Woke up this morning and saw that the AUD/USD rate was at 0.768. Now I normally don't trade before 0830hrs Singapore time, cos that's when most ABS reports are released in Canberra that might cause spikes in the rates. Also the spread becomes about 1.5 pips, more than double the 0.6 that I usually trade on. However, here comes the benefit of understanding one currency pair well - I knew that the RSI (1 day) is at 60+, so that's a long term downtrend. I also knew from yesterday that it hit 0.77 for a bit, before dropping to 0.74. So 0.768 was pretty high if you ask me. I saw it drop to 0.76796 and I decided to just go for it, without checking the candles or RSI.
At the same time, I'm not that brave right - so instead of going on my usual US$5 contract, I sold a US$2 contract. Reason is this - if I'm wrong and the price spikes, I can still go in again at 0.77, and whatever earnings I make from that second position, should be able to cover the losses from the first position. And if it goes waaaay beyond 0.77, I would have lost my account anyway, so it doesn't matter.
At the same time, I didn't want to have to keep taking positions throughout the day to hit my target of S$140. So instead of my usual 2 pip take profit, I went for 6 pips instead. Should have been 5 pips based on my target, but well, if it can drop to 5 pips, it should hit 6 pips. Besides, that wouldn't have brought me near the day's low at all, so why not.
Lo and behold, 15 mins later, I got a buzz for the auto close. Kicking myself, cos if I'd gone with US$5, I would have made S$400 odd today. Kicking myself cos right now, it's at 0.7662 - so if I hadn't taken profit so early, I would have made even more - S$380 on a US$2, or S$1,350 on a US$5.
But hey, I have a plan, and I'm sticking to it. All done for the day.
Then I spotted an entry point at 0.76511. RSI (1 min) was at 30, so I bought US$5 2 pip limit. But then I had to go charge my phone and as you know by now, I don't really like buying, so I wasn't too confident just leaving it alone. I then closed the position when it broke even. When I returned to my phone later though, my 2 pip limit alert was triggered, so it was a missed opportunity, but hey yet another verification of my system. So all in all, still good :)
224 days to go.
Yours,
X
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