Combined account Statement 6/14 to 6/18

Combined account Statement

Trading Recap 6/17

Had one of my better day, I was up +45 pips. I was right about the GBP, once it broke its trendline, from the late night hours, it was a drift for most of the day. The good news was that it went below the 1.8300 level and was able to do a big figure trade. Should have held it cause it did very well. I was able to make good money on selling and buying. I wished more days can be like this.

I felt that if the trendline broke, we would have seen the GBp gone down to the 1.8300 level.

Trading Plan 6/18/04

Again looking at the GBP. We had another overnight
reversal on the upside. I would be looking to be
again a buyer of GBP. I would like to see a test of
1.8445. A clear break of that would be bullish. I
have to keep in mind that todays action could be
similiar to yesterday. We had a failed attempt to
break 1.8400 we might be in a muddle trading session
for a friday.

GBP:
Support: 1.8355 / 1.8310
Resisitance: 1.8400 / 1.8445

Trading Plan 6/17/04

Looking overnight trading strong retail sales in GBP
and a very nice uptrend in the short term looks like
we might be testing the 1.8400 level. I am looking to
be a buyer of GBP. I think its going to test its
1.8445 resistance, but it must break the 1.8392 level.
PPI #'s came in a little stronger than expected, but
not enough to scare the market in thinking its
preposterous notion that fed will raise 50 bp. I will
keep an eye out on the euro see if it hits certain
levels to get in.

GBP
Resistance levels 1.8392 / 1.8445

Support level 1.8340 a break of that you might have a
reversal.

Euro
Resistance: 1.2095
Support: 1.1980 / 1.1955

Recap June 16th 2004

Overall today was a bit frustrating. I attempted to make a quick buck with the Strong Industrial Production #'s, but the trades worked against me. Was down -18 pips before I even knew what happened. Today was like how its been for the most part this month. If you miss a good morning move, you will be hard pressed to make any trades in the afternoon. If you are down in the morning, the afternoon hours will be difficult to make back your losses.

Here I thought the Beige Book that came out @ 2pm would help afternoon trading, but it seemed a non-event. The only thing that helped me make some of my loses was when the tape hit from comments for BOE Officials. If I was a little more aggressive I might have been able to break even.

Evening was of course rollover Wedsenday's. It worked like a charm I made up all my losses(-23 pips) and ended up being +9 pips for the day. It was ok, but I could have done better. I have only been live trading 2 weeks and I expect to have the perfect day. Perfect days don't come a long much even for the best traders.

My indicator flagged me that GBP/USD was going to be weaker. At the time, GBP was 1.8300 and in a short term uptrend. The end of the day it closed 1.8268. Mt plan was to buy, my indicator was to sell GBP. 2nd day only, I need at least 2-3 months data before I can declare my indicator a success.

6 Basic Rules of Trading

6 Basic Rules of Trading

1. Go with the Trend. The Trend is your friend.

This is most popular rule of trading, but its amazing how many people love to fight the trend. While trading currencies, I notice many times that I try to catch a falling knife. You know what happens, I get cut. I always question why I do that, follow the trend makes life easier. It must be a genetic defect that I have. That's why every morning I take a look at 5min / 1hr / daily/1yr charts. I also like to look at the 4hr chart, but I don't have detailed charting system yet.
You have to look at the trend, have there been reversal overnight, if there was why? A Trader has to know the Economic releases before they come out and know what they are after they come out. See if any major bank official made comments. World events, terrorism all affect the Dollar and cross pairs.

2. Buy Low / Sell High
I think everyone know this one too. These rules aren't anything new, but I feel its important to remind ourselves, that the most simplest rules are the most powerful rules to trade by.

Buy Low/Sell High for me implies to wait for your support/resistance and trend lines to hit before buying and selling. In my young FX trading career, I notice everyday that if I can have the patience to wait for my levels, I could do great. I will get a bit nervous and try to predict the move. I'm usually wrong.

3. Let Profits Run, Cut Losses Quickly

This you can only obtain by trying to master the Fine Art of Trading. You can only know how to do this with a lot of pain and anguish. Practice makes perfect.

4. Add to a Winning Position, Not to a Loser

Again, you can master this with practice, practice.

5. Converse your Capital

This comes down to Money Management. Everyone has to know that there cannot be an endless stream of money, if you continually lose money. A good trader knows when to pick his points and never risks more than a certain percentage of his cash. He/She also knows that when you reach a level of limit down, you stop. Every trader has an idea and writes down what there are looking for in every trade. How much profit, how much loss. Money management will distinguish you from a lap of luxury or holding a tin cup on the street corner.

6. Practice Patience

Everyone say, "Plan the Trade, Trade the Plan". Every successful trader has a general trading plan and a daily plan. This is why I use this blogger. I have my general plan, which I revisit from time to time to write down what works for me and what does not. I also write down my Daily Plan before I start trading for the day. This helps me collect my thoughts and focus for the day ahead. My plan is not always correct, you have to be aware of a trend reversal. However, its amazing how many times it has helped me. I always write support and resistance levels. This gives me great entry points and when I should exit out of a position. Currency trading can be very volatile. A successful trader knows where he should get in and out to save him pain, but also to make him profitable.

General Trading Plan

Trading Plan

5/22/2004





General Philosophy


I will consider myself as a trend/channel trader. I plan on day trading 3 primary currencies throughout my trading day. I will be trading Sterling (GBP), Euro and Japanese Yen. The majority of my Trades will be involved with Sterling and Euro currencies. I will monitor Swiss and Aussie/New Zealand Currencies. Once I get a better grasp into Australian and New Zealand currencies I will incorporate them into my trading plan. I will closely monitor the cross currency Euro/Yen and Eur/Gbp while trading the Big 3.



My daily goal will be to make 50 pips a day, with a shutdown limit of –50 pips. I will be trading mini-lots, and will take no more than 3 lots at a time. I will have only 2 different open positions at a time. Do not want to have 3 different open positions. It will become difficult to monitor all 3. When entering positions I will attempt to discover the bottom/upper channels of the currency and trade off the trend/channels and support and resistance levels. The main goal is to find very good entry point and monitor cross rates and possible candlestick reversals. I will limit my losses to no more than –15pips. Let my winners run, but with very tight mental stops, unless trend lines and levels break against me.



My ideal trading hours will be 7am – 2pm and then again 5pm – 10pm. Will have no set min/max amount trades to take on a day. If their spot hits the certain levels I am at I will open a position.



Research


My main fundamental research will come from the daily email reports that come from major wire houses, Goldman, Credit Agricole and Morgan Stanley. I will every morning check Financial Times (FT.com), Bloomberg.com, New York Times, and WSJ for major economic and world developments.



Charting & Analysis


Every time I will be using 1hr 30day, 1day 1yr, 5min 5day and multi hour charts to discover and spot trends and channels within the currencies. I will know what are key support and resistance levels. I will use a mix of Western and Eastern Technical Analysis. Use Fibonacci retracements, to discover support/resistance levels. Main goal every morning goal is to find out where the market might be trending based on economic and country news.



I will keep a close monitor of Gold, US Treasuries and Oil. World Economic news will determine the short-term movements of the currencies.



Portfolio Management


My daily goal is to make +50 pips a day. Once in a position I will determine what is my target point and exit point. My goal in each trade will be determined on the current position of the markets. Once up in a position over +20 pips I will set a stop so that I will make no less than +10pips. I will try to make my winners run, unless it hits my target price. I will look to get into one mini-lot at a time, if the position I feel is a very good entry point I will add a second position.



I will set my limit to no more than –50pips. Once the position has turned negative I will look to find a good exit point with a minimum loss. I will not hold onto losers too long. I will always look to get out once it comes back to me quickly. If a position is turning negative, I will not use all three lots, I will look to get out and then back in.





During the day, if am down near my shutdown limit or after three consecutive losers. I will take a quick timeout; reevaluate the charts to make sure my trading strategy is accurate. Look at my trades and see where might have I been wrong.

Trading plan 6/16/04

We seemed to have a little pullback overnight. We had
good economic #'s out UK, but we had a little of
reversal. Today I still feel the trend is to buy GBP,
depending on the 2 key economic 3's Industrial
Production, which came stronger than expected and
Beige book.

After Ind. Production came out they where stronger
than expected. Took a shot to short did not work got
out.

We also have 2 fed officials speaking today and it
will be interesting to see if they will have same tone
as Greenspan or more hawkish. I will keep an eye on
that.

Short term is looking more on the uptrend. Will be a
buyer, unless the tone of Fed officials is very
hawkish. Will keep close eye. Will follow my trend
lines.

Support on GBP: 1.8280 / .8235

Resistance 1.8325 / 1.8355

June 15

I did not trade on Monday. I missed a trade once 8:30 US #'s came out. The trade deficit helped GBP/EURO go up, but once there move was made, the currency where in a very tight trading range.

June 15th, I had the best trading plan set. US core CPI was weaker than expected, from what many traders anticipated a strong #. I felt Greenspan was not going to be as hawkish as many felt. I was correct on that also. Today was very frustrating day. I felt I was like a deer in headlights. I should have made a lot of money, but I didn't.

I made 8 trades all in GBP for 0 profit(I always consider a flat day a positive day).

I had easily 5 opportunities to jump in, but I didn't. I don't know why. Was I fearful of losing money? This is usually not my behavior. Will I be more active? I know my trend lines are drawn well and if I followed them I could have easily been up +50 pips. Even in the evening time, I was relunctant to put a trade. I really am confused. I always stress myself to be aggressive. Today I was not, I am hoping that will not be the trend for the week, cause there are a lot of good #'s coming out.

I also have established a buy/sell chart analyzer for the day. I have 9 indicators that I rate +2 to -2, then total it up to indicate the strength that currency has for the trading period. I will post my results daily and my overall strategy of this indicator. Today, it was weighed GBP strength guess what. It was right. This is the 1st day I have used it, so it will take sometime to fine tune it. I strongly feel that this will help me.

EK

June 10th Evening Session

After a disastrous morning and afternoon, I was able to make most of my money back. I was up +54 pips on the night. The sad part was if I stayed overnight I could have retraced the entire move upwards. I could have made a lot of money. I traded well, but I feel I could have made a lot more money, if I was aggressive or at least stuck to my guns.

The night could have been, nice. The positive thing I had to take from this night was I traded well(should have done better, but I am still learning) and I made good money. Friday I did not make any trades, for two reasons. 1. Reagan memorial would make US FX trading very sluggish. 2. The move happened in Japan and Europe and knew that money opportunity left.

June 10

I said I would never have a limit down day, and so far I am true to my word(I am a trade + 1pip from it, LOL!)

What was looking so nice became complete shit. Was relunctant to sell once rate hike announcement came out. Then should have held on to big figure trade for 250 pips(lol!). Morning Hours I was right on, had +61pips. The question is should I have stopped or go on? I feel no, I gotta keep true to my plan and sell at levels of resistance.

Most of my success was on GBP. Once I made a nice trade selling, everything fell apart. No other trade worked. Once problem I had was once GBP dropped -100 pips and I was short @ 1.2141, I had no resistance levels to work with till 1.8300. It ripped, I got in got out, tired to pick my points, but nothing worked. Then I waited for my hourly trendline on the Hourly. I truly felt that it was going to hold, but it ripped.

My only regrets other than losing money, was 1. I noticed a clear uptrend and what looked like a reversal, but I was stubborn to react to it. 2. After a few bad trades I have to take a breather and reevaluate where I stand and where the markets stand.

June 9, 2004

Had my 1st and last limit down day, very upset. I was looking to buy Euro and GBP on dips and big figure trades. Missed big moves on the downside. On the Euro, I really didn't get hurt that much. Made 3 trades 2 on big figure lost -15pips. Then Made a great trade on buying @ 1.2064, unfortunately I got screwed by FXCM, it will happen, but I am glad the trade worked.

On the Sterling, I only made one trade. I knew once I went in that I was making a "think, "emotion trade. I felt the GBP will rally, I was wrong and got in at levels with no confirmations. I also missed the cable @ 1.8249, if you look @ my plan, I was going to buy it if it dipped at that level. I didn't, I screwed up, and missed a potentially nice profit(+50pips).

I made two yen trades, I had a trend line @ 110.30/35 level. I hit it, it went against me, I had a tight stop. That tight stop helped me, cause it ripped against me. I have no regrets on that trade. It was at a level I was looking to get in, I got in, it didn't work, on to the next trade.

I also feel that my trading plan is to focus 80%on one currency. Today I went from Sterling to Euro to Yen. I cannot catch every trade, if I do, I will miss more and lose much more than I should.

June 8th 2004

Again came late to work, if I was in earlier I would have heard Greenspan Comments and would have reacted to the news.

Made a few good trades considering I missed the best moves of the day.

After 5pm, I made bad mistakes. I must learn not to get frustrated or think I will miss the move. Follow my charts, follow my guts not my merves.

Once I have my game plan for 5pm and after I should stick to it!!!!

I cannot always look for the best tick in every trade, if it tests a level and holds, and what I feel it will do what it should, GO INTO The TRADE, even if its a tick or two away from where you would like to have been in.

One serious problem, I have been having is that I am reluctant to short/sell. I prefer to wait for the FX to go down then buy the dips. I am basically trying to grab a falling knife!!!! I will get cut more often than not.

I should try to follow that move and wait for those supports/stops to hit.

Only problem with this is your guessing that the decline will continue. It goes against my idea of waiting for confirmation. Gotta reevaluate this position.

Must be focused!!!! No more internet browsing, till 2pm. If you dont have your eyes on the trading screeen, opportunites will disppear and frustration will set in.

June 7, 2004

Third down day in a row, becoming frustrated, but one reason for that I come in too late in the morning and miss most of the move in the FX. Must realize when US does not have economic #'s, trading activity will be light. If you start off the day with losses, on a slow day it will become difficult to make those up.

If US trading day will be light trading, gotta be early so I can participate in the European Market close.

June 4, 2004

Employment #'s came out had right plan, but did not execute correctly. Must realize in fast market must be quick to take loss and Profits(with profits might be better to put tight stops, constantly raising).

Made a couple of bad trades, went in at bad levels and got burned.

Don't think that the currency will GO! Wait for the confirmation on charts or news. Currency will never fly to the moon. You will get a good opportunity to make a good trade.

June 3, 2004

Losing Day, paniced out of one position on EUR, then got back in at a bad level and went in twice, made mistake lost money on both trades.

Being live I must be more swift with trigger once currencies hits the level I wanna get in.

Learn today not to be greddy take the profit. 90% of times a 15/20 tick profit is an awesome trade.

June 2, 2004

Active day. Traded Sterling exclusively. Followed trends missed out on a couple opportunities, but will learn.

Must wait for the trade to come to me, wait for top/bottoms of trends.

Rollover worked must be willing to be a little more agressive.

June 1st 2004

1st day of trading, made only one trade +14pips. Not nervous, not in the mood to make more trades, but did see opportunities.

Must learn to wait for trades to come to me and take a shot with very tight stop loss.