It's not I was afraid to trade today. It's because it's the only signal appeared for half of the day. Well after that there's some counter signal but I can't get in since my first TF long not yet reach my PT. I got out too soon since I didn't want to be trapped by lunch break.
CL surprisingly moved, maybe due to inventory report. I didn't want to enter before the report. But the shocking thing was: With CL crazy movement like "south : 80cents, north >100cents", there's no single signal showed up.
I intended to trade the currency again. But this time with trade limitation and this is my rules for currency:
1. Max SL per trade = 10 ticks
2. Max Trade per setup = 2 trades
3. Max Loss per day accumulated = $500
4. Only trade the second entry unless it's double/triple wedge
5. Minimum Profit Taking per trade = 20 ticks
6. Max Trade per instrument = 5 trades
7. Minimum Trade per day for currency = 3 trades*
*Unless there's less than 3 signals
There you go. It's quite a low risk system. The no.7 rules is the reason why I took the beating these days.
I had a bad habit for stopped trading after a decent profit, or if I was still trading, I would take profit too early, feared that I would give back my previous profit.
In contrary, I will keep trading if I was in red hoping to have at least a breakeven day.
With the No.7 rules, I negated the fear effect and just trade. Whatever the result, I'll took it. At least I already limit my daily losses :)
I know that doesn't make sense for keep trading if one trade already give you 100 ticks, but this system objective doesn't intend to maximize my profit it's about:
1. Eliminating the fear of giving back the profit.
2. Eliminating the desire to keep trading until it's profit/breakeven.
Please share your thought about my rules on currency. Every opinion gladly welcome. :)
1: why is"4. Only trade the second entry unless it's double/triple wedge", what's wrong with the first entry?
ReplyDelete2: 10 pip stop nowadays looks ok, 20 pips target is a bit hard. it's easy ofcource if you are with the trend, but recently there is no trend in fx.
3: I like "2. Max Trade per setup = 2 trades"
Hi RCM,
ReplyDelete1. First entry have very high probabilities of failure. I have a system for flipping the position. So if 2nd failed then the flipping probabilities will be higher. That's the cost of having tight Stop Loss.
2. Lol, you're right 20 pips is hard nowadays. But I have no choice. 2:1 ratio is my minimum. As you know I have a very low winning ratio setup.Around 40%.
3. Tq, I liked it too :)