Welcome to my investing and trading blog. This is where I post my trading journal, discussing what I see in the (primarily) Forex market, and talking through the actual trades that I make. Today, I made a short trade in Pound-Cad that crushed me. Read on to see how this trade played out.
GBP/CAD Short
Expected Entry – 1.6967 Stop Level – 1.6986 Target – 1.692 R:R – 2.5
I haven’t been feeling great over the last several days, and ended up largely taking yesterday off. This morning, I woke up feeling a little better, but still found it difficult to focus on the markets. I really tried, too; I had a protein shake and meditated before I started looking at charts, but it didn’t matter. The overly anxious feeling maintained, so I decided to wait a bit and come back in the afternoon.
I took care of some stuff around the house, then grabbed my computer to look at charts. Immediately I noticed that the chart I had up was making a push down, and appeared to be coming off of a rally, returning to the overall downtrend.
Side note: I’d been thinking, recently, about adding a wrinkle to my trading plan. I often see price pushing down off of the upper band, or coming out of overbought (vice-versa in uptrends), and it’s moving without any stalls, or providing any “entry opportunities”. I’m thinking about, when I catch those moves in action, just trading the move and not waiting for a pattern. I’d do a market order, or just an entry at the next key area, and put my stop above the high that was created before it started dropping. I think I’m definitely going to keep that in mind going forward, and trade them with 1/2 or 1/4 position size for now until I see how viable it plays out.
Back to this trade. When I first came across it, I thought this might be a candidate for the wrinkle I’d been thinking about. On the 4 hour chart, price looked like it was pushing down strong, and I’d miss the move if I didn’t do that. As I was watching, though, a small lower wick started to form, and I thought it might be offering an entry opportunity after all.
Entry – 1.69668
I dropped down to the 15 minute chart, and sure enough there was a nice bear rally that had formed. Price was coming off of the Moving average on the 4 hour chart, and RSI was below 50 and sloping down on both the 4h and 15 min charts. Overall, I liked the movement and direction so I set the entry order. I picked a target near the prior swing low on the 4 hour chart.
I set the order and left it alone do take care of some other things, and not too long after, I heard the chime that signaled my entry. It felt like another great sign to me, the fact that triggered so quickly after the short rally, and I was excited to see how many pips I could ultimately catch.
Exit – 1.70087
Price really only got to my entry. It made another small rally and pushed down again, so I remained confident. Price started to slowly push up from there, though, and I started worrying a bit from there. I didn’t want to obsess over the price, so I started working on this blog post. As I was writing the intro, though, I heard the noise again and knew I had been stopped out.
Price ultimately rolled to the upside, with my entry being the bottom, before finally making the spike up to the key area that was my stop level.
This is another one of those that checked all of the right boxes, but didn’t work out. That’s trading, though. And as I’ve already mentioned, I expect to lose at least 40% of my trades; I just have to continue to remind myself that this is one of those.
What’s worse, though, is that for some reason I was stopped out over 22 pips above my stop-loss level. I saw that the spread was high — over 5 pips at times — but I didn’t expect that in the least. I’ve heard horror stories about slippage, but I don’t think I’ve ever experienced anything this drastic. Maybe in Early – Mid 2020, but that’s it. It’s ridiculous.
Other than adding ‘ensuring the pair has a low spread’ to my trading plan (which would keep me out of even more trades), I don’t know what to do. Unfortunately, I can’t use stop-limit orders when I’m trading through TradingView. Maybe using another broker might help, but I’ve already compared the Oanda spreads to Schwab’s, and they’re comparable. Maybe I’d get filled at better prices? I’ll have to do more research.
Conclusion
If nothing else, though, at least it’s content. I hope my misery is at least entertaining. I just need to be better about my pre-trade routine, and getting into the right headspace before I trade. Easier said than done, but I have to keep moving forward.
Thanks for reading! As someone who’s still growing, today wasn’t the most encouraging day; but I’m going to brush it off and be better tomorrow. At least it wasn’t a 0 day. Leave me some words of encouragement in the comments section and as always, stay tuned for more Forex trades and analysis.