Longing the exact low on Dec 15 outright, not based on level, but on price action.
Cues – mid week day, no special data as such –> lower chance of breakout pre-American hours. Also, observing that in a falling market, this price came to bid with less volumes.
Booking out completely very soon (2 ticks). Should have let at least partial lots run(6-8 ticks in some time).
Markets have changed. A lot.
In the mean time, my trading style has not changed as much as it should. The slower I change, the more opportunities I lose.
1. Booking losses with discipline
1. Scratching spreads a little too often; wasting round turns. Need to better gauge the right time to take position.
BUT on the other hand, fills are also not so easy to get.
2. Trading randomly. Need to make trading cleaner by focusing on particular strategies; like say quickly getting in and out & thus building specific flies through spreads.
3. ^^Thus scale up.
4. Taking short position in front 6-month fly; without a plan. Spiked against by 6 ticks.
Note: When whites are crashing, this fly is a LONG.
5. LIBOR increased by 0.4 bps – quite a magnitude given recent LIBOR fixings. One spike to the downside HAD to happen. Didn’t take the right entry for that trade.
The Friday Effect – an extended, exaggerated, unidirectional move.
1. Randomly converting some 1 lot scalp-position into a “view” and casually going on averaging; eventually building up 8 lots there, in a move that went against me by around 14-15 ticks! Was very very lucky to get out this time without much damage. But this is exactly the type of thing that in one shot COMPLETELY RUINS my account.
2. ^^Thus on the wrong side of the Friday move.
Note: One of the best days to trade is the day IMMEDIATELY AFTER a high volatility day. There is good, but not wild, volatility on such a day.
Strategy: Leg in to make flies through spreads. If the fly is not in gap, very often, you also get a quick chance to leg out as well.
Forcing myself to be aggressive in American hours, even though (or especially because) i had lost out on doing much in European hours.
1. Not coming prepared to trade with the above mindset.
2. Needed to be a little more confident and leg in and make right side flies (quick 3 month spread –> 6 month half-tick combination). Instead, i traded for o/r scalps (making money somewhere, losing it elsewhere), and thus ended up doing around 1000 round turns and not making any money overall; thus completely losing out on European hours.
And what an FOMC it was! The interest rate markets have already started factoring a shift in the Fed stance, and volatility was expected. FOMC itself was hawkish, mainly vis a vis the change in UE projections.
1. Building up a reasonable buffer in European hours to have a cushion for FOMC.
2. Morning meeting – discussing possible scenarios + trades to watch out for.
Note: Always make note of flies that can taken, since they seem to show decent movement + most importantly, they move in one direction, so you can just hop on the running train.
1. Underestimating the volatility and taking long in o/r expecting some retracement. (I cut loss at 7 ticks, reasonable – given the day).
2. Not keeping track of data. This is quite important. It is easy to get muddled in all the price action, but at the same time, it is important to note the data flow to gauge the real strength the move will take. For eg. I never realized till late that the UE projections had been improved; which was really hawkish.
3. Not making enough use of the buffer. No risk , no reward.
4. Should have done more in and outs, at least through spreads.
Forcing myself to trade higher volume.
1. Late night, 10 yr broke 129.095 – that was a clear 1/2 tick scalp. Once again, I was aware of this trade, and still didn’t take it. Must make a habit of taking such trades, even if with small lots!
1. Partial booking – 2nd spread at 3.0
2. Taking 32.0 short on H5 outright and scalping 1 tick.
1. Scratched M4:U4 7.0 wrong side (long), but should also have taken short position in the same, since backup of U4:Z4.
2. 20 MA was resisting well on U5, but was breached today early in the day. On strong data, market came back down but almost immediately retraced back above. Was a very clear long for atleast a 2-3 tick upmove, but didn’t take EVEN THOUGH i was aware of this trade.