Friday 10 January 2014

No Trades! For Valid Reasons?...

PL: R0    £0

Summary:  Interestingly when I finished this AM session I thought it might have been some of my best trading, with some perspective it then felt like some of my worse. The reality is it was probably somewhere in the middle... I'm going to venture to say that it was probably some of my better trading.  The LON open sessions were choppy, big and angry, unlike the nice orderly sessions of the JAP close. I would ordinarily have traded it and got stopped out a lot so I probably did well to avoid it. BTW Any opinions I'd like to hear (as you can see below it's turned me schizophrenic for a while)...The question I found myself asking was: If individual sessions are choppy but they are respecting S&R, are the trades viable despite the far larger risk they require? A: I guess to me the risk was not worth it, to someone else it might have been a different story.

Ramblings this session created...
A series of HLs so initially thinking long (even after the TLB). Then price puts in a LL- LH  = making initial bias short and giving an imperfect LH short because it didn't meet a prior level of S/R at 1 (this i was right to avoid). Price then returned into (what was the area of ) a small but long overnight range (grey dashed hrz lines) my bias remained short, expecting a test of 1.36. Don't know if I put too much weight on this past and finished ON range? Price was clearly trending up on the JAP close and down in the LON open should I have traded the trend? was I making excuses? The candles certainly did little to inspire confidence with big overlapping trend bars and shadows. I think I was probably correct but maybe I could have reacted quicker when the average bar size started to reduce and I might have taken trade 6.  
Psychology:  Although the price action looked tempting the grey range was only 10 pips and my brokers spread is 1.5 pips making me doubt potentially good looking trades (in reality this ON range had passed!). It seemed reasonable to sit out the AM chop given several areas of BW but I'm aware that I might have been concentrating on preserving capital rather than reading price action which I know is incorrect. I also know that getting a breakeven week by simply avoiding trades for fear of losing my gains is outcome bias and is a pyrrhic victory. But at the time and because I made a case for it (perhaps because I was focusing on making excuses to not trade?!) I believed sitting out the AM action was correct, here's my chart and my reasons... Looking a couple of hours later 4 and 6 were the only possible trades but 4 was within BW and the middle of a small range. 6 came just after BW so threw me off. But both made nice RLs to R so were perfectly good shorts. Again if I'd stuck to bars not candles I might have seen this clearer!



TLB-LL-LH =  initial bias short but...
1. Imperfect LH as price did not meet prior level of S/R
2. Imperfect PB long entry as trigger was a hiwave doji/hammer (which would have been stopped out).
NB I can see that price is trending down (to 1.36 likely) but I'm not liking the way in which it's doing so (the hi wave candles and big trend bar in both directions)
3. BW, got to avoid all the overlapping bars...  going for a walk (0800-0830)....
4. More BW and a potential short off prior hi but for only a potential 1:1 as 1.36 just below (NB my brokers spread is 1.5 pips) and with the increased BW chop risk not worth it.
5. More BW! have to wait for this to clear...
NB there was a long entry at the botom of the range but it was in BW and the trigger was a doji HM so no good.
6. Q:  did BW clear here because bodies stopped overlapping or do I need to wait for the entire area to clear?
7. potential short off RL to prior low but BW not cleared (maybe it was?), stuck in ON range and 1.36 just below?

No comments:

Post a Comment

Note: only a member of this blog may post a comment.