PANIC MUCH?

 

“Every FX trader better have one!”

“Well, that escalated quickly, didn’t it”? The first 8 ½ hours of the day a 

complete bore, what with multiple trips back and forth from the high to the 

low … then all hell breaks loose … first the CPI fantasy numbers, and then 

news Tillerson is out as Sec. State … “you’re fired”! … then the Ruskies 

threaten the U.S. military over Syria, and after that is when the real fun 

begins.

Cuz nothin’ says “lovin” from our friends in the trade, the lovable scumbag 

LP banks like rallies and breaks faster than a newborn needs fresh diapers 

… just cuz we got multiple 20+ PIP breaks off the highs, doesn’t mean on the 

third trip up to the then high of the day, we can’t then drop approximately 40 

PIPS in 14 minutes, cleaning out sell stops on the way down, especially the last 

10 - 15 PIPS, and then magically racing back up straight to new “higher-er-er” 

highs within minutes. I don’t think I’ve ever seen more volatility inside a 70 

PIP range in all my years of trading … oh sure, things have been plenty more 

volatile in the past, but today sees so many trips up & down over 20 PIPS, that 

if you happen to be caught on the wrong side of one of these blitzes, you’re 

toast ... and the turns, when they come, are vicious.

Today was the kind of day that wreaks havoc on “Newbies”, for two big 

reasons; 1) the speed at which EURUSD [or any other FX pair as well] can go 

against you, and 2) the inability to process events in real time and make 

appropriate trading decisions ...this is AKA “the deer in headlights” syndrome, 

and while you sit there not believing what you’re seeing, your account is losing 

money faster than shoving $100 bills down the toilet. “You simply got to have a 

plan beforehand”.

Four trades today … PAMM up slightly, nothing significant.

It was the second long trade today, the speed at which it backed off the fourth 

attempt to make a new high, that caught me … simply had no choice but to 

liquidate when I reached my “pain threshold” on the downside, despite my 

belief the high hadn’t been put in yet … but, as I have repeatedly told my 

readers/clients, yours or my beliefs don’t mean Mr. Jack Squat to the market 

… it doesn’t know or care what I think, I have to do what I’m supposed to do 

cuz if I don’t, I know what can happen. No, I don’t enjoy taking a loss, but for 

the “greater good” I have to … I simply regroup and reevaluate the next 

trading opportunity.

For newer traders especially, it’s vitally important you understand the 

necessity of not getting “whacked” when you trade … anybody can handle a 

very small loss on a trade, cuz it comes with the territory … but you can’t do 

“stupid shit”, like hanging on to losers and hoping they come back, cuz the few 

times the market bails you out like this, you get it in your head that this is the 

“strategy” to grasp onto, when in reality it was “dumb luck”, not your brains, 

and now the market has “set you up” for the kill, cuz down the road some is 

gonna come a time when it doesn’t come back and you’re roadkill.

After the CPI report, a very difficult trading environment … extremely rapid 

shifts in sentiment today, where if you blink your eyes, you could be down 10+ 

PIPS or more rather easily. Again today, the trading day shortened due to the 

CPI report, and you can see the effect this has on trading … heightened 

volatility & very thin liquidity conditions.

I’m a little disappointed in the profit today, but quite frankly each trade I 

would do the same every time, and the only thing that matters at the end of the 

day is being up money & equity … some days it’s not pretty and you just have 

to live with it and prepare for the next day. So, tomorrow’s another day filled 

with more opportunity … I’m outta here … until tomorrow mi amigos … 

Onward & Upward!!

PAMM spreadsheet directly below.

 

Have a great day everybody!

-vegas

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