19.06.2008 - 3 mio trading as usual...

.....

>> Yesterday /18.06.2008/ I made a mistake as I abandoned the disciplined trading process and engaged in some overleveraged positions as I ultimately realised I was PUSHING the market.

The problem was I got some view that I was trying to validate thru increasing my positions while was impatient to get a clear confirmation from the market and the price action itself.

Logically this was followed by a large drawdown in the Equity as I was switching directions too fast and while trying to get the right opportunity the leverage size appeared to be very expensive >>> ultimately by the end of the day my account was -42%.

At the end of the day I went short EURUSD, GBPUSD, AUDJPY & EURJPY.

Those positions were held overnight but they all were in loss in the morning.

The 3 trades on the picture were the last ideas I had and I actually bet the farm on them as after I had the 1 mio trade back in April >> now I did my 3 mio trade. Congratulations as at the exit my trading return was approximately 128% and I reached Breakevenpoint from the peak on 17.06.2008.

--------------------------------------------------------

The ultimate lesson learned is respect your risk management rules, trade consistently and never engage in a such an over leveraged gamble until you have an equity base that would not be hurt in a case of adverse market reaction!

>>> While I had Feb & March 2008 a very good trading period > then till June 2008 I actually was constantly losing while I was very diligently researching Trend following methods and traders.

I lot of information on Ed Seykota, Richard Dennis and Richard Donchian was digested to give me a better idea of the prospective direction of further development.

A search for an EDGE and disciplined PROCESS somewhat seem now a bit closer.

Trend trade - 06.06.2008

>> following a tight consolidation I expected a very powerful trend to emerge so I fully leveraged my adversely damaged equity starting with a 100k position near 1.54 and once the trend broke out I was adding to reach a full position of 200k till it reached 1.55..

I rode the trend till 1.56 where I was scared and shaken off the trade location as I closed the position just before the NFP a bit below 1.56...

Data came in worse than expected but then it was all clearly reflected in the charts and I take it as a very important lesson to not let myself get pushed out of a great trade location.

I had before the data 20k position that I closed at 1.5660 and watched the trend reach the high above 1.58..

Pretty good lesson to belearned!

06.06.2008 - Breakthrough day

> 6 June 2008 -- a good day to turn things upside down?

I figured if I had been doing so much mistkes, always making the wrong thing -- then it was probably logical to assume that if I changed my perception and reactions in the exact opposite I would then be doing the right thing?..

>> Einstein said: how do you expect to fix something if you come at the problem with the same mindset that created the problem.
.................................................................
A new moment of reflection and estimation of the future impact of our present decisions..

LEVERAGE kills...

Just a quick reminder to myself why my last 3 weeks trading was a mere disaster ::
LEVERAGE!

I somewhat unexpectedly started trading maynly in standard 100k lots and this makes the profits huge but so are the losses...

the P/L is swinging around like crazy and my trading is more like gambling and this adds immense pressure on my decision making and self -esteem as this should be a sustainable business not a means to entertain myself at the cost of huge losses or crazy swings from big gains to total loss...

I made a few killings with 7 to 10 standard lots but also I suffer great setbacks and this seriously damages my perfornace so I pledge before myself to stop the irrational behavious and get back to business as usual.

Purgatory - March 31 - April 4, 2008

I feel I've been in the Purgatory this whole week.

Fixed on my Opinion and on imaginery things to do in future I neglected the present developments.

Since March 31 till I lost the account equity yesterday in the 1 mil trade I have lost my flexibility, correct judgement and actually I lost my life to my poor EGO that clouded my mind.

The thing is that I WANTED things to happen >>> worse, I FORCED things to happen >>> went the whole length and pushed to the limit just to fail --- and the whole process was so tangible - I knew thigns would happen this way and didn't act to stop ot correct.

All the time I had my exits and good profits but failed to take them - locked myself in the DESIRE to make a huge bet and even larger profit.

MONEY ain't nothing to talk about here as they really don't matter. It's the EGO that blinds the soul and clouds the mind - it makes you act wrong and suffer the pain.

So whatever you make money or not, there is far more to life than this. It's the right balance that is so hard to achieve -- even harder to maintain.

There is no easy way!

Lessons to be learned... Humbled by the market!

Yes - I did my first 1 mil trade - I actually lost the account today -- pretty stupid as I had almost made it to like 75% of the initial equity from 30% on the previous day.

A few major things to remeber and learn for future reference:

1. TREND FOLLOWING - well, not an easy job.. need to work more on a systematic approach and actually more testing before risking the equity.

2. GREED / LEVERAGE -- needless to say the position size was times bigger than my equity and also a major factor to the demise of this trade.

3. LEVERAGE / FLEXIBILITY --- this might actually be the most important point as I had several times seen a monster profit and wasn't unable to make myself to take profit.

Then on the other way I was unable to cut loss where I would normally would.

4. PSYCHOLOGICALLY - I was a failure as I wasn't able to act right and in timely manner to adjust position size and to take advantage of the intraday directional movements.

5. DAILY RANGE -- here was a major break today as I actually realised the use of the range. It is still a new part of the intraday analytic tools.

________________

Well wasn't a good experience at all.

However it was something I felt unevitable -- just a violent and painful reminder of the market forces and the need to adjust one's trading to the market.

Street smarts: "Lose your opinion - not your money"

I was so eager to earn a great profit with a huge position -- and I had numerous possible exits but blew them all -- can't think of a nice rationale out of this - I just think I had a too good time and it was due to get back on me and show me that there are NO EASY WAYS in life.

1 mio trade

my first 1 mio notional value short GBPUSD was a failure.

I did 3 or 4 different trades on Monday, 31.03.2008, where I had profit in each of the trades but stayed too long and at the end had a substantial loss.

Then I shorted GBPUSD at 1.9860 > it hi a low of 1.9740 but I had the idea of using the measured move concept: AB=CD (2.04 > 1.97 :: 2.02 > 1.95) . The notional value was 7 standard lots.

Next day - Tuesday 1.04.2008 was a fools game again - it went against me and I shorted 1 more standard lot at 1.9859. Now the position was 8 X 100k lots.

Wednesday - the day of reckonging - day started around the lows 1.9750... I didn't do nothing all day but watched it hit new highs around 1.9890...

What a stupid act. WHen it first probed 1.9800 I also shorted 2 more standard lots so I just wanted to do my first 1 mio trade no matter how much it would cost me.

Now I cut my position to only 300k and will look to withstand the move with what's left in the account -- right now onle about 30% of the starting equity..

That's how greed and selfishness take revenge over you. Once you lose control of yourself your inner enemy will just creep out and take you by surprise. I knew it was going to happen and just watched it inflict pain over me. How strange is that I did this damage to myself in full sense. Pity.