Note the title of this post … I know draw down and it hits you to the core. The reason I bring this up because, once again, I’m taking a hard look at the USD vs JPY. Why drawdown’s and the YEN? Well, because as a CTA I went into my first draw down – EVER – trying to go long the USD vs JPY in/around 75. TILT – all the way back down at 75? YES all the way down at 75. For those of you beginning this journey, you’ll say to yourself “you suck.” And for those of you who have been at it for a while you said “you’ll come away stronger …” I NEVER risk more than 1-2% on a trade … I didn’t then, I DO NOT now, but I lost something like 8 times in a row and went into an 18 percent draw down. It sucks … so anytime I start looking at the YEN I say “you sure you want to do this …?” YES, I DO and WILL ….
so, I really really like my count up at 125 …. and I really really like the long and deep retracement we are having. the question we have in front of us is … is this the end of it?
Michael Jenkins taught me his 1/8th Signal Reversal Candle technique – it’s SO SIMPLE yet the theory behind it’s so advanced. Let’s keep it simple:
- go to a weekly or monthly and look for the SIGNAL REVERSAL CANDLE. In this case, the LOW of the HIGH candle is taken out on close.
- from there simply subdivide that candle and bracket it w/ 7/8ths or .875. when you get to the last 1/8th division that SHOULD be big time support.
- note, in this case it was … try it, you’ll like it.
Here’s what I DO NOT like ... I DO NOT LIKE that the rally UP has been a clear three waves …so, crap that says one more low on the USD vs JPY. SO I WAIT … WHAT AM I MISSING HERE? 🙂
One thought on “Have you ever been in a draw down?”
Great post, both from a psychology standpoint and analysis standpoint. I’ve been similarly frustrated with the Yen.