Business Plan

Starting to find some useful information finally!!!

Creating a to-do list of sorts:

-Research Risk Management strategies

I have a strategy that makes sense to me, but needs to be able to know when to reduce risk when market is very Volatile. Considering getting my FRM from CSI.ca.

After all, Trading is only half the battle.


edit: Found this CHA (Chartered Hedgefund Associate) designation...might be helpful.

Business plans

soooo started the long process of creating a business plan for my managed firm.

Figured starting with prices would be best.

Euro

Sooooo kick in the teeth that I was stopped out +38.4 pips instead of the original target of 1.3150...


But I still think that it was a great trade.

Euro

Still a bloody mess, but profitable.

Taken a couple scalp trades ontop of my planned positional trade.

Moved SL to 1.29700, locking in 38.4 pips.

justified as if I am stopped out we are creating a lower low which would cause me to have a short bias.

still, 38.4 pips isn't that bad.

Euro

so as I have been focusing on solely one pair, I have tried to trade only when I recognize and can justify that a trend has been started.

I have taken a tiny euro position, Long @ 1.29316, with an SL @ 1.28700.


reasoning:

Euro has been a bloody mess this week (so far). As I see the downtrend line approaching I begin to think that we are at a key support level. I looked to daily, this area happens to lie within 100 pips of the 61.8% fib level. As I am thinking that there will be a retrace as according to my trading rules, there needs to be a retrace in order to confirm that this is a downtrend on daily (My past week has been trading the previous retracements on daily). So Lets set some key levels.

WELL...

The trend line lies around 1.31, which isn't a bad level. 1.3150. I drew a fib from the point where it last neared the trend line to where it stalled, and 1.3150 is the 50%.

now 1.3150 - 1.39316 = ~119 pips with ~60 pip risk.

small position as I am testing the theory, but if new trend does appear I will pounce upon its waves. The size of the trade is 1/10th of what I usually trade, and I am still profitable for the month even if I am stopped.

Notes

Finding that patterns emerge from price action. However, they are never the same, yet rely on the same principle.

When price drops significantly, it slowly begins to retrace, creating a lot of market noise. You can profit greatly from watching the noise and filtering it mentally so that you know when the retrace is over and the price begins to follow the original movement.

I watch for these stalling points, and base my trades off of these. I look for 3-5 pips before taking partial profits, and usually start by taking 50% of the position which limits my risk. Then pending my feeling on the movement, I take profits ~10,~15,~20 pips.

I peel off the largest percentage first as I want to lock in profits as pertaining to my calculated cost of living (~$30 a day), I lock in what I need to break even, then let the rest run to profitability.

Quoting an article:

When price advances think sell, stopping you from buying at the top and entering short as it contradicts the bias.

Also came to the conclusion that to trade for a living I will need $10 000 in an account, and make at least 3 pips a day. Toying with the idea of building an LLC shell to use, as I could "pay" myself my living expenses every month.

Trading

Trying to figure out if I am on a hot streak, or if I am finally getting it.

19 wins 4 losses.

+4% this week trading part time.

Trading has been getting better...becoming more patient and waiting for the trades to come to me.

technical indicators are there, but mostly using floor trader method to catch a couple of pips.

12 wins 4 losses.

made ~50 pips on euro before the drop, did not feel the drop coming.

How does this happen?

I logically look at the markets on longer time frames, and It just feels what will happen in coming days forces my hand on taking a trade, and I end up profitable.

I picked bottom on usdcad +130 pips, played euro short on Sunday gap should have held. I treasure my sleep, and cannot sleep with large positions on.

Need to find a way to keep me looking objectively at prices instead of random lines on the screen.