Dave's Forex trading journal

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noviceuk

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Ok - Start of my trading journal. I will be using it to track what trades I am taking, strategies being used, whether I am sticking to my plans or not.

My background - I have purchased various systems - Net-trap, Newsnight, 10-minute trader, ATM-FX, and attended a K2A training course. I have been trading for about 2.5 years and for the last six months or so, with a 3 month subscription to Phil Newton's trading room, I finally seem to have been able to gain some consistency

Primary pairs traded are Cable and Eur/Usd, but I also track NZD, CAD, JPY and CHF against the USD to look for trade setups.

Trading window is 6:30-10:30am UK time, although I will trade in the afternoon between 1-4pm on occasion

I will take short term trades that setup in the 5 minute window looking for 10, 20 and 30% of the average daily move as profit targets and stop loss behind days high/low. I will adjust these around pivot points as I have found these to be fairly accurate gauges of where the market will stop or turn. Identifying trend direction to trade in by looking at 4 or 8 hr timeframes, which I am also looking at identifying a swing trade strategy for longer term trades. Target risk is the standard 2% of my account.

February so far has been kind to me - my main trading account (IG) is currently up 10% for the month, here's hoping it can continue..:)
 
noviceuk said:
Ok - Start of my trading journal. I will be using it to track what trades I am taking, strategies being used, whether I am sticking to my plans or not.

My background - I have purchased various systems - Net-trap, Newsnight, 10-minute trader, ATM-FX, and attended a K2A training course. I have been trading for about 2.5 years and for the last six months or so, with a 3 month subscription to Phil Newton's trading room, I finally seem to have been able to gain some consistency

Primary pairs traded are Cable and Eur/Usd, but I also track NZD, CAD, JPY and CHF against the USD to look for trade setups.

Trading window is 6:30-10:30am UK time, although I will trade in the afternoon between 1-4pm on occasion

I will take short term trades that setup in the 5 minute window looking for 10, 20 and 30% of the average daily move as profit targets and stop loss behind days high/low. I will adjust these around pivot points as I have found these to be fairly accurate gauges of where the market will stop or turn. Identifying trend direction to trade in by looking at 4 or 8 hr timeframes, which I am also looking at identifying a swing trade strategy for longer term trades. Target risk is the standard 2% of my account.

February so far has been kind to me - my main trading account (IG) is currently up 10% for the month, here's hoping it can continue..:)
Click to expand...

10% so far this month...well done.(y)

Im thinking of starting a journal.....I trade eur/usd and gbp/usd

good luck
 
All the best, hope you keep this up, I'd be interested to see your charts and trades. Just started out on the journal path as well.
 
Trading goals...
So what is the point of trading ? My goal is to reach a stage where I can give up the day job, but not replace it with another ....so trading a few hours in the morning and spend 30 mins or so in the evening checking charts etc. I have bought systems and subscribed to rt data Feeds before but now rely primarily on standard charts from IG etc
I would like to get to the stage where i can plan and place longer term trades in the evening looking for trades that last days to ride long term trends. Trading over Xmas and summer tend to be more difficult so I stop trading mid-dec to mid-Jan and will likely do the same over the summer..

High level strategy is:
1 6:30 FNT trade if setup
2. 6:30-7am look for trading pairs that are trending or set alerts for a breakout from channel (based on 4 hr candles)
3. Identify 2-3 pairs to monitor for trades.
4. Take trades as they set up.
5. Manage trades to completion

If I have managed to make a profit of 1 percent or above I will stop trading

Evening
Look for options to place no-touch trades on ftse/sp/Dow (10mt strategy)
Update charts of forex pairs and look for swing trades - currently news night but looking to extend this to other strategies which can be followed evening or first thing am
I also follow FX-Friday - which as a strategy places NT bets on Forex pairs that are trending - which helps me to identify pairs to look at trading

More details of how I look for trades and manage them, stop loss, profit targets etc to follow, hopefully with some charts of I can work out how to load them..-)
 
noviceuk said:
Trading goals...
So what is the point of trading ? My goal is to reach a stage where I can give up the day job, but not replace it with another ....so trading a few hours in the morning and spend 30 mins or so in the evening checking charts etc. I have bought systems and subscribed to rt data Feeds before but now rely primarily on standard charts from IG etc
I would like to get to the stage where i can plan and place longer term trades in the evening looking for trades that last days to ride long term trends. Trading over Xmas and summer tend to be more difficult so I stop trading mid-dec to mid-Jan and will likely do the same over the summer..

High level strategy is:
1 6:30 FNT trade if setup
2. 6:30-7am look for trading pairs that are trending or set alerts for a breakout from channel (based on 4 hr candles)
3. Identify 2-3 pairs to monitor for trades.
4. Take trades as they set up.
5. Manage trades to completion

If I have managed to make a profit of 1 percent or above I will stop trading

Evening
Look for options to place no-touch trades on ftse/sp/Dow (10mt strategy)
Update charts of forex pairs and look for swing trades - currently news night but looking to extend this to other strategies which can be followed evening or first thing am
I also follow FX-Friday - which as a strategy places NT bets on Forex pairs that are trending - which helps me to identify pairs to look at trading

More details of how I look for trades and manage them, stop loss, profit targets etc to follow, hopefully with some charts of I can work out how to load them..-)
Click to expand...


Its good to have structure to the day (y)

But dont be too rigid.....go where the money is....whatever time of day
 
Wed 11th Feb

Frustrating day today but ended up in profit...
Early morning Cable trade almost made 20 points before reversing and closed out at BE

USDJPY - took a Long trade as appears to be heading higher (see chart) - closed out 50% of the trade after it made 10 points and then closed the rest of the trade when it appeared to have run out of steam. See the attached chart (if it loaded ok) -once a currency pair trades outside of a channel/area (marked by the boxes) that it has been in for some time I will look for trades in that direction

Sat on a NZDUSD trade most of the day - went in to small profit eventually but then reversed for a small loss before hitting my profit limit, which was set at 10 points above S1. I had moved the stop loss down with the trade - starting out above the days high and then above areas of resistance as they formed
 

Attachments

  • trades-16-02-11.xls
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  • usdjpy.html
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noviceuk said:
Wed 11th Feb

Frustrating day today but ended up in profit...
Early morning Cable trade almost made 20 points before reversing and closed out at BE

USDJPY - took a Long trade as appears to be heading higher (see chart) - closed out 50% of the trade after it made 10 points and then closed the rest of the trade when it appeared to have run out of steam. See the attached chart (if it loaded ok) -once a currency pair trades outside of a channel/area (marked by the boxes) that it has been in for some time I will look for trades in that direction

Sat on a NZDUSD trade most of the day - went in to small profit eventually but then reversed for a small loss before hitting my profit limit, which was set at 10 points above S1. I had moved the stop loss down with the trade - starting out above the days high and then above areas of resistance as they formed
Click to expand...


Well if your P/L is +42pips for tha day and this is in pips...then good day....(y)

More importantly.....did you stick to your trading plan today?...even if you lose but youstuck to your strategy then this too is a good trading day (y)

Either way well done :)
 
End of the weeks trading for me - so a recap..

pip count: 112
profit 240 pounds
% of trading capital 5% (started the month with 5k)
probably my best week to date !!

So did I stick to the plan ? for the most part..) there are no nasty drawdowns - the worst is the early morning Cable trades where I placed 3 orders with different profit targets so a total of 90 pips lost, so less than 2%
I stuck to trading the pairs on my list, but added silver as I follow that and will look for opportunities to take some pips - bit too volatile to hold for the long term.

If I look at the results there are a lot of near break-even trades, some of those make sense as I move the stops on active trades to BE after taking some money off the table - but this may signify I am being too ambitious in the amount a trade will move in my favour, and may need to adjust the strategy accordingly....

All in all a nice end to the week, long may it continue - plan next week is to document the trading strategy(ies) in more detail so that I can look back at how it evolves
 

Attachments

  • noviceuk-18-2-11.xlsx
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Monday and Tuesday recap:

Monday - I took three trades - there was no early morning Cable move but I took a trade on USD/CHF which went 2% against me, and a trade on Cable and EurUSD that both tread water all day and closed out at around breakeven manually, as I don't like leaving trades on overnight unless that was the original plan. Guess that was the US holidays for you....

Tuesday there was a trade on Cable short - setup looked quite good so put on 3 trades, two closed for profit limit and third closed manually at around 8:30 - total 70 pips, but risk was 90 so not a great risk:reward ratio

OK - trade strategy:

Apart from an early morning Cable trade which is based around Net-trap - I look for trends in a currency pair where it has broken out from a previous area of congestion, and then will look for trades in the direction of the breakout

Hopefully attached file shows Eur/USD for the last week or so, each block shows where it has been trading within a range over a day or two (36hrs+). When it moves out of one of these ranges I will be looking for short term trades in the same direction.
So for example around the 16th of this month it moved out of a trading range of between 13450 and 13550 to the upside. I would therefore be looking for long trades until the next trading range forms.
The large box drawn in shows how the Eur/USD has spent the best part of a month between 13400 and 13750. Until it gets out of this larger range I don't expect any major trend to establish itself, so wouldn't be looking for longer term (2-3days+) to set up
 

Attachments

  • eurusd.pdf
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Trade entry and exit criteria:

So having identified a currency pair and a direction to trade I now need to identify entry/exit/stop/profit limit and hence position size.

First of all, if it has moved a long way in the trade direction by the time I start looking (75-100 pips) then I will move on, as this represents a fair % of what can be expected in a daily move so reduces the probability of success- but hopefully by trading in the mornings the Asian markets tend to be fairly tightly range bound so this is normally only an issue if trading in the afternoons.
I will also look at the pivot points, preferably placing a trade around the PP on the right side for the trade (below for a sell, above for a buy). If it has already passed S2 or R2 this is also a good signal that the trade will have difficulty going too much further and a reason to avoid

on the 5 minute chart - I enable 10, 20, 50 EMA and Parabolic SAR. When these are all in the direction of the trade, along with a closed Candle (i.e. all green for a buy, all red for a sell), then I will look to enter on the next candle heading in the right direction.
The stop will preferably be behind the PP and daily high/low, if not an area that has seen S/R, and I may look at the 15 minute chart to find it, but normally as the trades are early in the day this is fairly easy to see. Position size is then 2% x distance to stop.

Profit limit - I will look to take some profits at 10%, 20% and/or 30% of ATR for the currency pair, so for Euro and Cable that's around 15, 30, 45 - for others I follow it may be 10/20/30.
Stop is moved to halfway at first limit target being reached, BE at the second.

The third part of the trade is the discretionary part... if the pair have moved in to a new trading range, and S1/S2/S3/R1/R2/R3 have enough space to let it run I will set a TS for 30 points and a profit limit just the right side of the first S/R line.
If it has moved back in to an area it has been trading in before then I usually take the 2nd and 3rd trades as one and close them out together
 
My main trading account went from 5.1K to 5.5k in the month, so a little under my target for 10% per month but not too shabby. My aim is to get the account to 6K and then add to the pot - might happen this month or might not - to take it up to 10K

I am also trying to work on an overall Swing trading strategy in a separate account - took one trade on Eur/CHF last week that netted 90 pips - this is based on looking for continuation of trends on the 4hr window - so will continue to build on that hopefully until I have more confidence in the overall strategy and will add to that pot a well
From this perspective, looks like a number of currencies are trending up against the USD - CAD, CHF, JPY, AUD and will look at these for trade opportunities
 
No early trade on Cable this morning...

I took a sell on USDCAD as it had broken down from a support level in the 4hr window (see chart) so looks ready to continue downward trend, and sold for just over 1% profit.

I have a limit sell on USDJPY at 81.57 for a similar reason, will see if that triggers
 

Attachments

  • USDCAD-28-2.pdf
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Early morning Cable trade (FNT) - wasn't a strong signal but Cable has been trending upwards so put on a slightly reduced stake - ended up taking half off the table at +20 and closed the other half at +43 pips - so happy with that.

Only other trade I saw setup was a sell on USDCAD at 9709 - should probably have made it 5 pips lower below previous low of the day.... need to be a bit more careful in the future - currently marginally in the red - stop loss @ 9734 - above previous couple of 4hr candle highs. USDCAD has been trending downwards and appears to have settled in to a consolidation range - so took a sell below what i considered the support level ...profit limit @ 9665 - just above S2 and a 2:1 profit ratio if it works out - so leaving that to run and will check back later.
 
usdcad got to S1 and then reversed - unfortunately wasn't actively monitoring due to an all day mtg - so ended up getting stopped out for 2%.... way it goes I suppose
 
Friday 4th March:
End of the first week of March - and trading pot about the same as where I started..-)
Early morning Cable trades haven't done well this week - got caught out on the HPI announcement today - and another trade earlier this week got stopped out as well, and these are the two that did the damage.
Nice trades today though in the afternoon today, AUD/USD broke out of a range it has been trading in for some time, and likewise USD/JPY, both trades worked out to plan...
I have also placed a buy trade on Euro as a long term/swing trade - lets hope that pans out...-)

For next week:
I have also started experimenting with Silver in a demo account - Silver seems to do well when the US market is closed and badly when it is open - so I am going to try buying at the US close each evening at 9:30pm and close it at 14:30 UK time. First trade today +20
Day trade/scalping seems to be working o.k., except for FNT - need to look at ways of staying out of the bad trades (including looking at FF more often). I have also observed that if a trade is heading to the next S/R level the limit or stop needs to be placed 10 pips away - so if a stop is behind S1, then it should be (S1-10), or if a buy is heading towards resistance then profit limit should be (Rx-10) so will use this from now on

Swing trading have some ideas to look at over the weekend time permitting - using a 4hr window for trend, 5min for entry with Fibonacci rules to guage entry and exit strategy
 
Last edited:
well the first 2 weeks of March haven't turned out too well - gave back all of the profit from last month...
Not sure if it was the markets, not following the trading plan or just one of those drawdowns that we all have to live through...

So for this week - markets seem to have little direction at the moment, and a lot of disruption due to the tragic events in Japan - I have amended the FNT trade setup to one kindly provided by one of the net-trappers on the forum - so thanks for that and I'll see how I get on with that - yesterday was a good start. Today signalled a sell, but it retraced up just far enough past the PP to take out two of the trades and left one running, before turning down and making 90 pips. Seems to me that 10 pips away from PP/S/Rx is the right number - it can easily test through less than this (as today) but it hits ten pips allowing for spread etc then it is probably going against me and time to exit, so will ensure I use this going forward.
Also took a sell on USDCHF - it has traded down for quite some time on the 4hr chart and then consolidated around 9220 all day - so took a sell below this- bit close to S1 but it hasn't moved far today so it is within trading plan. AUD/USD triggered a trade potential but the pair is a bit all over the place at the moment and has already made > average daily move, so not in the plan to take it
 
Todays early morning Cable went immediately against me - so just under 2% -

USD/CHF - Took a sell trade @9172. Why did I take the trade ? pair have been trading within a range for some time, and recently broke to the downside - initial stop was 30 pips away. Moved stop to breakeven and took 1/3rd off the table when it went in to profit and started to retrace. Other 2/3rd went on to make 9142 - which was the target limit being 10 points above S1. So was 1:1 risk reward ratio...almost but not quite made up for loss this morning, so will take a look at the markets for a potential trade this afternoon

Demo acct: I am using this to try to build a longer term strategy that works for me based on the 4 hr bars and 5 min for entry. Hoping some combination of Newsnight, Fibonacci and simple buy on reversion to trend will take shape over the next few weeks/months - once I can profitably trade this I will look at moving to real trades, but as the potential stop losses have to be 100+ pips away, and you really need to be able to split the trade for different profit targets, it needs a starting capital of 10K+
 
Trading update:
Took a long on USDCAD as it broke out of previous area of congestion at 9878 - usual 2% risk - I took half off at 15 pips and left the rest aiming for the usual 10 pips below first level R1 - it stopped about 10 points short and after 3 attempts started to reverse so ended up closing manually at 40 pips - so short term trading slightly up for the day after the losses on FNT made up by the two additional trades.

Swing trading:
As I mentioned - I am working on creating a strategy that works for me on the longer time frames (4 hrs) - the attached chart shows NZDUSD - here you can see that it has been in a clear downtrend - but the last few bars have been retracing. The simple premise behind this trade is that if it breaks below this retracement line it will likely continue downwards - so I placed a limit sell order just below the line. I'd look to see if it is triggered or adjust accordingly if the retracement continues higher. Anyway - trade did trigger so am now. Stop is placed 10 pips above nearest level of resistance and target is a 2:1 profit ratio, though I will probably adjust this part of the strategy as it is fairly arbitrary and replace it with some form of Fibonacci retracement level when I get my head around that..
 

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