Well what a day!
Yesterdays charts looked just like the view from my window – dismal and damp, I couldn’t find anything to trade so did some retail therapy instead.
Today has been a stonker, the kind of day I wait for, the kind of day when everything you like to see in a chart is right there.
Here’s today’s trade sheet:
Looks impressive. Well it is – but – I always scale out. At plus 20 I am half out. Plus 30 I am 80% out. Good day though.
I think that (like Paul) when it’s going in my favour I should look to add to the position rather than scale out.
Cable is a pretty good trade to talk about. Called it the wrong way first thing this morning, so my first trade closes and I am -50 pips already and the coffee is still warm. I originally took a short position because of my view of the daily chart, previously made a lower low and was starting to trend down. The MACD was confirming this (or so it seemed to me). Problem is I was premature – I jumped the gun and took the short too early at 16376, thinking that the trend, the MACD and the big number would keep cable falling.
But when it broke the big number it was clear that I was on the wrong side of the trade especially when I looked properly at the 1 hour chart
Looking at the 1 hour chart, it was clear I was very premature taking the short trade as price was nowhere near the trend line. The Double Bottom became apparent, the big number 16400 had been broken, the MACD trend also broke to the upside. I should definitely not be short here. Got stopped out of the short trade, waited for the pull back to the MA and entered long at 16408.
Learning points from this trade:
- Be patient – don’t jump the gun
- Check the different timeframes for entry (may have seen the double bottom!)
- If you realise the trade is going against you and it is clear that you are on the wrong side of the trade, don’t wait for the stop to be hit
- Reassess – flip the trade if the chart warrants it
- Don’t get overconfident after a good day – a day is just a day as long as I have followed the plan
- Think about how to rework the plan to scale into positions