Update 19 – 23rd October 2009

October 27, 2009

FX Trading

Well I spent most of last week attending Tom Hougards and Dr David Pauls workshop in London.  I don’t attend many workshops these days as they’re usually overpriced, packed full of fluff and presented by sales animals as opposed to actual Traders.

Here I can say that Tom and David’s workshop is the exception to the rule!  Whereas most courses are 2 hours of good data padded out to fill 2 days they have a weeks worth of data crammed into 2 days!  I thoroughly enjoyed their approach and felt that not only did I learn a great deal but that many, many of my own theories and philosophies regarding trading matched their own approach.

Anyway….I should have focussed on the coursework as it didnt help my trading on a discretionary basis!  Here’s a quick update of a couple of losses I’ve taken in the last few days.

CABLE Friday 23/10/09  – Loss -22 points

pw20091023 gbpusd 5 min break south.

Price was in a triangle formation but I believe there to be more probability of a downside move.  When price breaks both the upward trend line and the horizontal support line I go short at 1.6629.  My stop is placed above the last high at 1.6667…a fair distance away…but I think of it as more of a catastrophe stop.  Price breaks and closes below the support line but then rallies back up to point 2.  Am happy with that as the moving average is providing resistance and its forming a lower high.  So far…so good. (How many times have I said that before?)

Anyway Price continues back south and I’m happy until out of nowhere price reverses strongly and breaks north hard and fast.  when price closes above the high at point 2 I decide to close out and take my loss for -22 points.  In this scenario I was right to cut my loss short as price rallied back above where I would have been stopped out.  Learning point?  In hindsight (oh so easy) this wasnt really a great set-up.  May have been better to stay on the sidelines.

CABLE Monday 26/10/2009 Loss -20 points

pw20091026 gbpusd 5 min double top

Ok so start of a new week.  Cable had a shocker of a day on Friday after the GDP figures.  I’m expecting something of a pullback after such a drop.  When I see price print a couple of hi test bars at point 1 whilst forming a double top I decide to take one of my TACT trades and go short at 1.6306 with an initial target of just in front of the pivot at 6280 and next target down at recent lows / M2 at 6256.  Price does drop a few points but then goes sideways at point 2.  Next thing there is a big buyers bar which takes out the recent highs and closes above the recent resistance.  I decide to close out early and take the loss for -20 points.  As always with hindsight perhaps I was a little too aggressive in culling this trade. I just felt that the sentiment had changed and we were likely to see a bigger upswing.  Secondly had I been ballsy I could have retaken my short when price retraced back south of the resistance line.  That would have been a strong decision and ultimately a successful one.

Anyway two trades and down -44 overall.  Not pleasing…but hardly the worst thing that could have happened and I’m learning all the time.  Points for me to take forward:

1.  You don’t have to trade. If you don’t like the look of it then stand aside.  being flat is a position.

2. When you are on the right side you have to look at how you can press your advantage.

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About FXTraderPaul

A professional Trader and Coach, FXTraderPaul blogs about his adventures from the front-lines of FX Trading. A Trader and educator who can walk the walk as opposed to merely talk the talk!

View all posts by FXTraderPaul

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