Slow start to the year in Q1 as I didn’t get the volatility to help push my winners to outweigh my losers. Here’s are quick reflection on how it all went down.
Basic Forex Trading Stats
|DATE||TRADE IDEA||P/L in pips||P/L in %|
|Jan 22||USD/JPY Downtrend Momentum||-71||-0.24|
|Feb 12||Fib Short on EUR/NZD||+101||+0.21|
|Feb 26||GBP/NZD Reversing Lower?||-534||-0.58|
|Feb 26||CAD/JPY Upside Breakout Ahead?||-11||-0.02|
|Mar 20||Support Break on EUR/USD||-97||-0.25|
|Mar 20||AUD/USD Long-Term Downtrend||+51||+0.27|
Total Number of Trade Ideas in Q4: 6
Average Gain R:R: 0.59
Average Loss R:R: -0.40
Largest Drawdown: -0.85%
Win % (winning trades / triggered trades): 33.3%
Average % risk per trade: 0.56%
Total Q1 Blog Profit / Loss in %: -0.61% on 3.33% total risk taken
In my Q4 performance review, my biggest regret was not holding onto positions longer as I was generally right with my directional biases, but pretty off with adjusting out of trades to early. I also said I’d get more active and aggressive as I thought the pick up in volatility would continue given the weakening economic conditions.
That’s exactly what I did in this quarter as I tried to hold onto idea I really believed in (Short Aussie on weakening fundies), long USD on monetary policy divergence (two hikes expected in 2019) and general risk-off aversion as global economic data softened. And for a while a lot of that worked well for me (especially with my AUD/USD and EUR/USD short trades), but the environment shifted as volatility reverted back to low levels, the Fed went from two rate hikes to none (and signaled the end of their balance sheet run-off), and global risk sentiment shifted a bit back towards positive as geopolitical risks became less uncertain (U.K. may avoid no-deal Brexit; improving U.S.-China negotiations).
So, while I probably had the right trades on for the first couple of months, my big mistake was probably not doing a better job of taking more profits on my best trades (AUD/USD & EUR/USD short), especially when the Fed’s outlook on interest rates shifted.
As for the other trades, I think I played them according to my method of fundies first/price action to frame the trade, so I don’t feel like they were bad trades. Probably the only thing I would have done differently was not go the full 1% risk on my GBP/NZD short, but I was pretty confident on that one and I did say I would get more aggressive this quarter. Overall, while I did lose more than I won, I stuck to my adjustments, improved on my average +R:R vs. -R:R, and I tried to get bigger as the trades went my way.
Going forward, I think with volatility lower and price action a bit choppy, I think I’ll take profits a little bit quicker unless we do get a really big surprise that really shakes up the markets. That could come from any of the three major themes for the second quarter, like a Brexit deal or no-deal, a U.S.-China trade deal, or whether or not the global economy will go into recession. Stay tuned!
What do you think of my review and how did you do in Q1 2019? Please share your thoughts in the comment box below. Thanks for checking out my blog…good luck and good trading!
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