Bad Assed Trader: Yesterday I tried my first Gold trade. I was only looking for 12 pips but could I squeeze even that out before price hit my 24 pip stop loss? Could I buffalo.
I put the trade on at 08:16 (GMT) and watched as it dipped and fuffled about. I went to work and - because no-one can see my computer screen - at lunchtime checked it out every few minutes. I was waiting for price to go up. So it sunk a little, then a little more and then suddenly, at 13:15 it started gaining some strength in an upmove. Great, I thought, finally. But no sooner was I feeling things were going my way when price started tanking back down.
And it took me out. Oh well, I thought. Next time I looked, just half an hour later, well b***** me if price hadn't completely shot up almost off the screen - 70 pips in 15 minutes. It then took a little rest and went up another 40 or so pips.
Ok, this has happened to me before enough times that it's not actually physically painful anymore but I can't pretend that it doesn't p*** me off because it does.
There, I've said it. I've got it off my chest.
Now what did I learn from this experience? A lot of traders have rules about deleting a trade that's not going anywhere. The trouble is that when I've done that in the past about 30 seconds later price tends to shoot in the direction of my trade and leave me cursing so now my rule is to stick with the trade. But it does seem that often if price doesn't go your way fairly soon then the chances are it needs some movement the other way before it can spring into action in line with your strategy. I think of Zebedee from The Magic Roundabout at this point - the chap with a spring instead of legs.
But when to take the trade off? At what point?
It certainly didn't feel right to take it out when it started to move up with some strength. But perhaps when it then started to turn back rather than continuing up would have been the right time. A question for my coach, Emmanuel, I think.
Thanks for reading. Comments are most welcome.
I put the trade on at 08:16 (GMT) and watched as it dipped and fuffled about. I went to work and - because no-one can see my computer screen - at lunchtime checked it out every few minutes. I was waiting for price to go up. So it sunk a little, then a little more and then suddenly, at 13:15 it started gaining some strength in an upmove. Great, I thought, finally. But no sooner was I feeling things were going my way when price started tanking back down.
And it took me out. Oh well, I thought. Next time I looked, just half an hour later, well b***** me if price hadn't completely shot up almost off the screen - 70 pips in 15 minutes. It then took a little rest and went up another 40 or so pips.
Ok, this has happened to me before enough times that it's not actually physically painful anymore but I can't pretend that it doesn't p*** me off because it does.
There, I've said it. I've got it off my chest.
Now what did I learn from this experience? A lot of traders have rules about deleting a trade that's not going anywhere. The trouble is that when I've done that in the past about 30 seconds later price tends to shoot in the direction of my trade and leave me cursing so now my rule is to stick with the trade. But it does seem that often if price doesn't go your way fairly soon then the chances are it needs some movement the other way before it can spring into action in line with your strategy. I think of Zebedee from The Magic Roundabout at this point - the chap with a spring instead of legs.
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| Zebedee: the bounce you need for your trade |
It certainly didn't feel right to take it out when it started to move up with some strength. But perhaps when it then started to turn back rather than continuing up would have been the right time. A question for my coach, Emmanuel, I think.
Thanks for reading. Comments are most welcome.
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| Gold Fingers |
Personally I would stay away from most, if not all commodities as there's been some major fluctuations recently. Gold, especially has been trading at an all time high and even the pros can't seem to decide whether it's heading for a bubble burst or whether it's actually worth that amount!
ReplyDeleteAs for when to delete a trade, then that's definitely one for your coach! Good luck!
Hi Nelly, thanks for the wise advice. I was only trading for a few pips with gold but my coach subsequently said it's too volatile for that type of trading but he has said I can trade it with other approaches. I agree with you about the mixed messages but I try to trade what I see and ignore the noise of the opinions! Coach was not keen on deleting trades - scale out instead he says.
ReplyDelete