See that chart below? I’m one trade away from literally naming this post “Q4’s 1 Forex Trade Review”.
As you can see, I only took two long-term trades in the last few weeks and spent most of my time watching out for good setups.
I started Q4 trading pretty strong by jumping on USD/JPY‘s uptrend on the back of Fed rate hike speculations and expectations of a more dovish BOJ.
The trend was fine for a couple of days until the FBI caused a ruckus on Clinton’s Presidential campaign. Luckily, I was able to lock in pips before the event happened.
Fast forward to Trump winning the Presidential elections and the dollar, U.S. bond yields, and U.S. equities soared like there’s no tomorrow. It was my first time seeing uptrends that strong and sustained that I couldn’t quite believe that there was no reversal or even big retracements on the table.
Thinking that the fundamental picture is pretty messed up, I relied heavily on technical setups. Unfortunately, that is NOT the way to go especially if you’re into long-term setups like I am.
I tried to pick tops on USD/CHF and bottoms and EUR/USD and ended up denting my account and worse, my confidence in analyzing the markets.
| DATE | TRADE IDEA | P/L in Pips | P/L in & |
|---|---|---|---|
| Oct 07 | USD/JPY Triangle Breakout | 65 | 0.05% |
| Oct 27 | Will USD/CHF’s Parity Hold as Resistance? | Canceled | Canceled |
| Nov 11 | Simple Support Play on EUR/USD | -150 | -0.25% |
| Nov 17 | Parity Play for USD/CHF! | Canceled | Canceled |
| Dec 02 | USD/CHF’s Retracement Play | Canceled | Canceled |
| Dec 09 | EUR/USD’s Channel Day Trade | Canceled | Canceled |
| Dec 14 | USD/JPY to Reverse at 116.00 – 117.00? | Canceled | Canceled |
| Dec 22 | EUR/USD Downtrend Still Intact | Canceled | Canceled |
| TOTAL | -85 | -0.20% |
No. of Trade Ideas: 8
Trades Triggered: 2
No. of Wins: 1
No. of Losses: 1
No. of Break Even Trades: 0
Win %: 50%
Average Gain Per Winning Trade: 85 pips (0.05%)
Average Loss Per Losing Trade: -150 pips (-0.25%)
After looking at my trades, I’ve identified three major lessons that I’ve learned. The first is to keep your eyes on the goal.
Goals and resolutions aren’t just there to look back on after a period of time. They must always be in your head, dictating your every decision and action until you achieve them.
My next lesson is that trading long-term setups doesn’t mean that you shouldn’t engage in the markets regularly.Sure, a lot of traders like a more passive income, but I think the best long-term trade decisions are made from factoring in everyday price reactions and the small events that build up into big economic themes.
Last but not least is the classic “trade what you see and not what you think.” I was so convinced that the Trumponomics rally was going to see a reversal that I failed to see that the pro-dollar move was supported by fundamentals.
EUR/USD and GBP/USD‘s downtrends, for example, were fueled by Brexit jitters, as well as a dovish ECB and fresh banking crises in the eurozone.
Going forward, I’ll focus on simply winning trades. I know it sounds vague, but I heard that the best way to come back from a slump is to just start winning trades.
So that’s what I’ll do. I won’t think about expectancy for a while. I’ll just go back to trading shorter time frames, get my shots in, at taking profits at the earliest opportunities.
I’ll also revisit my goals on a more regular basis and take note of my progress, much like I did before. Not sure if I’ll make the journal public though. Maybe when I see that it’s working?
Anyway, that’s it for me this quarter! Hope you learned a thing or two from my rambling. How about you? What are your biggest trading struggles these days? Did you learn anything from reviewing your trades?
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