ForexSpirit

The huge 533,000 job loss figure from this morning’s NFP was the big talking point of the day. Even though there were supposedly whisper numbers of a potential 450,000 or half a million figure (versus the expectation of a negative 320,000) there was still an audible gasp on the trading floor in Chicago when Rick Santelli released the number on CNBC.

I had two trades open up via resting limit orders at about 6:40 EST, just before I was able to check my charts this morning. I generally don’t like to have trades open going into a big data release, but both trades were dawdling only 20-30 pips in the red all the way up to the 8:30 EST release time.

My expectation was that there would be a lot of volatility and noise just after the release no matter what the actual numbers were. This is indeed what happened and both trades were closed out successfully.

The markets then kept within the trading range thrown up by that volatility for much of the rest of the day.

It took until 14:00 EST before things got interesting again. Equity markets moved into positive territory for the first time that day and rallied into the close. Shades of the PPT at work again? These last minute surges on a Friday afternoon seem to be becoming commonplace now. This saw USD/JPY break above the 93 handle which pulled up EUR/JPY.

My first entry point in EUR/JPY at 117 did not play out, although my second one at 118 did.

As a sort of follow up exercise to my November 2008 review I analysed all my losing trades from that month and the three I closed out this week.

I wanted to know if closing them out had been the best thing to do or if I would have been better off just leaving them and letting my disaster stop have the final say.

Twelve losing trades went under the microscope.

One trade was closed out as a result of acknowledging that I hadn’t been following my proper entry criteria and thus was a mistake. Another of the trades, which was from this week, was set to close out at breakeven but lost three pips due to slippage. I’m going to discount these two trades from this quick bit of analysis as they doesn’t represent the sort of test cases that I’m interested in.

Out of the remaining ten trades all but one returned to at least break even. It took one trade almost 48 hours to get back to that break even point. For the rest it generally occurred within a 24 hour period.

The only trade that would have gone on to hit its disaster stop was the losing GBP/USD trade on November 6 which I manually closed out for a 176 loss (which was well on its way to the 250 pip disaster stop).

With this data fresh in my mind I was reluctant to close out the EUR/JPY trade opened at 117 even as price went into the weekend at just over 118. My disaster stop is at 119.48 which is above the highs for the week in this pair. I guess I want to get myself to be more accepting of my trading plan and to let my losers breath. The trend is still definitely to the downside.

I made the decision to let it ride over the weekend and see what Sunday and Monday brings.

Trade	Market	Direction	Entry	Exit	Pips
1	GBP/USD	Long	1.4652	1.4662	10
2	EUR/JPY	Long	117.55	117.65	10
3	EUR/JPY	Long	117.25	117.35	10
4	EUR/USD	Long	1.2700	1.2710	10
5	GBP/USD	Long	1.4550	1.4560	10
6	GBP/USD	Short	1.4578	1.4568	10
7	EUR/JPY	Short	118.013	117.90	11.3
8	EUR/USD	Short	1.2700	1.2690	10

Total daily pips: 81.3

Total weekly pips: 210.6