Trading the EUR/USD Friday 3/26

Sorry, this is a little bit late, its been a crazy weekend.  Friday morning I traded the EUR/USD a little bit from the short side and did okay, so I'll go through what I did and what I could have done better.

The EUR/USD caught my eye Friday night for a number of reasons.  One, it was trading up near 1.4250, which is around the high for the past few months.  Another reason is because of Portugal's economic troubles.  The nation was teetering on the edge of needing bailout, and a new austerity plan was just rejected.  A bailout request from Portugal would spell trouble for the euro, and I knew that it would be in play for Friday morning.  Also, some fourth quarter US GDP stuff was coming out in the morning.

Preparation:
I sat down Thursday night and Friday morning to study the EUR/USD chart as well as the dollar index.  I identified the 1.4150-1.4140 region as an important level to determine how the pair would trade for the rest of the day.  It had provided previous short term and long term support, so I was thinking that a lot of traders would be looking at this level.

Plan:
After finding this level, I came up with my if/then statements

If the pair drops support @ 1.4150-1.4140, then I'm getting short 1 lot with my target near 1.4075 and looking to add beyond that price

If support holds @ 1.4150-1.4140, then I'll do nothing.
-I wasn't expecting this to happen, so if it did I wouldn't have felt comfortable getting into it until it got above       1.4250.

It just so happened that the 1.4140 level broke, so I got short from 1.4135 1 lot.

Patience and Discipline:
The trade immediately went for me, and I always get tempted to take profits too early.  I showed patience by not taking profits, and I also didn't panic and close my position when this initial profit disappeared and the pair rallied a little bit (this may have been due to the positive US GDP release).  I need to continue to work on this, because its one of the biggest problems I have.

Hard Work:
I did plenty of reading and research before I placed this trade, so I felt well prepared and in a position to make a good trade.

Communication:
I tweeted my idea Friday morning, and I'm sharing the details of my trade right now in this blog.

This was a profitable trade for me, but I did close my position be fore the majority of the move.  I always expect things to happen faster than the actually do, so I need to focus on just setting a stop and letting things unfold on a trade like this instead of staring at every tick.  The EUR/USD eventually made it down to 1.4054, so my target would've been easily hit if I would've gave it more time.  It's good though, this blog is helping me become more and more aware of that issue and I've been letting things trade longer.  I want to continue getting better in the coming weeks.

Okay, I'm definitely going to be watching the EUR/USD throughout this coming week.  We're toying around near a longer term level, and there's plenty of fundamental fuel right now to push this pair around.  Specifically watch out for eurozone CPI on Tuesday, eurozone unemployment Thursday, and US NFP/unemployment/manufacturing on Friday.

Trading Need Your Full Attention

Whatsup everyone, sorry I didn't get a chance to trade today I had to catch up with some school work.  Even when I'm not actively trading, I've been trying to at least keep some charts up on one of my screens.  This way I get to watch some price movement and if something crazy happens I get to experience it, even if I don't actually have money in it.  I've learned the hard way in the past that if you can't pay full attention to your trading, don't even try to do it.  Make sure if your going to trade, you put in the time first.  Your only doing yourself a favor.  Its very easy to miss obvious signals if your rushing into trades, and you'll look back on it after you take a big hit and you'll hate yourself for being so stupid.

Anyways, I may try to trade a little tomorrow throughout the day if I can find any good swing setups.  If not, I'll be at it Friday morning early on.  I'll be using the chat feature on collegetradingexchange.com while trading some FX, and hopefully a few of the other Trading Pitt members will be joining me.  So if anyone's looking to do some chatting Friday morning, you should be able to find a few of us there.  Happy Trading :)

Just Some Thoughts

Hey everyone, just hoppin on here for a quick post.  No trading today and probably nothing tomorrow unless I decide to be stupid and trade Tokyo, too much school work.  I should be back to it Wednesday morning and I'll have breakdown some trades I make.  Just talked to my boy @stevemcmannis, and he just told me about a FANTASTIC site for young college traders http://collegetradingexchange.com/.  This site pulls together all kinds of info from our club here at Pitt and from a bunch of other clubs across the country.  I'll definitely be using this daily, especially the chat feature.

Friday Morning 3/18

So this morning, I had plans to trade the USD/CAD after CPI data was released at 7am EST.  Since I don't normally trade this pair, I wasn't too sure how it would react initially following the release.  I'll go through my thought process of this trade:

Preparation:
Last evening, I identified pairs that would be in play for this morning.  I saw that CPI data was coming out for the USD/CAD, so I put that on my radar.  I then checked out my charts, noting important levels on larger time frames (Daily and Hourly, mosts charts smaller than that won't be as relevant by the time I'm ready to trade the next morning).

Plan:
After finding the important levels, I came up with my if/then statements.  I missed the initial down move, but since .9810-.9800 had been acting as support level for the past few days, I decided that
-If the price dropped to .9810 but couldn't break support, then I would get long one lot with a target of .9835-40 and with a stop at ..9805ish
-If the support level broke, then I would get short 1 lot with a target of .9760 and a stop at .9810

Note: I normally use mental stops

Patience:
The first 20 minutes not much happened, but I was patient and didn't close my position.  I was also showed patience when I was looking to enter because I waited for the price to pullback to almost exactly where I wanted it to (.9810).  I could have been more patient when my position went against me, because it eventually came back and moved into the money.

Hard Work:
I made sure that I was up early enough this morning to be prepared to trade, and I also put in work last night to find good opportunities for this morning.

Discipline:
I often have a problem getting shaken out by market noise, and I occasionally bend my own rules mid trade.  I did neither of those things this morning, and I mostly satisfied with my execution of the trade this morning.

Communication:
I used Twitter to share my trade idea and execution with other traders.  I also am writing this blog to share my thought process with other traders.  I will also discuss this trade in person later today with some friends.

Reliving the Trade:
Before I started this blog, I visualized myself making this trade and thought about what I could've done better.  My main problem with this trade was that I misjudged my risk/reward.  I should have risked a few more pips, which would have prevented me from being shaken out of my initial position.  I was able to get back in, but I lost some profit that I should have had.

All in all, my plan was good but my execution was poor.  Currently, the USD/CAD is well past my target of .9840.  Next time, I need to take more time to analyze my risk/reward so that I can catch the entire move.  I definitely shook the rust off today, and now its time to get ready for next week.  It feels good to be back!

Ideas for Friday Morning

Since this will be my first day back in a while, I don't plan on being to aggressive.  Going to focus on USD/CAD since it'll be in play with the consumer price index coming out at 7 est.  1.0000 has been an important level for the pair for a while now (previously support, now is acting as resistance) so there may be a good opportunity for a short if the pair can rally to that level tomorrow morning.  Also definitely going to be keeping an eye on oil tomorrow morning in case something happens that will affect the CAD.  All this craziness in the world has left markets a little bit abnormal, so I'm gonna be on my toes.  Will probably be watching USD/JPY just for the hell of it, probably won't trade it but if I do I'll be small.  All in all, just going to shake the rust of tomorrow morning and get ready for next week.

Finally Back

Finally...back in the states.  Got stuck in China a few extra days due to everything going on in Japan (hoping for the best for everyone over there, especially my new friends from the trip and their families), but I'm finally back and just about caught up with all my school work.  I only had internet access for about 2 days of my trip, so I only got to follow the markets for a short time.  Everything's been crazy with the Middle East and Japan, and the markets are definitely reacting differently, so I'll definitely be sitting down and studying whats happened over the past couple weeks in FX.  Look for a later post tonight, I plan on trading for a few hours tomorrow morning so I'll post some prep work tonight.  Peace.

On my way to China

Well I'm nearing the end of a 5 hour layover in Minnesota and getting ready for a 14 hour flight to Japan, so this is pretty much the last chance I'll have to do a little blogging.  Midterms are just about done now, so after spring break I should be getting back to trading everyday and I cant wait!  Forex will be my main focus but I've been gettin urges lately to try out some new markets so we'll see.  Plan on knockin out "Confessions of a Street Addict" by James Cramer and "Reminiscences of a Stock Operator" on this ridiculously long flight, so that should be cool.  Kinda wishing I brought along a few more books...

See ya March 14th!