ForexSpirit

Monday was a pretty rangebound day. The tightness of the range made it difficult for me to pick out decent entry points so I was only able to close out two trades. A third entry had to wait until just after the end of NY session to reach its profit target.

Today turned out to be slightly more action packed. After a pretty routine trade in early NY trading things got interesting for me around 11:00 EST.

With price slowly ticking down looking for all world like it really wanted to test the 1.2500 level I had a sell stop in place at 1.2540. The order got hit but was cancelled due to too much slippage. I only allow for one pip of slippage and price had just moved four or five pips in this case.

My first thought was to place a new limit sell order at 1.2550 to catch any retracement but I decided against that and went for a market sell order at 1.2528. Price fell to 1.2522 to reach the low point for the day.

I failed to move my stop loss to breakeven which would have been the prudent thing to do in hindsight. Normally I look for at least 7 or 8 pips in my favour before moving the stop loss up to breakeven, but in this case, with new lows being reached, I should have been more conservative.

After my stop loss on this trade was hit I felt we might see a retest of 1.2600 again and so I decided to go long at 1.2580. This was probably my poorest decision of the day. I feel that my heroic recovery of 40 pips last week after I flipped direction from suffering a similar 50 pip stop loss defeat was fresh in my mind.

After reflecting on the market dynamics of this newly opened trade I realised that things were not really conductive to the same thing happening. It was deep into lunchtime by this stage with price lazily going nowhere. By this stage I felt the prudent thing to do was to scratch the trade.

My itch trigger figure had not had its fill yet. If long wasn’t the way to go after all, then short was obviously the only option. All too soon I was in a new short position at 1.2575. I set a 50 pip target, looking for the low of the day to be retested. I was soon able to move the stop loss to breakeven which allowed me the opportunity to let the trade ride.

By this stage I felt the initial pangs of revenge trading all too evidently. In a motionless lunchtime acting on those impulses was never going to result in any good. It was time to go out, get some fresh air and look at things anew when I returned.

When I got back I saw that price had dipped briefly but looked like going nowhere fast. The trade ended up being stopped out at breakeven.

I kept the short bias for the remainder of the afternoon and felt more centred as a result of my break. I was able to execute two more successful scalp trades to bring my loss for the day to a much more respectable -21 pips.

2 March trades:

2 March pips: 11

3 March trades:

3 March pips: (21)

2 March chart:

3 March chart: