BarroMetrics Views: Do I Regret EURUSD Exit?

I received an e-mail just now asking if I regretted exiting the EURUSD at 1.4414 - given  that it is at 1.4192 and I have not re-entered the trade.

Well at some level, I am sure there is some regret. But not enough for me to change my approach.

The fact is that after exiting at 1.4414, the EURUSD travelled to 1.4580. So the exit turned out to be correct. All that happened in this case is I did not get set on the re-short.

The fact is my practice is to sell retracements and I am happy to wait for my levels. Sometimes I fail to get set when the market fails to rally as much as I anticipate. Yesterday was such a day.

On the weekend video, I mentioned that I was looking for US$ weakness and that I would be selling the EURUSD after Martin Luther King day. But although I did make a number of attempts, I just did not get set.

The key for me is, first and foremost, to preserve my capital. I know that there is always another trade. I also know that as long as I have a positive expectancy, I expect to continue to make a good living from the markets. Finally, I know that to maintain a positive expectancy, I have to trade in a way that (as Denise Shull puts it) conserves and maintains my psychological capital.

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