Forex Trade Journal: Forex Lessons To Be Learned

My first trade was a loser and that is not good but if we look at the bright side we can get some good forex lessons from this first trade. I have a list of points of areas that this trade could have been improved. After the list of improvements I will then list the good points of the trade and then we will begin to improve our trading each time making sure that we don’t make the same mistake twice. I am counting on you the readers to hold me accountable to this, make sure you always go back and double check on me.

That is the ultimate accountability system, and I think that every one will learn a great deal in the process. If you remember our target was 1.2250 and the price did get to 1.2216, If you closed at the top you could have made +37 pips which would have been a good trade. I however did not, because it happened at 5am when I was asleep.

Trade Results:

Long Eur/Usd – 33 pips

Ways to improve:

  • I spoke of being patient but this trade was not patient. I broke the rule of waiting for the right setup. While the setup was decent it was not a setup that I had 100% confidence in. Because it was the first trade I was anxious and I excited to put one out for everybody. This will not happen again, next trade will be much more patient.
  • Going against the trend: there are times when it is ok to go against the trend this was not one of those times. The best time to go against the trend is if you get a trend line break and this clearly was not the case.( I even had a reader gently remind me of my error, thanks you know whoΒ  you are :))
  • Looking at other time frames to see other signals. I looked at the hourly chart and there was a buy signal but on the 15 Min chart there was a sell signal. When looking at chart time frames the longer time frame chart will be the guide but looking at what is going on, in other time frames can help.

See Chart Below:

Eur/Usd 15 Min Chart

Eur/Usd 15 Min Chart

Now That we have taken a look at areas of weakness lets look at some good points,( yes you can find good points in a losing trade :))

Things to keep Doing:

  • We waited until the close of the 1 hr candle to enter trade ( that was well disciplined and good)
  • The trade had a valid buy signal(even if it was a weak one)
  • We used Stop Losses and Limit orders
  • We practiced Money Management Discipline by keeping trade size at 1%
  • We did well by keeping a journal now we know what was good and what was bad so that we will be able to work on the process on the next trade.

Next trade I will be looking at the mistakes and I will make sure that I don’t repeat those same mistakes. In addition to the looking at the mistakes I will be looking at what went right and I will DO those things again. So now can you all see the benfits of a trade journal? A forex journal is truly one of the best ways to improve your trading. This was a losing trade but in my opinion a great forex lesson for everyone involved. I will be doing more analysis over the weekend so make sure you come back so we can get ready together to make our next trade a winner.

If you found some areas of improvement that I missed or if you found some positive things that I missed please add that as well. If you need any clarification please ask the question right here in the comment thread.Β  Thanks and have a great weekend.

P.S. I did a guest post on Leadership that I was pleased to do, if anyone is willing to do so it would please me if you can stop over and check it out and say hi.

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Casey Stubbs is the founder of Winners Edge Trading, which is one of the most widely read forex sites on the web. Winners Edge Trading has trained thousands of people to trade the Forex markets.

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  • Thanks Andy,

    If every trade was successful we would all be rich πŸ™‚ Ignorant but rich.

    Thanks and I look forward to future comments.

    Casey

  • Follower,

    You are welcome and I appreciate all the great comments. Please continue to follow along and we can all get some great trades together.

    Casey

  • Yes Vignesh,

    Thank you I am glad to have you on board each person has some great things to contribute. I am excited about where this is going. I will indicate more about price action in the next journal entry.

    Thanks

    Casey

  • Ivs,

    It is good to see you again, I won't beat myself up about that. If I beat myself up about bad trades I would be dead a long time ago. πŸ™‚

    I am not sure about the NFP rule I must make a decision on that one because there have been times that it has benefited me tremendously as well. I think that we should at a minimum have stops in place.

    Thanks

    Casey

  • I am not a genius but I have been taught well. I also get guidance in everything I do from the Lord.

    Thanks

    Casey

  • Dr,

    Thanks, the more comments I get the more it looks like everyone made money on this trade but me. I am happy about that. Not that I lost but that others didnt. You are right we can learn and earn more pips as we learn.

    Thanks for the comment and I appreciate the encouragement as well.

    Casey

  • That is right zeek over time is what we should be looking at. Forex Trading is a long term event. We should be attempting to grow our profits over time.

    Thanks for the comment and please check back soon.

    Casey

  • Thanks Mark,

    I appreciate the comment as well keep following along and see if we can all permanently change our bad habits into good habits.

  • Thanks Gerar,

    I appreciate the comment and If you ever need any help at all do not hesitate to send questions and you can even as questions on these comments that way everyone gets the benefits.

    Casey

  • Andy

    Nice work Casey. The trade didn't work out but learning the reasons why are extremely valuable for anyone starting out and who is following this journal. If every trade was successful we would never learn anything.

  • follower

    Thank you Casey for putting up the trade and let some of us followed with. It turns out to be a loss for you and some but a reasonable profit for me and others as I still managed to get a few pips by getting long ,in and out, twice. The technical analysis was good but quite against the fundemental direction . Also, heavy news was a big factor and you should not have left position overnight or well into the news hour. And I dont think what you say of still leaving the trade run with a little profit by ptotection stop loss is appropriate as the spread could be quite large and might not be worthed. It could have turned out to be a great trade for you, who know?. I really appreciate your initative to show us your real trade, how we trade is different thought. Again, thank you very much and hope we will all do better next time.

  • vignesh

    Hi Casey,

    Thanks for staring this blog/journal. It is going to be a journey, where I am keen to be part of. We all make mistakes, that is good in a way, because you get an opportunity to learn not only right and wrong but also why it is wrong. Again thanks for sharing your experiences. Also, I am not sure how the price action indicates it is as buy signal. Do you mind, explaining it please? Thanks and good luck.

    Cheers…

  • Ivsforex

    Casey,
    Don't beat yourself, tech was there in your mind(some comments come from hindsight/which is easier to diagnose!!!), just news changed things(Pigs have an initial… H. PIGS). I had the same on Long EurCad, stopped out @ 1.255 for -ve100pips, closed day above 1.27 , although 1% risk makes it more acceptable. I broke my rule of not trading NFP days as I thought it had bottomed-Discipline…Discipline…Discipline… some you win some you lose!! my loses are normally due to self Discipline where I break my own rules!!!As above!!
    Euro though I feel due to its close, we will see 118 if not 116 over the next few trading sessions/week. Mad really, the swings seen and how sensative things are to any -ve news coming out .

  • Ik

    Casey you're a genius. Patience is very, very important in forex trading.

  • Rudi Botha

    Why not consider using an EA that manages your trades. This could have prevented your loss. ex. managetpv34.mq4. You could set different targets that closes half of oder etc. Play around with it, you might wanna add it to your toolbox

    Here is a link.

    http://www.extrafast.onpw.de/?page_id=1441#

    God Bless

  • Dr. Magdee

    Hi, Casey,
    It is good you have enough self confidence to say ( I made a mistake), well , evey knight makes a mistake sometimes. By the way, I followed your trade , after observation I placed the entry (buy) though I was sure that is againt the trend ,because the buy signal was not confirmed yet, any how I said let's follow Casey this time and see my luck, I closed my position with profit 23 pips. I sent you thanks over the air, but to be hoenst with you, I knew it was just a good luck, it was a wrong entry (though I made profit) you already mentioned the good points and the bad points in the trade, so I will not repeat.but basiclly, we should not enter a trade without a confirmation signal,consider the coming news, consider friday. You know the good thing in this , it was a lesson, we all share our ideas, and as long as you want to benfit people as you do , certainly God will benifit you. So, forgot this one losing trade, many other trades you will put here will be winner and all will win, then we will celebrate it together, we wil say then, Thanks Casey, well done.
    see you in the next coming very profitable trade.

  • zeek

    Good blogger insight to call it a day. Seasoned professionals always come back from a stop out with solid system and set ups that work over time.

  • Mark

    Hi Casey, I think the information and analysis of what you are doing is one of the best things on the web. You are not afraid to post what u are doing and taking heat or gratitude for your decision.

    I really admire what you are doing.

    Thanks

    Mark

  • Gerarfx

    Thanks Casey, your work is very good… I also had a bad trade at the same time because of CAD job data. Could have closed with less pips but I wanted to respect my t profit….is an issue that I have to improved…good weekend

  • I am finding more and more people that have made money following this trade which is good. 30% is a great week Patfung, come back and tell us how you do next week. If you can do that again that would be great.

  • patfung

    Praise the Lord!

    I followed your trade and got out with +5 pips during Asia hours, as it was NFP Friday and I did not want to hold any open position.

    Just a suggestion – listen to Don Moen songs, and you may see your trades work better. (You will not get these strategies in Forex Seminars)

    I made +30% last week

    Thanks Casey for your sharing and response. You are amazing.

  • Johnny,

    That reminds me of fool me once shame on you and fool me twice shame on me. No reason to repeat the same mistakes over and over again we must adapt and change. thanks for the comment.

  • I agree we do learn more from our losers but now that we have that over with perhaps we can start learning from our winners. The toughest thing in life to learn: How to consistently be an overcome in everything we do.

    Over the years I have had victory after victory. Not that I am special but I have learn how not to quit, and that your faith is what keeps you going. I believe I will be a good trader and since I believe I am gong to act like it.

    When negative thoughts or ideas come into my head i dismiss them immediately.

    I don't know where that came from but anyways thanks so much for the comments and please feel free to share at any time.

    Thanks

    Casey

  • Johnny

    Correction to trend is not decided in 10 pips fragment. Corrections are measurable in price and time. The classic Fibonacci levels (38.2, 50, 61.8 %) always gives you an idea about the future and so do previous support and resistance, if any.

  • Thanks Dave

  • Marius,

    Get some rest and be ready for next week. Margin Friday, I wish I would have known that it was called margin Friday I might have thought twice πŸ™‚

    Thanks

    Casey

  • Juan,

    I can understand your english and thanks for taking the time to comment. I will see you next week trading.

    Casey

  • Gary,

    I already had some great things come my way. That is why I go out of my way to help others. The gift of salvation that was gift given to me by Jesus, He took my punishment. I can get no better gift than that.

    I appreciate the comment and I am truly thankful that you are appreciative.

    Casey

  • I appreciate the comments this great coming from an executive coach. I think I would be interested in hearing more details exactly what an executive coach does?

  • Great job, Now that makes me feel better that more people made some money on this trade.

    Thanks and lets hope we can get some more on the next one.

    Casey

  • Kubrat, Thanks for the encouragement. I think next time I will put my stop at break even before any major news events. That way if it goes in my direction at least I can get some major pips on a good news release.

  • Michael,

    Thanks for the comment, I am going to be interested to see where this goes by the end of June.I think that we will all have some great stories to tell. Thanks for the comment and stick around a while to see where this goes.

  • Marius

    Casey i think you are one of the most balanced traders that i know , the only thing that it was wrong about this trade is that it was against the trend,and i've learned(the hard way),not to trade against the trend(especially on the so called “margin Friday”)….look forward for you're next post.
    Anyways is pointless to say that it was a bad trade after it hapenned-anyone can do that…
    could have worked very well and now everybody would congratulate you…..
    So in forex,like in life we should learn from mistakes….and what i know for a fact is that you learn more from a losing trade than from a winning one…
    anyways have a good weekend…..almost 2 a.m. here ….time to relax till Monday

  • Juan Tinorio

    Hi casey…

    I'm very glad to know you opening this Forex Trade Journal, so we all can learn much lesson about trade forex together.
    about your first trade on Eur/Usd, i thought it was a good long signal (not the best coz EU are still in the down trend), if i were you and i took that trade i wouldn't set my TP more than 25 pips and set the SL as tight as possible around 15-20 pips, especialy when you took a counter trend trade, coz it's a first week of the month and there is tons of world economical data will be release. one more thing about fundamental forecast, and i don't think forecast are made for no reason, on forex factory friday calendar all USD forecast are favor to USD, so maybe you should consider to close your position before red news.
    keep up your good work dude…and keep your nice smile.
    see you next trading week casey.

    PS: sorry for my bad english, coz i live at Indonesia, and english isn't my mother language.

    Regards

    Juan Tinorio

  • CowCudCowboy

    He was stopped out before the announcement. Also if it had been as expected or better the dollar would have strengthened, not weakened.

    If he had entered short, even at the same place he went long, using the same size stop loss, he'd be at +200 pips right now.

  • gary

    what a great way to learn forex, thank you for being willing to spend so much of your time helping others.
    I belive in what goes around comes around so you should have some great things coming your way in the future. keep up yhe good work

  • Mark

    As a certified executive coach (in addition to being a 4x-trader!) this strikes me as a great example for your readers; an excellent model of positive constructive self-assessment. Feedback, accountability and support overcome resistance and result in change. Thanks Casey – for putting it out there.

  • Rudi

    Hello Casey,
    you do a great job and i want to say thanks for it. I took that trade after i read your blog and was stopped out with +22 PIPs – trailed the stop, as i am in Europe.
    Thanks again
    Rudi

  • CowCudCowboy

    I think realizing that so many people are staring over your shoulder has it's benefits in that it keeps you from taking impulsive trades spawned by impatience. They say patience is a virtue and a definition of virtue is, “the quality of doing what is right and avoiding what is wrong.”

    I'm sure also that there will be less and less mistakes. This journal is great for us to learn from, as it will be for you. We all learn from mistakes no matter if it's ours or others.

    Had this trade been a winner, how many lessons could have been learned compared to it being a loser.

    As they say…”The Lord works in mysterious ways.” πŸ˜‰

    Thanks for the invite Casey πŸ™‚

  • Johnny

    Well, you took a long position against the 6 month down trend, and prices kept falling and you did not stop yourself out after dubbel bottom was taken out. Long consolidation pattern over night and market falls again driven by bad news. Lesson no 1: Trade with the main trend for longer runs and higher probability, Lesson 2: Keep tighter stop below significant support levels, were you now you are wrong. Nothing wrong in being wrong, staying wrong is wrong.

    I did many mistakes trying to day trade the long consolidation pattern yesterday, but it would have better to skip trading such a day if you could now in advance. Nice move today.

  • dave

    beautiful job. thanks Casey. very helpful. Dave

  • Graham, I liked the comment until the last part. I didnt realize that there were so many people following this. So No I have the weight of the world on my shoulders πŸ™‚

    I am kidding I am glad that people are learning I really think this is the best way. Congratulations on your first baby!!! I have five and I am trying for more, Children are a true blessing πŸ™‚

    Thanks for coming to visit and sharing that you have been reading the site. If you ever have any questions or comments please do not hesitate to ask.

    Thanks

    Casey

  • Graham

    Hi there Casey, this is the first time actually writing a comment for you but just a quick note to say what a great idea having set up your blog where folks new to trading like myself can really learn from a seasoned pro..so far iv'e been visiting your website frequently ie EVERY NIGHT after work. So far iv'e learned quite a lot and hope to join your premium room in a few short weeks when my partner is due to have our first baby! So come August i hope to be earning whilst learning….so to speak! Keep up the good work because there a lot of people out here counting on you Casey….no pressure!

  • Michael Fedell

    I like the fact that you are doing a live trading journal. While I agree that the first signal was rather weak and the fundamentals went against the trade, I think it is great that we will all be able to contribute and learn together. Thanks Casey!

  • Thanks I have got to say when i read that comment I really did LOL.

    I appreciate you doing you duty. That does truly help everybody out here. I can actually imagine a community of people trading well and earning profits as we continually make work out these errors.

  • BTW, I don't want to be critical, just trying to pick your brain about how you pick your trades. I applaud your willingness to post your trades. More people should do it.

  • Shodson,

    I am doing the testing write now. I believe in foward testing and that is what this journal is all about we are conducting a live test to see if the strategy works,

    Thanks for the comments and come back to see what else we have coming up.

    thanks

    Casey

  • Thank you so much for the encouragement. I needed it today. Smart move one piece of advice to all traders is: if you have profits and you see the price moving against you then take the money and run. don't let a winner turn into a loser.

    Thanks and keep coming back I have some great material planned for this weekend.

    Casey

  • Argue Meant

    “Anyways thanks for the comment and come back again…..”

    Yes, you could have grabbed some pips. It is just my duty to argue.
    I have to say that you have “big kahuna's” for posting your trades,
    including the losers. Might make us all better traders.
    Keep up the good work !

  • I'm just wondering…have you backtested your trading strategies? If not then how do you know that you have an edge? Trading against the trend is statistically a money-losing way to trade unless you have very large expectancies and can psychologically handle being wrong a lot.

  • kubrat

    The trade plan wasn't bad at all. The entry point was good and the planned exit was ok. The main problem with this trade was not exiting before the news. Knowing what massive jerky moves the NFP release usually generates I would have exited the trade at least on hour prior to the release regardles of whether I was in profit or loss.

    Like your blog btw. Keep up the good work.

  • Jasvinder

    If the employment data was positive, as initially forecast, it would have been a great trade. I dont thing your strategy was wrong. The fundamentals stopped you out. Anyway I copied your trade and exited at +8 pips. You have a great journal. Don't ever stop.

  • The Trend is my friend I have heard that before. Ok I get it now. ok seriously. Thanks so much for the good feedback. The reason I sometimes don't go with the trend is because I have the I want to trade right now syndrome and at the time the only thing available was a buy that is what I went with. Anyways, I blew it and everyone knows it. At least many others can learn from this trading journal which is the point anyways.

    Thanks and come back I will be doing some analysis before my trades in the future so please come by and help out if you see some bad stuff going on. It will be to the benefit of everyone involved.

    However I think there will be less and less mistakes as time goes on and that is the purpose of this journal and I think it is going to work.

    Thanks

    Casey

  • Actually if you look at the trade it was a buy signal if you use price action strategy. Price action means using the candlesticks to find entry points. After the first one hour candle closed the price move up for several hours afterwards. Even though it was just a small move.

    I agree it is a descending triangle and the pair is moving down. Yes it was a bad trade thanks for pointing that out. That is why I like doing this forex journal so that when I make a bad trade I can get 50 people telling me it is a bad trade. πŸ™‚

    Anyways thanks for the comment and come back again and help with the next one before I make a cosmic blunder.

  • Thanks Diggers, It is not that brave because I have confidence in my trading. Once you get that confidence developed it is not hard to share with others. However it took alot of work to get that confidence built up.

  • I like to do manual stops rather than trailing stops. Just a personal preference because I like to watch how the price reacts at certain levels.

  • CowCudCowboy

    I agree with Argue. I can't see how there was a buy signal. Could you explain the buy signal? Also teaching people to against the trend, I believe, is a big mistake. The trick to trading is getting as much going for your trade as possible and one of the major factors that increases your odds is going with the trend, especially a trend that is as strong as the down trend in EUR/USD at this time. In any given day there are tons of potential short term trades. Sure you can scalp a few pips here and there going against the trend but why do that when there are just as many going with it?

    You're a great guy Casey with a heart of gold and I wish you nothing but the best.. just remember “The trend is your friend.”

  • Argue Meant

    Sorry Dude but that was not a buy signal on ANY chart.
    Take a look at the 32, 34, 50, 200 MA's. All pointing down
    and the pair still in a descending triangle.

  • diggers

    casey, it takes guts to talk about your failed trades like this , and I admire that in a world of smart asses, better luck next time buddy

  • Antonio

    What about a trailing stop-loss of 10 pips?

  • You are welcome thanks for visiting please come again.

  • Dan,

    That is true also and I actually have a trading strategy where I open two lots and close the first one at +20 and then move my stop to break even. That would have made this a successful trade. However I did not want to introduce that here yet for the sake of keeping it simple to start out with. In the past I have thrown out complex strategies and that has made it harder for everyone to follow along.

  • Tyler,

    That is very true I can't believe I missed that one. So I am going to add that to the forex trading journal check list from now on. I think for the next trade I will be creating a check list of how to avoid mistakes and how to increase success.

  • Tyler Durden

    Casey I think that the main bad point about this trade was that you ignored the fact that we have the first Friday of the month and tons of jobs data. Your stop was taken out 2 minutes after CAD employment came out.

  • Dan

    We all I am sure have a buit in need to be doing something, it is part of how God made us. So your desire to get into a trade is understandable. Maybe it would have been a good idea to have worked with a limit order of say 20-25 pips. Just a thought, but my trading has improved greatly when I am content with smaller amounts. Little bits add up to a big whole

  • zecarvalho

    this is forex… thank you for you very great work
    sorry my english…