EUR/USD

Long EUR/USD at 1.2361

Limit 1.242
Stop 1.229

Time frame 1 day

Closed out at -40 pips.

Time to stop trading support-resistance strategies. Doesnt really work.

No more forex trades until the automated strategies are backtested and approved.

Forex Strategy Review

I have backtested so many strategies lately, However the conclusion is, they made alot of money back from 2005 -2010.

The strategy returns are flat from 2011 onwards. I am really curious to why this happened.

Possibly more money employed by hedge funds/prop desk, but given the current economy, i would have thought it would be the other way round.

AUD/USD

Sold AUD/USD 1.05289. Seems like a bearish pin is developing.

Closed at AUD/USD 1.0523.

I realise my problem. I need to let profits hit the targets and losses to hit the target too

Must define a more complete system which covers my entry and exit targets so I do not fiddle with it.

USD/JPY enter long

Bought USD/JPY 78.80

Looking to hold this and see how it goes.

Closed at 78.407 for a lost of 40 pips.

USD/JPY entered long

Long USD/JPY at 78.374. Looking to exit at 78.67.

However, this one if it breaks might go up quite a fair bit.

Results
Closed at 78.57.

EUR/USD and EUR/JPY

Short EUR/USD    1.2342

Short EUR/JPY       96.72

Both trades broke their inside day bars. If it reverses by my stop loss, then will enter long trade.

Results:
Closed EUR/USD at 1.2329
Closed EUR/JPY at 96.658

Closed a majority of positions and focusing back on FX

Closed most of the positions. Left 2 open positions which roughly cancels out each other.

Current MTD P&L = $2,200 which is 11% of capital

Read some iInteresting strategy in using Price action to generate signals.

Read a few papers on momentum returns against the cross-sectional of all currencies instead of time-series. This strategy buys the currency which gained the most in the previous month and short the one which lost the most. More probably I believe, a portfolio needs to be constructed and properly weighted for this to yield any results.

Yet to do backtesting on this.

In some papers it seems that after Year 2000, it is hard to use momentum and filter based strategies to gain profits in foreign exchange based on time-series analysis of each currency.

Model vs Profit

Sometimes traders are very driven by P&L. especially if they are trying to catch up on their performance.

I should have kept my positions as they are running into deep profit, but in order to cash out on my P&L and catch up on last months negative performance, i closed the position.

I should perhaps keep to the model...and try distracting myself from fiddling with the trades.

Simple basic strategy

Momentum based on 5-day high low on FX especially on commodities currencies.

Once it breaks through the 5-day high - BUY
Once it breaks through the 5-day low - SELL

Take profit/loss when necessary.

4th August 2012 Weekly Recap

Current profit $1,100 roughly 5%

Money made on other strategies rather than on FX. Strategy 1 and 2 would have made money if followed througgh as well but I didnt have the confidence since last month. I have to stick to the models and be less emotional and affected.

Pairs trading

Did some pairs trading of equities and stock indices.

Currently +ve for the month. Hoping that it will continue. Reversals rather than momentum