Analysis of 64 trades taken in Oct 2014 …. still in progress…..

Progressed further on analyzing the 64 trades taken over the last four trading weeks, which comprise the first batch of trades following my adjustment of using multiple timeframes for entry, and being more selective as far trend & sentiment is concerned.  Unfortunately I still got 20 trades to analyze.  The good news is that I have already made some very insightful observations.  There are some surprises.  There are some things for which I, up to this point, had a gut-feel, but for which I can now put some hard numbers – a good example here is how much it costs if I am taking sub-optimal setups, or related to, entering setups too late.  And thirdly, it does look as if I will be able to come up with a few solid tactics for managing my open positions going forward – thus hopefully increasing clarity and decreasing stress.  I hope to share these tomorrow.

For now, here are some points so far (which will not change despite 20 trades remaining to be analyzes) – though these are certainly not game-changing insights:

Out of 64 trades:

  • 36 were on the DAX, and 14 on GBPUSD – 78% of the total on 2 instruments
  • 43 (67%) were on indices and commodities and only 21 (33%) on FX pairs
  • The long/short split was the same as the last split: 43 short trades, 21 long trades
  • 20 winners (average +1.02R), 29 losers (-0.61R), 15 scratch trades (-0.05R)
  • 42% of trade were entered between 12pm and 3pm GMT
  • 57 of the trades were executed from either the 1M or 5M timeframes – with very few trades being taken off higher timeframes (such as the 15M or 1H) – bearing in mind that the 200 or so trades taken from May to August were all off the 15M timeframe

The plan is to complete analyzing the remaining 20 trades tomorrow morning, and then possibly trade the New York crossover session tomorrow.

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2 Responses to Analysis of 64 trades taken in Oct 2014 …. still in progress…..

  1. James says:

    do you think there should be an upward bias if trading indexes – or really shouldn’t matter?
    Is it a case of the trades agree with a broader trend (from a higher timeframe)?
    Should you be looking at markets that are more directional and volatile (e.g oil) – rather than limiting to two instruments? (i admit this can be tricky as you don’t want to be backwards looking and trying to forward-fit or carry any bias)
    would you say that conditions have been more favourable for your strategy in October than in previous months?

    btw – was reading yesterday that a London hedge fund called Red Kite holds about 50% of the physical copper market at the LME. How this ends its hard to say (mine strikes on the horizon could cut supply, but also someone long that much could get easily squeezed)….. my point is there is likely to be some directional volatility in copper over the next 3-12 months.

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  2. Hey James – thanks a lot for your comments and suggestions here!

    My comments to the points you raised are heavily linked. One of the requirements of the strategy is for the instrument in question to show a consistent and strong trend. I am interested in that from a perspective of the last 5-6 trading sessions and generally use the 15M timeframe for that. If there is such a trend then I will only trade in alignment with that trend. I look across quite a few instruments in order to spot such trends (fx pairs, indices and a few commodities). Thus it wasn’t the case that I was only looking at Cable and DAX charts- rather these instruments were simply the ones that gave me setups a lot of the time. I would like to believe that the better performance in October (+2R) compared to previous months (losing 10R/month) is due to being more stringent in requiring a smooth/consistent trend and secondly, in being willing to trade off various timeframes, rather than limiting myself to the 15M chart for setups. Interestingly, out of the 64 trades I took, only 6 were from the 15M chart in October. However I can’t say for sure that the improved performance is not simply due to more suitable market conditions.
    Does that make sense?

    That’s very interesting what you said regarding copper!

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