Its been some serious time since I last blogged. Was busy with school after work, and the lastime I told myself I am putting forex in hiatus, but then as you can see from the post title, its the main subject of my post.
Its really bad idea of mobile trading, if you don't have discipline. What had happened to me past two weeks was everything a trader should not be doing. Okay, here is what happened.
2 weeks back, was watching my usual pairs, Eur/Usd, Aud/Usd. Aud/Usd has been ranging for quite some time in the daily chart, with major resistance around 1.0200/50. I thought I would hold some position in Aud/Usd so that if it remains strong I could gain some rollover. But I decided to do this with add-in position, if aud/usd go up, I gain, if it goes down, I have better price for another position, because it has been ranging long term, SHOULDN'T BE going down too low... but nothing is absolute in trading.
So I added a relatively small position in 1.0200, and add a little position in resistance and double zeros. So I did that, and I held my positions longest time I ever had. After a few days, I got better and better prices lol. And that began to trouble me. Before I knew it, I had 11 positions in it, and I was down about -1136 pips in total. Thats not the worst. Most of my stop-losses were at 0.9800, thats the max I told myself. It just kept going down. It was post Japan-tsunami incident.
Why? This article by Kathy Lien may give an insight of Japan's economy in relative to the Aussie dollar.
So finally, came the day I wake up with all my trading positions closed. I was downed. Drawing down about 30% of my account. I watch my busto account eating my breakfast in the morning. That morning, the coffee was strangely tasteless, and the bread I usually have in the morning feels like sponge.
After that day, I continued watching the aussie, it went past my stop/loss of 0.9800, to about 0.9705, before it decided to go back it belong. My mistake didn't end there. At 0.9920, with buying seems to go up such strength, I added a full-sized long again. This time, I did so right before deleting the Oanda mobile app off my BlackBerry.
Let it run boy. Why is losing such an easy job but not winning? Aussie continue to push up. It was good. My take-profit of 1.0190 area. It was going strong, I pull up my stop/loss to break-even price so as to minimize my mistake. On the 6th day of this trade, it finally hit my take-profit! I know what I was doing was wrong, base on Expected Value (EV) of making such a suicidal trade is going to bring one to hell. And so, I made this trade and this is a serious time to go on a break. This time seriously. It was just lucky that this revenge trade made it. My account was recoup plus a little bit more of profits.
If you had followed our blog for some time, this isn't the first revenge trade I did. And this is the only time I made it through.
Trading and poker are so similar. In my own opinion, what you need is to know the rules, practice and practice and practice, but to master them, it depend on how you control yourself. This is my weakness. Overtrading, revenge trading etc. Learning how to detach your emotions from such a BIG challenge for emotional human beings.
Still haven't run well, and I'm tired of talking about it. I play micro-stakes SNG and I'm bothered at losses. I start and stop my day looking at the cashier, and see how my account depletes every time. Close friend of mine who play closely with me, said I'm too bothered with the money, should just aim to play well.
I couldn't agree more. Even my girlfriend says that my mood was bad after a losing day, despite it was just a dollar. Another emotional factor at play here. Makes me wonder, to become mechanical in trading and poker one day, is it really possible? Or is it in-born with people or it could be done? Maybe the key to it is the thoughts that is happening in our head at the time of trading/poker. Maybe thoughts like "I SUCK BIG TIME SHIT POKER EVERYTIME HAPPEN TO ME", "ARGH F*** TATS WHAT THE STUPID PIPS LIKE TO DO WHENEVER I TRADE ALWAYS GO DOWN".
Anyway, Japan-tsunami disaster was very terrible. First was quake, tsunami, and then the nuclear reactor. I did a little donations myself and everyone willing to contribute do a little of their part.
Hail to the Fukushima 50.
Peace to the world.