My Eur/Jpy Trade journal

What I learned from today was both good and bad. The bad first, I was pretty dead set against placing a trade for reasons stated above. However, when I checked the chart and price action shortly before 4am open I wa swayed to make the trade as it seemed obvious to me that there was a lot of downside pressure. I really need to stick to my analysis and not deviate. This ended up being a proitable trade that went much farther than my take profit target. While the result was good it still seems that I have to discipline better as more times than not the trade will go against me for the reasons that were outlaid. So end result was good but more determination to be selective is still needed. That is how the small few who stay profitable over time do it I am sure.

On other thing I am pleased about is that I feel pretty confident in what the chart is telling me. If I didnt learn anything else while blowing a few accounts it was learning to read a chart. While still a work in progress I can envision movement pretty well. Entry is where I need to focus as sometimes I know the right direction but get in either too early or too late. I may experiment with set and forget it style instead of manually entering at london open as long as price is respecting trend and 20MA on 4hr candle.

Prep for the day:

3rd resistance is 103.80
2nd resistance is 103.08
1st resistance is 101.96
Pivot 101.24
1st support 100.12
2nd support 99.41
3rd support 98.28

Daily RSI is currently at 23 and 4hr is at 25.
Both charts are either touching or very near BB2 lower end. This is something I must hold fast to as the downward pressure is obvious but it will break my rules to take a trade. I may reasses come london open but as of now there is no trade planned. S1 is basically the same is fib retracement 78.6% level. Could be tough to crack or it could break easily. Lower BB2 on daily is also touching this area. I think this support may hold. May consider short if price reaches near pivot of 101.24

In that case I would consider short at 101.24 with stop loss 10 pips above 1hr 20MA but not more than 30 pips stop loss. Target would be 100.64 for 60 pips which would be well before S1 and still above the low of the last daily candle.

On another note I am going to try and include Stochastic Slow 5.5.5. to help with RSI in signaling entry. This pair may trend in the lower area of RSI for a while so slow stochastic help give a signal within the low periods.

No trade taken will stand aside today. Rsi daily 23 and price has already touched S1 and come back up 50 pips. May be short term bottom. Will study other pairs this weekend to see if I can apply this strategy to them.

No trade today as I will strictly follow my rule of no trading first day of the week. I am glad I did so as my sort bias would have caught me in a trade with no edge today. Risk vs reward was not enough. Most of my biggest losses have come on a monday, I will wait to see what the market has in mind then decide my next trade. My bias is still down and I will wait til it shows downward movement again.

I wa itching to pull a trade and I am pleased I did not give in to my tendency to overtrade. Even knowing the pitfalls it is diffiult not to get in the market. Had a shorted at the open of 4am I would have had a 24 pip drawdown which is within the limt and I would currently be about 20 pips in the green at this time, that is just about 1:1 rr and that is not acceptable to me at this time. As it is, I see that my next evolution will be to not even worry about what I "would" have made andinstead feel confident that my decisions are in the best interest of longterm success.

As I am typing the trade would be heading back to break even now so that further validates my thoughts. No looking backward only forward. No loss is better than a loss.

Of the other pairs that I have studied over the weekend it looks like GBP/USD is also a good candidate to try my strategy on. Will moniter this week and paper trade it to see if it will work.

Quick check of the chart and it looks like things are setting up nicely for a possible short at london open if my strategy is correct. I will have to validate my bias after the close of daily candle at 8pm est. If price stays around current levels then it will be close to the 4hr 20MA just above it. A break below with all other requirements met would allow me to short. As of now a short of around 101.26 looks good if it around this price at london open and heading downward. Trying to get better at percieving price action and using that analysis with indicators and patiently waiting for my set up. I feel some progress has been made in this area already. I am a little suprised at how helpful it actually is to write down toughts and reasons and the benefit it gives.