Euro again

After a failed H&S pattern on the daily down to the 240min timelevels the Euro moved into a sideways consolidation pattern holding above the neckline, but below the shoulders of said H&S pattern. We can see some important uptrend lines on the Euro, the first one has been broken a few days ago, the lower one coming into play now, but leaving the Euro still a lot of room.

On that 960min chart you can see where we stand right now. Yesterday we broke down finally, but that reversal we see right now leaves me questioning my decision to go 3/4 into the USD with my account at the 1.39 level. Retaking the 1.40 level will get me back into the Euro in the account. We might see another week or two of holding patterns in the Euro, but then that second uptrend line comes really into play and will decide whether we go higher or not.

Shift in sentiment

It's some time I published an article. Not due to lack of trading, but due to a shift in sentiment and approach to the markets. A study of my approach to the markets showed me something very clear:

• The time I force it, I lose.
• The time I become confident, I become careless and I lose.
• The time I take one small step after the other, I win.

It is frustratingly slow, it is a calm way of trading, sometimes I do just one trade a day, sometimes I do none, sometimes I do 3 or 4 trades, I stop when I made my target. I miss a lot of moves, and sometimes I feel I should press on, but then I remind myself, that it doesn't work that way.

Think about it this way: Over time you can fairly well define the win/loss ratio of your personal trade system. Now this win/loss ratio will not tell you, if the next trade will be a winner or loser, and actually even if all trades are independent, that win/loss ratio will be fairly accurate over a bigger number of trades. It will be also fairly accurate over a number of trades within the day.

So does it make a difference to start the day with a winning or loosing trade?
Knowing that each trade is independent, obviously NO.
Knowing that during the day my personal win/loss ratio will kick in, absolutely Yes!

Which means:
If I start with a winner and make or exceed my daily goal...I stop
If I start with a winner and don't make my daily goal... I continue. If the next trade makes or exceeds my daily goal, I stop.
If I still did not make my daily goal, I consider stopping for the day.
The least I do is take a walk with my dogs and switch contracts. Why: Because my daily goal is quite small and I can make it with one or two trades. So if I don't make it, my approach to the markets is wrong today.

If I start with a loser...I continue
If I have a second loser in a row, I'm out of sync for the day and I stop
I might even stop for another whole day, just watching the markets that day, to get back in sync.
If on the other hand that second trade is a winner...I continue. My personal win/loss ratio based on number of trades (not profits) is 58% winner, 22% breakeven and 20% looser, so the second trade being a winner is consistent with my personal w/l ratio encouraging me to continue.

This approach to the markets gives me a lot of time to do other things...I like it!

And I like the way my account is doing if I follow this approach to the markets.

...

Yes I miss the fun of trading more frequently during the day. Actually its boring at times.

But I noticed one thing: The personal win/loss ratio shifts during the month, if you follow this approach. I wasn't able to change my personal w/l ratio for 5 years. Taking this approach I have.

It might also have to do with my new trading system, I wrote about in my previous articles. So to give you another glimpse at what I'm following now, take a look at this Euro 240min chart

If we stay above that rising support line, I expect a real big move up in the next few days or weeks. if not, next support on the downside is 1.3736 and 1.3440.