Wednesday, 25 November 2020

Trade #1: GBP/USD

Going into this trade, I was paying attention to the market cycle, while having patience. I think I took a pretty good signal but I had poor management of my trade. Here is where I sold:

What you see is a second short signal double top in a 50% retracement rally. The signal bar went above the previous bar and closed below its close. I put my stop above the signal bar, risking 1%. Let’s see what happened:

When I saw this strong bear bar, I was obvious quite happy and extended my profit-target to the low you see on the left. However, the hope was short-lived, and this is where I think my management went wrong:

I see this and I’m thinking that was poor follow-through after such a strong bear bar. I also noticed how the selling pressure stopped once testing the low. I saw this, and I did nothing:

And that was a mistake. This is a wedge bottom in a bull trend making it a bull flag. Once I saw this bull reversal bar, I should’ve closed my trade and gone long, because this happened:

It all looks much more obvious here, but the signs were there. Additionally, once the big bull bar closed after the bull reversal bar, I should’ve basically just exited my trade. That would have been the most reasonable thing to do. Poor management. I bet you don’t even want to hear about my second trade…

Trade #2: GBP/USD

You see the trend channel line, making a wedge? Well, I sold as the market touched it, and I was very quickly stopped out for a loss about 10 pips above only to see it reverse down again in my favor. Still a bad trade. The reason is that I didn’t wait for the bar to close. This was revenge-trading. Plain and simple. Because I had been stopped out of a good trade where I almost had 2% in profit risking 1%, I now wanted to get back at the moment. How stupid.

Trade #3: GBP/USD

For my third trade of the day, I sold a broad double top:

You can see where I sold on the chart. My thinking was simple. This is trading range but slightly more buying pressure. I had my stop above the old top you see to the left. I sat a profit-target of 1%, and got filled on the next day. However, that is atypical of me, and hadn’t I done it, I would’ve been able to get 3%. Anyway, I can’t complain about getting some profits at last.