Prediction Reviews
Hi all,
Time to do a round up of the two pair I was watching and wrote about here this week now that the trades are closed. First the weekend wonder on the GBP/USD I wrote about on Sunday, where we saw a confluence area that I saw as a strong resistance point to any further moves up. Here is the chart again as it was Sunday:
Time to do a round up of the two pair I was watching and wrote about here this week now that the trades are closed. First the weekend wonder on the GBP/USD I wrote about on Sunday, where we saw a confluence area that I saw as a strong resistance point to any further moves up. Here is the chart again as it was Sunday:
GBP/USD 4H (Sunday 15/01/06)
The confluence of the daily trend line, previous resistance, fibonacci lines and median lines and the nearby psychological level of 1.7800 all indicated that prices would find it hard to get through that area, and the plan was to look for confirmation of a turn close to the 1.7800 area and go short. Here's how things turned out:
The confluence of the daily trend line, previous resistance, fibonacci lines and median lines and the nearby psychological level of 1.7800 all indicated that prices would find it hard to get through that area, and the plan was to look for confirmation of a turn close to the 1.7800 area and go short. Here's how things turned out:GBP/USD 4H (current)
Fantastic, just as predicted, price moved up, touched the daily trend line and reversed, I took the trade at 1.7784 and rode it for +122 pips, probably my most satisfying trade in recent times, thorough analysis, correct entry execution, and even a reasonable exit which can be my weakness. Thumbs up all round on that one.
The other trade I predicted about is something different, the USD/CAD triangle, that turned into a USD/CAD rectangle. Triangles and rectangles are both ranging patterns, pairs with no clear trend direction, and are formations where we should be looking for a breakout. I predicted both times that we would see a downside break, and both times and upside break occured, bummer! I am actually very happy with my analysis of these formations, identifying them correctly, I am however bitterly dissapointed at my execution of entries in review, breaking rule #4 on my trading list I have in front of me on my desk of "Do not pre-empt a breakout", meaning wait for breakout confirmation before acting. If this was followed, what turned out to be overall a +13 result on the USD/CAD trades should have been around +100 if I did wait for confirmation (i.e. a close above or below the formation lines). Here is the chart with the breakouts:
The other trade I predicted about is something different, the USD/CAD triangle, that turned into a USD/CAD rectangle. Triangles and rectangles are both ranging patterns, pairs with no clear trend direction, and are formations where we should be looking for a breakout. I predicted both times that we would see a downside break, and both times and upside break occured, bummer! I am actually very happy with my analysis of these formations, identifying them correctly, I am however bitterly dissapointed at my execution of entries in review, breaking rule #4 on my trading list I have in front of me on my desk of "Do not pre-empt a breakout", meaning wait for breakout confirmation before acting. If this was followed, what turned out to be overall a +13 result on the USD/CAD trades should have been around +100 if I did wait for confirmation (i.e. a close above or below the formation lines). Here is the chart with the breakouts:
USD/CAD 1H
So while I was amazingly wrong with my pick on direction of the breakout, waiting for confirmation would have resulted on two fantastic trades. I did catch around 40 pips of the second breakout in the wee hours of the morning for me.
So that's how it all went, these two trades alone have shown me the level of analysis that is needed to make responsible decisions, you can see from my current results, that a +180 or so Monday has now be whittled down to around +50 (as of Wednesday close) on speculative trades that didn't involve this level of analysis. I take encouragement out of knowing I do have the ability to analize markets, but just as importantly I am happy to eat my serve of humble pie knowing that the markets has the better of me if thought is not put into it.
Happy trading!
So while I was amazingly wrong with my pick on direction of the breakout, waiting for confirmation would have resulted on two fantastic trades. I did catch around 40 pips of the second breakout in the wee hours of the morning for me.
So that's how it all went, these two trades alone have shown me the level of analysis that is needed to make responsible decisions, you can see from my current results, that a +180 or so Monday has now be whittled down to around +50 (as of Wednesday close) on speculative trades that didn't involve this level of analysis. I take encouragement out of knowing I do have the ability to analize markets, but just as importantly I am happy to eat my serve of humble pie knowing that the markets has the better of me if thought is not put into it.
Happy trading!
This entry was posted
on Thursday, January 19, 2006 at 7:19:00 AM.
You can skip to the end and leave a response.
Posted byThursday, January 19, 2006 9:46:00 AM
We always learn from failures then improve better. :-)
» Post a Comment