This is my favourite chart of last year.
It is my favourite chart not for the reasons that might immediately spring to mind. I do a year end review of trades that come my way – the aim on doing so is to perform a rigorous form of self assessment. Over the years I have come to the conclusion that traders need to be their own unreasonable friend – you need the capacity to ask yourself very difficult questions about your own performance, why things went right but more importantly why things went wrong. Looking at what went wrong is profoundly uncomfortable but it is is the most valuable part of this exercise. This chart is my favourite because looking back I was very inefficient in what I got from the trade. To be perfectly honest I didn’t make anywhere what I should from it – my performance was quite poor with regard to the overall trend and the question is why and it is a question I am finding hard to answer. I am finding it hard to answer because of this chart.
The $A charts presents a passing similarity to crude – a period of consolidation and then a breakdown. This is my second favourite chart of the year because I was very efficient in trading this move. This presents a paradox of how could two near identical moves produce markedly different efficiencies and to be honest I dont exactly have an answer as to why yet. However, searching for an answer is proving valuable since asking yourself unpleasant questions is infinitely more gratifying than asking yourself easy questions.