Sunday, August 16, 2009

08/16 Weekly Review

This was by far one of my most challenging weeks! Not so much for the trading process itself, not even because of the markets.. All the challenges were in my head! Those are harder to spot and take care of, but it is my job, as my own trading coach, to figure them out and find a solution.

It all came together for me when I reduced my size and traded "in the zone" during the FMOC announcement! This gave back my swing and I was able to trade great for the rest of the week. It also helps to have good information to read, and I have to say that the "Daily Trading Coach" book and the Traderfeed blog are a must have for any trader! Thank you Dr. Steembarger!

Trading the FMOC with reduced capital was the only way I could get my head back in the game. Yes, it didn't help with my profitability, but HEY, it got me back in the game and YES it helped! On the longer run, getting myself confortable with my ability to trade is worth a lot more than a few percentage points of profits during one single week. So, one must always put things into perspective.

Increasing my focus by reducing the number of currency pairs I follow was another benefit this week! I now can really concentrate on what is going on in the GBP and EUR, instead of trying to chase set-ups here and there and everywhere. This makes a huge difference!

Day-by-day review:
08/10 - 2 trades, 2 losses (-2.18% ROI)
08/11 - 1 trade, 1 loss (-0.46% ROI)
08/12 - 4 trades, 3 losses (-2.85% ROI)
--- FIXED MY HEAD, got back in the game
08/12 FMOC - 3 trades, 3 wins (+2.16% ROI)** SMALLER SIZE
08/13 - 2 trades, 2 wins (+1.09% ROI)
08/14 - 3 trades, 3 wins (+1.37% ROI)

Totals for the week:
15 trades, 8 wins, 7 losses (-2.98% ROI ** Not compounded)
Average Win: 0.33%
Average Loss: -1%
Risk to Reward ratio: 3 : 1
Winning Percentage: 60%

The risk to reward is not good at all. This is a direct result from having too many trades "scratched", when they failed to reach the targets and fade back to their original entry. I will have to keep an eny on this to make sure it is worth scratching, or if it is better to simply take the risk of hitting the stop, but leaving the target alone.

Trading Performance Metrics
1) Trade set-up: B (Jumped the gun on the 08/12, manual entry errors)
2) Managing Stops: B (Did not manage stops well on 08/11, managed very well after the 12th)
3) Capital Allocation: A+ (Managed properly, reduced size on FMOC as planned)
4) Managing Exits: A+ (Kept a good grip on trades that faded the target)

** Results are not compounded because during the FMOC trades I traded close to nothing in terms of capital at risk. I was basically getting my self back in the game and didn't want any performance pressure. If I had traded those trades with the same level of risk, the results would have been a lot better (-0.98% ROI).

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