Before we get to February’s numbers, here is a short reminder of the results from January. The full report can be found here.
Number of trades: 35
Number of losers: 23
Winning percentage: 34.3%
Worst losing streak: 8 in a row (January 6-14)
Net pips: -40
January was our first losing month in years. February rebounded nicely even though the ranges died down. More on that below.
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 February 2011
Number of trades: 30
Number of losers: 12
Winning percentage: 60%
Worst losing streak: 4 in a row (February 16-18)
Net pips: +235
Considering the biggest trade of the month was only a 65-pip net winner and only two trades total carried over into a second day, we’re pretty pleased with the results of the calls. It’s a nice rebound from the January loss and it wasn’t particularly difficult even though it wasn’t particularly exciting either.
I think the real concern here, though (and the thing to focus on) is the drop in ranges. Have a look at the various pairs. The first number is where their 6-month average daily range stood February 1 and the second number is where it ended the month. Remember that with six months of data, a shift of even 5 points in either direction is pretty meaningful because you have to bring the AVERAGE down.
Ranges matter. The US Dollar Index was fairly flat for the month as well. The EURUSD and GBPUSD held up, but everything else lost considerable range in the month. Higher ranges usually leads to better results. The USDJPY in particular is seeing too many days that are virtually untradeable due to their lack of range. We will continue to monitor.
On to March…