Waves

Smooth and quiet waves in one direction, perfect situation for this kind of trading.

Friday

Missed NFP today, came late from a trip and had some pips before the weekend.

"I can't be wrong"

Two red bars at the same level but I can't be wrong, price must go up! So I lowered my defense and got an uppercut on the face!..-14 pips and felt really stupid.. This is the price of arrogance. I can't be wrong means I am smarter than the markets. But I have already learned that I am just a humble follower of the market. The days I feel I am something special, the loss is there to keep me on the soil...

Madness

Compulsive trading is just that : trading and trading at aeternam, exiting and re-entering at the same point, again and again. Overtrading is the "art" to destroy a genuine price move by splitting it into many trades and get ruined from the paid commissions.. From this 40 pips move I got ..nothing and payed a lot to my broker too.. I had a minor excuse - the move was hesitant and i had to be cautious and expect a reversal, BUT this is only an excuse..

Breakout and retracement

1.3757 (blue horizontal line) was the daily high. I was very cautious with that level, I closed trades, not waiting for the breakout, when price approached this  and found the slightest resistance. I had then two trades above the level, at the break of the high, very cautious again. But, from all these trades, the one I am proud of, is the last one, a breakeven. I closed immediately when i "smelled" that a correction was imminent.

As a scalper, I am realy privileged to trade as described above : imagine, on the contrary, a guy who trades the 15m chart and went long at the break, 1.3760. Taking an affordable risk, he has a stoploss of, say, 25 pips. But price retraced immediately after the break to 1.3728, 35 pips lower with spreads and stop was reached! Even worse, at the previous attempt to break this level today, price retraced 60  pips!.. All stops were taken...

Going up

My Sunday with Euclid

""THIS IS THE BEST BOOK EVER WRITTEN BY A HUMAN. I'm not kidding and I'm not exaggerating; there is no way to express the joy of reading Euclid without sounding like a lunatic. There are very few books which reach their umpteenth thousandth edition without promising a posthumous infinity of bliss. The bliss of 'The Elements' is admittedly finite, but it delivers right away. This is an electrifying piece of work which has produced a chorus of rapture and inspiration lasting two millennia.""wrote a reviewer on Amazon.

I passed my morning today re-reading (10th time?) the geometry-dedicated 6 first books of Euclid's Elements. I have the chance to read them in the original : greek never sounded so elegant and precise. I felt the same joy and enthusiasm as the reader cited above. This edition is the best translation in english and comprises all the 13 books in one volume.

What is the relation of this material with trading, you may ask. In my humble opinion, trading is pure geometry. It is the skill to think visually, in the two dimensions of a chart, as the chess player thinks in the 64 squares and 2 dimensions. Euclid's geometry is the best exercise i ever found for training your mind to think visually.

During my studies back in the 80's, I got a "passion" for some other geometries too. Among them, the now out-of-fashion projective geometry. Twenty years later, when I started reading trading books, I was really surpised to discover that all this stuff was the inspiration for the trading patterns of the first serious, pioneering book on Technical Analysis by Edwards and Magee, the famous Technical Analysis of Stock Trends, written in the 40's. Human knowledge transplanted on an other domain!..

 To trade properly, you need just two things : geometry and table tennis. The first, explained above. Table tennis makes you fast. More on this on an other post!

Pre-London

A strong (technical) move just before London opening (10:00), which I didn't trusted much and as a result I left many pips on the table.

Contra and straight

I usually avoid (not always!) contra trades after a strong move. The gain on these is minimal compared to the risk taken. So is the first trade on the chart, just 1,5 pips and closed in extremis before the resume up, which gave more pips with some "straight" trades.

And this

Late entry

Late first entry minimized the gains of the session.

Thin Monday

Not much, on a thin Monday morning session. I should skip Mondays trading..

Reversal

Range and breakout

Losses  inside the range (again) and then a breakout.

No news, no moves

Eurogroup day today, with no news and no moves, flat markets. I was busy all day,  I opened charts late in the afternoon. I insisted to trade inside the tight range. Big mistake. I got a big pain and risk, just to get a breakeven.

Again

The unecessary first trade, while price was in the range, gave a loss. The gains came after this, in a natural way, when price moved out of the box. Scared exit (or stop hunting?) on third trade let the pips on the table. Not a big deal, the next wave gave more.

Going up

Price confirmed support around 19:13 and broke the range to go up. I wasn't there, I entered after the first slight pullback. Shy first trade (unexplainable exit) and then some pips.

London opening

Two correct trades, followed by three rather lousy ones. Then I missed the obvious reversal of direction.

Nice little moves

Post-NFP (3)

Too many trades and tight stops and mini losses on this last part of the session, in order to keep previous gains. I could finish the session before all this.

Post-NFP (2)

Post-NFP (1)

No trades

No trades today. Missed the nice drop at 5 o'clock (10:00 Est), as I was away from the screens. Bad timing.

Splitting

Not a fast train down this one, so the need to split every trade into several ones (precaution). Despite that, some trades were mediocre as executions.

A start

First trades of the year, on a relatively thin morning. Last entry was late - and risky.

Ratatouille (2007)

When in bad mood, I have a remedy : I watch a film with my daughters. Today it was Ratatouille. A little mouse who becomes chef in a gourmet french restaurant! Astonishining direction and lighting, fantastic detail (professional cuisine, Paris), amazing caracters and a very touching story. The director, Brad Bird, has two more masterpieces on his credit : the most underrated marvel in animation, the Iron Giant (1999) and the incredible Incredibles (2004), created with Pixar.

Thank you Brad, you made my day!

Season's grief

Back from the holidays with a terrible cold and fever, only to be informed that I lost a good friend... I was thinking a lot of things in the last days and that putted me in the blues too... Exactly two years ago, I was writing in this blog one of my posts I like the most. Today, the crisis is a lot more actual and global. Where are we going, really?

Doing my little research about Tony Judt (previous post), I discovered a fine article of him, published here, which developes the same ideas, far more deeply and eloquently of course. Please, read it!.. (more about T.J. here).

Happy new year to all!

A book for Christmas

The memory chalet

Tony Judt was a brilliant British historian who died last August. I started reading his last work, wich was  composed while he was totally immobilized by the motor neuron disease that was to lead to his death within a few months of its publication. The book is a touching reminiscence of his life, a testament to his courage and a fitting memorial to a great historian and a wise and humane man. Fascinating reading.

Dangerous market

I usually avoid trading during the Christmas period, but today I opened charts again. What I was afraid of, was there : a thin market, violently moved by the big guys, to make extra gains before their vacations. I had a 2,5 pips trade and the market, IMMEDIATELY after this, moved 40 pips in the opposite direction, precisely at the London opening (10:00)!.. I could stay with the long open and no stop and get a -40 on the face in 3 seconds.. I took fastly 11 pips on the right direction but this is gambling, no trading. Got a little more and closed trades for a week at least. Leaving by now.

Merry Christmas, happy Hannukah!

Flat

Lost some on a perfectly flat, boring pre-Christmas session. I should go packing and leaving for the mountains instead.

5 o'clock

Nice steady move, on a pre-Christmas dull Monday. 32 pips in 12 trades and done for the day. I should learn (in 2011) to have those pips whith fewer trades. I had to exit and re-enter often today, because of the thin market and for maximum seciurity.

O'o

O'o is the name of a extinct Hawaian bird and an excellent album of John Zorn. Vivid, magnificent music and cover! One of the best albums of this (very prolific) great musician.

Expectations

A serious mistake here : in the middle of a strong move and after some green bars, I believed it was time for a retracement. I went contra-trend and...I lost 7,6 pips. I had the  "honesty" to accept my fault relatively quickly and then I entered in the right direction and got the pips back.

I wrote this a million times before : Our beliefs, expectations, assumptions are the perfect way to perdition, especially when trading. What every zen monk knows very well.

Out of the box

Range bars show ..the range much better than candlesticks. 4,9 easy pips here, just by putting a buy order above the rectangle. BUT, if I wanted more, I would be kicked off with a loss. That is the edge of the scalper : he needs a few pips only, he is modest. Otherwise, he's lost.

Slowly down

London opening

Same scenario

Same scenario as on the previous fx post : collecting pips when bying ascending supports and getting anxious, having fewer pips, if not losses, when bying breakouts It is very simple, isn't? Some cunning fellows charge you (a lot of) money to teach you this..

Valery Gergiev

Valery Gergiev conducting the famous Mariinsky Theater Orchestra at the Athens Megaron. I was lucky enough to be in the audience. He gave an astonishing performance of Mahler's 5th Symphony, a big revelation for me, although I have listen to this masterpiece hundreds of times, in the last 30 years... All the tension is in his hands, which are like rubber..On the first part, the exquisite Tchaikovsky's violin concerto, soloist the great Leonidas Kavakos. An unforgettable evening..

Ascending support vs. breakout

The trades who gave 12,4 and 5,1 pips on this chart were entered when an ascending support (after retracement) was observed, while (almost all of) the rest of the entries were at (local) breakouts. Look how more relaxed and easier are the former.

Greed or addiction?

Some mini-losses inside the range and then a good shot which gave 12,9 pips. Followed by six little trades which totalled -1,5 pips, plus commissions. The session should stop after the mandatory stop to preserve the 12,9 pips gain. Why did I continue?

Morning session

Move forward

Rather cautious at the start of the move, I trusted it more on the next wave up.

Bloody Monday

A rather easy to trade Monday opening was transformed to a few pips loss. Looks like I lost my fast reflexes during the weekend.  On fourth trade for example, a "smart ass" anticipation of reversal costed me 11.8 pips. Silly, silly.

Post-NFP (2)

The "good" shot came immediately after the previous trades.

Post-NFP (1)

Not much on this first attempt to trade post-NFP. Mainly due to the tight stop loss (my safety net under high volatility conditions).

Before NFP

Usually I don't trade at the London session before NFP announcement. Today was an exception. Volatility was slightly bigger than expected.

Morning session

Too many trades, again.

Slices

Getting slices only out of the afternoon move, as I didn't trusted much this downtrend/correction. Ending the day with 39 pips gain in 11 trades, trading significantly less than on the last days of November. I consider this fact a big plus. Don't get hooked. Life is elsewhere. Steve Kuhn on the stereo right now.

Risk

Silly risk taken on the first trade of the month. The rest was more easy.