Market Recap
Before we get down to the nitty-gritty, here’s a quick glance at how AUD/USD, USD/CAD, and NZD/USD fared over the past three months:
Performance was mixed in April, as the Aussie lost 1.45% to the dollar while the Kiwi and Loonie managed to make headway. At that time, China began showing some signs of weakness with its bleak GDP and lower than expected inflation data.
Later on, all three commodity currencies found themselves in Loserville for the next couple of months, eventually ending the entire quarter in the red. Australia, New Zealand, and Canada churned out a few downbeat economic figures then. Talks of the Fed‘s stimulus exit plan started to gain traction, as Chairman Bernanke was quoted saying that the central bank is considering winding down its bond purchases.
Risk aversion popped its head back in the markets towards the end of the quarter, as the continued slowdown in China posed threats to global economic growth. It didn’t help that traders got concerned that the Fed’s plan to reduce stimulus could derail the U.S. economic recovery.
Trading Performance
| DATE | TRADE IDEA | P/L in pips | P/L in % |
|---|---|---|---|
| Apr.3 | NZD/USD: A Day Trade and a Fib Play | ||
| Apr.10 | AUD/USD Short: Will 1.0600 Hold? | ||
| Apr.25 | U.K. GDP Release: GBP/AUD Straddle Trade | ||
| May.2 | Long-Term Trend Play on AUD/JPY | ||
| May.7 | AUD/USD Short: RBA Rate Cut | ||
| May.15 | AUD/JPY: Is the Trend My Friend? | ||
| May.23 | Short AUD/USD: How Low Can It Go? | ||
| Jun.6 | Technical Trade on CAD/JPY | ||
| Jun.13 | GBP/AUD Trend Play: New Strategy | ||
| Jun.20 | Trading CAD/JPY’s Symmetrical Triangle | ||
| Mar.25 | AUD/JPY: Waiting for Kuroda’s Speech | ||
| TOTAL |
No. of Trade Ideas: 10
Trades Triggered: 9
No. of Wins: 3
No. of Losses: 6
No. of Break Even Trades: 0
Win %: 33%
Average Gain Per Winning Trade: 167 pips / 0.77%
Average Loss Per Losing Trade: 83 pips / 0.37%
As you can see from the chart above, it was my three big winners that managed to keep me in the green. Even though I had twice the number of losses as winners, my average gain for each winner is double the amount that I usually lose per losing trade.
I can also see that I traded a lot of specific news reports and trend plays. Unfortunately, trading trends didn’t work out for me as I tend to miss out on round number entries. When I do get triggered, it’s usually because price is about to break its trend. Talk about tough luck!
Here are a couple of things that I’ll work on to get better results for the next quarter:
1. I won’t be afraid to try out new pairs and strategies.
Two of my three winning trades came from GBP/AUD, a pair that I don’t usually look at. Not only that, but trading the 200 SMA for the first time had also worked out for one winning GBP/AUD trade. I don’t expect to win in all the new strategies that I explore, but I think they’re still worth taking a risk on as long as I manage my risk. Care to share a strategy that works for you?
2. I shouldn’t trade against my fundamental bias
I noticed one or two “technical” trades on my journal. I think this really just means that I traded against my fundamental biases on those times. This strategy was a tricky one to use for Q2 2013 because market sentiment played a huge role in making and breaking really good technical patterns. On my next trades I’ll make sure that I don’t go against a strong market bias. Don’t be afraid to call me out if you see me doing it!
3. I should consider cutting losses, adjusting stops
A lot of my losing trades were closed at my original stop loss provisions. I really should think about cutting my losses or at least adjusting my stop losses especially if a technical setup has already been broken.
That’s all I have for today! How about you? What are your major resolutions for Q3 2013?
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