2/3 – Two trades net gain of 0.5R + psych review

Here are the charts of the two trades I took today (again, no action until 3pm!!)

136 Cable Mar2

137 Oil Mar2

Risk Management/Money Management update

Increased value of unit of risk to £100.  Continuation trades and 123-based reversal trades will use one unit of risk per trade.  Reversal trades using setups other than 123 will use 0.33R per trade because the results of these have not been good based on the 130 trades analysed recently.

Risk Management will not vary between DAX, Cable and Oil.  The Oil trades in the last two weeks have been ok, and I seem to have realised the mistakes that I have made on that instrument.

Psychology Review

(refer to my end-of-day checklist here)

1.  The proficient trader was in charge of the entry and management of both positions.  On Cable a lot of patience was required prior to getting into the trade – with needing to navigate around US news – but this was handled well – there was no jumping the gun. The setup on Oil jumped out from the screen.  I ahd actually been looking for a bearish reversal trade from the $50 handle – instead it turned into a bullish continuation trade.  Unfortunately I could only get 1/2 the position as price had moved too far by the close of the confirmation candle.

The managing of the position was also handled by the proficient trader.  Stops and targets were planned and moved carefully.  Even though I had said that everything would be exited at T1, I did in fact make some provision for using the EMA (1M) to potentially manage the 2nd half of the Cable trade.  Ultimately this was never relevant.  The tightening of the Cable stop turned out to be a bit unfortunate but that’s how it goes.  On the other hand, I could call myself quite lucky in the way I got in and came out of the Oil trade. You win and you lose some.

I had also looked at a long setup on the DAX – however this was very similar to the setup from last Monday – where a bullish 123 pattern had occurred – but below the key level.  The same thing happened again today.  However i did not go long as the pattern was clearly on the wrong side of the key level.  Ironically price turned and declined a good 40-50 points – which would have produced a losing trade.  Good work on staying away from that one.

2.  So overall some good patient trading all round.  Most of the “trading well” entailed sitting on my hands.  Basically nothing happened all morning and i just on the sidelines.

3. With more experience I will become better at tightening the stops.  Thus the proficient trader can become better by having more screen-time.

4. Good trading – avoiding invalid setups (DAX), patiently navigating around US news for Cable trade, planning stop management and targets and sticking to it, planning and sticking to plans re entering of trades (1/2 on stop-entry, 1/2 on confirmation), risk management calculations, spotting the correlation between the USDJPY breakout above 120 handle and Cable falling, identifying T1 levels for Oil by referring to 1H timeframe (well done!)

5. There was no bad trading – yay!

6. No comment – why no comment – this is because I have not gotten around to doing further psychology work.

So who was in charge today? You guessed it…. Gordon Gecko was!

proficient trader

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