the next night, the price was trending upwards so we longed, and same procedure we went to bed and wake up seeing the price hit my S/L again! as bottle said, SELL BECOME SUPPORT, BUY BECOME RESISTANCE. we felt fucking miserable on wednesday. it was at a point of time we felt so helpless and dont know wad to do. buy wrong sell wrong. so that day i decided we should open ourselves up to more currency pairs.. i have a full time forex trader friend, who gives updates on his trade and forex world thru twitter. i learned from him on wednesday the Reserve Bank of Australia has hike their rates to 3.25%, which is a good news for Aussie. i also do update myself daily on Bloomberg & Reuters currency section. i went back to look at eurusd as usual, and open up Aud/Usd. scalped on eurusd quickly, i know scalping is not an advisable method, but i dont do it aimlessly. most of the time i look out for indicators of reversal. in, take a few pips and out i go. i do that using higher lot (high based on the capital i am holding LOL) than usual.
Before me and bottle end our night, i was watching Aud/Usd closely, it has been wandering @ my fibo support level for some time, on top of that, the hike in Aussie interest definitely attract much traders into holding their currency. I asked bottle about longing the pairs with minimum lot size, becuz we were still unfamiliar with the pair. he was ok. i hesitated and went back to ask him if we should hv drop the idea, he say.. I HAVE ALREADY EXECUTED THE TRADE DAMMIT! ok, let's do it then i say. price looks good, we set our t/p and s/l and went to bed. i woke up in the morning to see +40 pips, definitely was good move. i was about to left home for office when i went back to my computer and decided to secure my profits by setting a trailing stop at 15 points, therefore extending my take-profit to another level, since profits are secured. i longed aud/usd the night before @ 0.8879, initial s/l @ 0.8850, initial t-p @ 0.8950, further extend to 0.9000. +121 pips closed. my highest pip trade since my LIVE trading, definitely motivating.fundamental + technical combined. it is not always u got such opportunity, therefore u see those expert traders only trading a few times per month, and are so HIGHLY profitable! they only go in on opportunity, not like us! like humping girls in out in out in out and in out! we're trying not to overtrade. every trade every week gives us a new lesson to learn.
Most of articles u read on money management, would tell u about only risking 2% of your account and a 1:2 risk-to-reward ratio. i m highly agreeable to the first, on risking no more than 2% of ur account in any one trade. becuz of the draw down, and if u are in the situation where price is likely to move more than 2% meaning ur s/l, better don't go in, always wait. some of the night when i juz watch and wait for opportunity, and some times went to bed without any trades, can feel good, better than juz 'wanting to be in the trade' and bring losses to bed like i always did.
As for the risk-reward, i can only say apply it same as above, meaning if u do not see a reward opportunity higher than ur risk, do not enter. but this is harder to fulfill. alot of times i find myself ripping reward halfway before a retracement, or price would hv almost touches ur t/p and retrace to ur s/l. in another perspective, i believe in flexibility. but end of the day, still, discipline is needed. if u are highly discipline like the expert traders, then most likely u wouldn't find urself in a situation above like me.
We love the Koalas this week, although the lot earned was small, but we're trying our best to rip PIPS, definitely the 'IN' thing in the long run! Happy trading.
Black
Ps: the profit we ripped thru the aud/usd trade went the most profitable when aud unemployment rate was annouced. The result was far better than forecasted. That was partly the caused of the spike in the morning (singapore time). Check out news annoucement @ forex factory - link at our forex knowledge portal!
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