The Skint-International Trading Journal

[skint-international]

Greetings,this is my first post to the forum so I'll take the opportunity to say hello! :clap:

The objective of the journal is to learn. I am very new to trading, I've been studying several hours per day books, forums, courses and practice for around four months.

I need to fit study time in around my day job in IT so I get up early and do a couple of hours before work and then another 2-3 hours in the evening.

I have a lot to learn, some of this will come from books, forums etc. but I also need to experiment.

The main theme of the journal is to record experiments so I can look back at the results and determine a strategy that works for me.

The other purpose of the journal is to get feedback, I have a lot to learn and will no doubt make mistakes so I welcome feedback from the people on here.

So thanks in advance to anyone reading this and who is prepared to give feedback.

Over the next few posts I will spell out some more of my objectives based on the categories recommended in the first steps thread.

Cheers!
Skint-int :cheesy:

 

[skint-international]

• Objectives
At the moment trading is a learning experience, I consider myself to be at University. If and when I "graduate" I plan to run trading as a part time business as a supplement to my day job. I wouldn't like to propose anything more ambitious than that at this stage.

• Markets & Instruments
I will focus on Major currency pairs. I like the fact that currencies are a large market and hopefully more predictable than shares. Although I will be focussing on mostly technical analysis I will mix in fundamentals and I find Forex fundamentals more interesting to study as I like monitoring global events rather than individual company's performance.

• Style
I'm hoping that practicing and developing the journal will help answer this question. I'm guessing I will be a swing trader due to work commitments, but may try some shorter term trades in the evening.

 

[Nexas]

Hi Skint,

Good luck with your journal.

Swing trading is a good approach for Forex.

If you find you want to do more scalping type trades I would stay away from Forex and head on over to the emini's although you will need a larger account for that than you would Forex.

May I recommend that you investigate Range bars... Don't worry you can thank me later...

I hope it all goes well

Nexas

 

[skint-international]

Thanks Nexas, great to have some feedback!

Thanks for the advice on scalping, I will bear this in mind depending on where I go with time periods.

Not heard of range bars, I will certainly look into them too, thanks!

Cheers,
Skint

 

[skint-international]

RIP Steve Jobs, I'm more of a Linux than a Mac, but the guy was undoubtedly a genius.

 

[skint-international]

• Time-frames
I work full time so have been previously focusing on end of day data and trades that last a few days. I could also trade shorter time frames in the evening after work so I will experiment and see how things progress.

• Reversals, Breakouts or Retracements?
Again, as this is early days I want to experiment with different approaches, and use the journal as a way of gaining the most knowledge. So I intend to look for opportunities in all areas and see which suits my trading style.

The focus at the moment is on reversals and since I start reading PozzyP's excellent journal – breakouts.

I tend to read forums, books and watch video lesson so will attempt trades based on a number of strategies and hopefully keeping the journal will help me draw out the ones that work best for me.

• Trade Set Up
I think going through the process of planning the journal has already allowed me to identify places I need to do some work.

In terms of set-ups I will hopefully develop ideas along the way. I aim to focus on price action in the main, I would like to develop the skill to be able to read price action on a chart and be able to spot trends, set ups and market psychology.

At present I'm mainly using support and resistance levels to look for set-ups, with the help of some candlestick patterns to try and assess the mood of the market.

 

[timsk]

I will focus on Major currency pairs. I like the fact that currencies are a large market and hopefully more predictable than shares.

Hi skint-international,
Welcome to T2W!

Perhaps the comment I've quoted was just a throw away remark? If not, what makes you think that forex is more (or less) predictable than any other market? If one takes your comment at face value, then everyone would trade forex in preference to other markets because - presumably - if it's more predictable, then it's easier to make a profit. It may very well be that forex is easier for you than it is for me, say, but that's a very different proposition from saying there's something inherent in the market itself that makes it easier than any other. It's an important distinction: here's an example of how it works in practice . . .

One of the reasons why many stock traders prefer equities to other markets is because individual stocks tend to be at the mercy of the main market as a whole. (Please note the emphasis - this is a generalization!) A common approach is to search for very strong stocks in weak markets (i.e. when the major indices are moving down) and very weak stocks in strong markets. With the former, the strong stock may consolidate or retrace it's gains minimally as the main market falls. When the main market stalls or reverses, the equity trader jumps on board the strong stock; the logic being that it will resume its upward trend once the main market is moving in concert. Vice versa for the weak stocks. This is a valid reason for choosing equities in preference to other markets and why - for equities traders who utilize this basic principle - equites are more 'predictable' and therefore easier to trade than other markets.

In a nutshell, one market is only ever easier to trade than another based upon the individual trader's approach to it. It's about their philosophy, style and trading methodology - as opposed to anything inherent in the market itself. I hope that all makes some kind of sense!

Good luck with your journal btw - promising start.
Tim.

 

[MajorDutch]

have you read 'trading in the zone' if not I would highly recommend it.

 

[skint-international]

Hi skint-international,
Welcome to T2W!

Perhaps the comment I've quoted was just a throw away remark? If not, what makes you think that forex is more (or less) predictable than any other market? If one takes your comment at face value, then everyone would trade forex in preference to other markets because - presumably - if it's more predictable, then it's easier to make a profit.

Hi Timsk,

Thanks for the feedback, most welcome, and thanks to you and the rest of the staff for making this resource available for us all to learn from.

I take your points on board, every market has it's challenges and if this was easy everybody would be doing it.

I think the comment I made was from a theory I've seen a few people make and may even have read in a book.

The idea was that the major Forex are such a large market that it would absorb some of the possible noise and unpredictability.

It was a statement based on theory rather than practice however and watching my EUR/USD long get destroyed in a few minutes last night was a useful lesson

This is a learning experience and I will definitely be keeping an open mind. I have a spread betting demo account as well as a Forex account, so will look for opportunities in stocks as well as Forex to see which market suits my trading style (when I develop one) the best.

One of the things I found challenging when looking at stocks was deciding which one to trade from such a large number of possibilities, so I will keep your advice in mind re selection in mind.

One of the attractive features about the Forex is that it seems to be the market you can get into with the smallest stake, even more so than spread betting, so this may be an important factor in the short term but as I said I will keep an open mind in terms of learning and gaining knowledge

Thanks again for your feedback, much appreciated.

Skint

 

[skint-international]

have you read 'trading in the zone' if not I would highly recommend it.

Thanks, looks good! I will add it to my list. It seems to be a sequel to the Disciplined Trader. Is it best to read that one first?

Cheers,
SI

 

[skint-international]

good luck !
]

Thanks Zutou!

 

[skint-international]

• Testing
I plan to test strategies, using a demo account or a very low stakes Forex account. I am a programmer by trade so hope this will come in handy for back testing any strategies using a package such as ProRealtime as time goes on.

• Entry, Stop Loss & Targets
The aim is to develop good money management strategies, using tight stops and larger take profit targets. The plan is to take trades with rewards targets of ideally at least 2-3 times the risk but will test the strategy as time goes on.

I plan to develop the strategy using a combination of study and experimentation.

 

[skint-international]

Perusing the charts to look for opportunities to place trades this week, trying to spot trades without indicators and just use price action.

Will keep an eye on this possible reversal forming with the EUR/USD. A shooting star/ pin bar candlestick has formed at the top of the uptrend.

I was long on the uptrend on Friday but it turned around pretty fast at around 5pm UK time on bad news re some of the European banks.

A similar pattern is forming on the AUS/USD so will keep an eye on them both and look to place shorts if further evidence on shorter time frames confirms the reversal.


Lets see what happens :cheesy:

Still learning the ropes as you know so feel free to pitch in with any views.

Cheers!
Skint

 

[skint-international]

Interesting test of support EUR/AUD too. Will keep an eye on this too.

 

[skint-international]

Decided to put these trades on last night, may have jumped the gun as it's not looking too good this morning, European markets haven't opened yet and there''s a lot of news to be factored in so I will see how things develop.

Date Transaction Pair Price Take Profit
October 9 16:07:43 EDT Buy EUR/AUD 1.37202 1.3954
October 9 15:49:01 EDT Sell EUR/USD 1.33547 1.3149
October 9 15:55:47 EDT Sell AUD/USD 0.97348 0.9400

 

[skint-international]

October 9 16:07:43 EDT Buy EUR/AUD 1.37202 1.3954
Still running now but very close to stop.Have placed a short limit order just below support in case it breaks out.


October 9 15:49:01 EDT Sell EUR/USD 1.33547 1.3149
Stopped out fairly quickly loss of £12.35. Euro rallied today on positive new re the debt crisis.

October 9 15:55:47 EDT Sell AUD/USD 0.97348 0.9400
Was trading up so closed trade at 0.98367 loss of £6.54
Switched from a short to a long and trade was closed on a trailing stop at profit of £7.05

Lessons Learned.

1) Need to confirm the direction of the trend more effectively. Shouldn't have put trades on last night,should have waited until this morning when the markets open to properly confirm the direction of the trend, or use a limit order.

Possibly consider an indicator to confirm trend direction.

2) Three trades is probably to mnany trades to have on at one time.

 

[skint-international]

Looks like I wasn't the only one that went for the EUR|USD yesterday:

Forex Trade Setups Commentary: EURUSD counter-trend rally continues, 10th October 2011 | Learn To Trade

 

[skint-international]

Euro/USD touched resistance yesterday. Feel it could go up or down today so I'm experimenting with a buy and sell limit order.

I've placed the buy order just above the resistance level of yesterday and the sell limit just below a recent support level.

 

[skint-international]

Still waiting to see what will happen with EUR/USD.

Looking for techniques to add to my trading arsenal, planning to study Fibonacci retracements and stochastic indicators next.

 

[skint-international]

The EUR/USD rose yesterday and activated my buy order at 1.37234.

Trailing stop closed out the order at a around £4.50 profit, could have been bigger but I wanted to minimise risk due to the volatility.