Demo Account Log, Part II

Hi All,

I have started a new demo account trading mostly EUR/CHF since I find this pair easy for me to observe. I will keep a log here of my success so far with this account. I do mainly small trades so it won't be useful or possible for me to posts my trades ahead of time. So I will mostly just be posting my gains to date and discussing things I learn along the way.

My demo account is using 100:1 leverage. I go for small gains on fluctuations that I consider extremely low risk, and I complete as many trades per day as possible. I work a full time job so alot of my trades are caught out of the corner of my eye on my PocketPC screen. I spend a bit more dedicated time with trading when I get home at night.

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Day 1 (Monday, June 19th): $5,000 starting capital into demo account. Opened the demo account and went to bed with no trading at all.

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Day 2 (Tuesday, June 20th): Increased to $5,214

I made a very rare departure from EUR/CHF into EUR/USD for a 5 pip gain with 2 standard lots netting $100. I saw that the trend was not over as I suspected and jumped back in for another 2 pips and $40 gain.

I made a bad trade with USD/JPY selling at 114.92 and getting out at 114.97 for a 5 pip loss, netting -$86.98 thus losing over half of my EUR/USD gain. I thought I caught the top of an oscillation but I was wrong!

All other trades were with EUR/CHF and all were in profit or break even.

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Day 3 (Wednesday, June 21st): Increased to $5,562

Tried to catch the USD/CAD news release. Got out with one pip gain on a buy trade, thankfully, since I was in the wrong direction and hopped out when I saw it reversing on me! I was too slow to get in on a sell so I left the pair alone after that.

All other trades were EUR/CHF with nearly all being in profit or break even.

I made one trade at a loss of one pip on EUR/CHF because I hit the close button by mistake! I have been 10 times more careful since this incident.

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Day 4 (Thursday, June 22nd): Increased to $5,850

Made my largest loss trade to date on EUR/CHF for a loss of 7 pips netting me a loss of -$112.67 on two standard lots. I was trying to scalp one pip against the trend and ending up losing. I had to hold this one for 4 hours to get out with a loss that small on a rebound from the reversal that happened.

My timing getting out was not optimal, I found that I could have made it out with only a 2 pip loss with a longer wait, but I did not feel I wanted to risk further loss and got out at a loss I found acceptable.

All other trades this day were EUR/CHF in profit or break even.

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Day 5 (Friday, June 23rd): Increased to $5,915 due to minimal trading and one bad trade.

I discovered that trading after 1:00 PM on Friday with EUR/CHF is pointless as I made one loss trade and three break even trades after 1:00 PM. I will try not to trade after 1:00 PM on Friday anymore.

My loss trade on EUR/CHF dragged me down 4 pips for a loss of -$64.07 on 2 standard lots. I was trying too hard to break $6,000 on a Friday with low trading volume when I should have stayed out!

I made one several ventures into USD/JPY only managing a one pip gain on a single transaction and two break even transactions.

All other trades were EUR/CHF in profit or break even.

Day 6 (Sunday, June 25th): Increased to $6,328

I traded only EUR/CHF today using varying lot sizes of 2, 2.5, or 3 depending on how confident I was in the trade. I made all winning or break even trades today.

Day 7 (Monday, June 26th): Increased to $6,502

I made 4 loss trades on EUR/CHF totalling 8 pips on varying lot size for a total loss of -$209.27.

I made 1 loss trade on USD/JPY totalling 9 pips on 2 lots for a total loss of -$137.98.

I made 4 winning trades on USD/JPY totalling 6 pips on 2 lots for a gain of $103.52.

The rest of my trades were with EUR/CHF and were either winning or break even for a total gain of $417.73.

I kept playing around today after I exceeded my goal and made my final loss trade of the day, as mentioned above, on USD/JPY this making my total gain for the day after losses only $174. I find it hard to stay disciplined and quit when I'm ahead until I make a nasty loss trade. I do need to work on this aspect.

Day 8 (Tuesday, June 27th): Increased to $6,863

I made 4 losing trades on EUR/CHF today for a loss of 7 pips netting me a loss of -$112.65 on 2 standard lots per trade.

I made 6 small EUR/USD trades for a gain of 12 pips netting me a gain of $240 on 2 standard lots per trade.

All other trades were EUR/CHF and in profit or break even for a gain of $233.65 total.

Overall I increased my account size by $361 making this my second best trading day so far. I am posting my log early since I decided to be done with demo trading for the day and take a break tonight.

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I feel like my new method is working out quite well in demo. I am in the process of signing up for a live account with MIG Investments and hope to test this strategy out after some more fine tuning with my demo account.

I am using only 2 lots in demo since I am not sure how many lots will move at some of the slower times of day I trade at. I will start my real account with 1 lot and work my way up from there to find out how liquid the markets are at my trading times -- I am especially interested to see how EUR/CHF behaves at my main trading times since it is my primary trading pair for this method.

My goal is to achieve a steady $500 gain per trading day when I open and begin trading on my live account. So far that goal is out of reach on my demo account while maintaining a very low risk, as this method does. I may experiment with my demo account to see if I can achieve this goal by upping my normal trade size to 3 standard lots.

Day 9 (Wednesday, June 28th): Increased to $7,239

I exceeded my earnings from yesterday and managed a gain of $376 today.

I made one loss trade on EUR/USD for a loss of 6 pips on 2 lots netting me a loss of -$120 on this trade. I held it long enough that I earned $39 of positive swap to offset some of the loss. I shorted it right before it went way up against me. I waited for the rebound and got out with minimal loss -- had I waited longer this trade would have actually turned into a 1 pip gain, but I wanted to free up capital and move on with other trades.

I made several other attempts at EUR/USD but only managed to break even on most of them and earned a total of 2 pips on the winning pair of trades.

I made one attempt at EUR/GBP but only managed to get out at break even on this one.

I made one loss trade on EUR/CHF for a loss of 2 pips netting me a loss of -$32.18 on 2 lots.

All of my remaining trades were EUR/CHF and were break even or winning for a total gain of 26 pips on varying size trades; mostly 2 lots but I did a few at 3 lots to get a feel for it.

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I was gunning for $500 today but I turned on "safety mode" after my near disaster with EUR/USD and stuck with trading mostly 2 lots. I will wait for a more comfortable day to attempt 3 lot trading for the majority of the day.

My system is designed to keep risk VERY low and to make my "worst case scenario" a step back one trading day in losses. If I make a series of bad or shaky trades I tend to step back and keep my hands off for a while and/or trade smaller lots to secure myself a bit. Still working on my discipline, though, as I find it very difficult to walk away.

My end goal is to achieve a predictable, if not large, income stream that I can live off of. I made more demo trading today than my weekly take home (after tax) pay at my normal day job. To me, a $376 day is fantastic, so I'm not trying to be a multi billionaire at this point in my trading life. If I can achieve $500 per day in a relatively predictable manner I will be utterly satisfied with my trading income. If I can achieve similar results to my demo on my forthcoming live account I will be very pleased.

You might want to stick with 1 or 2 pairs.....makes keeping track of things alot easier, if you try to trade everything it can really bite you in the butt, so stick with the 2 pair with the tightest spreads, JMHO.
We'll be watching, good luck and may the pips be with you.

John,

Good idea, I agree with you. I trade almost exclusively EUR/CHF and EUR/USD but I will venture into USD/JPY or other pairs if I spot a news event or if my main pairs are totally stagnating and I see something that catches my eye on another pair.

I do prefer sticking to my bread and butter pair, the EUR/CHF, as you said, it allows me to become very familiar with how it behaves and be safer with my trades.

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I will update my log for today and Friday tomorrow night. I'm up far too late and need to get to bed!

Day 10 (Thursday, June 29th): Increased to $7,466

Increased the account by $227 today which is a decent day for me.

I made two loss trades on EUR/CHF today for a total of an 11 pip loss on 2 standard lots on each losing trade.

Two of my trades had negative swap netting me -$29.12 total.

I made 18 pips on several 2 lot EUR/CHF trades as well as a single pip on one single lot EUR/CHF trade.

USD/JPY saved the day for me today as I caught the very tail end of the action making 6 pips on two lots per trade. I was busy at work during the main news action so I missed a good oppurtunity. But I am glad I managed to catch a small piece of the action at the end.

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Day 11 (Friday, June 30th): Increased to $7,673

Increased the account by $207 today, which is significantly better than my trading last Friday. I seem to have a tough time on Friday, but I exceeded my "Friday goal" which was just to come out ahead and not lose any money.

I made one loss trade on EUR/CHF on a two lot trade for 2 pips. This netted me -$32.46 total.

I made one loss trade on EUR/USD on two lots for 11 pips netting me -$220 total. I jumped the gun on this one as I thought a reversal was near and bailed out when I could, unfortunatly I was correct initially and this would have turned into a profit trade for 5 pips for me. But we can't always be right, so I just watched my step and made up for the loss afterwards.

I gained 10 pips on several other EUR/CHF trades.

I gained 14 pips on several other EUR/USD trades.

There was quite a bit of price action on EUR/CHF today after 1:00 PM this Friday as compared to last week. This could be because of the significant price movement from yesterday still settling down. I will keep my eye on the charts in the coming weeks to see how it behaves in the future.

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I am still very satisfied with my gains on the demo account. I have not yet experienced a drawdown day which was a problem I had with all of my previous demo accounts, and my attempt at a live mini account. I would get WAY ahead on some days then make large losses and end up 2-3 days back.

I much prefer making steady gains without the negative impact on my attitude from large drawdowns. I can handle a loss like I made today, my largest to date, since I know that my average daily gain would at least be enough to break even. As mentioned before, I like to limit my losses to setting me back not more than one trading day.

As a final note I have made 265 trades on this demo account to arrive at the current state. I don't really mind making a bunch of tiny trades to reach my goal as it makes me feel more secure to "lock in" my profit by closing the trades quickly -- I have found that leaving trades open for more than an hour stresses me out so I avoid it. As you have all taught me, the most challenging part is finding what works for YOU... and longer term trading is NOT my cup of tea.

Day 12 (Sunday, July 2nd): Increased to $7905

Account increased by $232 today.

Gained 4 pips on EUR/USD.
Gained 1 pip on USD/JPY.
Gained 8 pips on EUR/CHF and lost 1 pip on EUR/CHF.

All trades utilized my standard 2 lots.

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Day 13 (Monday, July 3rd): Increased to $8403

Account increased by $498 today, my best day so far.

Gained 30 pips on EUR/CHF on mostly 2 lot trades, and one 3 lot trade.

I made a stab at EUR/USD and broke even on that trade.

No losses today.

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Day 14 (Tuesday, July 4th): Increased to $8563

Account increased by $160 today. Very little trading today.

Gained 9 pips on EUR/CHF with varying lot sizes (1 or 2 lots per trade).

Gained 1 pip on USD/JPY with 0.5 lots. I was going to attempt a longer term trade by decided against it later and made it out with 1 pip profit.

No losses today.

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Day 15 (Wednesday, July 5th): Increased to $9079

Account increased by $516 setting a new personal record for me.

All trades were 2 lots today.

Gained 27 pips on EUR/CHF.
Gained 5 pips on EUR/USD, lost 2 pips on EUR/USD.
Gained 1 pip on USD/JPY.

Today worked out quite well for me! I also got an e-mail from MIG Investments to tell me that my live account application has been accepted so I will be funding it soon to try my new method live.

I am done for the night (3 hours early) as my trading is far ahead of expectations for this point and I do not want to get burnt out and/or make loss trades.

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My primary pairs are becoming more distinct in that I prefer EUR/USD and EUR/CHF very much over even looking at USD/JPY or other pairs. As suggested earlier, it makes studying the behavior of my main pair(s) much easier to do.

My increasing level of success each day is helped by the fact that my discipline is improving very rapidly and I can stay out of trading when it is too risky. Before, I had a difficult time not entering some kind of trade early on in the day even if it wasn't that great. This tended to cost me... as did trying to throw in trades on my lunch break. I have mostly tamed both of these behaviors.

Day 16 (Thursday, July 6th): Increased to $9657

Increased account by $578 today, a new record again.

Made 33 pips on EUR/CHF today.

No losses today. No other pairs besides EUR/CHF were traded today.

Lots sizes were:

2 for most trades
1 lot for three trades
3 lots for last two trades of the day

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I was severely hampered this morning by rainy weather rendering my PocketPC internet useless at work. Interestingly, I had a record day today none the less -- I take this as a good sign that my discipline in taking only the best trades is increasing.

I wired my starting capital to MIG Investments today. When they receive my wire I will be going live with my new method on a $2,000 standard account. Since my starting capital is only 40% of the size of my demo starting capital I will more than likely trade 1 lot per trade until I increase the account balance enough to warrant trading 2 lots.

I will be keeping a log to journal my live trading adventures when I begin!

I have made 392 trades to obtain these results with an average rate of "correct" (profit or break even) trades being 95% overall.

Day 17 (Friday, July 7th): Increased to $9968

Increased account by $311 today.

Made 19 pips on EUR/CHF today.

No loss trades today.

It seems as if I have gotten the hang of trading Friday. I almost had an issue with the NFP release today... but I got out of my open trade with a tiny bit of profit before it decided to run the other way :-)

I wanted to hit 10k today... but I ran out of trades and didn't want to enter anything that could risk any of my gains today.

Day 18 (Sunday, July 9th): Increased to $10,777

Increased account by $809 today.

Made 33 pips on EUR/CHF today. Same pip gain as my previous best day on Thursday but with larger trades.

All trades were 3 lots today.

No loss trades today.

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Lot size was increased to 3 lots today since the account was nearing $10k. Three lots will be the new "standard" trade size for the demo account unless for some reason I feel that the trades I am making are not low risk enough, in which case I will revert to 1 or 2 lots at a time.

excellant results

Day 19 (Monday, July 10th): Increased to $10,851

Increased account by $74 today.

Made 3 pips on EUR/CHF at 3 lots.

I played around a little this morning and made that amount and suddenly I got the e-mail from MIG Investments that my funds transfer has completed! I will be going live today :-) New log to be started soon.