Week 4: Day 2

On the open I sold the schatz for a quick profit and made several trades and by 8am I was up 150 euros, which is my profit target for the day. I felt each time I hit my target early I missed out on opportunities so I kept on trading and bought the spread on the low of the day at 7's, it went down and I bought 5.5's too, it carried on downwards, the euribor bids were pulled and it fell down, the schatz didn't follow. The spread was at 0's and instead of buying the spread I punted the euribor and made a quick tick profit. The spread moved up 2 ticks and came back down and I bought at just under 0's whilst still being long 5.5 and 7, I sold some at 2's so took a 2.5 tick profit, my largest winning trade yet but I still had two massive losing trades running. When it fall back down I did it again. My original trades seemed a mile away and when it moved up I sold them both at 4's and was back on 150 euros for the day. Having been down 575 euros it felt pretty good and it was great to not lose anything on the trade overall even though it went heavily against me. It was pretty scary having 3 clips on, which is really my limit although I am able to go further but I doubt I would.

With 3 clips on a 1 tick move against me is equal to my daily target each day! I could easily blow a weeks work in minutes so buying more really took some balls lol.. I felt like the downward move was complete and it was a good buying opportunity. Although at one point I was thinking about getting out the trade and almost did! I made one more trade to bring my day to +175 and called it a day!

Spreading is kinda cool

I only made 1 trade on Friday so didn't bother to blog about it, but today I had a reasonable up day which was nice because every Monday I have lost money so far. In fact during my second trade of the day I was down 400 euros but it eventually came back in my favour.

I am approaching the end of my first month and it has been far better than expected. Spreading is really quite fun, there is very little information on the internet as well as scalping which are the two techniques I use to trade. Spreading ensures that I am hedged when I take a trade on and I don't even have to have a bias on any of the two products. I trade two similar products and when I buy one I sell the other, the spread between them changes with time and when the spread moves wider I sell it etc. The spread does trade within a range often but can move to a new range without warning. The challenge is to make a lot of winning trades and not allow your few losing trades to be to big. There are many things I like about this style of trading one is because I am trading the spread it doesn't really matter what each individual price is, I could be buying the high of the day on one of them but that could be because the other product just blew through it's high of the day and I think the other one will catch up. It is easier to do than trading outright I don't need to guess the market direction just try to work the bid and the offer. Because I am scalping I just look for a small profit.

I try not to pay the spread between the bid and the ask, as a scalper you would like to wait in line to buy something then wait in line to sell it, the cheapest seller is always higher than the cheapest bidder so if you can bid at the best price and have someone sell it at that price to you then you can offer it at the cheapest and hope someone buys it. Not everyone wants to wait in line and if the price is rising then normally no one is going to sell it to you at the best bid price so you have to buy it off the people on the offer before they retract their offer! and soon this will become the bid anyway. It is not just about going bid and then offer when you spread because you have to think about getting out a good price and keeping yourself hedged. If your not hedged it is very easy to just lose a days profit target, so there are many factors to consider and always two ways in and out of the trade. You can always buy 1 of the products if you think it is going to go up, if it doesn't but you see the other product about to move a price down you can sell it at the last possible moment which gives you a chance to make profit on an outright and if it doesn't work just hedge yourself. I have been doing this especially if I like the price I would hedge myself at, there are many other things you can do, e.g. buy and sell one side of your hedge when it is oscillating between two prices and turn a profit whilst being hedged some of the time! Maybe I will go into more detail about it but just to say I am enjoying this style of trading.

Week 3: Day 4

I made a buy early on at what appeared to be the low, but it was in a down trend over the week so the second time I became hesitant to buy again. It was annoying because I would have made 50 euros but it did retrace back to the low, and I did manage to sell it near the high for a small profit but didn't buy it when it came back to the low. It did break down and I bought it a few ticks lower and sold for a profit and it continued to gradually make new lows and I did the same again. I really think I should have been selling the lower highs, especially if I think it is still trending downwards. Something I realised is that it is so against human nature to sell a price that seems cheap, it appears to make more sense to buy the new low but logically this is far more riskier as you are fighting against the trend and it could just fall further than you think.

As the day went on it was ranging downwards and the range was becoming tighter and tighter and I feared an outbreak and more towards the downside. I was really hesitant to get involved and just decided to watch and it did in fact fall about 5 ticks in a short space of time. I then considered buying it and I had myself queued and then realised I wasn't going to get the price I wanted so I pulled my order which was to sell the schatz. Literally 2-3 seconds after I pulled my order, there was news I believe from Trichett saying there will be no quantitative easing and I think just the fact he said the word made people panic buy and it literally rocketed up 6 ticks and then retraced back but continued to rally upwards making the TED spread plummet further. I just sat back and watched I didn't trade after 1.30pm and was pretty happy to not get caught in this trade like I did last time.

I had a good day today and I have had just 1 losing trade in my last 24 trades, so wondering how far this will continue!

Week 3: Day 3

At midnight last night Germany banned naked short selling of German bonds, which is what I trade and I wasn't sure the affects of it. There was also a rumour about the Euro breaking up and I decided to watch rather than get involved as did many others around me. I eventually traded at about 11am and made a tick. I made 2 other profitable trades for the day and finished at about 5pm, which is a long day when you get in before 7am!

I am having a really good run for the last 20 trades or so with only a couple of losing trades, which is awesome. Today I realised the schatz was making the spread range and the euribor was often not moving with the schatz. Therefore I normally entered with the schatz first much more and realised the best entry was when the euribor looked like it was about to go bid or offered and then to que the schatz, get filled and lift or hit the euribor depending if I was long or short. There were a lot of opportunities to leg and you could get a good price leaning on the euribor throughout the day. There were many more trades I mentally took which worked out well but didn't take because of the fear of rumours becoming fact. I really didn't wanna get caught offside of a huge movement.

I was feeling a little demotivated after losing 200 euros on Monday, but overall it's going well and I feel like I am improving and thinking about more each time I enter a trade. My goal right now is to be at least flat by the end of the month after commissions which for me are already over £500 for the month... :(

Week 3: Day 2

On the open I waited for 7's and went long, it carried on down so I bought 5.5's, I was then queued to buy 4's but didn't get them. When you are looking to do a third average you know things are going bad and I would have bought 4's as they seemed hard to get otherwise I would be looking to dump the whole position at 4, or if I got 4's dump the whole position at 3. It then retraced and I sold 6.5's and 7's giving myself a tick profit by about 7.30am. I then did pretty much the same in the other direction, my first sell was too aggressive and I sold some more and bought them back half a tick cheaper and then did it again and I ended up scratching my original short too. I got stuck in a trade over lunch and grabbed lunch at about 2pm. When I got back I was pretty content with my day so was just sitting and watching but then I couldn't resist selling the high of the day, at first I didn't take the sell because it looked too easy, but then it became hard to do so I did it on a leg and then legged the other side for half a tick, I was in and out within 4 minutes which was one of my fastest trades so far.

One of my best days so far, and pretty cool considering I was down a lot when I was trying to buy 4's.

Week 3: Day 1

Not quite as bad as last monday, down 200 euros and a lot of round turns so not too great. The big move was done within an hour and it just didn't move much for the rest of the day. I really messed up today and fat fingered and at one point was long on both the euribor and schatz... I really felt tired and almost dizzy when I closed my eyes. Luckily I was able to scratch almost all of my errors and just lost money because I picked bad entry points. Anyway, another day tomorrow :D

End of week 2

It is the end of the second week and in total I have traded 7 and a half days and so far it is going well. The last 25 trades went really well and I learnt plenty about execution and knowing when to take risk on getting in and out of trades. I have some confidence now that I will be able to trade profitably but it should become clearer by the end of the month.

So far I am really enjoying this style of trading and just trading generally and just hope things carry on well.

Week 2: Day 3 and 4

Didn't get time yesterday to blog, but it was my best day so far! I ran my profits 1 tick which really helped increase my profit for the day. Today was a more interesting day as always I was trading the TED spread, euribor - schatz spread. By early morning I was up 125 euros and then I went long on the low of the day for a second time, this point had held many times before although it was making lower highs so even though I wasn't as convinced for some reason I got in and someone flipped the euribor and I got filled on the schatz and had to take the next price in the euribor. So I didn't get the price I wanted and I then averaged in when the market was highly volatile, moving between levels rapidly and I averaged in at the same price unfortunately.... I was kinda annoyed and a better price came on so I took that as well. I then was told to unwind my position because it was quite big, so I scratched the last average and took a half tick loss on my second average in. It wasn't really going my way, nor was it really going against me but at one point I was down 300 euros for the trade, so I decided to take a loss. I had infact legged out when I took a half tick loss,otherwise it would have been a whole tick and then I had realised the schatz was going up and down around the same place, so I bought it back at the low of this movement but soon as I did it broke through it and as I was leaning on the bid on the euribor and I hit it just before it vanished. So I took a 1.5 tick loss for my original trade, so 2 ticks overall, which wasn't bad especially considering it broke down further and  I got a pretty good price for what was available. It did pop up briefly 1 hour later about 1 tick above where I went long but it didn't last and it soon tried to break through the low of the day.

I saw loads of selling in the euribor (a 5000 lot was sold) and I decided it was pretty weak and sold the low of the day and the schatz moved up 3 ticks and the euribor didn't move. Therefore I had so far sold the euribor and bought the schatz, so I could sell the schatz 3 ticks higher for 75 euros in profit but I would then have to go at market on the euribor otherwise I would be unhedged, going at market and closing the position would give 50 euro loss on the euribor and so 25 euros profit for the trade. Therefore as the offer on the euribor was 5000 (pretty big) I decided to sell the schatz before it retraced back down and I queued on the bid in the euribor, if I got filled I would make 75 euros otherwise if the offer started to go I would get ready to lift it and take just 25 euros. The schatz came back down and the euribor held steady so I decided to rebuy the schatz and it once again went back up and I sold it again and the euribor started to go bid and I lifted the offer and locked in a nice profit bringing me back up to where I was in the morning. This was the first time I had done something quite like that and it makes trading a lot more fun.

Week 2: Day 2

Spent just over 11 hours at the office, I made steady money but not much. I was already in a trade and was considering buying more but I accidently clicked buy instead of "trade ticket" and I was trying to re-hedge myself at the price I wanted and lean on a number in the euribor, which ever became available first and also trying to scratch the miss-bought lots. It was a lot to think about and I ended up legged and was long on the euribor and there were about 50 on the offer, 6 were mine (2 were filled) but no one was taking them. The guy sitting next to me bought them off me, haha.. but he said he needed them. The range was much much tighter today and I picked the top and bottom almost perfectly, just I only took 1/2 tick each time and I should really have given it room and took at least a tick. Therefore I need to work at letting my profits run for a little longer. Since being down 675 on Monday morning I have recouped over a 1/3 of my losses, which isn't too bad.

Week 2: Day 1

On the open the schatz plummeted and I watched for 20 minutes before getting involved, the TED spread which had rallied a huge amount looked to be turning as the schatz was retracing and so I sold it, it almost immediately took off again and I was 5 ticks offside and I averaged my position by selling more. It continued to go against me and I dumped it about 2 ticks from my last sell. I fat fingered on my first trade too and was down 675 euros within 40 minutes of the open, which seemed disastrous. The spread continued 10 or so ticks more but I didn't get involved and I waited for the guy I report to, to get in the office to see If I could still trade or not. It seemed almost everyone was down huge amounts. I was told I joined at the best time possible because I am seeing the extreme side to trading and spreading, I just hope my account can take the hit.

I had a chat with him and he said I could trade but soon as I had a losing trade I was to stop. Luckily I put together 5 winning trades and finished around 5.30pm and finished -493 euros, not soo bad considering I was actually showing -800 euros at one point whilst still in a trade...

I felt a little de motivated after losing 500 euros in 1 trade but feel quite positive knowing I can take ticks out of the market, so I just need to work on averaging and knowing when to use it. I have been told I could average up to 3 or 4 times but I still have to know when to puke it and get out the trade. I learned from last time to not average so tightly but the move was just too big and if I continue to average you run the risk of busting your account! Hopefully I'll get the hang of averaging as it is useful.

Day 3

Today was another crazy day but really intense at one point for me, I was quickly told what had happened after I left, loads of big stocks had hit 1c and shot back up and the DJ had dropped 900 points and liquidity had dried up immensely and it was so hard to trade. I jumped in at about 7.30 by longing the TED and it ripped through me and I averaged my position for a better price and it continued to go against me... I managed to sell half of my trade for a profit and averaged in again and it still dropped and my profit and loss was printing -500 euros at one point... I made a mistake by buying the euribor but not selling the schatz when I tried to average for a third time and the euribor moved 3 ticks and I sold everything and legged out the schatz, such a messy trade but I was down 238 euros which was a whole lot better than 500!. Considering if you lose 5k or more you generally get asked to leave... but the markets were just mental.

From then I made a series of trades making between 25 to 63 euros and finished -75 euros, which was pretty cool considering. The first 2-3 days of trading went good overall and I learnt a lot and made some money. The graph is a bit weird cause its showing my balance twice between each trade so I actually did 22ish trades instead of 45.

2nd Day

Today was insane by 11am I had hit my target again but made a very costly error by double clicking by accident and lost almost half of it but managed to pull it back to where it was. The markets were moving so fast and it was so hard to get out at the price I wanted. I was really happy during the day to just sit down and get in a trade then back out 4 minutes later and go to shops and chill out.

The bobl rocketed up, I don't trade it but many people around me do and the spread shot out by 100 ticks and the environment kicked off pretty badly... I feel sorry for some guy who was helping me, who was definitely on the wrong side of it. It was just brutal how it ripped out the range so fast... when your looking for 1 tick profit and it moves 100 ticks in 20 minutes, it's a scalpers nightmare, especially if you average into it.

First day trading!

So yesterday I didn't even get a desk, I just socialized and watched some people trade. Some guy was up 1k by 11 am.. I saw he was trading pretty big volume until the next day when they sat me next to a guy who is trading like 4-5 times that amount. Everyone is really laid back, a lot of young guys mostly in their twenties all joking about or cursing at the screen ^^. The atmosphere is great and I am so glad almost everyone is wearing casual clothes and that I have been put on a team that gives you a lot of freedom.

So today, I was trading by 12.30 and by 2.45 I had hit my daily profit target, which was insane. I was out with a girl till gone midnight so felt pretty tired and after hitting my target I just laid back and went to the shops and chatted to various people. I left at 4pm and that was my day! No way I expect to just go in and be profitable so I will try and prepare my mind to expect to lose but it was great to have a good first day.

The trades themselves involved going long the June11 TED spread, in the morning the Euribor had shot up and the spread was at a high and I wanted to short it at about 11am but I hadn't been given the all clear to trade. Before I traded, the guy I report to asked me what my strategy was and I just said sell 10's and buy 8's and he said great. Then when it broke down to 8 and went to 7, I was trying to buy 6's and the guy came over and goes I see you didn't get the 8's, a good thing too etc. So by the time I got in I had chat with the guy next to me and he kind of helped me establish good entry levels. The 8's became too easy to get too fast and so I kinda of waited to see what would happen. So I went long 6's and sold 6.5's for 1/2 a tick profit i.e 25 euros and was a bit annoyed because 7's were really easy to sell and it soon went bid at 8. I waited for it to retrace as I didn't fancy getting involved around the 8.5 to 9 mark when the high was about 11 and the low 7.5. 1 hour later it had come down and I tried to buy 5's and soon as I got filled on the Euribor I hit enter and picked up 4.5's! and sold them for 5.5. I did 1 other trade profitably but nothing too interesting.

Anyway I will be in at 6.30am and can't wait to trade the open. Today was really crazy what with the rumours about Portugal's ratings and at one point it was so tense having my finger poised on the mouse button whilst everything bounces around super fast, so was very pleased to not get caught.

On to the floor

I made it to the floor!!! So happy and to top it all off I was recommended by the people who ran the 4 week course to a successful trader who now manages a team of traders and he decided to take me on. The idea is I should progress faster as I will be sat amongst experienced traders that I can learn from rather than be put with all the other new traders.

A really big turning point in my life, the last 4 weeks have been intense and tiring but probably the best 4 weeks of my life. I spent the last 3 days drinking with different groups of friends and was eventually sick last night, when I couldn't take any more but glad I spent time with everyone I know in London.

My plan for this blog is to blog each day now that I have the internet but I am little unsure. I don't know but hopefully I can provide something reasonably entertaining to follow.

Right now I start on tuesday and should be spreading on the TED spread (the euribor vs schatz) and may well be doing bund/bobl/schatz (10 year, 5 year and 2 year german bonds) we shall see!