February is over, and so ends the most pitiful and infuriating month of my trading career so far. I finished the month on -57 pips, which given the circumstances could have been a lot worse.  I caught a big winner on the eur/jpy which brought me back from my lowest point of -176, and made the score sheet look slightly less catastrophic.

I had two golden opportunities to finish the month in profit, both of which would have been realised by just keeping my live trades open. Another trade was stopped out by 1 pip, and then raced away for a further 400. This one I can live with though. It was well within my rules, and I was simply beaten by the unavoidable cruelty of trading probability. The others though were utterly intolerable, and I fully deserve to have finished the month in the red.

So let’s draw a line under all this. If I can internalise the learnings from this terrible month and it only costs me 57 pips, then this might be the best month I ever had.

This month has been pretty bad so far, with last week being the worst of all. I have placed 6 trades, the first four of which were all 30 pip losers. Never a good thing, but I was happy with them because they were all sensible positions and as we all know, losers are a perfectly natural part of trading. The next two trades however, make me nauseous just thinking about them. I was in positive territory on a short USDCHF trade, but decided to cash out on a pullback for 30 pips, only to see it fall away for another 120. I then I entered a short trade on the USDJPY and exited for just 4 pips, only to see it drop a further 300. I exited both of these trades in the middle of the day, and if I had only left it until the following morning I would have gained around 260. So as the month stands, I am down 86 pips, where I should be up at least 170.
Despite all my rhetoric, I have allowed emotion to dictate my trading this week, and it has cost me a big winning month. The JPY trade in particular was sickening because as you can see, it was an absolutely perfect set up…

What made me cash out was a sudden panic that the trade wasn’t moving as quickly in my direction as I would have liked. Had I not been checking my MT4 trading app on my phone, I wouldn’t even have been aware of it until the next morning, by which time I could have closed out for a 150 pip gain.
I’m hoping that this feeling of disgust can be turned into a positive. One thing’s for sure, I am now imposing a complete ban checking my MT4 app during the day. It’s strictly set & forget from here on in.

First trading month of the year over. Here are the headline results…

After a hectic start, the last few days of January got a lot quieter. Having already bagged 146 pips for the month, I was less inclined to take much risk, and although there were a few potential opportunities, I felt they were a little too 50-50 for me to risk eating into my profits.

I’m in two minds about this. Although I feel positive and content with my tally going into February, I still have a nagging sense that I’m thinking too short term, and that I’m still placing too much value on what is essentially a completely arbitrary target (a monthly target).  I won’t beat myself up too much about this. It’s been enjoyable to put my feet up and watch from the sidelines for a few weeks, and those potential opportunities didn’t turn into anything anyway.  Monday is Feb 1^st and I’ll be back on the court for real.

It’s better to take a small, manageable loss and be ready to enter the trade again at a different price, than to exit with a few quick pips, only to see the trade escalate into a 3-month monster. The problem is that it doesn’t feel like that when you’re in the moment. 20 pips is 20 pips, right? 4 of those and you can put your feet up for the rest of the month.

This week I picked an entry on the NZD / USD which went immediately in my favor, but found myself trying to find reasons / excuses to exit with a small, tidy profit.  I’m pleased to say I held my ground and instead just moved my stop to zero. I may very well make nothing off this trade, but I could also end up with 500 pips, and that for me is worth the risk.

The challenge with trading is that the monsters are rarely visible from the surface. You can only see them by putting your head under the water. Sometimes you have to hold your head down there for so long, that every nerve in your body will be screaming at you to get out. All that’s visible from the surface are a few quick pips here and there, which in the long run will be vastly outnumbered by your losers. Have patience though, because the monsters be out there, and they’re the only thing that can save you.

And what a week to kick off with! There’s a lot happening in the markets at the moment, with many pairs continuing their established trends, but thrashing around while doing so, offering very little in the way of clear entry points. It’s more volatile that I was hoping for to be honest, and so for the most part I’ve been more of an observer this week.  First trading days of the year, followed by NFP data on Friday, meant this was no place for the novice.

I did make a few pips selling the EUR/JPY, but was guilty of cashing out too early on this one. The price had reached a significant level of support which it hadn’t broken since February 2015.  In anticipation of a pull back, I cashed out when it started to reverse off the mark, and set another pending order below the level.  This was swiftly taken out by a false break, and the price eventually moved back beyond where my original stop loss had been. So in practice, I ended up with +66 pips, where I should have taken a loss of 30.  Not bad you might be thinking?  Not really.  In this particular instance I’ve benefited, but in the long run, that kind of short-term thinking will make it impossible to capture the big moves, which is what my trading is all about.

January 1st 2016. This is the day my journey begins. Five long years lie ahead of me, but the prize at the end of it is well worth the effort; true financial independence.  2015 was a great year for trading. I exceeded my target of 60%, and stuck to the same system all the way through. That’s not to say it was perfect.  There were long stretches of time when I didn’t trade, either because I had already reached an arbitrary monthly target, or just because life got in the way.  These are the things I need to work on this year, as I start to treat this venture more as a business than a hobby.

So I’m starting the year full of confidence, and excited about the future. There’s no trading to report today because the brokers are closed for the bank holiday. But on Monday, battle commences.