thread: Training Journal

03/03/2018
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Still another rant post.
I am severely disappointed by us human's capacity to determine false prophets... I am unsure if that is related to the degree of schooling, the intellect of people, no thanks dilligence or just greed...

only a simple warning to all retail traders out there. Whenever someone tells you how you can trade, get the f!
NOBODY can predict the future. Unless you have insider info.

Whats worse is that the so called prophet is betting nearly his entire capital on each transaction... Zero risk management... And if I am not wrong, has VERY small trading expertise. Their sole credentials is that they are effective so far(and it is not a very long timeline).

Is this the largest problem with people? The obscene greed that blinds us to the reality that you is taking huge amount of risk? The sheer laziness to just do our homework and perform a background check on these prophets?

I am honestly horrified that there are people whom still stick to these trading messiahs... And in my honest effort to assist, I get crucified!

I am on the point of giving up completely on improving the retail trading community... For many folks just are not intended to trade.
Look to the past on these divine beings, all of them magically disappear eventually. Ever wonder why? It's certainly not because they struck the jackpot. Their self may urge them to keep bragging if they did. My guess is that they all got margin called. Plus they dare not go back to the faithful followers that once worshipped them...


The key takeaway from this whole escapade is: If it is too good to be true, it likely is.

Just finished doing my accounts to get feb.. Im down 0.25% in for the month. Not surprisingly, the largest loss stemming from my demographics vulnerability. The dollar strength starting about the second half of feb supported my portfolio and was able to recover some losses.
While my performance in the past month is not impressive. It's quite small relative to SP500's decrease of approximately 3.9%. However my YTD functionality is -3.3%. This is due to to my place sizing being too large to ride out the dollar downtrend. I needed to close my dollar positions and realize a massive loss someplace around jan.. It was a painful start to the year but served to remind me not to get too greedy and bet too big. This valuable lesson will stick with me.

I believe that the current dollar rally and likely acceleration, coupled with rising interest rates expectations, will probably serve as tailwinds for my current portfolio positioning. I also expect more volatility in the markets in the coming months, and consequently, affecting the valuation of my portfolio. This can either get the job done for me, or from me. And thus, I should not panick when faced with profound drawdown nor should I get too excited and over confident when ahead by a wide margin.

Edit:
To add on. I expect huge volatility in the euro next week. Due to german coalition outcome and italian elections. Governmental occasion. Although I'm unsure about the particular effects. Reading news reports suggests that is a real possibility of governmental risk here. Yet the euro doesn't seem to signify that. Looks like there's value!

02/03/2018
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Hazards of possible trade wars griping the stock markets. US, EU, UK, Japan are not spared. Heading into friday I do suspect that this risk-off momentum will continue.

I do deem commerce warfare to be fundamentally something serious. Along with the US will probably be the biggest loser going into this. Short US equities? In my account list.

01/03/2018
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After much discussion and lurking around FX and retail trading forums. I noticed one very similar attribute of all retail traders. And its this very characteristic which I believe is harmful to our trading functionality.

I will always see people saying things like I think XXXYYY pair is going up! Or Short YYYXXX @ 1.3, TP: 1.2, SL: 1.4
Do you find yourself making such statements?

To such statements I will usually ask Why do you think prices are going up/down?
At this stage most people fumble (I dont know or that I just think so!)
Perhaps you have thought about the logic behind why you think prices will move up or down next? Or are you in reality simply trading away gut feeling?

Then we've got the people who have justifiion (It's reached support/resistance)
My next question is: Just how confident are you of the trade thought?
If you aren't even moderately-highly confident on your trade ideas, THEN WHY DO YOU STILL ENTER THE TRADE?


Allow me to discuss two consideration that I believe could help alot of retail traders: Narrative and Conviction.

Narrative
it's basically the logic behind your trade idea. Plus it must make sense. Talk youself through the narrative of how and why you think the transaction will unfold this particular way. What are the scenarios? Which are the alysts? Are there any scenarios where prices will probably move the opposite direction instead? What do you do then? (Hint: Get out!) . Having a story you can see how your trade may play out. And where and when to get in/out.

Conviction
The level of assurance in your own narrative. How positive are you that your trade logic holds? If your story has 1 scenario for prices to go up, but 10 scenario for prices to drop, then why are you still buying? Attempt to just take high conviction trades. Unless you're sure the payout when your transaction is right is considerably greater than the reward! In that case, position your transaction size smaller!


The explanations behind the abovementioned are only short descriptions. However, I do feel that it's important in any traders arsenal. It can help to eliminate the plogical aspects of trading.
The point I am attempting to get at here is not to promote my fundamentals. Rather it's to inform all retail traders to THINK before you TRADE. The next time you find yourself mindlessly trading, take a step back and ask yourself Why.

quote Nope. I meant as in the initial time when I became USD bullish. That happened back in 2017. I believe about october - november? I had been wayyyyyyy too premature and utilize an excessive amount of leverage to handle the drawdown. So I had to reduce my position in a loss (Believe my total trade dimensions on AUDUSD EURSD back was approximately 10 - 11x total funding, which meant I might only weather about 9 percent drawdown. It's down to approximately 3.5x capital today, which in my opinion is allows for more than enough drawdown). As a contrarian-styled trader, I noticed that my perspectives on the...

Thanks for Sharing Synicz...

quote Synicz, Long Calls as in Options? When did you buy them? Thanks PS: Apologize if it you mentioned in some of your older posts.

Nope. I meant as in the initial time when I became USD bullish. That happened back in 2017. I believe about october - november?
I had been wayyyyyyy too early and use an excessive amount of leverage to deal with the drawdown. So I had to reduce my position at a reduction (Think my overall trade dimensions on AUDUSD EURSD back was approximately 10 - 11x total funding, which meant I might just weather roughly 9 percent drawdown. It's down to approximately 3.5x funding now, which in my view will be allows for more than sufficient drawdown).
As a contrarian-styled trader, I noticed that my views on the markets nearly always are contrary to the majority concensus. I must be prepared to confront drawdowns.

That incident taught me a valuable lesson in risk management.

28/02/2018 -- Nothing new to add, USD on a roster. I guess that this week is going to be the week of USD strength. My USD long calls out of 2017 are starting to materialize!

Synicz,

Extended Calls as in Choices? When did you buy them?

Thanks

PS: Apologize if it you previously mentioned in a few of your older articles.

28/02/2018
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Nothing new to add, USD on a roll. I guess that this week is going to be the week of USD strength.
My USD long calls from 2017 are starting to materialize!

Note to self:
Risk management is key.
Every transaction has to be calculated and warranted. Ignore preachers of enormous risk taking. They can be making 10%, 50% or even 100% this month. Nonetheless, it is all simply a function of luck. Given enough time, they'll wipe out eventually.
Nobody can predict the future. We can only make edued speculation. Be critical of the logic behind your speculation and also be aware of human biases. Since you are human afterall.

I ordinarily do not want disputes on individuals. But if they go about their inflated self, dispersing false ideology without a concrete proof other than their own achievement and discrediting individuals, then I might hope the markets instruct them a good lesson.


Apologies for the rant. Onto the markets.
I am glad for the strength of the USD yesterday. It seems to be holding up well so far. I am slightly more convinced on my bullish dollar conviction.

Again on my radar is the resilience of the yen. Unfortunately I don't have enough opportunity to explore deeper into it. Guess I would need to provide this trade a miss.

27/02/2018
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USD given a boost following Powell testimony. As im writing this article, he is having his QA now. Guess all directional tendencies in price demands a alyst.
I only need to put my observations out there. Irregardless of the possibility of offending anyone, or the chance of waking negative remarks.

Have you wondered why retail forex community is dominated by Technical analysis? 99% of these egies, talks, discussions I see are about TA.
Coincidently, have you heard of this notion that 90% of retail traders lose money? Coincident? I don't think so. Have a look at big boys trading in wall street. What do they utilize? TA? Heck no! Just watch an episode of Bloomberg and see just how much they debate on fundamentals, economics, politics. Coincidence? I don't think so.

Take every suggestion with a grain of salt. Be critical of what you learn. Have you ever challenged the reliability of the TA that you utilize? Are you sure you backtested it? Or are your decisions based more on gut feeling?
People are out to earn money, irregardless of whose money it is. IMO it is not denying that FX or CFD brokers teach TA to retail traders. Firstly, it's a popular issue with retail traders compared to conventional eduion for example economics and economics, it's also easier to teach and more entertaining to learn. Contrast that with conventional schooling. Recall during your university days taking economics 101. How you felt like sleeping? Yup, those brokers dont need to bore their clients! It's a marketing gimmick! Secondly, TA and short-term trading are synonymous. Brokers will want you to put additional trades and generate more comissions for them. Back to my own Bloomberg example. How do Bloomberg make money? 1 route is through selling of the famous Bloomberg platform to institutional traders. Their clients are the PROFESSIONAL traders. And also the information they generate has to be appealing to those professionals, or they lose their clients. Can it be a coincidence that there's virtually zero reference to TA on Bloomberg? Think about it. The difference in the content which retail brokers provides versus what professional financial service suppliers offers is a very big hint as to what is much more useful.

Then, Im fairly sure a few of you out there knows someone with success with TA. Or maybe youre personally successfully together with TA. Allow me to introduce you to the concept of infinite money theorem. With sufficient monkeys typing randomly over the typewriter, finally we'll have one who will create the works of William Shakespear.
What Im getting at is that given enough individuals trying, finally we'll have some who will make it. It is a function of probability! On the flip side. Take a Look at associations. Which type of analysis do most institutions use? What's the probability that most of them utilizes similar kinds of analysis? That is no coincidence.

I'm quite sick and tired of getting into discussions with TA loyalists. Wake up retail traders! Open your mind! You are being fed junk by individuals who only want your money!