Hello everyone,

Today I have been reminded that markets are not perfect. Every trader tends to forget this fact as time passes, and every time the markets slap you back into reality with a not-so-tender wake-up call.

Why do I say this? because today I took a trade that was based on a perfect setup from a Technical Analysis point of view: I had the 3SMAs in order, I had the longer time frames agreeing with me, I had a crystal-clear level of confluence of resistance backing up my position, I had a retracement-trendline breakout, I had my beloved breakout-pullback-continuation entry pattern, I had a very positive risk/reward ratio, etc. All the ducks were literally falling in line…

And I scored a -23 pip loss :)

You see, markets are just not perfect and nor is any Forex trading system. There’s a certain component of chaotic randomness in this whole business that makes it totally unpredictable, untamable. In a way, trading could be compared to bull-fighting: most of the times if the bull-fighter does his job right he will come on top, but on some occasions the bull pulls out an unexpected turn and horns the bull-fighter dead. It’s just something that happens and there’s nil you can do about it. Well, actually that’s not quite correct - yes, there’s something you can do: keep the loss as small as possible. In this case, I limited the loss to -23 pip which is not disastrous by any means.

Alright, end of the week and time to sum things up: this week I have only taken two trades, one of GBPAUD for +0 and another one on EURNZD for -23 pips, so the final score is -23 pips for the week. And while we are at it, the score for September 2007 has been +88 pips. Not the best month to be honest; I usually benchmark my trading months around the 200-pip limit - anything above that milestone is a good month in my opinion.



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Hello everyone,

I have just closed the trade I had opened from yesterday on GBPAUD based on a 4H time frame which has just hit my trail stop at breakeven levels. The setup was basically a double bottom breakout in the direction of the main trend with a subsequent typical breakout, pullback, continuation pattern. As I teach on my Forex trading course, breakouts in the direction of the overall trend is one of my favorite trading strategies with proven results over time despite the fact that this very trade has yielded no results.

I still believe that from a general point of view the setup is still valid since we have the 3SMAs and the down-trendline still in place, so I will probably keep an eye on this currency pair tomorrow for new possible entries. At this time, the London session (the session I actively trade) is about to close and therefore it’s a little bit late in the day for me to seek for new entries.

I am a tad disappointed with this trade because it certainly looked like a winner, having gone into profits for +80 pips at one time (I was aiming for a +200 pip run on this one), but my experience tells me that it’s better to be slapped out of a winning trade than letting a winner turn into a loser, so I believe that I took the right decision trailing my stoploss down despite the final outcome of the trade.



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Hello guys,

Sorry for not uploading any video today but my trade is still open. I am right now short on GBPAUD off the 4H chart setup that I sent the guys on my mailing list this morning based on a breakout of the 2.3100 level in the direction of the main trend.

As soon as I close the trade I will upload it here on the blog alright?

Cheers!


-HECTOR-

Hello everyone,

If you have been reading my Forex blog and videos during the last few days, you have probably noticed that I am going through a period of no-trading at the moment. Either there are no decent setups, or those setups violate my trade plans or I simply cannot find an appropriate entry.

Well, today I did find a very good setup but not a valid entry to profit from that setup. It was a triangle breakout on a clearly down-trending USDCHF 4H chart - the triangle broke to the downside as planned but I never got the breakout, pullback, continuation pattern I like to base my entries on. Indeed, the swissie simply plummeted for 50 pips straight without taking a rest. Oh well, when you’re a conservative trader, some times you see the train chugging along without you and there’s not much you can do about it.

Patience, young grasshopper, patience… trades will come, eventually…



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Hello everyone,

Today Monday was a quieter-than-usual day and most of the crosses remain entrapped within a sideways range. The only two tradable setups I found this morning were EURUSD 4H and USDCAD 1H, but no signal has been given on either of them: USDCAD 1H broke its triangle to the wrong side and thus my Trade Plan was void, and EURUSD 4H is still too far above the Dynamic Area of Support for me to consider an entry.

So a very dull day in all fairness. On the positive side of things, I have had plenty of time to sort out and arrange my holiday pics in the photo album :D

Now seriously: it’s crucial to keep your discipline and patience in check these boring days in order to not take any half-assed trade that may hurt your account. If the conditions are not there, simply focus your attention onto something else (like your holiday photos for example!!!).



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