Friday, January 30, 2015

January Trading Summary

Net breakdown (contracts traded):
6E $759(4), TF -$116(5), NQ $102(15)
Net $P/L:744

Fri. 1/30

3:35pm CST - Tested out another system today that trades more frequently, especially on days like today.
NQ Contracts:15
Net $P/L: 102
Wins: 9
Losses: 6
Avg$Win: 57
Avg$Loss: -68

Thursday, January 29, 2015

Thurs. 1/29

3:20pm CST - Well I either need to sh!t or get off the pot! I still haven't fully committed to trading my TF system but have taken a few signals this week to feel things out. Perhaps I'm just waiting for a new month to start.  This has resulted in a nice missed winner yesterday and today.  I nearly took today's but didn't like the location (near resistance). System trading requires taking ALL signals, no human bias allowed. 
TF Contracts:3
Net $P/L: -110
Wins: 1
Losses: 2
Avg$Win: 197
Avg$Loss: -153

In other news, I was surprised to read this yesterday that FXCM is joining with Gain and others to forgive "most" of the negative balances from the SNB announcement.  What surprised me is that they still plan to go after higher net worth individuals!  I wonder what net worth qualifies this determination?  And is it based only on your account history (max. balance) or does your net worth stated on account application come into play?  Something to think about if/when I sign up for my next account someday.

Tuesday, January 27, 2015

Tues. 1/27

3:05pm CST -
TF Contracts:1
Net $P/L: 127
Wins: 1
Losses: 0
Avg$Win: 127
Avg$Loss: 0

Monday, January 26, 2015

Mon. 1/26

2:50pm CST - 1 system trade in TF today. Not ready to go live yet but wanted to test. Have an issue with slightly different signals between my OEC programming vs. NinjaTrader.  This always seems to be a problem when you don't use minute-based bars.
TF Contracts:1
Net $P/L: -133
Wins: 0
Losses: 1
Avg$Win: 0
Avg$Loss: -133

Thursday, January 22, 2015

Thurs. 1/22

2:40pm CST - I like system trading days like this one. Thanks Mario.
6E Contracts:2
Net $P/L: 1167
Wins: 2
Losses: 0
Avg$Win: 583
Avg$Loss: 0

Wednesday, January 21, 2015

Wed. 1/21

3:55pm CST - One 6E system trade loser today after the morning spike down triggered a short, followed by a 100+ pip spurt higher to take out all the stops including mine!  Still coding systems mostly and getting frustrated with Ninjatrader performance, my CPU's power, or my ability to write efficient code, not sure which.  I'm also experimenting with automating system fills in OEC but that's a whole other can of worms I'm not sure I should be considering.
6E Contracts:1
Net $P/L: -629
Wins: 0
Losses: 1
Avg$Win: 0
Avg$Loss: -629

Friday, January 16, 2015

Weekend Viewing

Weekend viewing:

RISK: (why most people can't be traders)

FIBONACCI: (made with 3D Printer - click Vimeo logo to learn more)

Thursday, January 15, 2015

Futures Extreme

Today's move by the Swiss central bank to remove a cap on their currency reminds us all what can happen. Over $30,000 move per contract in less than a half hour.  Odds are someone in the world was short with too much leverage and no stop in place.  And vice versa!

Wednesday, January 14, 2015

Wed. 1/14

5:40pm CST - One 6E system trade to start off the month and year on the right food.  I was kicking myself yesterday as I watched my new TF system make $2300, if only I had been trading it!
6E Contracts:1
Net $P/L: 221
Wins: 1
Losses: 0
Avg$Win: 221
Avg$Loss: 0

Monday, January 12, 2015

The Way Forward

2:45pm CST - As mentioned end of last year, the way forward for me has to include system trading. I know myself well enough and have enough history of my trading to conclude this is the least painful way to get my equity curve rising again.  I could be envious of the discretionary traders out there who seem to post winning days endlessly but what point is there in that?  Good for them. I wish them continued success, except for times they may coincidentally be on the other side of my trades!

I've been doing a lot of Ninjatrader strategy coding and continue to improve. I never run out of ideas but it's so rare to find anything that produces some results with good merit.  And that sometimes causes frustration and/or procrastination when backtested results, after days of work, are almost always bad.  But you just have to keep moving ahead to find a gem.

My main criteria for "good merit" includes:  decent Profit Factor (usually >1.5), low Drawdown, high NetProfit to Drawdown ratio (usually >2) for all 1-year periods, sufficiently high Average Trade Profit to overcome slippage/commissions, and of course, a decent looking profit curve.  Lots of intangibles come into consideration too like how robust the system seems to be with various tweaks and optimizations to the variables as well as different timeframes.

I hope to start trading again soon and I may be adding TF back into the mix. More work to do tweaking my latest system but these results look good enough for me.

The monthly crop report was today and I resisted the urge to trade that (I don't have a system for it). The first minute or so was not for the faint of heart...

Tuesday, January 6, 2015


I've updated my spreadsheet which shows the daily range covered by various symbols in the same 2-hour period each day, 8:30-10:30 AM Central Time.  If anyone wants a copy of the data, email me and I'll send you the Excel file.

Gold lost some of its movement last year and TF and NQ moved around significantly more on average compared to 2013.

Sunday, January 4, 2015

Retail Forex

The ugly truth about this industry.  I couldn't agree more with this:
"Obliging operators to disclose more about the performance of their clients — such as average returns and churn rates — would help, too."
Same goes for FCMs too, not just Forex!

From:  More scrutiny needed of retail forex trading platforms
retail foreign exchange trading accounts for some 6 per cent of global daily forex volumes, or about $300bn.
According to the Autorité des Marchés Financiers in France, nearly nine-tenths of the clients it surveyed over four years lost money, with the average loss being almost €11,000. Worse, the AMF concluded that there was no correlation between trading experience and making money. The most active and regular punters simply saw their losses pile up steadily over time.

This is not entirely incidental to the way in which platforms conduct their business. Punters are encouraged to leverage their stake several hundred times its underlying value. Ratios of 200:1 are not uncommon, with more aggressive operators going as high as 500:1.

High leverage may provide investors with the opportunity to magnify gain in the case of a winning trade. But it also means that only a tiny adverse shift in exchange rates can wipe them out.

The trading platforms tilt the odds further by urging clients to put stop-losses on their bets. The consequent blend of market volatility and high leverage means that many trades are stopped early, even if the investor’s underlying view of rates is correct.

Heavy client losses help make platforms profitable. Most operators run flat books overall, simply pocketing the spread from each punter. Plus500, for instance, boasts a pre-tax profit margin of nearly 70 per cent.

But it also requires operators constantly to replenish the legions of burned-out clients. In its interim statement last year, Plus500 put its active client base at 67,000, but said it was adding 5,500 customers a month.

To fill these gaps, operators rely on affiliates. Some make use of so-called “educators” to provide a steady stream of ingenues. Lulled by images of helicopters and beach houses, potential investors are persuaded that “trading skill” will allow them to make a killing. Yet many of these “educators” earn their living from referral fees rather than trading.

It is not the function of the regulator to keep a fool and his money from being parted, but a few steps could offer a more realistic prospectus to the would-be client. Capping leverage would prevent platforms from cynically gearing punters with a view to profiting from volatility. The US has done this, operating a 50:1 limit since 2010. Significantly, much of the growth in the market has occurred elsewhere.

Obliging operators to disclose more about the performance of their clients — such as average returns and churn rates — would help, too.

None of this will stop more hapless souls from taking the plunge, but it might put a little more grit into the machinery. It would at least alert investors to the quality of companies they are increasingly being invited to back.