‘People who succeed in trading business have the single-minded devotion to their goal. Some people refer to these over-achievers as workaholics. Total commitment can’t be achieved until you find your true calling. Total commitment isn’t just hard work; it’s total involvement.”
Hello:
This is an update on some of the movements on the markets and what I’m doing about them, plus my losses and profits. The analyses are based on daily charts, looking at the Big Picture, though my entries are on a smaller timeframe. My preferred leverage is 1:100 and my position size is 0.01 lots for each $1000. My maximum drawdown in a week is 3% (worst case scenario). I use the Price Behavior rules for strategic decisions and customized indicators for tactical entries. I open primary positions without predetermined exit target in mind, riding the trend for as long as it continues. The value of patience will forever be emphasized. As long as I stick to my rules and keep my risk low, I’m immune to fear.
Psychologically, you got to view your trading losses and profits with a nice level-headed indifference. There’s something called Oneness which you can use to your advantage in trading. Dr. Van says that a core principle of Oneness is that there is no thinker, only thinking, because you are not your thoughts and feelings. They are just there and you are simply the awareness of them. But you routinely identify yourself with your beliefs and think they define you. So in your trading, illogical emotions can’t do you any good.
AUDUSD
Primary trend: Bullish
The AUDUSD is slowly but steadily inching its way up. The market is in a strong uptrend and any attempt to sell is clearly a suicide mission. It may take longer than imagined for this trend to change. I’ll be keeping my fingers crossed for now, since the only action I’ll want to take is to sell short whenever sellers clearly prevail. Even during that period, the price action must’ve confirmed this.
NZDUSD
Primary trend: Bullish
It’s known that the NZDUSD tends to be positively correlated with the AUDUSD. There may be occasional pullbacks on this pair, but it’ll have the same experience with its Aussie counterpart. The market looks as though it’s overbought, but the present bias is still bullish. Even if there’s any sustained bearish reversal, we’ll only be a few days late. Remember, this is a long-term strategy. Unless one’s using a short-term strategy, it’s unwise to buy or sell this pair at the present: buyers would be entering a late signal and sellers would be going against the trend. The best thing is to be there at the start of a ride; never more than a few days late. If a professional can sometimes be a victim of irrational emotions, how much more a rookie? A clever rat is caught in a trap, how much more a stupid one?
EURCAD
Primary trend: Bullish
The bullish ride on this instrument is expected to continue until otherwise indicated. A trend continues until it’s definitely over. There’s no everlasting trend, yet it takes a great deal of time for a trend to change. Forget anything about resistance and support in a trending market. Even a price consolidation is just a pause, after which the market would resume its overall trend.
Order: Buy Limit
Entry date: September 9, 2010
Entry price: 1.3100
Initial stop: 1.2950
Current stop: 1.3593
Exit price: N/A
Exit date: N/A
Status: Open
Profit/loss: 972 pips
Percentage growth: 9.7%
EURAUD
Primary trend: Bullish
The trend on this cross clearly turned bullish last week, and this is the beginning. Please note that Forex trading is just an art of matching a strong currency against a weak one. Despite the Aussie’s strength, it’s powerless in the presence of the Euro. This means that any expected weakness (the AUD will eventually weaken) in the instrument’s counter currency will expedite the bulls’ supremacy. I missed this bullish ride. I’m trying to buy a serious pullback with a pending order, but only on the condition that the market retraces back to my preferred entry price. Otherwise, I’d simply wait for the bulls to finish expending their might – which may take a long period of time. An eventual bearish outbreak would at last present me with a very good shorting opportunity.
Order: Buy Limit
Entry date: October 1, 2010
Entry price: 1.4000
Initial stop: 1.3850
Current stop: N/A
Exit price: 1.3871
Exit date: N/A
Status: Pending
Profit/loss: N/A
Percentage growth: N/A
EURNZD
Primary trend: Bullish
The Price on this instrument is now far quoted above the SMA 20 while the +DI is still far in the region above the –DI, plus the ADX 20 is now above level 30. The uptrend is still expected to continue (when it comes to strength, the NZD is no match for the Euro right now). There’s no end for the bullish trend in sight since any sudden weakness in the Kiwi would only shoot up the market. The occasional loss in momentum, as you’ll be seeing that, isn’t a sign of trend reversal. I missed the beginning of the instrument’s bullish ride as well, whereas the future bearish overthrow would also present me with a nice trading opportunity.
AUDJPY
Primary trend: Bullish
There’s no need for me to be fussy about any further bullish outbreak on this cross. My stop hds been moved to a breakeven. I sold short because there’s an extremely stubborn resistance at 81.55. The market is now in a ranging mode. Besides, any further strength in Yen may spark off short selling since it looks like the AUD’s stamina against the Yen is almost exhausted. This could be a great supply level, and if it fails, then the bulls would continue their hegemony. You need support from your trading environment so that you’ll always be encouraged. Nevertheless if your sweetheart treats you disdainfully as a trader, coming to you at the end of a trading day, and asking you: “Mr. Mug, how much did you lose today?’’ It means you’re in a hostile trading environment. What do you then think the solution is?
Order: Sell Limit
Entry date: September 15, 2010
Entry price: 81.00
Initial stop: 82.50
Current stop: 81.00
Exit price: N/A
Exit date: N/A
Status: Closed
Profit/loss: 0 pips
Percentage growth: 0%
Conclusion: There’s a need for you to remain rational and unemotional when trading. Note that whatever happens on a demo account would also happen on a live account (with a reliable broker). The problem is often that we become too emotional with a live account and we don’t take a demo account too serious because any losses and profits have no direct effect on us. Demo accounts are a great tool we can use to test the viability of our trading ideas, but don’t ever make trades on a demo account if you know you can’t try that on a live account. It isn’t proper to think that you’ll be smarter with a live account than you’re with a demo account. Paul V. Azzorpadi has something more to say about this issue:
‘…Many investors claim that their luck turns bad when they stop paper trading and start the real thing. When paper trading and using notional money investors have less emotional involvement… Once they start using the real money, they become hesitant and emotional rather than logical, and their trading suffers.”
Your questions and opinions are highly welcome.
Thank you.
With best regards,
Azeez Mustapha
Forex Signals Strategist, Funds Manager &Coach
Senior Analyst
FX Instructor, LLC
Email: amustapha@fxinstructor.com
Get my Forex trading signals at: http://www.fxinstructor.com/en/analytics/ituglobal
And my past articles are also available at: www.ituglobalforex.blogspot.com
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