A busy currency trading day today. Lots of signals, a number of trades, some good profits. What more could I ask for?
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Morning Tuesday 5/10/2016
Signal: Silver / US Dollar (XAGUSD)
Look at the move on Silver. I was in the Signal from yesterday morning on the daily chart with one position. I hit the profit target and had a nice profit on this trade. The picture below is the hourly chart, I mistakenly took this screenshot instead of the daily chart.
Signal: Euro / Canadian Dollar (EURCAD)
This one moved up too quickly. By the time I had a confirmation it was already at the first profit target level. I passed because the risk reward ratio was too high.
Signal: British Pound / US Dollar (GBPUSD)
Signal: US Dollar / Swiss Franc (USDCHF)
I took two positions on this one after I did my post last night. I have had success on Swiss Franc trades in the past. Boom, this moved up quickly and hit both the first and second profit targets within an hour. A great trade!
Evening Tuesday 5/10/2016
Signal: Euro/ British Pound (EURGBP)
I did not do this trade. I only included it as an example of how fast things can move sometimes. If you see the sell signal and look at the next red downwards bar you will see it almost hit all three profit targets within the hour. You see this much more commonly on 5 Minute and 15 Minute charts, but it can happen on the longer intervals as well.
Signal: Euro/ Japanese Yen (EURJPY) Harmonic Shark Pattern
I did not take this trade. I have not had the best success with the Japanese Yen in the past and I am a little gun shy. This is a problem with me controlling my emotional reactions. I have written about trading and emotions many times in the past. In my opinion, this is the downfall of many, many traders. They let their emotions get the best of them and it wrecks their ability to trade. I missed this very nice Japanese Yen trade because I have been burned by the Yen in the past. If I knew that Yen signals were always less accurate, the logical course of action would be to avoid them. From a pure statistical point of view there is no reason to believe that winning signals are evenly distributed. If you take a period of a year it is likely that there will be losing streaks and winning streaks fr a particular currency pair. As long as the long term expectation is a good profit over 100 trades without too big of a drawdown, then it is a good currency pair to trade. I am going to do some
Signal: US Dollar/ BSwiss Franc (USDHF)
Today’s Geography Lesson: Potosi Silver Mine, Bolivia
From Wikipedia; “
Founded in 1545 as a mining town, it soon produced fabulous wealth, and the population eventually exceeded 200,000 people. The city gave rise to a Spanish expression, still in use: vale un Potosí, (“to be worth a Potosí”) meaning “to be of great value”. The rich mountain, Cerro Rico, produced an estimated 60% of all silver mined in the world during the second half of the 16th century.
Potosí’s naturally rich deposits, along with technological advancements in production like the Patio process, allowed silver production costs to remain extremely low. In fact, Spanish American mines were the world’s cheapest sources of silver during this time period. Spanish America’s ability to supply a great amount of silver and China’s strong demand for this commodity resulted in a spectacular mining boom. The true champion of this boom in the silver industry was indeed the Spanish crown. By allowing private-sector entrepreneurs to operate mines and placing high taxes on mining profits, the Spanish empire was able to extract the greatest benefits. From the raw materials extracted from the mines, the Potosí mint called pieces of eight were fashioned.”
Potosi Mine, Bolivia
Lessons Learned 1: Take your free time off. It is easy to see great trades that you missed because you were sleeping or you were at your son’r swimming practice or you are helping your son with homework. This will happen, it can’t be avoided. You can’t stress about it unless you want to needlessly aggravate yourself. If you do you won’t enjoy dinner out with your family, you will be thinking about trades. Trade when you can and be serious about it. When you aren’t trading enjoy what you are doing and let the trading go.
Lessons Learned 2: Don’t chase trades. As I said earlier in this post. If you miss a trade because you don’t see it in time or it moves to fast just pass. You can set yourself up for large losses and smaller profits by chasing a trade. Be patient, another trade is always around the corner. Just wait for it.
I hope you have enjoyed my series on Silver mines. Some interesting history if that type of thing intrigues you.
Today was another busy and profitable day. I can hardly believe the run of great trades with Silver. I am enjoying it while I can. However, I am not escalating my trade size crazily. I know that eventually there will be losses and I want to trade small.
Hopefully you enjoyed my independent trading. If you would like to profit from currency trading there is an easier way, as shown below.
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As always, if anyone has questions, comments or suggestions, please leave them in the comments area below or contact me.