Hi, it’s been one of those extremely frustrating weeks that we all have to suffer from time to time when trading.
My $/Yen short missed the entry by 8 pips and then dropped 130 🙁
Non scheduled news.
I explained last week that we can make the best plan in the world and yet some unexpected news comes out & ruins a trade. Last week the UK governments new bill spoiled the GBP.
This week all the Yen trades, including my Cad/Yen trade, were spoiled with the news of the new Japanese Prime Minister.
Yesterday the Euro/GBP was dropping nicely after the Gbp news to my entry point. Suddenly Ms Lagarde, head of the ECB, came out and said that a deal with the UK was still possible with the UK. The Euro/Gbp shot up 70 pips in 30 minutes. This was despite the fact that the day before she was extremely negative about the situation!
Here is a forum post from yesterday. You SHOULD start to use it and get involved and keep up to date with what’s going on:
Hi, guys, as per last weeks blog post, we have to keep our eyes on non-scheduled news more than ever.
All the economies are in the same poor state due to COVID so conventional fundamental data, inflation, interest rates & growth don’t really apply much at the moment. Its more to do with which country is least worst and then sentiment which is almost impossible to quantify.
For example, this week the Japanese ruling party voted for a new Prime Minister, the Japanese economy has been bankrupt for years (their debt is currently 268% of their GDP ( how much “stuff & services” they create and sell in a year)! the Yen strengthened, so all the Yen cross pairs fell. Why? Because the new Prime Minister is expected to carry on the same as the previous one. Check this out to see how crazy the world debt situation is:
Last week the Brexit situation/new bill in the UK caused problems on the GBP. Last nights Nzd news was not good, it dropped, now back where it was, it’s all messy.
As Ashley says we need to wait and see what the GBP news is today. My gut feeling is it won’t be good news BUT “sell the news, buy the rumour” at your peril! The good thing is that Ashley & Attila, you sensed it didn’t “feel right” and got out THAT is a good state to have reached.
We had an 11 winning week run in the summer and things seemed to be easy. Now the secret is what you do on a bad week, ie control the drawdown. Reduce the number of trades, consider, like Pierre- Marc above, reduce the lot size. I estimate that 30 weeks a year its relatively easy to make money trading. What you do in the other 22 will define your success or failure.
good luck to all. If you are going to trade any GBP pair after the news, make a plan in advance, work out where it will probably stop if it goes on a run and let the dust settle, ie don’t dive in if it sets off. I explained this in the live session on Tuesday.
Have a great weekend. I never trade Fridays, lets start afresh for next week