I will resume trading in January. I will trade with 0,5% risk level to preserve my capital as long as possible during my learning period. I will continue with the strategy that I've been practicing. It's possible that I change my entry rules to enter after the first retrace after breaking a support/resistance or pivot point and observe the momentum on a smaller time frame.

At the same time I will continue to practice the Art of War on a demo account as it fascinates me with it's logical and natural approach to the markets.

I can almost touch the PROGRESS! Did some backtesting today with new mentality and approach. Results are great. However patience is a virtue (and one of the qualities needed to be mastered by a trader alike) so I'm not going to try it alive before my training is complete and I'm ready for it. It's a struggle of life and death out there, which is not to be taken carelessly.

I've been observing for the past week, not even backtesting because there is something else than just knowledge and experience. Trading for profit can be looked upon as if going to war - proper preparation is required knowledge-wise as well as mentally. I've been imbuing myself with wisdom from a mentor. Sinking the mentality in takes some time. Currently I'm reading The Art of War, by Sun Tzu - a book written 2500 years ago, that has impact on todays trading warfare, if you will.

One can't rely on analysis of the past only when trading. Unbiased ongoing analysis must be done with ongoing trade as well and that requires sharp mind, discipline and... bah, better read the Art of War ;)

The Art of War

Today I took 3 losing trades. After that I decided I won't trade more for the day. I've overlooked the numbers by now and the problem is clearly not having backtested the strategy enough and making simple mistakes in decision that cost me money as well as risk to reward ratio that should be at least 1 or better depending on right to wrong ratio, which has lead to average losses being greater than average gains.

Further plans:

1. develop and backtest the strategy on the weekend
2. choose one certain currency pair to trade and ignore the others until that pair is producing constant profit in at least on 50 trades
   

Strategy planning:

1. risk to reward at least 1,5:1 (depending on right to wrong ratio)
   
2. 4h charts
3. SL risk level of 1%
4. right to wrong ratio at least 50% or better
   

Looking forward to continue with the journal as soon as I've got a strategy that corresponds to the points listed above.




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GBPJPY
time frame ----- 4h
account after -- 1419,59
entry ---------- 225.58
SL ------------- 225.85
TP ------------- 225.00
profit --------- -36,36
date ----------- 7. Dec
risk level ----- 2,5%
risk to reward - 2,15

Reason for:
entry - price reaching resistance - mistake, predicting will not be a successful strategy
stop loss - too far, because there was an instant market move after entering - mistake
trade profit - psychological level this time, however too far for this scalp

This was the third trade. Probably I felt a little angry on unconscious level although I asked myself before entering this trade, if this is my knowledge or emotions making the current trade. I was wrong. Firstly, it's not my strategy to capitalize on bounces but breakthroughs. The momentum against me was too risky - very bullish looking candle with no signs of reversal whatsoever. Again the stop loss was not planned correctly and I changed it after entering the trade.


MISTAKES TO AVOID IN THE FUTURE:
1) no more trading for the day after 2 losing trades
2) follow ONLY the strategy and not do experiments with real money
3) profit and loss targets must have logical reasons
4) keep an eye on momentum and candle size - no trading against momentum ever




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EURUSD
time frame ----- 4h
account after -- 1455,95
entry ---------- 1.4611
SL ------------- 1.4627
TP ------------- 1.4587
profit --------- -32
date ----------- 7. Dec
risk level ----- 2,13%
risk to reward - 1,5

Reason for:
entry - breaking of a resistance and pivot point
stop loss - 16 pips (no proper reason - mistake)
trade profit - calculated from SL - mistake, has to be a logical reason for exiting

This trade was made mostly from seeing a good setup. No former planning was made. Also, the momentum wasn't on my side and I had no idea, how strong the momentum was, because I hadn't been observing this pair.

MISTAKES TO AVOID IN THE FUTURE:
1) no trading with a pair I hadn't been observing
2) no entering into a trade I hadn't planned in front
3) profit and loss targets must have logical reasons




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GBPJPY
time frame ----- 4h
account after -- 1487,95
entry ---------- 225.30
SL ------------- 225.55
TP ------------- 224.90
profit --------- -15,72
date ----------- 7. Dec
risk level ----- 1,05%
risk to reward - 1,60




Reason for:
entry - breaking of a resistance and pivot point somewhat further up
stop loss - a little below resistance - mistake
trade profit - below psychological price (225.00) and somewhat more - mistake

This trade didn't go the way that I had planned. Although the price crossed the 225 level indeed, it missed my TP level by 4 pips. I shouldn't have entered after the pivot point because the last resistance was too far up and I hadn't planned that trade in front but rather thought that I saw a good opportunity. I guess the emotional thinking took over to make 2 bad mistakes (bad entry and bad stop loss and profit levels). Have to practice discipline and not make decisions that haven't been analyzed long before the actual trade happens...

MISTAKES TO AVOID IN THE FUTURE:
1) not to enter unplanned trades
2) not to enter too close to a psychological level
3) no giving in on TP and SL targets




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AUDJPY
time frame ----- 4h
account after -- 1503,67
entry ---------- 97.30
SL ------------- 97.10
TP ------------- 97.60
profit --------- +26,93
date ----------- 6. Dec
risk level ----- 1,22%
risk to reward - 1,50



Reason for:
entry - Breaking of a resistance and pivot point as well
stop loss - just under the resistance
trade profit - a little below the resistance that the price had had a few days ago, no other obstacles on the way

This trade went as planned.




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EURUSD
time frame ----- 4h
account after -- 1476,74
entry ---------- 1.4625
SL ------------- 1.4603
TP ------------- 1.4650 & 1.4680
profit --------- +20,8
date ----------- 6. Dec
risk level ----- 1,89%
risk to reward - 1,14

Reason for:
entry - Breaking of a resistance at 1.4615
stop loss - 1.4604 was the lowest point 5 candles back
trade profit - just below a pivot point that was at 1.4652
trade profit 2 - previous movement had great momentum and I expected that price could move more

This trade went as planned. The profit target was hit with the first part and price started to fall back just after hitting 1.4652. After taking the profit from the first part, I changed the SL level on the second part to 1 pip profit, which eventually got stopped out.




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