Welcome back Meta-Traders.I took a bit of a beating in the forex market this week. But i've had a pretty good year so far in both equities and Forex and drawdown is part of the game. So let's do the numbers.
Megadroid Live took a big it. Recall from last week's post that was back above 30% for the year and just short of a new equity high. The lack of a high put the 'Droid in "Recovery" mode which means it trades double lot size. Well it did so and took a 70-pip loss times 2 or about 14% of the account in one shot. This set the account back and took back about half of this years profits. Even so, it remains up 17% for the year and we'll see what happens next.
Megadroid Demo took no trades this week and remains up over 50% for the year. Note that MD Demo is running a different version of the 'Droid and on a different broker than my live account which may account for some of the differences.
The beating continued with Atinalla #1 which lost -182 pips after getting drawn in on a short EUR/USD position early in the week which reversed as EUR/USD moved higher later in the week. This was also my first week trading Atinalla #1 in my new live FXDD account. That account lost $54 or about 2.7% on the week.
Atinalla #2 took a long GBP/USD and short USD/JPY early in the week and are still with those trades. Those trades went positive as the USD weakened later in the week against the majors.
Finally, God's Gift Duo Live started with week with a -95 pip loss and slowly zig-zagged its way back to end down about -35 pips.
In the other half of my new FXDD live account, I traded the Megadroid, ScalperX combination. This account also lost about -2% on the week. Comparing this account to Forex.com, i'm finding that the spreads are actually worse than Forex.com. FXDD advertises a fixed, 2-pip spread in EUR/USD, but apparently that is only good during active hours and it becomes 4 pips after hours. The spread on EUR/CHF is even worse and I saw it as high as 7 pips.
Overall lessons learned for the week are as follows:
- EUR/CHF and EUR/USD have a strong positive correlation, and trading the scalpers as a pair doesn't help to diversify the account
- EUR/CHF is not an ideal pair to use with a scalper since the spreads are much wider than EUR/USD
- Trading 40% of my accounts with scalpers is probably not smart as they are likely to all draw down together.
Overall, my journey to profitability in Forex in going to be much lumpier than I expected. Stay tuned for the Watukushay #3 review and have a great weekend.
Hi Chris,
ReplyDeleteThank you for another interesting update :o) Certainly it is important to know that the journey towards long term profitability in forex trading is a VERY bumpy one (otherwise it would just be easy for anyone to do this). Through the course of your journey you will have to face the true worst faces of the systems you trade and therefore having adequate analysis and understanding about how they trade and behave is essential in being successful :o) All systems will have draw downs - long and deep - and only your understanding will get you through it. Long term statistical analysis and knowledge are the KEY here :o) Keep up the great work Chris !
Best Regards,
Daniel
Daniel-
ReplyDeleteThanks for the words of encouragement, I appreciate it!
Chris
Thanks for the update Chris,
ReplyDeleteSorry you had some trouble this week. I have had some good and bad this week myself. The Bad, my new refurbished PC I bought for $250 crashed this week when I plugged in my USB drive into it. I was not able to recover the hard drive and any files I wanted backed up. I lost my tweaks to Mover3 of which I was calling Mover3.1. I think I lost some other code as well... Luckily the coding is simple and I can repeat it if necessary. Additionally this was my test machine. I was waiting for some trades from Teyacannani, so I could see it in action... On the good side, Mover3 has now had a run of 5 in a row wins. I have been waiting for a run and I hope it continues.
Thanks for your update and I hope you close out this year in the positive. With my passive testing on Tiger Tail with GBP/USD pair that cost me bigger than I wanted it too, ending positive this year may not happen for me.
JT
JT-
ReplyDeleteThanks for the comment. Sorry to hear about your PC crash - always make backups of your code!
Regarding coming out in the positive, I think if you stick with Daniel's systems and keep the risk under control, you will come out positive. Its not always pretty, and not always profitable short term, but long term, money will be made!
Thanks again for the comments,
Chris