January 2014 - Forex Trading Journal

What a ride it has been.

After a dismal performance in Forex Trading in 2013 I just had to take a break.  It was just the right timing as well as I had a long before scheduled trip to another continent in the world!

Came back refreshed and energized around October and then just forgot about Forex for a while to enjoy the Christmas holidays.

It's now February 2014.  And I haven't written any entry in January so I thought I'd start writing again since I started to trade the Forex market again.

Mid January, after the hang over from the holidays has finally lapsed.  I funded my account with 600 USD.

This time I traded more carefully and just bought 1 to 2 lots per currency pair.  My trading strategy was to try out currency baskets.  I would first observe the market and see which currencies are strong and which are weak.  In addition to observing them, I also applied the techniques I learned from Mark So.

First week back into trading, I was very fruitful.  The new strategy is working.  I was able to successfully isolate the weak currencies - that time it was AUD and CAD.  I then shorted these currencies against all other currencies.  Luck was on my side and my timing was perfect.  As a result, in 1 day I gained about 1000 pips.  How I wish I traded with more than just 1 lot in each pair! hahaha  Nonetheless, the total pip count produced an additional 100 USD for my account.

I was ecstatic and was very eager to try out the strategy again.

In the succeeding days, even with the new strategy, it wasn't all working well.  The problem with the currency basket was when my analysis was incorrect, then all trades would likely be losing as well.  An advantage though is that the loses wouldn't be as big because it would spread out over other currencies.  I mean, there will be days when one currency will be so strong that when paired with your weak currency, the currency pair will outperform all other pairs.  The opposite would be when your weak currency is paired with another weak currency.  In this instance, this pair could still possibly gain or the loses wouldn't be as big as the previous pair.  This is one advantage of a currency basket.

In summary, in those days I gained a little and then lost a little as well.  It was a see-saw battle.  But I was happy because I was able to preserve the 100 USD gain I achieved the previous day.

With an extra 100 USD, I decided to try and withdraw through credit card.  This was a test on how long FXCM would process the withdrawal.  I am pleased to announced that in about 3 working days, the withdrawal was already credited in to my credit card account.  There is no fee to withdraw through credit card so I didn't think twice about doing this even when I am merely withdrawing 100 USD.

In January, the USD has soared and is now very expensive against the peso.  When I funded the account, it was definitely at a premium which is usual for credit card rates.  Nonetheless, I was happy to see that when my withdrawal was credited to my credit card, the exchange rate was higher than local bank rates as well.

This is what happened this January.
I'm optimistic that this year will be a good trading year for me.
I hope to end the year with a positive balance on my account.

Let's see how I'll do in February.
I would be ecstatic if I can make another withdrawal in February.
 
Pips Be With Us!

Kapoot!

I realized I haven't updated my Forex trading journal for about 2 weeks.

Just a quick update.

2 weekends ago my equity plummeted to 25 USD.  It's a hard life trading forex.  Like that reckless trading day, I don't exactly know what happened.  The market was very volatile, I suppose.  I was buying NZD/USD one minute, still buying NZD/USD another hour later but both trades lost.  So I decided to sell NZD/USD this time but even that trade still lost.

I realized that there are pips to be made any direction you choose but sometimes if it doesn't reach your limit and when that happens, on the opposite direction, your stop loss could be hit.  

Even at only 25 USD, I kept trading the following week and managed to increase my equity to 35 USD.  But then, the good days never last and this week my equity is down to only 17 dollars.  

To continue I definitely would have to top up my account again.  I'm thinking to add 300 to 500 USD to my account this week.

But before that, I'm more eager to practice again using a demo account.  I'd like to come up with a trading system before going live again.  Although I still believe that trading with a live account is the best way to learn.

I might just stick with a demo this week especially since the Fed meeting is coming up.  

Major Forex Lesson: 

These things take TIME!  As much as I wanted to see results and report to you that trading the Forex market for a living is doable, I became too eager that at most times I really just entered trades without giving much thought to the reason why I entered the trade.  In effect, I just gambled away my first account.

As I reported in a previous post, there are people doing great in some of the forums I've joined.  Some have even withdrawn amounts from their account already.  I hope someday I will be withdrawing from my account on a regular basis as well.

It's a matter of learning the art and skill and having the patience and discipline to follow your system.

My time, your time, our time will come.

Just continue learning and acquiring the skills necessary to be successful in this business.  Never give up.  Dreams mean work.

  Pips Be With You!

EUR/CHF Interesting Currency Pair

THE EURO / SWISS FRANC CURRENCY PAIR
EUR/CHF

A very interesting pair.  One of my discoveries this week.

When the EURO strengthens the pair has the tendency to go up since the EURO is stronger than the SWISS FRANC (CHF).

When the US stengthens, the USD/CHF PAIR shoots up, therefore the EUR/CHF pair still has the potential to go up since this time around the SWISS FRANC is weaker than the EURO.

Ready to Give Up?

I'm ready to give up, but not quite giving up yet.

That reckless trading day, started a series of events that led me to this fortune plant.  It's an indoor fortune plant.  Hopefully it'll bring me some good luck trading Forex for the rest of my life.

I created this blog not only to serve as my trading journal but also so that some of you who are thinking of taking up Forex to trade for a living can have a legit reference on how it's like trading the forex market.   I hope my articles have been helpful somehow and for the sake of transparency you can view my forex trading performance in this page.

Reckless Forex Trading Day

Pips Be With You!

When I say this to you, it's your turn to reply back and say "Pips be with you too!"

I haven't gotten that much replies back since the PIPS have not been with me this week.  Or maybe they have been with me but on the negative side. huhuhu 

Reckless Trading

The start of this week is the most bloody experience in my Forex trading life.  I have been trading recklessly.   I thought I wouldn't be susceptible to emotional trading given my experience in stock trading, but I was wrong.  At one point, my usable margin was down at only 40% of my account and I had lots of several positions open at one time.  Every time one of the trades goes against me, I kept thinking about whether I would get called on margin.  Suffice to say, I didn't sleep very well last night.

The nightmares have started.

Wrong Call