Trend Following Quest

This is the place where I will collect and record the results of my trading system as required by the method as described below.

The Method:

In order to know if a system works or not, one has to define it clearly, in advance, and when ready, trade it carefully for a defined period of time and without departing from the defined rules. Then investigate whether the inner mechanics of that system are safe or not, and according to the results eventually correct or improve it.

This is nothing else than the scientific method:

1. Problem =>.........Detect a new trend in order to trade it => Surf the wave when you see it.

2. Hypothesis =>......A trend, like a wave has its own duration and we want to trade in its direction for a maximum

...........................amount of time. For that, we have to enter the earlier possible and stay with it as long as the trend
...........................remains valid. A trend is detected when the current price is higher (for an up trend),
...........................or lower (for a down trend) than its recent historical value => Surf the wave the longer you can
................ ..........but it's OK to swim from time to time and even more...

3. Experiment =>......Put the hypothesis at work by performing real trades => Stop talking and go surfing...

4. Data =>............Collect and analyze the results in a journal => Watch the videos and have fun...

5. Improve/Correct =>.Keep what works, remove what doesn’t, add new ideas and go to point 3 => Improve your surf...

As a trader, I have identified 2 jobs and goals for me:

1. To use this method with the goal of determining if my system works or not.

2. To respect the trading rules in any circumstance as not doing so would invalidate the first goal.

The System:

This is a journal where I want to record my trades and performances so I’m voluntarily not exposing the entirety of my system here. That being said, I can give a word about its general mechanics so maybe you get some inspiration from them but as you will see, there is nothing new here, this is just trend following in its purest form.

1. How to detect a new trend and enter a trade.
   This is done by the unique analysis of current price and past prices. No fancy indicator is used here. When the price is higher that it has been for a specific period of time, there is strength and we could be in a new up trend so we want to buy. When the price is lower that it has been for a specific period of time, there is weakness so we could be in a new down trend and we want to sell. So in short, and to the contrary of a lot of dudes out there that try to buy low and sell high, I buy high to sell higher and sell low to buy lower.
   -
2. How to stay in the trend for a maximum of time ?
   When a new trend is detected according to point 1, we enter and when the trend reverses, also as specified in point 1 we exit, and as ridiculous as this new trend could seem at the beginning, I initiate a trade in the opposite direction. It seems simple and it is, and this is the essence of this system.

-
The Style:

Technique => Price action.

Indicators => None.

Pairs traded => EURUSD, CADJPY

Time frame => 1 hour and up.

Stop Loss => None, the rules say when to exit.

The Inspiration:

Be patient.

Respect the risk and remain humble.

Avoid being involved psychologically.

Follow the rules and not the judgments or fear, greed or hope.

Give attention to detail.

Don't expect to be right every time and when wrong, take your losses and move on.

Leave the agitation for the others, instead trade slow, be a turtle.

React to price movements and follow, price says it all, no need for a story.

Buy Strength, Sell weakness.

Rest and have good sleep.

Done talking the talk, let's walk the walk. . .
.

The Results:

Month....Start Balance.....End Balance... Profit.....Return....Pr Factor...Win Rate...Appreciation

April 18..........$169............$280.....+$111.....+65.7%. .......2.53......50.0%...........Luck

May 18............$280............$620.....+$340....+121.6%........ 2.53......52.5%...........Luck

June 18...........$620............$268.....-$352.... -56.7%........ 1.10......47.0%.....Rebuilding

July 18...........$418............$144.....-$274.... -65.6%........ 0.87......52.5%.....Rebuilding

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---.......................Aug 18 - ACCOUNT BUST - STARTING AUTOMATED TRADING...................---

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...

┌--------┬-----------┬-----------┬----------┬----------┬---------┬---------┬--------------------┐

¦........¦.....Start.¦.......End.¦..........¦..........¦..Profit.¦.....Win.¦.............. .....¦

¦..Month.¦...Balance.¦...Balance.¦...Profit.¦...Return.¦..Factor.¦....Rate.¦..Appreciation .....¦

├--------┼-----------┼-----------┼----------┼----------┼---------┼---------┼--------------------┤

¦.Aug 18.¦....$1'000.¦....$1'145.¦.....$145.¦....14.5%.¦....2.72.¦...30.8%.¦..Ok (1 week) ......¦

├--------┼-----------┼-----------┼----------┼----------┼---------┼---------┼--------------------┤

¦.Sep 18.¦....$1'391.¦....$1'545.¦.....$154.¦....11.1%.¦....1.28.¦...29.5%.¦..Bad/Consolidation.¦

├--------┼-----------┼-----------┼----------┼----------┼---------┼---------┼--------------------┤

¦.Oct 18.¦....------.¦....------.¦.....----.¦....-----.¦....----.¦...-----.¦..Account Busted !..¦

└--------┴-----------┴-----------┴----------┴----------┴---------┴---------┴--------------------┘

...

...

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ShortCuts:
.

Season 1

The Lucky Episode 1 - The Luck of the beginner

The Lucky Episode 2 - A bit more than just luck

Rebuilding Episode 3 - Starting Again

Rebuilding Episode 4 - Going Fully Automatic

Season 2

Introduction - A new Automated Era

Prologue - A good warm-up week

Episode 1 - Quite bad for a start but...

Episode 2 - Account Busted Again

Episode 3 - Good for a new Start

Episode 4 - Good Resiliency seen in a desperately flat December

As of start of trading...

Closed Trades.

Trade 1.

Started trading my system on April 2 and only half of the down trend seen could be captured. It still was a good trade that lasted 4 days for a total of +47 pips with a profit of 23$. The whole down trend lasted from March 26 to April 6 for a total of about 260 pips.

Trade 2.

A good case study as it was a near perfect trade where almost all the pips were captured in this little up trend.

Trade and trend lasted 5 days for a total of 125 pips and $73 profit

Trade 3 (probe).

Failed with -40 pips but without much consequences for the account as the risk was adjusted and only $4 were lost.

Trade 4 (probe).

This is a tiny "probe" trade that I use to "sense" the markets direction. The fact that it succeeded, even with very few pips means that the market has changed direction, so we trade on the opposite direction, that's the hypothesis.
Trade lasted 5 days for a 3 pips ($0.26) profit.

Trade 5 (sister).

This is what I will call a (little) "sister" trade. The goal here is not to ride all the trend but rather capture some pips early in the trend, This is a little optimization to my system. The other (grand) "sister" trade which is the standard tradem was executed at the same exact moment and will try to ride this new trend as per the rules.

Trade lasted 12 min for a 16 pips ($9.60) profit.

Trade 6.
Failed up trend stopped with +13 pips ($4.96) profit in 28hrs.

Trade 7.
Sister trade initiated on a new down trend Succeeded with +16 pips ($11.20) profit in 1h53.

Trade 8.

Failed down trend with -24 pips ($12) loss in 23 hours.

Trade 9.

Took the train late on this one but still managed to take out +64 pips ($18) gain in 9 days out of a 400 pips up trend !

Paying the bills...

Trade 10.

Failed up trend with a loss of -26 pips (-$13.90) in 22 hours.

Trade 11.

Failed trade 10 sister trade with a loss of -27 pips (-$20.10) in 22 hours.

TP was set at 1.2401 ! missed for 1 pip, no luck this time !

Trade 12.

Sister trade succeeded with +16 pips ($9.60) profit in 6 hours.

Trade 13.

Succeeded in catching this down trend for a total of +127 pips ($50.76) profit in 4 days.

Note that the trend is maybe not terminated yet but I have to respect my rules for getting out.

Episode 1 - The Luck of the beginner +74%

There is still one trading day left but I will close the month with this ending week.

A good trading month traded by the rules where I let profits run and cut losses short.

That said, I just consider that as pure luck, but even with the luck of the beginner, I’m a bit proud of what I did this month, not because of gains but instead because I respected my trading rules and did not self-sabotaged! Now, it’s just a matter of repeating that next month, and next, and next...

The profit has been above what I was expecting which could mean that my risk is far too high for a turtle trading system but according to what I have seen, I will keep things like they are now and wait and see. As long as my risk factor doesn’t degrade too much I will continue as is until I see that I’m too high, I hope without blowing up the account.

"I'm a greater believer in luck, and I find the harder I work the more I have of it”
- Thomas Jefferson

Month stats

Trade 14. Failed down trend trade with a loss of -25 pips (-$9.97) in 7 days.

Trade 15. Successful sister trade in a "maybe" new up trend, with a total of +15 pips (+$10.08) in 2 days.

Trade 16. Failed up trend trade with a loss of -48 pips (-$24.30) in three days.

Trade 17. Successful sister trade in a new down trend, with a total of +16 pips (+$12.76) in 20 hours.

Trade 18. Sometimes you miss a trade for 1 pip, and others you see a 70 pips pullback just before reaching your target !

Successful down trend trade with a total of +124 pips ($74.34) profit in 2 days

Trade 19. Eight days spent for an up trend that just failed miserably with a total of -32 pips ($11.60) loss.

Trade 20. Failed down trend trade on CADJPY (again) for a total of -16 pips ($11.01) loss.

Trade 21. Quick profit at start of a new up trend for a total of 13 pips ($6.72) profit.

Trade 22. Took what I could in this up trend for a total of 48 pips ($18) profit.

Finally the master creates a thread. Congrats and hope you collect lots of green pips. Sometimes we have to be patient waiting for the trend and it makes many traders fail because they can not stand waiting too long.

Hi! Well, it's a bit excessive to talk about a master, I just try to trade trends the better I can, but thanks for the intention.

Yes, trade by trade I'm learning to be patient, I'm more and more convinced that it's one of the keys to success.

Thanks for stopping by and I hope you're doing well too !

apparently it is a key ingredient, but unfortunately for many of us are still struggling to understand the language of market not knowing enough amplifies impatience, they go hand in hand a total destruction if one is not careful with risk they're taking while in the still learning phase.

It is a key ingredient, and one thing that you have to understand is that the market test you again and again, so you better have a system with rules in place and act accordingly. Look at my trade 20 on CADJPY, I was some 100 pips in profit, and my rules telling me not to exit, then the market retracted and the trade terminated in a loss of -16 pips. Was it a bad trade ? I think that for many yes but for me not, even if I lost those 100 pips, because I traded by my rules, so learn to be patient and learn to lose and not be frustrated by it.

I'm still trying to catch a good trend in CADJPY (more than 100+ pips) without success but I know it will come...

Trade 23. Quick profits at the beginning of a new downtrend totaling +15 pips ($10.46) in profit.

Trade 24. Could capture +33 pips ($21.13) in this aborted up trend. Not yet the real thing...

Trade 25. Very nice down trend captured on EURUSD for a total of +124 pips ($61.94) in profit.

There is nothing indicating that the down trend was going to stop but that was my profit taking target.

Trade 26. New failed tentative on CADJPY for a loss of -59 pips ($43.08)

now that's how it should be done riding the waves I'm sure surfers feel that rush too a sense of accomplishment.
when you ride the wave for instance on 1h do you look at higher TFs like daily or 4h ?

I do understand the advantage of concentrating on few pairs
but why EURUSD or CADJPY ?