Before we get to August’s numbers, here is a short reminder of the results from July. The full report from July can be found here and you can get the last several months in a row vertically by clicking here and scrolling down
Tradesight Pip Results for July 2012
Number of trades: 28
Number of losers: 15
Winning percentage: 46.4%
Worst losing streak: 7 in a row (Week of Fourth of July)
Net pips: +150 (+310 if you ignored the Fourth of July week)
Reminder: Here are the rules.
1) Calls made in the calendar month count. In other words, a call made on August 31 that triggered the morning of September 1 is not part of September. Calls made on Thursday, September 30 that triggered between then and the morning of October 1 ARE part of September.
2) Trades that triggered before 8 pm EST / 5 pm PST (i.e. pre Asia) and NEVER gave you a chance to re-enter are NOT counted. Everything else is counted equally.
3) All trades are broken into two pieces, with the assumption that one half is sold at the first target and one half is sold at the final exit. These are then averaged. So if we made 40 pips on one half and 60 on the second, that’s a 50-pip winner. If we made 40 pips on one half, never adjusted our stop, and the second half stopped for the 25 pip loser, then that’s a 7 pip winner (15 divided by 2 is 7.5, and I rounded down).
4) Pure losers (trades that just stop out) are considered 25 pip losers. In some cases, this can be a few more or a few less, but it should average right in there, so instead of making it complicated, I count them as 25 pips.
5) Trade re-entries are valid if a trade stops except between 3 am EST and 9 am EST (when I’m sleeping). So in other words, even if you are awake in those hours and you could have re-entered, I’m only counting things that I would have done. This is important because otherwise the implication is that you need to be awake 24/6. Triggers that occur right on the Big Three news announcements each month don’t count as you shouldn’t have orders in that close at that time.
You can go through the reports and compare the breakdown that I give as each trade is reviewed.
Tradesight Pip Results for August 2012
Number of trades: 23
Number of losers: 9
Winning percentage: 52.1%
Worst losing streak: 3 in a row (middle of the month)
Net pips: +100
August on average is one of the slowest months of the year, as many of the big players out of Europe are on summer break. This was no exception, unfortunately, and we dropped to half size once the ranges contracted, as we do most Augusts. It was barely worth trying for much of the month, and we even had several sessions where none of our trades triggered due to the flat market. In fact, only 23 trades triggered during the month, the lowest number of the year.
The win ratio was still on target at just over 50%, but there weren’t many trades that continued further than the first target.
With the poor action, the 6-month average daily ranges of the major pairs dropped further, unfortunately. The EURUSD average lost 3 pips from 111 to 108 during the month. GBPUSD also lost a few. Even the USDJPY, which you wouldn’t think could drop further, lost 5 pips to 56 as an average.
There really isn’t much else to say. Four out of the last five Augusts have been bad (and one was spectacular). You just build that into your expectations for the year. The good news is that September has already started out much better just in the first week, and although we won’t go back to normal size until the ranges show more than a day or two of improvement, things usually improve fairly quickly.