Application of Learning: Stocks and Forex Trading



So, after weeks of reading and applying whatever I learned from the book The Trading Code, I can now really confirm that it's one of the most useful resources when it comes to Technical Analysis. It's not only applicable in stock trading but in Forex trading as well. Here are some of my past and current trades based from the journal I made and the technical reasons behind why I bought it. (sorry for the long post :p )









and yes, I sold all my RWM shares on the encircled candles below:

I cannot confirm as of the moment if it was just a shake out or really a fake out. There is still a probability that it might reverse any time from its long time bearish move and if that happens plus if it shows a good trading set-up then I'll just buy again. Simple as that. :)

You can also see that I also bought X on July 21 but made some mistake as I did not follow my buy rule when trading from a price channel.


But, I was not easily shaken out of X as I have observed first if the support will hold, and it did so I added more of this. So my average price is now 11.7659

Currently, I'm holding the following stocks:

Update on RFM:

Breakout from pennant and downtrend channel. ADX with +DI above 30 signifying an uptrend.

I added 2go and DNL for the following reasons:

I bought 2go when I observed that it's already forming a flag. Support is still intact and there's a decline in volume after the breakout which signifies that it's a healthy pullback. I added some more of this so my average price went up to 8.51.

I bought DNL after the breakout as I was expecting that it might find support at the previous resistance so I initially placed order at 21.8 and it got hit before the trading day ends. It was now forming a flag as well plus the moving averages are still intact, signifying that it still on an uptrend move.

I also buy 3rd liner stocks from time to time just to have something to play for swing trading like AR or DAVIN. I also played DD when it made an All Time High. But my rule for that is I only buy it in small percentage of my portfolio as my goal is to find a stock that I can hold for a long time (I don't know yet if it would be RFM or X or another stock. We'll see in the following days to come).  Just don't be afraid to buy when the trend is still intact, just be cautious with the risk-reward ratio. If you bought it high then sell it higher. :)

Another good thing about this book is I have also applied it in forex trading. Here's the sample trade I took last July 27 for EURO-JPY pair:


141.41 USD ain't bad for a couple of hours of swing trade, right? :)

I know that I still got a long way to go and still got a lot to learn, but if you're a newbie and reading this, here's what I learned in my trading career so far:
  • Don't listen to rumors, news or HYPE! (learn how to manage the noise around you, if it means deactivating your social media accounts like what I've been doing from time to time then do it! It's really effective.)
  • Never ever depend your trades on other people's analysis.
  • Listen to what your chart says. 
  • Always follow your buy, sell, trailing stops rules. 
  • Take the initiative to always learn and don't forget to apply it always. 
  • Make a journal of your trades so it will remind you your past mistakes.
  • Be persistent, never give up and always be patient!   
  • Failing is part of the game, it's like boxing or UFC, if you don't want to get hurt or even knocked out then don't even think on entering the ring! :)
  • Be confident with your analysis, and don't be afraid to execute it!
  • Always be humble and admit to yourself when a trade didn't go the way you want it. Trade with probabilities in mind. 
  • Don't chase the price. The more you chase it, the more you'll find yourself in a higher risk position.

God bless and Happy Trading! :)

3 comments:

  1. good day. want to learn more about forex trading. I already have COL.. what account should I open for forex trading? trying to learn...

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    Replies
    1. Hi Yvon, you can browse this site http://www.babypips.com/ to learn more about the basics of Forex trading. With the account, I opened mine at http://www.liteforex.com/ you can download there the trading platform and create a demo account for learning purposes. Hope that helps! Happy trading! :)

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  2. Great review! Did you start trading after, before or while reading the book? I'm interested thanks.

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