A couple of thoughts after yesterday's ECB moves and rhetoric
I've been reading through a few of the posts we put up during and after the ECB presser yesterday and I see a lot of anger and vitriol in the comments section.
It doesn't take a rocket scientist or humble forex trader like me to spot that it's not coming from those who were long of euros, so what can we learn from yesterday's moves?
Well, the first thing is that we shouldn't ever get so angry to such an extent that it clouds our judgement. I'm a great fan of Rudyard Kipling's poem If and have quoted it many times here particularly the reference to treating victory and defeat as equals.
As traders we all have bad days and we will invariably always blame others rather than accept our own ineptitude or stubborn mindsets. Yesterday I posted an ECB preview where I spoke of inherent euro demand, the SNB warning about not being able to increase negative rates too far and the recommendation to buy euro dips. I also noted, on a few occasions prior and post-ECB decision about the large cluster of EURUSD option expiries. I hope some of you took heed but yes of course I accept that Draghi threw in a curve ball or two and I'm certainly not claiming any bragging rights here. I was merely offering a few thoughts/pointers to consider.
We know the pattern of pressers though and in all the heat and frenzy while it's going on we should either look at the bigger picture or just trade with the flow with no questions asked aka my " ours is not to reason why, ours is just to sell and buy" mantra. To get caught in between is invariably a very dangerous game.
Yes the moves were extreme to the top side ( I certainly didn't see that much of a rally) and may well be overdone in the short term. We'll find out a bit more today but in the meantime take a look at how you reacted yesterday and learn from it. If you feel you were hard done by that's understandable to a degree but don't let the feeling fester.
There's no In or Out tray in forex markets. It's on-going and mostly relentless, and as I warned/advised in a post earlier this week sometimes it's the right thing to step away until the market and/or your mind becomes clearer.
Yes you can also jump back straight back onto the horse, bike or whatever analogy you want to use and that can also be good exorcism of a bad day, but just be sure you're trading for the right reasons, not because you're angry or chasing back losses.
Don't get mad, get even. Preferably on your terms.
