Taking a trade late in its life ... and yet, too early!

GBPUSD

Looking at the 4-hour chart, it looks like an opportunity is opening up here:

The 10 ema has just crossed up over the 25. I _want_ it to go above 50, but maybe it won’t.

The daily also shows a nice opportunity: the SAR is below the candles right now:
Taking a look at the 15-minute time-frame:
Interesting – that blue circle is where I was wanting to get in this morning. Should I have??

I may still get in now – it’s strongly bullish yet. I think I’ll wait for it to close above resistance, then get into this trade. Why? Cause I want a winner. Not need. Not just profit. WANT. It's an ego issue, for some reason.

Note: if it closes above that resistance right now, then there is a GOOD chance it will get all the way up to the Fibonacci line at 2.00216 or so

The 15-minute chart again:

Still watching, at 9:54 p.m … started watching close to 8:30!!

If I’m going to play with the 15-minute time frame, then I really want to wait till after it tests the support and bounces back up: within a couple timeframes now:

Okay. It just finally bounced off the wholesale line. I took a small trade: bought 5 micro mini lots at 1.9954, stop at 1.9920, limit at 1.9958 – tiny profit, if any!!!

Note that all this was on the night of the 22nd - yesterday I was too busy to blog, far too busy to do any analysis or take a trade. Anyway, as soon as I took this trade, the GBP/USD started to down-tick. I'm a compulsive watcher, so I watched as it plunged about 30 pips. Forced myself to not panic, as it hadn't hit the very low stop. Then, watched with glee as it rose again ... and hovered just below where I'd bought. Finally, it crept up, up, up .... past 1.9954. So as soon as it was well above, I moved the stop up - to 1.9959. And the limit to 2.051. And went to sleep.

As usual, when I awoke on the 23rd, I found I'd been stopped out. But at least I was stopped out at a small profit rather than at the way heavier loss my original stop would have locked in.

Lesson learned: Move the stop up as soon as you can, so that you lock in a profit rather than a loss. :) If you have the time to keep watching, you can keep adjusting the stop to lock in meatier profits - but at least if you do have to sleep, you won't lose it all overnight. :)

And then when I got home yesterday, just for kicks, I looked at GBP/USD again. HAH. I was right, it had got up to 2.057 and higher. Oh well. I'm the one that moved the stop up, instead of sticking to my original trade plan.

Lesson learned: I'm confused. :) If I move the stop up, I lock in a profit, but potentially give away a much greater profit. That makes no sense. Maybe the lesson to learn is that I need to be able to dedicate more time to watching my trades. :)

4-hour timeframe on GBP/USD

Okay, this morning I'm looking at the GBP/USD just because we happened to discuss it in class last night.

Here's what the 4-hour timeframe (my target management timeframe) looks like right now:

And here's the zoomed-out view of the same chart:

Hmm - that's barely readable, but I hope you get the idea. We've got a bearish bias right now, which means I can expect the USD to get stronger against the GBP. Not sure about that in the real world, but this is online trading, right? :)

Jordan would be looking at the Fibonacci retracement right around the circled area - I'm not sure what I hope to gain or learn by looking at the bigger trend as I am doing.

To see the longer trend, I'm looking at the daily chart as well:
Again, barely readable, but what it's saying is that there is an engulfing bull forming right now. I'm off to confirm on the 15-minute timeframe:

Back at the green ellipse is where the 10-period ema crossed over the 25-period ema and the 50-period ema - that would have been a great position for a long entry, but I obviously missed that. Right now it's still bullish, though, and the parabolic SAR (the dots) are below the candles, so maybe this is still a good entry point.

Let me look at a larger number of candles:


Hmm. It's really close to major resistance on the 15-minute timeframe, as you can see from the red line I've stuck in at the M way at the peak of this chart.

I'm confused - I think this is trying to tell me that I'm likely to see a retracement as the pair heads towards that M, but we still have a bullish trend on the 15-minute, and the parabolic SAR is below the candles.

The pivot was a while ago, so I guess I'm going to sit this one out and not try to trade it right this minute. Darn. I thought I had a good entry point - but maybe I'm analysing this too much. :)

- Maya

Learning to walk

So Jordan's put me on a diet: Not more than one trade a day.

Who's Jordan, you ask? Why, he's my Forex mentor - I'm in a group of people who're taking classes to learn about trading Forex. I've been taking the classes offered by The Financial Edge (fantastic classes they offer, by the way).

I'm new to the whole Forex-trading thing. But I'm pretty sure I want to learn as much about it as fast as I can. So, with a couple of classes under my belt, I signed up for an account, stuck in some money and started. I have the beginner's eagerness for experience, mingled with probably the best 20/20 hindsight-insight ever! When I look back at the trades I've already made, I cringe. How come I can't see the pitfalls before I jump in?

I've been trying to analyse the entry and exit possibilities, but, over the past 40-plus trades that I've taken since August 8th, I've lost way more often than I've won. Thanks to listening to one of Jordan's core pieces of advice, I've only been trading micro-mini lots (a thousand units at a time), so I haven't done terribly badly, but it's still sobering to realise that unless I shape up and really digest the technical analysis, I could potentially lose a ton of money in this marketplace.

Of course, Jordan, when he discovered what I was doing, was firm about a few things:

• If you have a day job, don't try to manage your trades on less than an hourly timeframe
• Do spot your trade setups on an hourly, daily or weekly timeframe
  
• Do use the parabolic SAR to confirm your desired trade on the 15-minute timeframe
• Learn to walk before you try to run
  

I tried, I really did. But by the time this month's class rolled around, I was still making the same mistakes - my account is currently down over 50%.

Jordan, being my mentor, has decided it's time for me to really learn - so now I'm on the diet as prescribed by Jordan: no more than one trade a day. It's a simple diet, but I'm already having trouble sticking to it, just two days in! :)

The theory is that the knowledge that I can only take one trade a day will force me to do deeper analysis before I place the trade. That is definitely already happening. But I'm seeing lots of phantom possibilities that I really, really, really want to trade. The discipline must be happening somewhere, but I'm not seeing it yet. :)

So here's the idea: I'm going to post my analysis (HAH!) every day and you can all tell me what I'm doing wrong. I'll include my chart analysis as I do that, so my trade log will be public. You can all follow along and help me re-interpret my analyses. I'm probably going to make lots of mistakes, so you'll have the ability to feel superior all the time - it's a win-win situation, because I'll be learning while you're honing your trading instincts.

In case you're wondering what tools/setup I've got: I'm using Equis Software's MetaStock Pro and I have an online Forex trading account. I have a day job, so I only do the trading either really early in the morning or after work - with my crazy work and class hours that means that I typically trade between 5 a.m. and 6 a.m. and again between 7 p.m and 9 p.m. with a few more analyses thrown in between 9 p.m. and midnight.

Here's to a fantastic journey over the next few weeks, months and years!

- Maya