ah yes, ....you tube....thats right, I just recently discovered some good trading videos on you tube. youre right about that. no, by all means do your journal as you see fit. I wasnt trying to claim almighty wisdom, just what I thought I was reading in your posts as I skimmed thru it all. sorry if I misunderstood it. T
I decided to move my learning and watching day to Monday, since Sunday doesnât really qualify as the standard trading conditions Iâm looking for. For Monday, I figure there is an equities market close, a dayâs worth of pivots and trend to figure out, and overall likely more typical movement. That being said, I spent my time studying the marketâs effects on the normal things - PA on trendlines, etc., but I also took this day to look more closely on Fibs. I found a few good videos on the fib levels, and watched the best one three or four times until I very much understood how to draw and begin experimenting with them. As a result, I think the market is practically governed by the 38.2% retracement level. Itâs everywhere. I also noticed something that I learned a long time ago, when apparently I had more sense. When a trendline breaks, the overall currency trend is usually too strong to simply reverse. It may continue up in a less orderly way, or have a pullback, or even a false break before correcting back (even if it moves on to finish moving the other way). I was doing several other tasks while I was watching the market today, but overall I think I got about three solid hours in. Tomorrow I should be back for my study day.
I am doing studies today, but I wanted to share my mesmerization by exactly how many technical things combine to work in forex at precisely the same time. For the EUR/USD move from 14:03-14:16, the exit was either precisely, or within about a single pip of: bottom of 2.5 hour channel downtrend line from last channel's top one of daily pivot lines 1.382 Fibonacci extension from the first correction (I have to infer this from the 1.618 however, as TOS doesn't chart it). Furthermore, it was started by: 50% retracement of hill move (I make up stuff) many hour resistance (which actually is a monthly pivot level!!) Forecasted upper channel from previous two highs Those are just the levels I know about pretty much, and then the whole candlestick and other PA comes into play. The best part though is that I find these multi-occurrences remarkably often. Had to do something, my roommate wasn't as excited as I was lol
I think I made an important realization today: Trading with longer time frames will lessen the number of required split-second decisions, which naturally and inevitably have emotional and instinctive tendencies (so probably not for a beginner trader to be having 12 trades in an hour, like I was doing). Today was a study day, and I studied only four moves 2:00-8:00 totaling about 190 playable pips. I just noted a few others, but they had to be over thirty this time to attract my attention. I would have liked to have done this with the three other 30+ moves since eight, but I am out of time for today. Although I was working for about 3.5 hours, I spent a great deal of time analyzing and experimenting with the charts, and my average analysis is about 150 hand-written words, so they are each fairly time-consuming. I also decided to play with some more fibs on different moves and time frames, and I also decided to calculate the pivot points for 2006 and 2007, which have been on my to do list for quite some time (I do pivots manually because I can chart them how I like and also include midpoints, which neither TOS nor Oanda does last time I checked). One more quick note: I think the removal of 10 minute plays and the focus of longer term plays could be very beneficial to me. Not only will I have a chance to come out ahead (big plus), but I may also eventually be able to extend my trading to more currencies. This is a bit difficult in the Asian session, but the EUR/JPY showed higher percentage movement in my last calculations, so I could potentially re-introduce it and have my thread title make sense again. However, this would require time that I donât currently have in analysis, experience, or focus (as a rookie, I need to learn closely, I can only process a few ideas at a time anyway â just how my mind works). Even so, I would have liked to continue studying today, but I have two exams tomorrow for which I would like to study, and I already briefly went over the entries and exits of these moves. Tomorrow will be a very exciting trading today for me, as I will be introducing Fibs to my actual trading, and I will also have a new strategy and mindset after all the more I have learned this week (although I honestly think that every week). Good trading.
I am cutting my trading day short today because I am no longer in a mental shape to trade. I began my pre-trading routine at 5:35, and began searching for market direction and potential trades around 6:05. I was a bit confounded at first, before seeing a brilliant long entry (itâs easy to see it on the chart, itâs actually the exact bottom â my entry was about 4 pips above it). Anyway, I held on for about 45 minutes, working with a net 2-9 pip gain. However, I was watching a fib level, and began seeing an exit as it rounded at the fib level and lost all upward momentum. Cautious as I was, I exited. Not only did I exit, I reversed and went short. Fifteen seconds later⦠Triple bottom on one minute and a takeoff of 35 pips in the initial direction of my trade. Not only that, but I didnât even have time to exit until I lost 15 on my short. Thatâs a 50 pip difference plus 6 in commissions â I was PISSED. I left for a brief bit, and came back still a little edgy. I didnât have enough confidence for my next entry, but saw certain signs of market weakness at a semi-major TL. I got ten pips in my direction before it turned, erasing my gains and then hitting my conservative stop. At this point, it rallied HARD and created an extra 5 pip loss before my exit. I canât concentrate enough to trade anymore today. Three trades today: +1.7, -15, and -14.6 pips. I donât even feel like doing the addition. There were a few good things today such as my initial analysis of PA and only three trades but Iâm not in the mood to talk about it. Iâm going to do a few last things like save my chart styles on TOS (something I havenât done in a very long time), watch the market (I had a few initial target levels for my long, which are actually being reached now, so I want to see what happens), and then go out and be a college student for a few hours ;-)
I would like to take a minute to discuss the difference between strategy trading and day trading straight from the head. As I have been in the markets, I have noticed several correlations that I think could easily be developed into profitable strategies. Yet, it is my personal wish to simply trade directly from my own knowledge and feel for the markets. As a result, I have found that the differences are profound. With strategy trading, it is not extremely difficult to have faith in a strategy you know to have a high probability of being and remaining profitable. If it goes wrong, it will do better, and the strategy has a safe stop in place. However, when you are trading from your head, everything becomes your responsibility. A bad trade results in perceived failure, from which the need to recover in the form of profits becomes a necessity. It is intensely emotional in comparison, and much more difficult. Over time, however, I believe that knowledge and experience will result in such a profound understanding of the markets, as well as a substantial comprehension of both conscious and unconscious patterns and strategies. In the end, I believe this to be a superior approach for my individual goals, as it will mean that I have conquered myself, the market, and have combined everything I know and turned it into what would likely be the best balance of risk and reward for my personal style. Thatâs my little input of trading wisdom, now to continue my studies (switched my order so that it is now study, watching, trading. Watching, studying, then trading didnât really make that much sense).
I just read you last page of posts in this thread. Just some comments... It's good to continuously question oneself - but you also need to have some confidence, and grow this confidence in what you are doing. It also seem you are somewhat emotional while, and that can be a bit tricky to deal with. You should try to find out a way to get less emotional... What you want of course are the good emotions, and there's nothing wrong with feeling the success and confidence - but you need to be able to turn that into something positive that works FOR you by enabling you to apply the right risk, and NOT something that clouds your trading by making you euphoric or upset. Re-evaluating yourself is useful - after successes and after drawdowns - but you always need to put yourself in the setting of what the situation was, and how you were interacting with the information - what your decisions were; how you weighed the risks, considerations and came to a conclusion. You don't need to have it committed to paper - during the decision making, or afterwards - because you shouldn't let the analysis itself be the focus, when it's trading which you are aiming to excel at. However, you need to be aware of what you do - the "meta-information" of your own decision making. Hard to not chime in here, being an old martial arts instructor... hehe.
I think someone could lose their mind experimenting with Fibonacci retracements. There is just so much that ends up oddly working out within a pip or so (not just by chance, but legitimately many minor moves continue to hit the major fib levels all the time), but to draw them would take hours and hours with no end. ***As I recall, I remember John Carter (Mastering the Trade I believe it was called) talked about a service that just drew fibs and tried to locate the most important levels. I wonder how many of the people working for them lost their sanity (ever seen the movie 23?)
Yes, I remember "23"... Also - if you are really into quantitative analysis like that... I think you should look more into the nature and the philosophy of mathematics - to understand what you are really looking at. Even math philosophy and metaphilosophy are very useful. http://en.wikipedia.org/wiki/Philosophy_of_mathematics http://en.wikipedia.org/wiki/Foundations_of_mathematics http://en.wikipedia.org/wiki/Metaphilosophy E.g take a look at "ZermeloâFraenkel set theory with the axiom of choice" (ZFC) and cardinality, large cardinal property, self-similarity etc. Fibonacci is just a itsy-bitsy tiny piece of reality ... I don't think it's worth getting hung up in Fibs alone. http://en.wikipedia.org/wiki/ZFC If you have the mathematical background for it - stuff like "model theory" is also very useful, interesting - but it gets pretty nitty gritty and heavy with all the "mechanics" of it all.