Short EURUSD -15 pips

With dollar failing to make lower lows and showing strength, I saw SMT in Euro as it made another high. I was thinking it would finally drop and decided to look for a short.

My trade idea was short at 1.0600 looking for 1.0535 which was an old low.

Dollar was retracing to a +OB so I was not terribly worried about what might happen as it was showing a willingness to rally.

 Euro had moved some 20 pips originally but right now wasn't showing willingness to drop so that got me nervous as ICT mentioned they might to a 3-top pattern before dropping it.

 At this point Dollar was still holding on but nothing was happening in Euro.

I lowered my stop to 15 pips and decided to learn from this experience if it indeed trade higher as it wasn't really my call that it wouldn't drop.

 Euro did end up making a higher high that day and dollar failed to make a lower low, so this loss can be mitigated.

Short NZDUSD +15 pips

I have been looking for NZDUSD to reach for 0.7125 Daily +OB, but it had failed to do so, so I was looking for it one more time.

As I've been doing lately, I look at the price past midnight and see where we open, where we could go and then go the opposite way. I set my sell limit order at 0.7170 and went to sleep.

When I woke up, NZDUSD had moved to 0.7154 which was an old equal low, even though I expected it to move lower, it had previously failed so I decided to take half of my position off here for 12 pips after it gave back a few pips at this area.

I was afraid that dollar would fill in what I thought was a H1 void as it was breaking below the OB, so I trailed my stop to break even.

Price went back up and ended up taking me out for a 3 pip profit.

I think I moved the stop tight very fast, but also 0.7125 was never reached, and Kiwi gave most of the trade back.

Overall: +15 pips that taste like too few.

NZDUSD Short +35 pips

February 14th, 2017

After two months out with negative market conditions and a long trip to South America, I finally decided to try things out once again. I was skeptical of going with short term trades as I have not touched them in a while but this is definitely my preference for trading so I decided to start practicing once again.

My only two possible trades were short the euro or short the kiwi. The kiwi I was looking for a drop to 0.7125 from last week when it was trading at around 0.7210 but I did not get a fill with my limit order.

This time around, I saw price action that looked promising going into London and placed a limit order at 0.7190 looking for 0.7125 once again.

I woke up at 6am and the trade was up 3 pips or so. Not being mentally tough, I was already thinking of lowering my stop and what not. At around 7am, or so, the trade was in the red for 15 pips at one point and I did not know what to do. I was already questioning my ability to place trades, especially short term.  I've noticed I've gotten better at seeing where price is going in the daily, but so far had not executed properly.

Anyway, I decided to ignore my worst instincts and let the trade develop. It went positive again and when I was at 5 pips or so thought about closing, then thought about lowering stop and what not. I held and was thinking of changing my take profit as it was approaching 9am or there abouts.
I missed a spike to 0.7155 and was regretting it as the price was again at around 0.7180.

At this point, I changed my take profit to 0.7155 and thought I'd manage it from 10-11am. Unfortunately, (or fortunately) some things came up and could not, and the trade closed at 35 plus pips, at 0.7155. The trade went to 0.7135 but reversed after that.

Overall, I'm glad I avoided the trap of lowering stops or taking profits of a few pips. I held the the killzones and time of day theories and did better because of that.

The negatives: I had not checked Forex Factory prior to trading, so that could have been a factor in my trade, and also taking profit right away. One caveat though, was that it was already around 10:20am when I changed the stop so it was a profit taking hour anyway.

I still think NZD is going to 0.7125 so I might look for another opportunity to get in.

The charts:

The Monthly chart shows 0.7125 as being the mean threshold of the three consecutive down candles.

   There's a +OB at the 0.7125 level on the weekly.

Daily shows equal lows below 0.7125

What I was seeing at midnight or there abouts.

What happened during the day with NZDUSD.

EURUSD Short +12pips

I was up for London session looking for a short on a currency opposite the USDX as I was thinking it still wanted to go higher. My hypothesis for the day was that USDX would drop seeking liquidity and then drive higher as it had been doing for most of the time on up days.

There were some news releases at 3:00am for EUR, as well as 3:30am and 4:30am, so I was focused on that one, although because of EURGBP I was thinking they would hold EUR and drop GBP.

At around 2:45am I wasn't seeing anything on GBP, but EUR looked like it was a trade to go lower, even ahead of the news (which in hindsight might have been a terrible idea) with a tight stop if I was wrong.

I took a short at 1.0633 fill, with stop at 1.0655, which might have been too big, and probably 1.0650 was the right stop in that scenario, looking for liquidity below 1.0585, so a 2.5:1 trade basically.

With USDX having behaved as I was expecting by dropping lower to take out stops and then a move higher.

The news did not move the market a lot, but the trade started going in my direction. The trade size was 1 mini lot, which is the minimum amount I can trade on this platform. After about an hour, the first target was taken out and I would have liked to take some off but I can't with the sizes I'm trading at.

And USDX looking to take out a high:

The trade stalled there for a while, and only moved lower another 5-10 pips on EURUSD, with nothing really happening. I had moved my stop to +3 pips to break out even if it spiked the other way as I did not see it going higher than where it started dropping from.

At 5:00am when London session ended, I decided to go to sleep, I put my stop at +12pips as I did not want to see everything give up while I slept.

EUR went up higher to 1.0637 so it took out my stop and went higher to an H1 -OB, that gave two chances to get short again, but I was sleeping. Ultimately, EURUSD went to my target.

I probably mismanaged the trade but trailing the stop too tightly, it was psychology saying 'hey, you want to get paid something for this effort' which is probably the wrong mindset. It's hard to see your profits evaporate, there's no such thing as a free trade, even if you get out at break-even, at one point you were up. When I went to sleep my risk-reward was probably 1:1 or lower at that time and it's hard to take that trade.

Another thing I learned is that trading London is hard with my schedule. I live on the East Coast and getting up anywhere between 2-4 in the morning is tough, and it's especially hard staying up watching the trade and micromanaging. I'm going to have to learn to trade New York or look for a set up and then go to sleep and trust my analysis and my stop.

USDCAD -4pips

So many lessons learned today, mostly about patience, trading London and not trying to do something just to be doing something. 

So, I got up at 7am and what I had seen at midnight had already passed (up move to 0.7055 to fill a void on NZDUSD). I missed that GBP was giving a retracement to get a chance to get short to get my objective of 1.2345 sell stops being taken out. I did not really see anything on EUR, so I was looking at CAD. 

At the time I'm seeing that it has stalled at a +OB, and that GBPUSD still has room to drop (bullish USD). USDX was showing the same thing as USDCAD:

The analysis by itself is defensible, the problem I believe lies in the execution. I took the trade at 7:37am, at 1.3508, with an objective of 1.3565 stops, and a stop loss of 1.3493, essentially a 3R trade. What I failed to account for was that there would be a news release at 8:30am for CAD of high impact news, so I should have waited to see how it behaved prior to that. I guess I did not want to miss the trade by it going long, which is obviously flawed thinking.

USDCAD rejected faster at the 8:30am news release after dropping to 1.3497 and then stalled at 1.3430, where it started trading a bit lower, in tandem with USDX. I thought it'd ran higher already and trailed my stop to 1.3403 below the body of the closest +OB. 

Price went exactly to 1.3403, took me out, then continued higher and it currently sits at 1.3440, with USDX going higher as well.

I guess the takeaway from all of this is: don't try to do something because you are afraid you will miss a trade, because you are going to miss most of them, there are set ups every day.
Do not rush to trade ahead of the news, by mindful of those. Do not trail the stop too tightly.
I was thinking I had dodged a bullet and didn't want to suffer a bigger loss. I was also trying to make back what I'd lost the previous week all at once.

The minimum lot size is one mini on this account, which I'm treating as a 1,000 account (thought it's really 5,000). I had made 5.1% for the week on my trades for the week which was more than enough.

The psychological aspect is definitely a lot more important than the analytical one, because even with a solid idea, trade mismanagement can be killer.

NZDUSD Short +51pips

I had been paying attention to NZDUSD and had been able to see the movements well as it seems to be a currency that is very trendy instead of consolidating at the moment.

At 4:30am, I saw this price action in NZDUSD while USDX looked primed to rally. So I decided to take a short, aiming for 0.7035 as had been called previously on my notes.

The trade stalled for a long time but eventually started going lower.

I wanted to take something out at this point but 0.10 was my trade size and that's the smallest allowed on this platform so decided to monitor it. I did lower the stop to 0.7106 from the original of 0.7116.

The trade continued in my direction but was stalling again at this order block, but I was confident since it had breached the mean threshold of it.

After it traded to the lows, USDX was running over the high and failed to run higher with speed, so I decided to close out my position early instead of waiting for the last 5 pips. NZDUSD ended up going to 0.7035 and rejected fast, closing at 0.7099, so that was a good call on my part to get out early for +51 pips.

Totally Wrong on USDCAD -20pips

Again I messed up, took a trade and did not take a screenshot of what I was seeing at the time.
I'm going to try to recall as much as I can what I was thinking though.

It's about 12:05am and I'm thinking that I had my experience with the NZDUSD not getting the turtle soup so I do not want to miss another trade that looks 'obvious' to me as I was seeing equal highs on 1.3585 on USDCAD as can be seen below.

Therefore, I decided to take the long as I was seeing support off an H1 +OB, and took the long at 1.3540, with a stop at 1.3513, which was below the sell stops I was seeing the previous day.

USDX was supporting my analysis:

Because it was holding tight and respecting +OBs. Turns out USDX had a correction and USDCAD went seeking sell stops instead of the buy stops.

So I was completely wrong on my analysis and completely wrong in wanting to get in a trade prior to a good time with tight stops. I guess I wanted to take a trade more than really seeing it.