Since my last update, six more crossovers materialized for the week. Three ended up as winners, one incurred a loss, and two were not valid trades because they didn’t meet my RSI condition. Here’s the breakdown:
1. Short at 1.2796, closed at 1.2678 (+118 pips) when a new crossover materialized.
2. Crossover at 1.2678 wasn’t a valid trade because RSI wasn’t above 50.
3. Short at 1.2664, closed at 1.2679 (-14 pips) when a new crossover materialized.
4. Long at 1.2679, closed at 1.2737 (+58 pips), when a new crossover materialized.
5. Crossover at 1.2737 wasn’t a valid trade because RSI wasn’t below 50.
6. Long at 1.2747, closed at 1.2947 (+200 pips). Maximum profit target hit!
Adding all ‘em pips up, my system was up 376 pips for the week! That’s huge!
This year is starting out opposite of how I ended 2011. My discretionary trading is sucking but this tweaked version of the Amazing Crossover system is performing extremely well! But I guess it’s only been barely one month, and anything can happen in the next 11 months.
The reason why I lost this week was my failure to recognize the major shift in market sentiment. A few weeks ago, the dollar was gaining due to euro zone debt troubles. But the positive news from the region, like ECB President Mario Draghi’s optimistic speeches, and the possibility of Greece finally coming to an agreement with bondholders by Saturday, completely turned this around.
Unfortunately, I remained stubborn and I was slow to change my gloom and domo bias. As a result, my account took another unneeded hit! Ahh, drawdowns our part of trading – I can’t win them all! For next week, I promise to re-asses my views and come up with a more solid market analysis.