Every trade we take is a teaching moment and if we don't learn from it then even a winning trade is a loss because being rewarded by bad practises just reinforce bad discipline. That price will eventually be paid but at a higher cost. Should you learn from it then that loss is an investment. A trader becomes better because it makes less and less mistakes. Trade opportunities are ephemeral and as a trader you need to develop your trading process because it is the process that eventually delivers you consistency. If you don't have a discipline process you will drown.
I will try again to write them all down in future. What I was doing lately was just writing down a handful of trades every week or 2. If I wanted to look back at my trading history for clues or whatever, then those handfuls of written trades each 1 or 2 weeks (samples of the population- statistics) should suffice in identifying a pattern of issues... I don't use that many different forms of analysis, so I don't see much of a problem doing this. But, i'll try write them all.
Even if I don't write my trades down, I still learn from them. I only started writing trades down about a month ago. Clearly I was learning lessons before that point, so basically what I am saying is one doesn't fail to learn anything just because they didn't write the trade down. Getting into a trade based on nothing other than feeling on the other hand would be wasteful because, to quote you, "even a winning trade is a loss because being rewarded by bad practises just reinforce bad discipline
I do realise that I have only started to make money back in the last month, and that this is around the time that I started to write things down. This could be the reason that my account seems to be turning around...or it could just be a coincidence or simply due to the fact that I am bound to see significant changes in success early on because I am going from someone who knew nothing about it to someone who knows at least something about it. At the same time, I wrote down trades at the start of that month but I was also making money back when I wasn't writing them down too. I need more data in order to make a call on this.
That is your immediate problem. You don't have a trade plan. You have some idea of why you are taking the trade but the key question you need to address is the premise of your trade. You need to develop a discipline to write down your trade plan before you execute your trade to avoid post trade execution bias. That should be part of your trade evaluation process.
I can understand how you have identified immediate resistance and hence the price level for protective stop placement. This is however different to price action assessment to go short on a trade. What was it?
This right here sets off the alarm bells for me.
trade plan?...what do you mean by this? I am not a purely systematic trader. In fact, if I was made become a purely systematic trader then I would probably pack in all in. That would bore the life out of me! And for me to put exceptional effort into something, I must enjoy it.
Perhaps my understanding of this is a little off, but when I say a purely systematic trader what I am referring to is one of these people that has 1 setup and then aims to find that 1 set up in the market. If that set up isn't found then they do not trade. While if they are happy to do this, then more power to them, but I have absolutely zero intentions of pigeon holing myself like that. I come from a construction background and not once did we ever turn up to a job with 1 tool. I want to be able to look at a handful of charts and be able to identify different set ups, all of which I am experienced in using.
I would also like to draw attention to my equity curve.
Clearly something different is going on in recent times... perhaps it's luck, perhaps it's the development of skill... Either way, to change too much too soon is not what I was thought in Uni when carrying out experiments. If I change any more than 1 variable at a time, then how can I tell which variable made the difference? Maybe it is luck this last month...maybe the markets were extra kind during that period, but maybe it wasn't.
At this stage I just want to point out my dyslexia again.
The last time I checked, about 5-10% of the population were dyslexic. I am not wired the same as 90-95% of you, so following a hard set path developed by people who do not think or act like me naturally raises a red flag. One thing that stood out during my test for this was my elevated ability with patterns and abstract thinking, including mental rotation of objects. I am not saying that my path to "trading success" requires me to follow a totally different path to most of you or that it means that I get to follow completely different rules... what I am saying is that unless you (collective you) are dyslexic, then my path will not be even close to being a carbon copy of yours (collective yours). Without a doubt there will be a lot of things that we will both abide by, but there will still be a significant difference.
I cannot know everything related to a trade I am about to make, nor am I attempting to know it all. What I am doing is very simple... I accept that I will not always be right. Even when there is overwhelming evidence for 1 direction, it could very well go the other way regardless. My objective is to skew the probability in my favour. I try to figure out where the pressure is and then I trade with that pressure. At least that's what I am attempting/trying to develop. So I look at interest rates and inflation and try to figure out where the pressure is there between two currencies. Once I know where that pressure is, I look for set ups to that direction. Simple! Obviously apart from practicing this, the real hard part is the psychology!
Having a view of USD bullishness might be an informed opinion but what you need to understand is to learn how to integrate this type of information into your trading methodology in making a trade decision. I too share the view that there is bullish sentiment on the USD as currently the market has a 80 % probability rating that the US will hike interest rate in Nov. There will always be a range of conflicting economic data and prices will ebb and flow. The challenge is learning to navigate through the minefield. This kind of skills can take a long time to develop.
I also use multi time frames but there are very specific purpose of use. You need to sort this out in your trade evaluation process. The issue is not the "use" but "how it is use". Which time frame did you use for the trade decision? Is this consistent with your other trade decisions? Was it a problem in this particular trade?
As I said before on the use of indicators, if you want to use it then you need to know how to use it properly. With indicators, there are trade conditions when it is problematic to rely on it. You need to know what they are.
I agree with this and yes, it will take time. I need to carry on analysing and doing post mortems, seeing what does and doesn't work for me. I will continue to listen to the suggestions/advice from others... considering it and letting go of what doesn't fit. All I can ultimately do is try to remain as objective as I can and also realise that at times others will see things that I cannot.
Read Technical analysis for the trade professionals by Constance Brown. There is an entire chapter devoted to how to use oscillators in trading. You will find all the discussions on bullish, bearish, negative and positive divergences.
Thank you very much for that. And all of this for that matter! Even if I disagree with something you say, it will at least make me think about it in order to come to my conclusion. And you're doing this for free! So please know that I appreciate it immensely!
This is the number one psychological problem for all traders. The fear of missing out. It is the fear that if you don't take the trade you would have missed out on a major opportunity. So they jump in and is basically reactionary to immediate price action development. Remember in trading it is to plan the trade and then trade the plan. A simple statement but fundamentally all the problems that a trader will ever face or have to deal with in his or her trading career is found in that statement.
When I said this I was referring to me being ready to physically move at a moments notice. As in, if an opportunity popped up with a firm or whatever in another country, then I am ready to go. I was not referring to the execution of a trade