I wish I could say a lot of things happened this trading week but it simply didn't. Although I did think outside the box and traded the USD/CAD and raked in a whopping 20 pips (almost 18.1 to be precise) The main problem I have lately is that I spent too much time researching and analyzing different pairs, by the time the moment comes to actually enter the trade something has happened that the 'old' research is not that reliable anymore and I back off, and hesitate to do anything. The issue with that is that a lot of 'woulda, coulda, shoulda' comes into play afterwards, one of the down falls I have with Forex trading. They say not to think about it and move on to the next trading opportunity, but I'm human, what can I say. I get pissed at myself sometimes for doing or not doing something regarding trades. Many times for example with the USD/CAD I was in a winning trade but bailed out too early, realizing afterwards instead of gaining 18.1 pips I could've had 100+, and that makes a huge difference and YES I get upset. Not to a point where I start throwing things (although some say that's a good idea to relief stress) but I noticed that I'm tempted to do what many Forex books and guides say is the number 1 problem with newbie Forex investors, trying to take revenge on the market! Basically what this means is that right after you've lost a trade, enter quickly in another trade in the same or opposite direction in order to gain the lost money back, which hardly ever ever works. I tried that months ago and I learned my lesson the hard way. Although the losses were manageable, they were gambling trades and one thing Forex is not is gambling. Anyone that claims that it is, obviously has no clue what they're talking about. Forex is a complex job that requires a lot of researching and patience, waiting for that 'perfect' opportunity to come by to make money. Some people I talk to think Forex like gambling and everyone can become a Forex trader when they want to. Think about it wouldn't it be gambling is someone wants to become a taxi driver but has no drivers license, never driven before, but still drives the car around with passengers? Ok, maybe that's not such a good example but that's the best I can come up with, hehe.
Anyway, I'm getting off the subject here, main lesson learned this week;
'don't spend so much time researching that the quality of the trade you're analyzing becomes endangered'.
Pretty well said as I do say so myself. Luckily this week I still ended up in positive territory.
Another unusual thing happened this week that I haven't seen in before, that I'd like to share and maybe someone can explain this to me. Besides following the Forex markets I also follow the indices on wallstreet. Lately for the past few months the trend has been Dow up, dollar down, euro up, but then the Dow closed to one of the lowest levels in a long time at 8,146.52 and the dollar is gaining value. Not only to the EUR but most majors, except the JPY (which by the way skyrocketed). Now I understand the basic supply and demand theory when it comes to this but why was this cycle broken last week?! Something weird is going on. Next week I'm focusing on the EUR/USD pair again and guess what; I'm gonna try Fibonacci strategy for the week ahead and see where it ends up!
Basically it will look something like this; the EUR/USD on a 15 minute interval before recent close.
I was trying to make it more a solid 1.40 but I ended up with 1.3999 instead, oh well. The idea is that when the pair rises towards 1.40 level or near it it would be a great SELL opportunity. In fact I'm jealous of the people that have short this pair at 1.40 and hopefully I can snatch it up at that same price point, or above. The difference with any other trading week this upcoming week is that is more based on technical analysis.
A daily chart (uptrend until 1.40)
Keep a close eye on this tomorrow, but the actual roller coaster down will probably depart Monday during US trading. That's pretty much I'm trying to do next week, focusing on the good 'ol EUR/USD, I'll post the results on next weeks Stop Trading!!