No such thing as we dont make bad trades.

Regardless of how careful we are on making good trades, we can never predict when the market is going to turn against us.

As mentioned before, my account was down to 2.4k. I managed to bring it back to 3.1k before another bad set of trades set in and down my account to 2.7k . As much as i want to to determine what went wrong….i cant! Maybe i need another ten years or so to be a guru.

The market just turned around upon hitting a double bottom in 4hrs in which i see it as weak….. the daily and weekly showed me that there could be more potential going downwards as did the fundamentals.

I knew the GBP is in weaker position (reports about their weak economy and the EURO debt issues) and as did the downtrend of GBP/NZD & GBP/CHF, it should logically go down much more but the GBP/JPY has strong correlation with the EUR/USD. And strangely enough, it just followed the “slightly recovered” EUR/USD pair in synchronized movement.

As yet again, this set of bad trades was martingale in wrong direction. I have to revise the martingale trade rules again.

Conditions:

1) max lousiest trade’s pips damage set at 200. The only allowable freeplay to determine the closure of the trades would be the opening of the last (3rd) trade to max 200pips.

2) only a set of three trades allowable

3) within 10-15% of account size

So given account size of 3k,

10-15% would be = 300-450

For every X pips, i entered a martingale trade…. the total damage would be

a) For 70 pips (trades at 0, 70, 140) = 390pips

b) For 75 pips (trades at 0, 75, 150) = 375pips (i am taking this as my option)

c) For 80 pips (trades at 0, 80, 160) = 360pips

Bad luck?

Seems like tiger year is not my year. I knew from the first series of events through my gambling and misadventure with one forex trade that i am destined to fail big time for this year…..

Looks like i am going to lose my account for good when i lost another USD471.84 yesterday which set my account back to USD2400. That is like USD1k within a week of bad luck, especially so for a pitiful account size of orginally USD3.4k.

Lessons learnt?

1) dont listen to advice about using indicators?

2) Trend is your friend till proven otherwise. Dont determine its reversal or future directions. Let price movement prove iteself.

3) Martingale is very very painful in wrong direction.

I have checked the COT report and it doesnt seems to strongly suggest the correlation between the report and actual movement for GBP/JPY. I am looking for similar volatility pair and spotted two: GBP/CAD and GBP/AUD. Hopefully they can give the excitement and not heartache from GBP/JPY.

The last trades that i did today was in short but the price didnt make “effort” to penetrate the lower lows and seems to observe an invisible S&R in which i cant really make out what or where. I exited the trades with a miserable profit of a few dollars when the price kept hovering upwards. Will see how is the direction that it is going to take tomorrow….. i foresee a minor retracement up to Bands(20, daily, middle) before heading down again.

Yellow pen’s insight on how to do a proper TA.

This is quite informative. It was quoted from “yellow pen” on the following forum:

http://forums.hardwarezone.com.sg/showthread.php?t=2676305&page=2

i just share a bit ah…
u can ask your questions from there…

first of all, when u open up a chart, the first thing u would probably want to do is to identify the trend, because in TA, “Trend is your friend”. By identifying the trend and going along with it, most of the time, you will not go wrong. Buy at support, sell at resistance.

However, do note that uptrend can also change to sideway or downtrend. And the key is to identify it using either candlestick reversal patterns, or crossovers from the indicators, namely the stochastic, MACD crossover, etc…

After identifying the trend, next is to identify the various support/resistance levels..

Bear market, supports break easily and resistance holds.
Bull market, resistance break easily and support holds.