Week 2 of "Doing it LIVE!!"

    For the second week of live trading, I had a somewhat inauspicious start to the week.  I got into a short trade of EUR/USD that I really thought was going to go well but I ended up getting stopped out for a loss.  That made me real nervous to start off my second week of live trading.   But it was important to stick to the rules of engagement.

    Good thing too, because after that trade I took a deep breath and waited for the next opportunity.  It didn't take long and the rest of the week was really incredible.  In the end I had a very positive week:

Beginning Balance:                      $2153

Ending Balance:                           $2800

Weekly Gain/Loss:                      $  647

Avg Pips:                                           162

    I need to interject at this point for full disclosure, that I am also trading the Australian dollar (AUD/USD) pair as well as the Euro (EUR/USD).  What is great about the Aussie is that it trades for near "par" value of the US dollar. 

    Why is that so special?  I trade on a 50:1 leverage rate, so for every $1 I have in my account I can buy $50 worth of currency.  This allows me to trade with "mini contracts" in amounts of 10,000 units of currency.  So in the case of Aussie, it works out like this, example:  10,000 x 1.03 (approx. exchange rate to the US dollar) = $10,300  that is divided by the leverage rate, 50 which equals $206.  This is the amount of actual cash I need in my account to purchase one contract of AUD/USD.  My rule of thumb is to have about twice the value of contract in my account to trade one contract, so this would be about $400.

    In the case of EUR/USD, a contract costs about $260 so I would need $500 in my account to but one contract of Euro.  So with an account balance of $2000 I would limit myself to 4 contracts of EUR/USD or 5 contracts of AUD/USD.  When trading mini contracts, a 1 pip move equals $1 to my account at 50:1 leverage, so if I buy 4 contracts of Euro and collect 10 pips then I made $40, if I buy 5 contracts of Aussie and collect those same 10 pips then I made $50 for the same amount of pips.

    Of course the opposite of this is that I could lose more trading Aussie if the trade goes against me.  So be careful and watch your risk tolerance.

Lets Begin......Again.

     I remember as a kid playing with friends, a game of HORSE on the b-ball court, or when I first learned how to golf, and I would make a really bad shot and immediately call out, "Do over!"

Life is full of "Do-over's" and this blog is yet another do-over for me.  I'm starting fresh....again.  I will be using this blog to journal my experience trying to make a living as a Currency Trader.  This is mainly written for a few family members, friends and colleagues that are semi-interested in how well or how badly I am doing as a trader.  So let's jump into it, shall we?

As of the end of today I am +7.7% overall in my account.

Today marks the end of my "soft opening" of live trading.  Bear with me for a little bit on the history of my trading and how I got to this point.  I have always had a school boy crush on financial markets ever since high school when we played a stock trading game in a business/economics class I took as a softmore.  A little over three years ago, after having resisted it's Siron's Song, I succumbed and started studying what currency trading was and is and I was soon hooked.

I started practice trading and within a couple of weeks, and like many before me and no doubt many to follow me, thought I had mastered the craft well enough to trade with real money so I jumped in and quickly blew through my cash in about two months, so I went back to practice trading and then tried it again, this second time around I made it a few more months before losing all my money.

Determined not to have this happen again I studied even more, and practised even more which I have been doing for the last 18+ months which has brought me to this past week when I started live trading again.

I had actually planned on starting in May 2013, but with everything in place I started this week and decided I would ease into it and this would be sort of a practice run at live trading again.  It turned out to be a good week of returns and I ended the week in positive territory.

The purpose of my keeping a public journal of my FX trading is not to brag about how well I'm doing (well to be honest, there is a little vainity involved here), but rather to be transparent and accountable to someone else.  I feel that if I have all of my trading out in the open, the good trades along side the not so good trades, then I will actually be a little more cautious with my trading and not be so inclined to put on trades that fall outside of the boundaries of my risk tolerance.  I also invite those that follow this to ask me the tough questions so as to keep me on my toes.  I think this will help me be a better trader.

DISCLAIMER:

I will lay out in future posts, my trading philosophy, strategies and methods along with the mechanics of my trading for entertainment purposes only.  Since I am not doing this professionally, but for my own account, here is my disclaimer:  Nothing published here should be construed as an offer to buy or sell any commodity, derivitive, option, equity, stock or currency.  I am not putting myself out to the public as an investment advisor in any way, shape or form.  The opinions expressed on this blog are my own.  I am only relating my own personal experience trading and it is not being offered as trading advice.  Anyone that reads or follows my blog that chooses to invest or trade in financial markets based on what they have read here, does so at their own risk and should consult their own investment advisors and professionals.