Closed AUDUSD @ 1.0426, -51 pips

14.09 gmt

AUDUSD has broken what is for me a trailing stop and I have to close it here for a loss of -51 pips.

Closed AUDUSD long @ 1.0426, -51 pips.

This trade entry was poor – I had been eyeing it for a long time, since it was below 1.04 but did not take the trade, and when I finally took the trade it was too close to the 1.05 resistance level. I am pretty certain AUDUSD will find a bottom near here and will go up soon. I will re-enter the long once a bottom has been formed.

A bad loss plays havoc with a trader’s decision-making and this is one  example. I expect I should be in a better frame of mind next week, after the Easter week-end, and hope to start trading better again. I need to re-discover my trading mojo.

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6 thoughts on “Closed AUDUSD @ 1.0426, -51 pips

  1. rahul

    hi zen, very sorry about ur loss.ur an excellent trader and this is just a small blip.stick to your method.i have re entered my longs at 1.0420…even i was caught by surprise by the strength of the dip.its just trading.best of luck

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    1. ZenFXTrader

      Hey Rahul, thanks for the kind words, and your warning earlier today. I have a wider time horizon so my stop was wider. Today’s action looks like a classic stop hunt which happens before the RBA decision each month, this time due on April 2. I am waiting for the 4hr candle close and might go long at that point if the price action is positive.

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  2. rahul

    iv stopped trying to “explain” movements in forex zen. There are just so many exogenous factors that we are always better off listening to price. I see it all around me, people are forever predicting or second guessing the problem with the narrative method is we refuse to listen to PRICE as we are convinced of our “story”. as traders our job is just to be IN the crowd as much as possible.
    How did the losses get so out of hand last week?..do you keep automatic cut off points?( I personally close everything on a 5% loss in a week)..its every traders nightmare to have such a huge set back and i really admire your guts. Any tips on how you plan to handle it would be wonderful! thnk u

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    1. ZenFXTrader

      Rahul, EXACTLY what I say too! Price is the most important indicator, and we simply must not try to explain every twitch or even every trend in the market. It is simply IMPOSSIBLE for anyone, even a machine, to fully explain or anticipate every movement. I take my signals from price, because the price contains the SUM TOTAL of every factor acting on the market. Occasionally I write comments like this on some of the fx sites I read like Forexlive, or fxww. Newbies are always searching for an explanation of why did the price do this or that. And having an opinion on the market means one’s ego gets involved, and that is bad for trading.
      I got into this trouble when the Cyprus situation caused EURJPY to open gap down by over 300 pips. Earlier with the Italian elections I was also caught with the wrong position in EURJPY and EURUSD, with gap losses. In both cases, I a)ignored my technical signals which are based on simple technicals like price breaking trendlines, and b)being convinced that the political situation in Italy was priced-in, or c)in the case of Cyprus being unaware of the depth of the problem before the EU announcement on a Saturday. The first reason (a) is the root cause. Read my posts from those days for a story of how I got caught in this, and my post-mortem of it.
      How am I going to handle it? I may need to put money into my account, i.e. re-capitalize it. Or just try and trade correctly without making such glaring stupid errors and hope the laws of mathematics help me build up my account again. I know that is a very tall task. Even if I make 100% each month(possible, but tough), I will need 4 months to achieve it. If I make 50% each month, it will take about 7 months. I am going to start trading properly next week and see how it goes week by week.

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  3. gomes

    I think AU reached a place, where there may be a trend change from high to low, for 200/400 pips.
    Or just a correction.

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    1. ZenFXTrader

      Gomes, thanks for your feedback. I too look at the 4hr Trendline, but there is also a Fibo level off which the pair has bounced. And it is very likely that the pair will re-try taking 1.05 again, hence my long.

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