Thoughts About The Week

I need to rant, I have just had one of the most emotional trading moments. The chart below explains why. And of course it is included in my Missed Setups Journal.

CADCHF 4H

Long story short, I liked the setup, there was a topping pattern and a breakout retest with a pin at the 0.93 round number. All the pairs were confirming what I expected would happen - Dollar to tank, Eur to rally. It was picture perfect. I had my order placed, but I pulled it half an hour before NFP because I didn't want my order to get gunned by market makers during the low liquidity period before the news release. The plan was to reenter my order around 8:29pm. BIG MISTAKE. This is the kind of runner I'm waiting for, it could have been the trade of the month with around 3R profits.

I got so shocked I actually felt faint, went to lie down on my bed, and couldn't even bear to look at the charts. Till now I'm still feeling so sore I have to blog to rant. I really really feel very awful. If I were in prop, this trade alone could have been my monthly income and more. If any consolation, I learned a very important lesson: Price can still move quite abit even before major news, leave the order on if many pairs are showing confluence of direction. I've also learned that very often price will drop hints on the direction it'll take after the news, this was the case for the NFP and for yesterday's BOJ monetary policies. I shouldn't be afraid to take setups before major news, in fact the news can act as a major profit propellant. Note though that this is different from trading equities before earnings. With FX if the news goes against you, you will lose 1R with slippage at most. With equities, overnight gaps due to earnings can literally wipe out multiple Rs and skew the equity curve.

This week has been really bittersweet. I'm up 1R in the first week so I should be happy (my target is 2.5R per month), but believe it or not, I could have been up about 8R. 8 freaking R!!!! Of course this is hindsight amateurish talk and I missed out on a lot of profits because of the way I managed my trades, but it really doesn't feel good. I missed out probably 4-5R because I was prematurely stopped out of Nikkei and AUDJPY prior to the insane rally. I was up about 0.75R in EURGBP yesterday but prices reversed all the way and took me out at breakeven. Btw that was a major blow too. And now, I missed out around 3R because I pulled my order before NFP.

To be honest I really don't feel too good, it is one thing to suffer one blow, but 3 consecutive blows is quite something. At least it is not due to losses, but missed profits sucks a lot too. I need to spend some time encouraging myself, because I cannot afford to get negative and discouraged. I realized that if I were to trade full time, there will be many such moments. This will not be the last and I need to have a larger mental and emotional capacity. When I make mistakes, I must learn from them, opportunities will always be there, there is no point berating myself over it. These lessons will add to my experience and make me a better trader.  Gonna go do some reading, next week will be a better week!