EM FX Lesson: Don't chase the story, wait for the chart

Was thinking back to a classic mistake I made a few years ago that cost me a good chunk of my quarterly gains. It was around the time when a lot of the narrative around the Turkish Lira, $TRY, was shifting. There was a strong story building about a potential policy pivot, and a lot of the analysts I respected were starting to call for a turnaround.

My mistake wasn't necessarily in the analysis of the fundamental story – that did eventually play out. My error was in trying to front-run it based purely on the narrative and a few early, very thin candle stick movements. I went in with a position size that was simply too large for the early stages of a potential trend reversal, especially in a currency pair known for its volatility and the potential for headline risk. I got chopped up badly as the market continued to whipsaw, moving against me significantly before the true fundamental shift gained traction and volume confirmed the direction. By the time the actual move happened, I was already out, nursing losses, and completely missed the real upside. It was a harsh reminder that even if the story is compelling, market structure and price action are still kings, especially in less liquid EM pairs. Always wait for the chart to confirm the narrative, rather than just jumping on the story itself.