http://www.netpicks.com/tjgiveaway1 - YOUR FREE TRADING SYSTEM I messed up on a swing trade and it cost me money. The hardest part of the entire event is that I know better and have written about it many times in these trading tips blog posts. Yes the trade made money which is much better than taking a loss but in all honesty, I can accept a loss much easier than what occurred this morning. Let’s go on a journey of the trade from start to its demise and hopefully there are some takeaways from it.

1. Forex Swing Trade Error
http://www.netpicks.com/swing-trade-error/

2. I messed up on a swing trade and it
cost me money. The hardest part of
the entire event is that I know better
and have written about it many times
in these trading tips blog posts.

3. Yes the trade made money which is
much better than taking a loss but in
all honesty, I can accept a loss much
easier than what occurred this
morning.

4. Let's go on a journey of the trade from
start to its demise and hopefully there
are some takeaways from it.
It was a swing trade on the EURUSD
Forex pair and even before it was
entered, I felt there was a lot of
promise in it.

6. 1. After price traveled sideways, there
was a healthy push from this level.
I've written previously that when price
does something that is different from
the action that came before it, take
notice. See *

7. 2. This indicates the strong move
away and if you were to tighten your
charts so you could barely see the
candle details, these types of moves
are obvious to see.

8. 3. Price traveled back into the level in
a slogging sort of fashion but the
details of the travel is important. You
can also see price did not break the
bottom of the level and rallied out
after a little bit of retracement into the
zone.

9. * The common description of this event was
that there was a strong imbalance of buyers
than sellers at this area which is indicated by the
strong move. There are a few people on the
internet that teach this way of trading but the
reality is that with an understanding of the
market and price acceptance/rejection, you
could figure this out on your own

10. Some traders may pass on trades like
this where price does not just drop
into the zone. The other issue is the
ledge just above our zone of interest.

12. The upper shadows I've marked off is
actually price returning to where price
resisted and dropped and what is
happening at these shadows? Orders
are being filled.

14. The red box and yellow highlight?
Again, sellers being filled on their
orders and by the looks of it, anybody
who wanted to sell was given the
opportunity.

15. We also could have break out traders
selling the break of the box plus
traders selling when price retraced
back into the area of the break.
Conclusion?

16. When price hits the zone where the
large move started and then starts to
rally, the sellers above the zone are
already filled. Price will likely have
little issue rising and the triggering of
protective stops will help propel the
move faster.

17. The key was watching the price
descend and then seeing small rallies
to fill more sellers and weaken the
potential resistance above my zone.
I wanted to buy at an area where price
certainly fit a "that's different"
characteristic. And I did.

18. The plan was in motion and while the
trade chopped around for a time, the
stop was never tested and price began
to rise throughout the day.

19. Later that night, I was looking at the
chart and noted that price stalled after
rising 102 pips from my entry. On a
four hour chart, the majority of the
move occurred in one candle and price
was beginning to base.

20. Made sense to lock in some of the
profit in case there were buyers
looking to take profit. The problem
was that there was nothing to the left
of price that would objectively speak
to a pullback in price.

22. All those shadows that are highlighted
speaks to the highs finding enough
sellers to bring price down. Even the
highs on the left of this graphic have
already moved up into an area where
sellers were sitting.

23. I locked in gains based on...nothing.
The structure of those areas were not
red flags to be overly concerned
about. If this was a day trade perhaps
there are areas I would look for
reactions but for a swing trade, you
expect bumps along the way.

24. It gets worse!

25. In the archives of this trading blog, I
spoke about price action entries and
one I speak about is called a failure
test. You can read about failure tests
at this link:
http://www.netpicks.com/no-trading-indicators/

26. Essentially it's where price breaches
the low/high of a range and is quickly
bought/sold back. In the direction of
overall order flow, it's a great trade
entry.

27. Textbooks always talk about placing
your stop just below/above the swing
level or on either side of a range. The
problem is that these are easy targets
for those that move the markets
because they know these areas are
loaded with stops.

28. Trigger the stops, add order flow, get
better fills, and propel price.
I placed my stop exactly where I
would have looked for buying.

30. Price ranged and the test of the low of
the range is bought back up after
exceeding my stop by 2 pips. Price
went on to rally over 130 more pips.
.here's another thing..

31. This is a new sub-account where I
want to build it up without adding
funds from another account. Risk is
6% of the trading account per trade
and when combined with fairly tight
stops due to the nature of the setups,
position size can be a handful of mini-
lots.

32. If I adhered to what I write about, this
trade would have been a great account
builder as it is just shy of what my
target was for a scale-out @ 1.1260.
and my ultimate target of 1.1330.

33. Update: Price rallied
to a high of 1.1389
which would have
triggered my profit
target at 1.1330 giving
a trade of 284 pips
with a 7R

34. Many of you may be wondering how I
made such a amateur mistake when I
clearly know better. The answer is - I
was multi-tasking. Interesting enough,
I wrote about focus not too long ago.
http://www.netpicks.com/focus-not-overrated/

35. I hope you take away a few things
from my mistake with this swing trade.
Most of all, silly mistakes can cost you
not only profit but too many of them
will eat away at any success you may
have.