“Make information gained greater than the “Stupid Shit Express” event!”
Sometimes doing “stupid shit” when trading has direct, physical & financial
costs … like being long when you should be short or vice versa, and you knew
it but thought yourself too smart by half and it took you out back behind the
barn, and all the neighbors heard was a loud gunshot … “yea, everybody knows
that’s gonna leave a mark”.
Then there are the “stupid shit” events that come and go that are mere
opportunity costs … but since opportunity is infinite, way too many people fail
to learn from them cuz they either don’t want to face up to them cuz it’s an
“unpleasant thought”, or it didn’t matter anyway cuz no money was actually
lost and so “no harm no foul” … and here lies a dirty little secret; “many times
these leave psychological marks worse than financial cost marks, and traders
punish themselves to the point they are very hard to recover from effectively”
… and especially in trading, where trading experiences have direct & very
quick ramifications seen no other place in your life cuz they happen so damn
fast, people literally fail to “fail successfully”.
So, exactly how do you fail successfully?
“You make the INFORMATION GAINED FROM THE FAILED EVENT
WORTH MORE THAN WHAT THE FAILED EVENT COST YOU”! Simple
Turning to today’s GBPJPY market … another day, and I’m beginning to
wonder if the USDJPY market is somehow broken … we’re 16 hours into the
day, and the day’s range is 25 PIPS, so another day of GBPJPY = GBPUSD.
For the third day in a row, data out of the U.K. misses lower on all fronts
… today’s retail sales number an absolute disaster, and GBPJPY gaps
violently lower on the miss [Yen sleeping, but thanks for asking.], and from
there action picks up for the next few hours until severe chop sets in, and then
the market goes full throttle “Thelma & Louise” later; directly below, the day’s
M30, with commentary.
Only 2 long trades today … PAMM up marginally, nothing significant.
I want you to focus on the M30 above, right after trend change #5, and this is
when the market takes off to the upside … the trend changes from being short
to being long on this #5 candlestick @ 09:30 @ approximately the 152.360 level,
when the previous M30 high is breached … the market rallies a tiny bit into the
M30 close, and the next M30 starts with some light liquidation … the M1 in
GBPJPY from this time period directly below, with commentary.
And here is where I catch myself playing “analyst”, and don’t take the trade
cuz no way can Cable rally with that retail sales news, and in the process look
like an idiot … “yup, as clear a signal as you’ll ever get, but I step into the
“stupid shit” cloud and pass … pissed off no, but annoyed “yessiree”, cuz I know
better than this”.
Back in the day, when I was on the trading floor, and commuted into the
trading floor, I’d spend the last 15 - 20 minutes into the city preparing myself
for the upcoming day … I had a list I went down, and kept with me all day,
even in my trading jacket … by the time I hit the floor, I was all biz, nothing
but biz, tune out the bullshit biz world headlines, and concentrate on nothing
but the trading action and the “tape”. Today, I get up, make coffee, take the dog
out, turn the machines on, and then get “compfy” with the MT4 and start
trading … “oh, how easy it is to walk into the wrong room, like you’re in an
episode of “The Twilight Zone”, and suddenly you’re in the faculty lounge
waxing eloquent to all the skulls full of mush about how it’s done, and in the
process you don’t do shit”!
“Well, that ain’t happening again I can assure you, cuz I’ve already taken
measures to make sure I’m on my “A” trader game when the machines come on
at the start of the day”. Fact is, GBPJPY can go anywhere and do anything
… it has in the past and will into the future … trying to “analyze” where the
“Dragon Trade” is headed is the definitive definition of “stupid shit” … what
we do know, however, is that when this thing picks up steam in either direction,
it moves and the length of the scope of it’s moves are eye watering.
Today wasn’t one of those days where I then wanted to go out and play on the
interstate highway … the move up was relatively short … but my “slip up”,
sitting there in my Superman Jammies and super fuzzy “analyst” slippers,
could have been a lot more expensive … “what if it goes up straight another 100
“Ok, now what … call the crisis hotline and tell them I couldn’t find the Chicken
McNuggets in the freezer, and I think the dog & his friends might have taken
them”? No, put procedures in place … whatever works for you … to make sure
it doesn’t happen again, and realize that not missing a great move in the
immediate future is worth a helluva lot more than today’s idiotic excursion into
And there is a helluva lot more you can learn from today, from my brief trip
into an episode of “The Twilight Zone”. For starters, pull up the daily
candlestick of GBPJPY … arrange the chart so the grid is 100 points … now
look and see how many days are less than 1 grid in terms of price for the day,
excluding Sundays and Holiday periods … “yea, they aren’t there are they”?
Maybe 1% or 2% of trading days, but the point here is that this market “finds
a way” to move 100 PIPS minimum, with most days needing no excuse to go
between 100 - 150+ PIPS, easy as 1, 2, 3 … point is, at some point it’s gonna
make its move; statistically, most will start in the 06:00 - 10:00 server time
frame, and go from there … today’s move up started in the 09:30 candlestick.
And guess what? “You snooze, you lose … you got to be there and make the trade
or you’re toast”.
Of course, once you catch a nice move, you can decide at that point on how to
proceed with the rest of the day; all options on the table at this point, but
you’re the one making the decision, not the market,
The trading action these last four days, is about as brutal as it gets in GBPJPY
… you can see that in the M30’s … still, there are windows of opportunity
during our 12 hour window 06:00 - 18:00, and as the week shows, this market
will find a way to make a decent move every day. And that move will start with
a previous M30 high or low getting breached … now, patiently wait for the M1
crossover signal and then pounce!
One last thing: turn off the news, and only care about when news is supposed to
be reported, not what is in the news being reported; you don’t want to get
caught with your pants down and get blindsided with scheduled economic
reports. Today I fell into the “spider’s web”, cuz looking at the U.K. retail sales
number I didn’t “think” Cable could rally … “yea, only 80 PIPS off the low to a
new high for the day”. [“Repeat after me: dumbbbbb assssssss .... Ok, 37 times is
A final thought before I repress today out of existence: “if this can happen to
me, trust me, it can happen to any of you reading this … any time and any day.
Cuz the FX crosses are as dangerous as they are alluring … all I’m saying is,
make sure you aren’t me today going forward. Sure, we’re all human, and
everybody FUBAR’s trades over time … that’s not the issue … the issue is simply
this: MAKE YOUR STRENGTHS GREATER THAN ANY TRADING
WEAKNESS, and do not be afraid to look into the mirror, or stare down the abyss
and admit to yourself you were an idiot … lifting that burden off your shoulders is
a freeing up moment, and will lead to you putting in place procedures that rectify
the problem … when you do the right things, no market or trade is at all as
frightening as you believe”.
Still, as unhappy as I am with myself, the day really wasn’t that great
… coulda been, but that’s water under the bridge … that opportunity gone, an
infinite number still awaiting us … all in all about a 100 PIP range … “errr, wait
a sec there Skippy … well, that escalated quickly to the downside, didn’t it”? Who
cares the reason? As I said, this market finds a way … up, down, reversal,
double reversal, whatever … at the end of the day, the PIP moves are there
… this late day move down starting much higher on the M30, with trend
change #10, with plenty of chances to get short from the M1 signals … GBPJPY
now with about a 180+ PIP range … and as is the case in almost all trading
FUBAR’s, the aftermath dominoes that fall when you don’t do what you’re
supposed to do earlier in the day, compound the day’s problems and magnify
what the “coulda, shoulda, woulda” scenarios should be but aren’t … learn my
lesson from today and take it to heart in the FX crosses!
But I do know this; going forward, from 06:00 - 18:00 server time each day,
I’m gonna be all over this market and any “pony ride” that rears its head, and I
intend to be there for every damn inch of it via the M1 signals. “Mark my words
GBPJPY, this is the last time this shit happens”! Until tomorrow mi amigos
… I’m outta here … [“and no, you get no more bacon or roast beef from the
impenetrable bacon box until you stop mumbling “dumbbbb asssss” under your
breath … yea, I see you over there snickering”.] … Onward & Upward!!
PAMM spreadsheet directly below.
Have a great day everybody!
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