Cable Update and the one that got away

November 3, 2009

FX Trading

It’s been a pretty empty, quiet period for me in the last week or so on my early morning trading.  The last two days demonstrate exactly why.

Yesterday Monday 2nd Novemeber I had done my relative strength analysis and it had told me I should be buying Sterling and selling US Dollars. So I was looking to take advantage of that by taking a Long in Cable.  However the market had other ideas and decided to simply plummet at the start of the session.   There was no long trade on offer.

Now some might say that I should have just ripped up my plan and reversed my view which is a very plausable piece of advice.  However personally I find I’m better when I make a plan and stick to it.  If that plan isn’t triggered then so be it, there’ll be another day (have been telling myself that a lot recently).

Today was the other side of the coin.  I had yet to finish my early morning analysis before Cable just dropped hard as per the view below.  Should I just jump on board?  Well for me again, nope.  Just jumping on a moving market before I’ve finished my analysis smacks of gambling and impulse trading.

pw20091103 gbpusd 5 min late to party

Cable dropped nicely at point 1 and broke the trendline. As I mentioned I was stilll doing my analysis of the markets and so missed that opportunity.  At point 2 price did re-trace and I suppose in hindsight that was a chance for me to sell a rally back to the previous support line however there was nothing telling me to pull the trigger.

Then at point 3 I saw a Bear flag  / wedge being created and was tempted to take the short however this was triggering about 10 minutes before a UK News announcement so I ended up holding fire. Naturally it dropped again after the announcment.

So 2 great examples of trader discipline of not chasing the market or just being far too slow to react to a fast moving market?  You decide. 

Frustrating as it is to watch FXTraders Al and Sandy doing well I know that I just have to wait for my next time at the plate and to wait for my ideal pitch.  That’s the thing with trading, the opportunities keep coming around again and again.

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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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