Short the EUR/JPY pair at 135.213, looking for a retrace around 134.8. May go lower to test the uptrend line.
Edit: And the account is currently at $16.24 which is somewhat of a bummer. But I'm still pushing forward.
Tuesday, June 30, 2009
Uncertainty
I lost ~$2.60 last night. I guess I put the short on a little too early and I didn't want to see the EUR/USD shoot up today for some reason.
Monday, June 29, 2009
$18.87 Some Wins; Some Losses
Damn. I really wanted to hold on, but I have some errands to do and don't want the positions on while I'm gone. In any case, I wouldn't be surprised if the EURUSD pair fell lower. As for the AUD/USD, I don't have any clue.
Lost about $.95 on the AUD and gained about $1.20 on the EUR. Bleh. Well, it could've been much worse.
Lost about $.95 on the AUD and gained about $1.20 on the EUR. Bleh. Well, it could've been much worse.
$18.62 and the "Real Money" Effect
After I posted last night, I went on to do a little more trading. I learned two things: One, I need to maintain a strong clear mind uninhibited by the temptations of profit or the lamentations of loss. If I can do that, I am one step closer to success.
Two, minimizing leverage can do wonders for a good position. Not only does it provide you with quite a bit of leeway should the position not do exactly what you plan at exactly the moment you plan it, but it also limits something I'd like to the "real money" effect.
The "real money" effect occurs when you're doing something (normally playing a game) that you are relatively competent at. You know the rules, you know what you have to do in order to win, etc. However, because "real money" (in quotations because different people consider different amounts to be significant) is involved you lose touch with those rules needed to succeed. Your mind is no longer on the game, but on the money. And because of that, you end up doing stupid things you normally wouldn't do, losing you money.
Take care everyone.
Two, minimizing leverage can do wonders for a good position. Not only does it provide you with quite a bit of leeway should the position not do exactly what you plan at exactly the moment you plan it, but it also limits something I'd like to the "real money" effect.
The "real money" effect occurs when you're doing something (normally playing a game) that you are relatively competent at. You know the rules, you know what you have to do in order to win, etc. However, because "real money" (in quotations because different people consider different amounts to be significant) is involved you lose touch with those rules needed to succeed. Your mind is no longer on the game, but on the money. And because of that, you end up doing stupid things you normally wouldn't do, losing you money.
Take care everyone.
Sunday, June 28, 2009
$17.83
Took a4.3 pip loss in the AUD/USD, but made up for it by catching a 16.3pip gain in the USD/JPY. I think it has a good chance of hitting at least the 95.80 area, if not 96. I took my lot off, anyway. That's another $1.28 I can scratch off my losses.
Gotta keep the discipline so that I can continue moving in this direction.
Gotta keep the discipline so that I can continue moving in this direction.
Simulated Trading Contest
I love all types of trading. I've done stocks, options, futures and forex, and still participate in all of them to some extent. If you're interested in playing a futures trading game with the chance of winning an Apple gift card, check out CME's simulated trading game. I find myself playing it on and off with a best score of just over 5200 (it took me a long time to break the 4k level). There are a few tricks here and there, but I'm going to keep them a secret. I'm guessing anyone interested in playing for a while will figure them out on their own anyway.
Enjoy.
Enjoy.
Saturday, June 27, 2009
Money Management; Risk Rules
As I posted a while back, I am not going to be trading more than a single microlot (1k of currency) until I break above $50. Trading with this amount of leverage is still very risky. Currently with 16.55 in my account, trading a 1k lot of currency requires leverage of 60.4:1 (taking the entire account and not just the margin required by FXCM into consideration). Even if I were to have $25 in the account, I would still be trading with 40:1 leverage, which (if you have been following the leverage maintained by some of the currently hurting financial institutions) is tremendous leverage.
With high leverage comes lots of risk. I would like to limit the risk especially as the account grows in size. Yes, it's impossible for me to reduce the leverage at the moment without adding more to the account, but I do want a plan in place to reduce leverage as I move forward.
This is why I am waiting on a second lot until I hit $50, at which time a single lot would provide me with 20:1 leverage in my account. The second will push me back up to 40:1. While still hefty, it is much more reasonable and provides much more leeway should a trade go against me. Furthermore, and I have given this quite some thought, I will not add a third contract until I hit $100 (or the equivalent to 30:1 leverage). That may be a very long time away, but I want to be prepared as I near $50 and then $100. These precautions will help me prevent catastrophe as my account grows. Obviously, as I move forward, I will continue to reduce leverage. 10:1 sounds like a safe area for which to aim, albeit I will weigh the pros and cons as I move forward.
As always, the currency markets are tremendously risky. With large amounts of leverage you can destroy an account (of whatever size) with relatively little effort. Make sure to protect yourself from greed and from unrealistic expectations so that you can succeed.
With high leverage comes lots of risk. I would like to limit the risk especially as the account grows in size. Yes, it's impossible for me to reduce the leverage at the moment without adding more to the account, but I do want a plan in place to reduce leverage as I move forward.
This is why I am waiting on a second lot until I hit $50, at which time a single lot would provide me with 20:1 leverage in my account. The second will push me back up to 40:1. While still hefty, it is much more reasonable and provides much more leeway should a trade go against me. Furthermore, and I have given this quite some thought, I will not add a third contract until I hit $100 (or the equivalent to 30:1 leverage). That may be a very long time away, but I want to be prepared as I near $50 and then $100. These precautions will help me prevent catastrophe as my account grows. Obviously, as I move forward, I will continue to reduce leverage. 10:1 sounds like a safe area for which to aim, albeit I will weigh the pros and cons as I move forward.
As always, the currency markets are tremendously risky. With large amounts of leverage you can destroy an account (of whatever size) with relatively little effort. Make sure to protect yourself from greed and from unrealistic expectations so that you can succeed.
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