Lessons Learned for the week ending 12-Dec-08

I decided that I would rehash my "lessons learned" for the week. Being a new trader, if I am not learning lessons from my trading, I am either not trading enough or do not recognize the weakness's in my trading technique.

For me this past week was one of mixed reviews. I was down almost $2000, however on a single EA trade I was down $3000, so on manual trading I was up about $1000. That being said most of the recovery I made was on Thursday night and Friday. I also switched my trading method from the "Baby Pips" with Shi and LR channels to more of a price action using only Fibonacci retracement, and S&R points. One of the major reasons was that in my old system when the pairs were moving in a directional basis, my entry signals were very far and few between and generally not correct. Even though the trading numbers did not show it, I think this week was valuable. Anyway, here were my major takeaways:

1. I prefer trading on price action as opposed to just using indicators. I feel more in control of my trade.
   
2. Money Management - In the beginning of the week I allowed my account to take 5 - 10% SL's in the hopes of gaining 30 pips. Now I will put the stop loss where I think it should be and control my money management by the size of lots. So if on a full lot trade, I have a 60 pip SL, then I must only trade 1/2 lot. This will keep my account in the 3% range.
3. Even an EA that is profitable most of the time will lose. In my case, the EA did not have a stop loss, and never hit its own selling signal. I closed 1 trade for a loss of $3000. Make sure your EA follows your MM, and test your EAs for 2 months on a demo account.
   
4. Only trade in the direction of the trend. If you stop out, and the market has not reversed you can re-enter the trade at the point where you got stopped. (Jacko style for your forexfactory forum readers).
   
5. One good week does not mean the next will be. I had a good week last week (ending 5-Dec), and got hammered this week.
   
6. Wait for trades to come to you, do not "search" for trades. This is one of my weakness's. I am excited to trade, and find myself seeing things that may not be there. Patience pays, it seems.
   

Here is my demo Summary Statement:

Summary:
Deposit/Withdrawal:		0.00		Credit Facility:				0.00
Closed Trade P/L:		-1 884.26		Floating P/L:				0.00	Margin:			0.00
Balance:		10522.20		Equity:				10522.20	Free Margin:			10 522.20