Digital Diatribes

A presentation of data on climate and other stuff

Forex Account Update as of 4/30/2012 [Through 06/30/2011]

Posted by The Diatribe Guy on May 4, 2012

Continuing my account updating:

OUTSTANDING ORDERS as of End of Day 05/31/2011 settled by End of Day 06/30/2011
Date of entry / Type of Entry / Lot size / Currency Pair / Entry Price / Date of Settlement / Exit Price / Net Profit
05/17/2011 SELL 0.01 usdjpy 81.196 06/02/2011 80.764 +4.99

*Net profit means profit after consideration of swap fees (these can be negative or positive)

New Orders since End of Day 05/31/2011, settled by end of day 06/30/2011
Date of entry / Type of Entry / Lot size / Currency Pair / Entry Price / Date of Settlement / Exit Price / Net Profit
06/03/2011 SELL 0.01 usdcad 0.98501 06/06/2011 0.97983 +5.30
06/13/2011 BUY 0.02 xauusd 1524.73 06/16/2011 1529.93 +10.35
06/16/2011 BUY 0.01 audusd 1.05217 06/17/2011 1.06187 +9.81
06/16/2011 SELL 0.01 usdcad 0.98659 06/17/2011 0.98053 +6.22
06/24/2011 BUY 0.02 xauusd 1503.17 06/29/2011 1508.58 +10.79
06/27/2011 SELL 0.01 usdcad 0.98968 06/29/2011 0.97054 +19.74
06/27/2011 BUY 0.01 audusd 1.04369 06/28/2011 1.04878 +5.20
06/29/2011 SELL 0.01 eurjpy 116.855 06/30/2011 116.251 +7.35

New Orders Since end of day 05/31/2011, still outstanding as of end of day 06/30/2011
Date of entry / Type of entry / Currency Pair / Lot size / Entry price
06/23/2011 BUY 0.02 xauusd 1518.35

Carried Orders Since before end of day 05/31/2011, still outstanding as of end of day 06/30/2011
Date of entry / Type of entry / Currency Pair / Lot size / Entry price

Equity Balance @ 06/30/2011: $3,767.47
Current Month Return: +1.29%
Initial 10/31/2009 balance: $2,360.46
Current Yield since inception: +59.61%
Annualized Return: +34.42%
Average monthly return: +2.37%

11/1/2009 – 7/31/2010: +89.71%
8/1/2010 – 10/17/2010 (the date at which point I ceased the short strategy and liquidated positions): -34.35%
10/18/2010 – 12/31/2010: +11.94%
1/1/2011 – 1/31/2011: -7.23%
2/1/2011 – 6/30/2011: +23.79%

Journal Notes:
I have a lot of limit orders set on various currencies right now at various pullback points. I evaluate these every day. Strictly trading with the trend line at this point, not countertrading against it. I’d rather wait for pullbacks to trade with the trend line than try to anticipate the pullbacks by buying/selling against the trend. Been there, done that.

A logical question that I’m still trying to work out is when to assume the trend is over and a trend in the opposite direction has occurred. It’s a good question. Admittedly, it’s a judgment call, and some trends are easier to discern than others. The most conservative route is to only trade a currency pair where the trend is the same on Weekly, daily, and 4 hour charts. Good strong corroboration of the trend there. And no, I don’t fit trend lines. I just look at the chart. If it looks like it goes up from left to right, it’s an uptrend. If it looks like it goes down, it’s a downtrend. I don’t determine entry points by trend lines or anything. occasionally I’ll fit a line if I think a break of that line might have meaning, but normally that is a secondary consideration.

Currently, USDJPY Weekly is a strong downtrend, daily is a strong downtrend, and 4 hour is a weak downtrend. I continue to trade that as a downtrend. An interesting set of charts is EURGBP. The Weekly is a strong uptrend from left to right, but the majority of that move occurred September 2007 – December 2008. The Daily chart actually shows a slight downtrend, but the 4 hour chart is a clear uptrend. I am considering this an uptrend, but being cautious about entering, so it’s more on my “watch” list to see if the 4 hour trend continues.

Anyway, I’ve mainly traded gold until now, but I’ve been watching the other charts all along and have developed what I think is a very similar strategy on currencies. I’m starting off with minimal positions on these so that if I screw up it isn’t too costly (on the flip side, my gains are also minimal, but that’s OK). I’m also more cautious about entering multiple positions – I’m spacing my trades at twice the distance I space my gold trades. Part of that is caution, but part of it is an understanding that Gold – while driven by supply/demand factors globally, primarily adjusts in the short-term to the USD when priced in USD. Other currency pairs can be more volatile due to opposing forces or actions in the two different economies, so there’s a bit more risk of undesirable swings there.

I only do this in the direction of the long-term trend. At some point a trend may reverse, so there may be a need in the future to “cut bait” on an individual trade here and there. It will happen, and I don’t have a specific criteria for doing that. One mitigating factor is that, by focusing on the regional highs and lows, it is possible for the trend to reverse, but the strategy will still work as long as the reversal has enough variability within it. The need to cut bait would occur after a sharp reversal that doesn’t rebound to previous profit levels.

I’m totally bummed right now, thanks to friggin’ Dodd-Frank. Looks like soon we’ll be able to trade Gold/Silver with leverage.


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