Aside from the bit of trading discussed below, and having the psychology/risk management conversations with Mr France, I spent some time trying to figure out how to structure my trading sessions from Monday onwards – I guess I am looking for structure and rhythm. Also, I found it difficult to focus/concentrate with the squawk not working properly.
Yesterday’s market was very quiet, as expected, due to Thanksgiving holiday in the US. I took one small trade on Cable on the basis of a rounding bottom and a bullish 1H trend. This trade didn’t work out. In hindsight this could have also been traded as the break of a trendline/flag in line with the 5M momentum (but this would be against the 1H trend). In any case price traded more or less sideways for the rest of the day. I also entered an order to go long on the DAX but then pulled the order after price went sideways for too many 5M candles. Unsurprisingly, DAX was also flat for the rest of the day. Trading seemed thin.
The main event yesterday was the OPEC meeting in Vienna. Here’s a great article that sums up some of the fundamental issues currently hitting the oil market. Although there was some patterns on the chart I refrained from taking anything before the OPEC news announcements would be released – which turned out to be around 3pm GMT. I was actually out of the office at that time, but got back to my desk around 3.15/3.30 at which point I saw two descending triangles on the 5M chart and promptly entered an order to short on the breakout of the triangle (again tiny size). Note the market took the OPEC announcements very bearishly. Using a stop of 50 pips, price quickly and shortly thereafter I was 290 pips in profit. I closed 1/2 the position on Friday morning at +190, with the other half of the position still running. I hadn’t realized that oil trading was halted between 4pm-11pm GMT (roughly) due to the US Thanksgiving holiday. Anyway, here’s the chart:
Update, Friday 6.45pm
Closed the 2nd portion just prior to the oil close of 6.45pm. Oil really took a tumble towards the end of the session at one point falling 100 points in the space of 5 minutes. I closed out the 2nd portion at $66.60 – a gain of 410 points. This was a good trade – making 190 pips on 1/2, and 410 pips on the second 1/2, for a risk of 50 pips – in terms of R it was +6R, Shame this one was only a tiny size – but hey, c’est la vie. Let’s hope I can do it again next week.