Before we get to October, here’s a short reminder of the results from September. The full report can be found here.
Tradesight Pip Results for September 2010
Number of trades: 38
Number of losers: 16
Winning percentage: 57.8%
Worst losing streak: 5 in a row (September 27-28)
Net pips: +308
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.
This month, we had a “worst losing streak” of only 3 trades, which isn’t really a streak like last month had. Here’s the raw breakdown, and then we will discuss below.
Tradesight Pip Results for October 2010
Number of trades: 38
Number of losers: 18
Winning percentage: 52.6%
Worst losing streak: 3 in a row (Oct 6-8)
Net pips: +218
One other thing we want to consider in reviewing the calls each month is the overall environment, and we have a very easy way to consider this, which is to look at the ADR (Average Daily Range) changes during the month. Remember that the ADR takes the daily range (high minus low) and averages that over each day for the last six months or so. Whether the ADR moved up or down during the month tells us whether ranges were, on average, better than average or not.
From the beginning of October until the end of October, Average Daily Ranges mostly increased about 3-4 pips. The exceptions were that the AUDUSD increased 10 pips and the EURJPY and GBPJPY dropped.
There are some interesting features about October, however. Halfway through the month, the calls were a net zero. The total for the month was 218 pips gained. However, two of the winners were 100 and 60 pips, respectively (net partial and final). So if you missed those two trades, that’s about 75% of the net gains for the month. This was a much less consistent environment than the prior month and really depended on not missing anything for fear of missing the two big moves. Having said that, there were also two trades that we barely got stopped out of that ended up being over 100 pip winners, so just as our system teaches, the key is to keep stops tight and let the winners play out when they happen. Sometimes it doesn’t work ideally, but sometimes it does.