Journal.
Let’s see. Well, I’m sorry I didn’t come on in here last weekend. I don’t know, it just didn’t feel right. In fact, I don’t think I calculated my weekend numbers, like I usually do. Probably because the first of the month started on Wednesday. So therefore, I’m gonna call this, right now, the first complete week of the month.
This is gonna be different. Cause I told you of my changes, last time. Which is my trading consists of 2 separate accounts (in fact, I have to figure it out myself). I will as we go along. So anyway, here goes the macro of it.
I trade complete currencies. What that means is this. It’s a basket of trades. It’s 7 pairs running at once. All for one and one for all. This first quarter, I traded the JPY. Which means the 7 Yen pairs. Their all going in the same direction. So, in whatever trend they were in (told me by my trend indicator), all 7 pairs traded in that particular direction. Of course that would be in either a JPY bull trend (south), or a JPY bear trend (north). Basically, the Yen is either shorted or longed.
My trades run continually. No stops, whatsoever. I’m continually in the market. Have been, since the beginning of the year. Therefore, my only job is to switch directions at the appropriate time. And so, at the end of every month, I withdraw from my trading account what I need. It’s that simple.
But I do have another element, that of adding position sizing. This is something that has been developing. I compartmentalize it all into standard sizes. I will always have at least one standard size on each of my 7 pairs. And to be more specific, what I call a standard size is something from Mastergunners methodology. Whatever the size of my account balance is, that’s the amount of units I put on each pair. For instance, if I start out with a $30,000 account balance, then my first standard sizes will be 30,000 units. That’s on each pair. Remember, one for all and all for one. The same. But, there will be times when I have 2 sizes on. Not always, just certain times. They will come on and go off.
But…that’s pretty much it. All of this is what I call trading a complete currency. But, for this new quarter (2nd), I’ve added another currency. Along with the JPY, I now trade the AUD also. And the only way I know how to do this is to open another separate account for it. Now I have two. That’s two $30k accounts. I’m just keeping track of them both. We’ll have to see what I do at the end of the month. I don’t know yet. But one thing I do know, is that I have to pay myself (withdraw). I will have to figure out the best way to go about it. TBA.
Ok. Enough nonsense talk. How is this month going so far, with it? Well, I have to say. At first, it was rough. Kind of made a mistake. But I knew I needed time for it to play out. But for the first week and a half now, it’s turning out very promising. I’m very happy with it. I’ll show you in a minute how it unraveled. But, I get more excited about them the more I do the back testing of them (AUD). I’ll get to more of that later.
Well, I started out this way. I’ll have to show you what tells me in which direction to go in (my indicator).
Without showing you the whole history, just know that the AUD has been in a long bear market this year. The red tells me their in a bear market. Green bull. And what’s inside is the strength of it. Up there is the lead up into the end of the month. Notice the strength of the bear market shrinking and shrinking, eventually leading to a change in trends. On the 30th. Well, it was at this time, at EOD Tuesday the 30th, when I seen this, that I decided to start my new currency trading. Therefore, I placed my 7 AUD pairs going long. I followed the plan. This is what the chart looked like then.
Now, if you add up the differences of the 5 ema’s and 9 ema’s, in pips, at this point you will have a total of 40 pips. It’s my aggregate number that tells me that the AUD is in a bull market. Well, sure does seem like a change in trend coming, huh? Only against the GBP do they not look like a bull. And that’s why I look at the aggregate figure, not just one pair. In fact, if you look above, that 6-1 figure is saying just that. The Pound is that one pair their trending bear against. The rest bull.
Next day results.
I added on there the days pips results. Which was -390 pips. That’s the total amount of all 7 pairs. Ok. So. Not going so well. But the thing is, I followed the plan. So, I’m alright with it. Here’s the related chart.
Well, as you can see, not looking so good. And my only job is to follow. So that’s what I do. Let’s see the next day.
The trend changes. It went back to a bear market. All of the pips in between the 5 & 9 will add up to 6 pips, to the bear side. Look.
It’s looking like a turn, right? What can I do…I just follow. Look above at that daily pip count. It was 456 pips. That would be a -456 pips for me, cause I was long the AUD (I just keep track of the perfect system that way). In any case, I switch at this EOD. Ok. Fine. I take the loss. And then immediately get back in, going AUD bear. This happens. It’s called the whip saws. We got to ride them out. Let’s move on then.
That goes to the end of that week (last week). Here’s the related chart.
Meanwhile, I forgot, that when I originally got in with them, that it was only with one standard sizing (my rule is to always start out with 2 sizes). Therefore, over the weekend I contemplated going in with another size. And that’s what I did. I can’t remember if it was before the close, of last week, or at the open. In any case, I went with another size. So that means 2 sizes on each, going AUD bear (south). Cause look at my table. Sure does look like their escalating into bear territory. So, let’s move on. Here’s Monday’s EOD results.
Yeah, I seen it happen that day. The trend turned pretty violently back to AUD bull. Look at the EOD pip results. +1106 pips. You don’t know it, but when I see 85 pips bear market turn to 39 pips bull market, that’s quite huge! Well, 1106 pips should explain all of that. This is what the related chart looks like, EOD Monday.
Those are some bid daily candles. Especially against the GBP, huh? Well, all this means to me is to change directions, again. Whip sawed. But…that’s the game. And this time, when I get in (going AUD bull), I go in with 2 sizes. And this makes sense to me. The AUD got strong, touched the bull market, retraced back down for some momentum, and turned back up to go much higher and stronger in their bull market trend. Makes all kind of sense to me.
Alright. I’m done with the day by day. Let’s just see how the week turns out.
Yeah, they turned bull alright. It wasn’t pretty at the start, but the ending, well as it stands right now anyway, is all trend. Now look at the EOD pip results. Lots of them. All week also. Oh, and by the way, I doubled them up on the 7th. So I raked in 932 of them that day. I only could wait out one days worth. Took profit quite quickly, cause I didn’t think this was gonna last. But, the good thing is that I’m still in it (cause that’s my plan…always riding it out). I chalked up a good amount of pips the rest of the week (673, 894, 67). Here’s the related chart.
Well, in hindsight, you can see getting whip sawed hurts, but it doesn’t always stay that way. I mean look. There’s absolutely no way I should have known that this original AUD bull market would keep. My only job is to follow. I have to trust my trend indicator. And in a nut shell, all it is, is the aggregate amount of pips between all of the 5 & 9 ema’s. It’s a smoothed out way of determining the trend along with seeing the macro picture, at the same time. I know of no better way.
But, as I’ve mentioned earlier, what most excites me is the results I’m getting from the back testing. It’s what happens over time. I’ve been comparing all of the 8 currencies. And, by far, the AUD proves the most promising.
Not only that, Journal, but I’ve been learning more on how I should be utilizing the factor of adding position sizes. The IF and WHEN I should be doing that. I truly believe it’s coming together. Trust me, I have a lot of notes on it all.
Speaking of that. I know you don’t see it, but I’ve been working so very much in my “Business Journal”. I had to buy more pencils (I really like the plastic leaded ones). And I also got a huge amount of paper (some I bought and some Trish donated, from her office). So, I’m set. And putting it all to good use. Needless to say, this tool is extremely beneficial to me. I often go back over what I wrote down. In fact, I even tell myself in there to come back to a particular point. It’s the hindsight perspective that I use and learn from.
Look. I like typing. A lot, as you can tell. But I’m just as much a pencil, paper kind of person the same. Can’t take the old school out of me.
Anyway. I think I should wrap all this up.
So, for documentation purposes.
This is my latest with the AUD account. Of course, it’s still open and running.
And my JPY account.
AUD
First complete week
- +2.72%
JPY
First complete week
- +2.01%
Combined Total
- +4.73%
Alright Journal, I do have much else going on. But maybe not for today. I should come back in sometime this week and share the things that I’m excited about. I truly believe my trading system is getting better and better.
Thanks for listening!
Mike