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Could be fatigue! On the other hand, the brain just shut down, or something. Something must have happened. Went against almost all forex in-trade management rules. The trading day started badly but I was able to save the day in the end. What exactly happened?
The EURAUD forex sell trade was a counter trend from the beginning. Well, according to one of my systems as the candlesticks are above the Kumo. This is a big indicator to consider most of my trades to be Buy signals. The thing is yesterday the pair had enough confluence for a sell in the Pivot System. But it is good I considered the trade because that is the whole point of speculative finance, gain from calculated risks. The problem was that I was a tad too greedy (or careless) and did not put a take profit at the cloud. I was hoping (there is very little room or none for that matter for hope in trading) the trade would go past the cloud.
Considering the high probability of the price being on a Long bias, the price got to Kumo, violated it a bit, and indeed retraced to Long direction. Instead of exiting this trade because of the mistake of not placing a very clear take profit, I ‘Hoped’ for it to continue in the Short direction. It did not and up to now, it has not. Eventually salvaged the situation and exited with a profit of around 270 points. If I had put my profit at the Kumo I would have gained around 600 points. Anyway, Lesson learnt. For counter trades, consider a take profit point.
Forex Trading Bias At Play
With few words as possible, I was wrong with the CADJPY Long forex trade. First, I was late with the trade (today after much review, I note my entries are a bit late). After the late entry, the system clearly indicated the trend has changed but I was too stubborn to exit the trade. Loss aversion is in play over there. Refer to yesterday’s blog comments on that trade. This article talks more about trading biases.
Waiting on a bigger move on the daily chart.
By 1730 GMT+3 when I looked at the trade, It was negative 600 points. The best thing to do was to exit the trade then but I decided to risk a just a little more. Decided to wait on the Crude Oil Inventories news that would be released in an hours’ time, you know to try to regain some points, or make things worse, Yikes.
Because the Oil Inventories were way less than expected, meant the oil supply was less, therefore increasing oil price. Looney being an Oil Comdoll meant I saved 200 points. I admit I am Proud of that moment but I also acknowledge there was a bit (a lot 🙂 ) of luck in the trade. In the end, negative 400 points for the CADJPY trade.
GBPs Saved The Day
I must admit, exiting the CADJPY forex trade minus the 400 points took a toll on my energy reserves. Looking at my GBP trades (GBPJPY and GBPUSD), felt they had run their course. I did not like the way they were choppy in their movement. Just as I was looking at the GBPJPY, it moved negative 200 points then moved positive 200 points in a span of 20 minutes. The 20 minutes felt like a millennium. I felt I did not have the energy to manage the 2 trades.
Nevertheless, GBPUSD was doing very well. It gave me more conviction to exit the two trades. Exited GBPJPY trade with 200points and GBPUSD with 1250 points.
Another Biased Forex Trade?
In the morning, traded EURGBP Long which in the beginning was ok but later moved against me. Will start treating these 4H trades intra-day or scalps. 4-hour chart trades are not like the Daily chart trades that I tend to set and forget peacefully.
I will not extremely micro-manage this trade as it has not reached the threshold to consider an early exit before hitting the stop loss. Will give it time. However, I do not want to be with the trade until tomorrow afternoon (Bank Of England news releases) and Friday (Non Farm Payrolls), (but the week’s news has been kind to my trades, so…). The open trade is currently negative 110 points. Overall, I’m still past the 1000 point profit for the week. Will do the proper calculations tomorrow. Today’s forex skirmish has really worn me down.
Remember to comment below or at the forex forums. Nice time folks.