structure and then broke and closed above previous resistance on this timeframe (the blue line).

Once this happened I was comfortable going long. However, price found resistance at a previous minor support level and reversed to stop me out for break-even.

Good trade nonetheless. I don’t like holding on to day trades if the momentum isn’t there, so despite being a disappointing outcome, I was glad to get out with no pain.

Trade #233

Reflection:

This was another intraday trend-continuation trade on EUR/JPY.

Price had just made it below a key daily structure zone and had held below it for an entire day, so when price began trending on this timeframe and gave me a pullback setup, I went for it.

Unfortunately this time I was wicked out for a loss before price rolled over.

Trade #234

Reflection:

This was actually an error trade.

In hindsight, after placing it, I realized that there was an RSI Swing Signal setup on both the 15M timeframe AND the 1-Hour timeframe!

This is a new negative filter I’ve introduced to my trading recently. When this price action setup occurs, I found that I have about a 60% chance of losing the trade. I prefer to take setups with a closer to 50% chance of winning, so 40% and below is not really what I’m after.

Given the average R:R from these setups I can’t really afford to lose 60%+ of my trades, so I do regret taking this trade. If I had noticed the RSI Swing Signal before I’d placed the position I wouldn’t have taken this trade.

This is a new filter that I only recently added to my trading plan, so it’s fairly normal to forget about it in the heat of the moment of trading after being in a repetitive routine for so long.

But I can’t let it happen again, so I’m adding it to my active focus-list of mistakes to watch out for when I’m trading.

Trade #235

Reflection:

This was one of the best trades I’ve taken all year. I was extremely confident in going long here because there were so many bullish factors in confluence with this simple pullback setup.

I’m still involved with the second position of this trade and I’m trailing my stop loss on the 15-Minute chart as we approach the nearest resistance zone that I anticipate could push price lower.

I won’t go into more detail here, because I actually made a 20-minute long video explaining the thought process behind this particular trade and why I was so confident in it. I’ll link to that below.

In the future I would love to be able to increase my risk on trades such as this, and I plan to eventually find a way to systematically add rules for this type of discretion.

Here is the video:

Weekly Reflection

Annual Return: +4.80% | Drawdown: -18.50%

Last Week’s Goal: Backtest For At Least 2 Hours Per Day.

Overall Grade: D

I should quickly mention that one morning last week I went to enter a position, and I screwed up my stop loss order by mixing up two numbers. My order was entered and it wasn’t until after the trade was executed that I noticed my stop loss was accidentally set far too tight.

I thought about what to do for a few seconds, and then I decided to just exit the trade instead of waiting to see what happened. Being a day trade I had quite a large position on, so I instantly took a -0.39% hit from it despite the fact that I was only down -2 pips. But the trade did in fact end up losing, so technically by taking that hit I saved myself from losing an extra -0.61%.

Errors like this are unacceptable in my trading, but they do happen from time to time. The only way to prevent it is to be more focused when entering my positions. I tend to get into an autopilot routine because TradingView makes entering trades so easy. But that tiny mistake cost me a -0.39% chunk of my capital. I’m determined not to let it happen again, so I’ve been extra vigilant with my order execution since then.

Anyway, I’m still in the process of backtesting Advanced Patterns to add to my trading plan. Last week I did not get as much backtesting done as I would’ve liked because I spent a few days visiting friends, so between that and the two trading mistakes I made, I gave myself a D grade. I’d give myself an F but I don’t think that’s quite fair as I feel I did handle the situation well.

This week I plan to get on top of my testing again. I’m already getting much better at identifying AP1 patterns (aka. Bat Patterns) and I’m excited to find out which pairs it performs best on so that I can begin trading it live.

Anyway that’s it for this week’s journal entry. I’m going to keep it short this week because I spent many hours yesterday and this morning working on that EUR/USD YouTube video and new content for the site.

Be safe, be good, and trade green. Speak to you in the next one!

Next Week’s Goal

Backtest Advanced Patterns & Avoid RSI Swing Signal PB Setups.

Previous Week’s Review
This Week’s Review
Myfxbook Stats

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