[MicroPips fund] my next 20-year day-scalping journal :)

didn't get a chance to close the open deals
still holding the bias toward existing divergence
http://www.forexfactory.com/attachme...1&d=1246068563
will request cancellation of credit card deposit fund back early next week (before July) since this broker only allow 4 times free cancellation per month

try not to trade next month after close this one... cannot focus at work. >_<

1. biggest divergence as on day t-f
(lazy to post a chart, look at day/week t-f you can see this on every pair)
asia wants to break up, us wants to break down, europe sits on the wall

impact to trading:
ask/bid spreads are tightly traded
impact to future:
future long and future short expectations median differences(spread) are wide
high probability entry:
when both break-up and break-down happen on reverse side,
ask/bid further close and volume increase like mad, future long and short separate like mad

a repair is possible:
short the greedy and long the fear

2. a "working" hedging strategy mentioned by a economist:
a. long the gold
b. long the usd

by theory it's reverse correlated, (assumption is CHF keep flat)
so should break even

but at times they are out of correlation and gold/usd rise at same time like July'2007 to May'2007...
he made a profit by this correlation out of work and gold/usd, usd/chf both rise.

(we can see reality is equity drop in value and currency of all kind gains risk value realitive to equity, ... before fed print money; other element is CHF print moeny)

3. biggest divergence as on year t-f: break of balance of supply and demand, break of balance of cost and profit
(warning: long and boring analysis)

the biggest divergence as of now on year t-f (Y2000-Y2009) is
#1 on one hand the over-leveraged speculations, in realesate, in commodity, in energy, in agriculture
has brought the global work-force living cost to extra high in a rocketing speed...

if assume in the west salary/material/land is 50% of product cost,
moving to asia 10 yrs ago, salary/land/material was all 1/10 of west, say that's <10% of product cost or 40% cost saved.
as of now, salary is 60% of west, material is same and land is same price of west,,, you can see globalization fails in reducing cost

on the other hand, although salary on paper rised average 3 times compared with 10 yrs ago,
because of realestate and commodity/energy speculations,,,,
the new work-force did not have enough free money to spend after deducting the life cost from those hot/life basic needs....
result of this is globalization has not produce as much population of customer needs and affordability as welll...

#2 on the other hand, real economy has not been able to generate enough profit by the simple idea of globalization and reduced labor cost (due to #1)

but as a result of the over-leverage and abounced of imaginary money allowed for speculators,
real economy that runs on real money has failed to dominant the cost of production, esp realestate, food, energy and commodity....
because supply is fixed but real demand vs fake demand (overleveraged speculations) could be sometimes 1:10 or more.

resulting in a lose-lose situation, where driving forces of real economy lost the cost bottom line and has to join speculators in virtual economy...

as the people focusing generating real profit become less and less, and people focusing on unreasonable ROI from virtual trading becomes more and more, property price, equity and labor cost has rised to a point where virtual ROI cannot be supported by the even weaker real economy.

at some point the clapse began and tech trading, upon seeing a reverse from historic top, jumps in shorting.... causing realestate property and equity/stocks to jump sharp in water....

the over-leveraged nature in especially realestate and credit market, has thus run into a disaster.... where if w/o intervention....

will be having >50% people too unhappy that the basis of a political power or many other to be in question.

this has lead to what we see since mid last year............ paper money providers who is supposed to match every currency unit to gold has given up their professional discipline and honesty and jump in with the crime of printing fake money.... robbing cash holders (middle class) in compensation of credit and loan holders. (speculators and rich/business owner)

this for a short period time may resolve the previous fear of property and equity 'drop' in currency numbers...

however the basic conflict,
between the expected ROI of overleveraged speculations in industry basic elements (material and labor),
and the ever dropping ROI of real economy in face of rising cost.... will not be resolved because we use 1cent to count price or use 1$ to count price.

going forward in 5-10 years... we will continue seeing this deep problem be troubling economy and speculation market from time to time.

the belief is, not until someone who really want to face the real problem mentioned above, the periodical up (by print money and devalue currency unit) and downs (by finding out that quick fix did not solve root cause) will continue to happen.

as value arbitrager we can profit from correcting the real reality and the unrealistic expections of people, till expectations match reality.

however whole problem cannot be solved until people really sits down to find out that it is labor itself that is generating value, rather than the greedy of capital looking for ever increasing return from robbing the labor.

but the cost of educating people away from unrealistic return from capital markets, could be as high as nightmare meaning give them a bad memory where he will never again try it in his life.

I doubt the governments, who heavily invest and rely on realestate etc, has the courage to let free fall fall to where it is due. (due price is 10yrs ago? ... when we have PC and internet and everything already... nothing changed in past 10 yrs)

then we will see that the recession falls into a stag situation, where gov don't wants it to fall, but gov is doing nothing to solve the root cause make it possible for industry to profit.

the free fall will become manipulated until it reach the real value required by the law of labor,
that price cannot be higher than value over the long term, and that supply has to match real demand over the long term, and that value has to come out of labor instead of specualtion over the long term.

in effect you can see that the correction has been pushed out due to gov intervention....

this is the basic expections for how things could be moving ahead in the next 5-10 yrs period.

and will be the driving cause for us, for the monthly t-f,
to be technically and sentimentally shorting into the greedies where people who longed at the very historic top when price far exceed due value,
and in red for past 1-2 years / now hoping for price to be back to top and hoping for things double...
regardless of what impact the everyday life to people and to basis of product cost.

they will never get what they want eventually, (even if they get money what it's use for? for buying 3 houses, 10000 barrel of oil and 1000 oz of gold? house, oil and gold cannot be eaten or drinked hahahaha... so money have no use at all.)

and will pay to learn the lesson with a cost to be remembered for a life time.

(oh this may sound too fearful, do we still trade and speculate? yes...
we still trade day t-f for people's different opinion of long/shorts to be aligned,
and trade monthly t-f for people's vision of top and bottoms to match reality...

just we're trading with a hope to correct price back to it's value
and don't do the reverse way for price to be moving far away from value ...
well not really, sometimes still do it if gov intervene and we have to survive and avoid short when government longs... hahahahaha ... we're less evil than the evilest... less greedy than the greediest and less fearful and the most fearful; no real/fundamental differences in reality >_<)

if we compare the past 3 or 6 month realestate price and sales for US and for newyork....
and the price and sales for beijing and shanghai...

we can see US is still at 75% of historic peak price, only about <5% up
but beijing and shanghai overall has 10% up this year (and 20% up in specific cases)...

and price has overall approaching historic peak price in Q2 2008 and sales volume wise, much higher than 1 yr ago.

possibly we're seeing a divergence here that could be corrected with time.

[edit] repost... just now is bank loan estimate price... below is real sale price from 2 sampled places.

http://www.forexfactory.com/attachme...1&d=1246199258

http://www.forexfactory.com/attachme...1&d=1246193321

(gas)
as expected, there is always a reason for those big guys (oil field and refinary) to not lose money or make more no matter good or bad thing come out.

(had this comments in carbon bill last time)

sep. dow future jumps from 8360 to 8600 now... +3% by just 2* H4 candle

oil and dow index is rising at same time at this moment...

I'm almost done for the correction of pessimistic right now

will lurk for 3 weeks and wait for people to be over greedy and over optimistic

on this side of the earth I already see people who is at the edge of that....

but we will not strike till they become arrogant and stop thinking about risk... fear has it's most efficient use when investors are in such a mood.

misinterpretation&debates of Q2 company report and GDP in mid-late July could create a chance for market disturbance.

last week has exit most position and today cancelled deposit back to cc
will exit remaining 1 dow order if reach 8550 tomorow.

the sp500 890 long was good, till now 4% up! nothing fun to trade recently... time to back to focus at work lo
http://www.forexfactory.com/attachme...8&d=1246307072

I had interactivebrokers acc open but will not deposit till 1 month later (pretty costy for currency exchange and wire...)
will trade this mt4 broker's demo commodity future 1st...because I know nothing even the basics it's not worth deposit & try with live.

happened to open a few short with all orders to test yesterday... meet the end of month rush........ all profit faint.

try to list the basics I know till now. will all trade 0.1 lot only,
below try to calc the position/commission/spread/swap so I can control position size/acc risk and t/p goal.
================================================================================
Ymu9: sep dow future, 0.1lot=8400$*5*0.1=4200$, commission is -15*0.1=-1.5$ or 3pip, spread is 2-3. annualized swap rollover is 3%
profit calc=pip*0.5, below example is 0.5*(8462-8369)=46.5$, commission is 1.5$
Epu9: sep sp500 future, 0.1lot=900$*50*0.1=4500$, commission is -15*0.1=-1.5$ or 0.3pip, spread is 0.4. annualized swap rollover is 3%
profit calc=pip*5, below example is 5*(922.5-912.5)=50$, commission is 1.5$
Clq9: Aug crude oil future, 0.1lot=70$*1000*0.1=7000$, commission is -15*0.1=-1.5$ or 2pip, spread is 1. annualized swap rollover is 3%
profit calc=pip*100, below example is 100*(71.16-69.71)=145$, commission is 1.5$
Wn9: July wheat future, 0.1lot=500$*50*0.1=2500$, commission is -15*0.1=-1.5$ or 6pip, spread is 5. annualized swap rollover is 3%
profit calc=pip*5, below example is 5*(528.5-511.5)=85$, commission is 1.5$
Cn9: July corn future, 0.1lot=350$*50*0.1=1500$, commission is -15*0.1=-1.5$ or 10pip, spread is 10. annualized swap rollover is 3%
profit calc=pip*5, below example is 5*(377.25-347.75)=147.5$, commission is 1.5$
Ngq9: Aug natural gas future, 0.1lot=4$*10000*0.1=4000$, commission is -15*0.1=-1.5$ or 4pip, spread is 10. annualized swap rollover is 3%
profit calc=pip*100, below example is 100*(3.977-3.842)=135$, commission is 1.5$
Sn9: July Soybean future, 0.1lot=1200$*50*0.1=6000$, commission is -15*0.1=-1.5$ or 3pip, spread is 5. annualized swap rollover is 3%
profit calc=pip*5, not listed example is 5*(1206-1204)=10$, commission is 1.5$
=====================================================================================
seems that on average 1 future 0.1 lot is 4000$, 1% variation is 40$ per day

I can create a 10,000$ demo acc and hold on average 5 orders...
that means position size vs acc is 2:1. max variation of acc is <100$ or 1%
t/p goal should be 1% a month so upon 1% variation will exit (in this case commission/spread ignorable)
s/l goal should be -2% of acc or position price in red

from past experience, 10k$ live acc size and daily 100$ variation seems to be a mentally acceptable acc/risk ratio.

dow long limits 8560 from 8316
sp500 limits 931 from 890

knocked out within 10min before oil news.

I'm out... let the madness run then

concept1: value median refers to the fair value of an instrument
usually calculated by competitve recreation cost, or by risk free profit rate compared with bank rate.

concept2: price curve refers to tick chart we see in mt4
price will usually react to short term supply and demand, also price is sensitive to industry cost and profit, trading wise price also reflects market sentiment

tradingzone1: zone of under value, refers to when price ~ 2/3 of fair value
this usually last for 0.5-1yr, where people starts to leave the market with hope of growth weakening, we can invest 10% of total acc to long as a long term investment

tradingzone2: zone of pessimistic, refers to when price ~ 1/3 of fair value
this usually last for 0.5-1yr, where everyone shy away from this market and never would anyone think of people doing it as sane.
we need to invest 80% of total acc and never wanna sell it, justified case by case a 2:1 leverage could be granted

tradingzone3: zone of over value, refers to when price ~ 2x of fair value
this usually last for 0.5-1yr, where more and more informed people return to the market assuming that the profit return is still better than bank rate.
at this time we can switch 10% of our long postions into short and hold as a long term investment

tradingzone4: zone of optimistic, refers to when price ~ 3x of fair value
this usually last for 0.5-1yr, where anyone including people who left at bottom is now saying that the market is by far under valued and can grow another 10x times....
at this time we can put 80% of acc at short and go on with monthly deposit into the short.
but note that a leverage is not allowed since it may need to hold for years before price really turn back to value.

http://www.forexfactory.com/attachme...1&d=1246462759
from above zone/splitting actually we can see we either prefer a liquidity-less market where instrument supply exceed free capital by far, so we can purchase equity at good price.
or we prefer a liquidity-aboundant market where shorting tool is inaccessible to majority of people, where it is easy to create prices over-valued by measure of 3x, 5x or 10x of fair value.

now question is what do we do when market is in a zone where price match value and investors are overall rational?
this is the hardest area because there is no clear direction and there is no real good price to long or short from.

there are 2 approach for this zone,
1st approach is hold for a life time (till it over value by far)
meaning we hold on the positions purchased in zone of pessimitic and never give it to anyone except for 150% of market price.... in one word, we hide the turtle eggs among the sand and leave.... assuming the trend will go on.
benefit of 1st approach is it avoids uncertainty of market violatility during zone of no direction.... where biggest risk is we get fear and throw away our position.

2nd approach is to free up 50% of capital from zone of pessimistic,
and then doing hedge/correction type of trading, or doing major S/R bounce off type of trading.
both type of trading signifies quick entry and quick exit and chances-rare feature... meaning when enter a 5% divergence in order for a 1 day 1% correction, or 1 week 2% correction, then exit and wait 1month for next oppotunity.
benefit of 2nd aproach is it avoid the market of uncertainty and avoids the market basically... where after getting fixed return of average 8-12% a year that beats inflation... we return back to market suddenly find most of the things over-valued or under valued .... so biggest risk of holding cash in a no direction market is jump in a guessed/wrong direction... by avoiding a long term position and do short term trading only we avoid a risk of capital betting on a wrong direction.
while doing this, we wait 1-2yr till the market runs to over value and optimistic zone... when we can build up long term short position and hold to it.

also due to geo and capital flow limitations, there could often be 1 instrument undervalue in one market and another overvalue in another market.
if they are uncorrelated, we can pick a divation market while another is no direction... in this way we don't have to wait 5yrs for the next bull market.
if they are correlated, we can long the undervalue and short the overvalue till the correction or fix happen.

closed all open positions remaining yesterday (1 sp500, 1 dow, 1 eurchf), actually still 1 deal (left 1 with limit order) and cancelled all deposit back to cc.
will probably rest/focus back to work for next 3 weeks at least.

boss is unhappy with me focusing 11hr on forex every night past 1 week haha that sure is a conflict of interest anyway.
need to work on certainty 1st before having more fun here.

broker has made about 90$ spread fee from my trading assuming it did not trade against me as it claim.

http://www.forexfactory.com/attachme...1&d=1246478661

did not take it as live acc not ready yet... as well as I don't fully understand the moves.

will not disclose the instrument you will see what it is if you're trading samething.

I call it claw because if only one you'd call it cobra.

very interesting is all the shorts go from 650 to about 250$ profit (demo) and now back to 650$ lo

this is after 1 day of equity bull market in the world so it is strange!

I've no idea what is happening though or why oil drops after inventry shorter at all.

seems those bear runners seek any chance or news to start a panic run, they failed yesterday though.

today
http://www.forexfactory.com/attachme...1&d=1246483071

yesterday
http://www.forexfactory.com/attachme...6&d=1246379853

dynamic profit from 650$->1300$ today, seems bear runners win today.
I don't understand it by any means though.
http://www.forexfactory.com/attachme...1&d=1246566413

E/U 1.416->1.410 knocked out, both entry&exit are auto exec

I created but now cancelled these
the Dow 8250->8320, E/U 1.3916->1.3977 pending orders

coz from weekly chart a downside risk of ~half a year seems inevitable...
(risk inevitable... not downside inevitable...)

I wouldn't be doing any hour+4 or T+1 bounce off in a trending market ...
we never t/p quick enough in a bounce-off tradings because of greedy,
but then trend takes us to hell when a bounce-off finished.

I mentioned how to survive from no direction market:
0) don't against trend, don't follow trend
i) correction trading
ii) scalping low time frames w/o a leverage and with low t/p goal.

with US holiday on Friday

commodity stay at a low w/o a massive break out further... short position proft increase a little bit 1300$->1400$
http://www.forexfactory.com/attachme...1&d=1246682923
July may be a critical on where market is heading for the next 1yr period. Most people may eye bull/bear combat or Q2 GDP data release as key to deciding next step direction...
but we still believe it is fundamentals of economy that decides it instead of how well gov can manipulate data.

last weekend I have condemned the over-leveraged speculation causing industry cost to rise dramatically over the past 10 yrs...
as I tried more CFD/future trading via over-leveraged (100:1) forex acc, I am becoming more convinced by this... people can go long energy or metals by 10:1 or more of initial deposit and not blow up if the market is trending in a single direction for a year or two...

this will create an unreal inbalance of supply vs demand...where with more capital exit real economy and join virtual speculations... the over leveraged speculation (hot) money may exceed real demand by 10x or 20x more... creating an unreal demand that supports the sky-rocketing cost of everything.

there has been proposal in the news that japan will limit leverage to 50:1 2nd half year and 25:1 next year...
It is believed that reducing leverage to eventually 5:1~10:1 which match what it is in futures market is the returning to reality and will not damage the benefits esp for new traders.

because if we don't limit speculation capital/hot money, it will go into every corner of life and squeeze profit out of everywhere... everyone.
then people who generate value by their labor will not be able to receive fair compensation because speculation capital takes all profit out of it... even if we as individual gain tiny profit from speculations, our family, friends or children will suffer from it later.

keep in mind that over the long run like 10, 20yrs, this market is a zero sum or negative sum overall (excluding brokers and governments who make free money out of no effort).
any profit goal except for
beating inflation, or grow together with a exceptional industry leader or innovator to get above market average return
will be unrealistic and how much excess profit we get from market, eventually will be paid back as traders as a whole.

after learning the honored calc from james16 group on risk/award.

coupling with my original feeling... now I feel more justified for correlation/correction, S/R rebounce/glitch type of trading to use below numbers for money management.

assumption is that my comfortable trading acc is 10k$, but start with 5k$ to prove myself 1st.

sorry this post may be too long, so this is the ouline
1. assume rarely use a leverage meaning position total <= acc size, what is position size, s/l and t/p and expected return for A, A+ and golden setup?
2. comparison of A, A+ and golden setup, why daily T/F & A+ setup is best to trade?
3. assume amplify that by 10x, over leverage, what is position size, s/l and t/p and expected return for A, A+ and golden setup?
4. the working stategy plan to combine low leverage A setup and 1:1 A+ setup.
5. granularity, safety of intial capital and compounding
6. example of 1 sigma, 2 sigma (A, A+ setup oppotunities) from trend, fundemental and investor/speculator senti convergence point of view

==============================below are considerations of rarely use a leverage situation===============
i) if take a trade with probability=1sigma or 84% win (A setup) for a +1% correction, over 1 month period
use a leverage of position size=0.1x acc
i.e. 1k$ position which is offered on typical forex micro/sp500/gold (fxsol is ideal, or delta)

set s/l at -16%, set t/p at +1%,
so maximum dynamic loss is -1.6% of acc (or -3% if use 5k$ acc to open 1k$ position), gain is +0.1% per deal
hold for a month period, there could be one kind of this oppotunities in a week in at least one of the instruments

if all hit t/p, annualized return is 0.1%*50=5%, calc probability it's 5%*84%=4.2%+
if all hit s/l, annualized loss is -1.6%*50=-80%, calc probability it's -80%*16%=-13%
so by probability loss over a year is expected to be -9%, risk is well controlled, spread is ignorable since low leverage

.... summary is this is a weekly T/F S/R rebounce or trend riding or correlation/correction trading with an order holding duraton of 1 month, 4 order a month, an expected return of -9% a year and max position=0.1x acc.

ii) probability=2sigma or 98% win (A+ setup) for a +1% correction, over 1 week period
use a leverage of position size=1x acc
i.e. 10k$ position which is offered on typical forex mini/dow/10xgold/2x future 0.1lot (fxsol or fxpro)

set s/l at -200pips, set t/p at +100 pips,
so maximum dynamic loss is -2% of acc per deal, gain is +1% per deal
hold for a week period, there could be one kind of this oppotunity in a month

if all hit t/p, annualized return is 1%*12=12%, calc probability it's 12%*97%=11.6%+
if all hit s/l, annualized loss is -2%*12=-24%, calc probability it's -24%*2%=-0.5%
so by probability loss over a year is expected to be +11%, risk is well controlled, spread is 0.1%*12 or 1% cost of acc

.... summary is this is a daily T/F S/R rebounce or trend riding or correlation/correction trading with an order holding duraton of 1 week, 1 order per month, and an expected return of +10% a year and max position=1.0x acc.

iii) probability=3sigma or 99.8% win for a +1% correction, over 1 day period
use a leverage of position size=10x acc
i.e. 100k$ position which is offered on typical forex std/10xdow/100xgold/2x future (fxsol or fxcm)

set s/l at -20pips, set t/p at +100 pips,
so maximum dynamic loss is -2% of acc per deal, gain is +10% per deal
hold for one day period, there could be one kind of this oppotunity in a year

if all hit t/p, annualized return is 10%*1=10%, calc probability it's 10%*99.8%=10%
if all hit s/l, annualized loss is -2%*1=-2%, calc probability it's -2%*2%=-0.04%
so by probability loss over a year is expected to be +10%, risk is well controlled, spread is 0.1%*10 or 1% cost of acc

.... summary is this is a H4 T/F S/R rebounce or trend riding or correlation/correction trading with an order holding duraton of 1-2 day, an expected return of 9% a year and max position=10x acc.
==================================summary and comments=====================
because all 3 strategy are taken by calculated/informed risk, and controlled draw-down, possibly can apply jacko's anti hedge strategy,

meaning if the price has run passed my stop/loss by 2x distance, and I still believed it could go back, then I re-enter a limit order at price where I'm stoped out, so if market comes back eventually. I can still t/p at the +1% target.

actually comparing i), ii) and iii)
we can see that look for a 2sigma possibility for 1% correction on daily T/F over 1 week period.
this type of trading has best combined probability return VS risk.

coz for weekly T/F and 1 sigma possbility 1% correction trading, we trade a lot like 50 deals a year, but profit is small, and overall expect small negative -9%/yr

while for H4 T/F and 3 sigma possbility 1% correction trading, the chances are so rare that keep looking every day for such a chance may not be justified... and use of a -20 pip s/l would require highly experience on entry picks.

(what eursir did is to increase more trial a year, and increase t/p target to 500 pips... in that way we can see he's busy every day but only a 500pip breakout in a quarter gives him biggest boost)
(what maxey possibly did is to have a very sure expection of news on annoucement, and wait for market to make mistakes within 1min after news, and jump in high leverage with a small acc to fix it)

overall the most ideal trading is on daily T/F and look for 2 sigma possbility 1% correction trading, we trade moderately like 1 deals a month and we can take 1 look every day to see divations slowly build up(as well as people's greedy/fear), -200 or -300 pips s/l on a 2 sigma chance win is safe enough to hold a no leverage position, and overall we have positive expectation which is 10% a year.

.............okey can possibly try on familiar instuments using a 5k usd acc to trade 1k$/10k$ 1st
... and use demo & live cent acc to get familiar with new instruments like future, etc.

now I am much more comfortable with a system with positive expected return (10%/yr), a comfortable position size(pos=acc, 5k or 10k$), and a comfortable stop/loss (-200 or -300pip), and a comfortable chart (daily T/F), and a comfortable position holding duration (1 week) and trading freq (1 trade per month)............ let's make it rock!

==============================below are considerations of overleverage situation===============
==========use 1x leverage instead of 0.1x on A setup
==========use 10x leverage instead of 1x on A+ setup

ps: another calc if use position size=1x acc on 1 sigma possibility

set s/l at -1.6%, set t/p at +1%,
so maximum dynamic loss is -1.6% of acc (or -3% if use 5k$ acc to open 1k$ position), gain is +1% per deal
hold for a month period, there could be one kind of this oppotunities in a week in at least one of the instruments

if all hit t/p, annualized return is 1%*50=50%, calc probability it's 50%*84%=42%+
if all hit s/l, annualized loss is -1.6%*50=-80%, calc probability it's -80%*16%=-13%

wow... we can get a 30% return by trading 50 deals a year and win 84%, lose 16% of deals...(win 42, lose 8)
that's even better return but will trade more freq and meet loss more freq...

ps: another calc if use position size=10x acc on 2 sigma possibility

set s/l at -2%, set t/p at +1%,
so maximum dynamic loss is -20% of acc, gain is +10% per deal
hold for a week period, there could be one kind of this oppotunities in a month in at least one of the instruments

if all hit t/p, annualized return is 10%*12=120%, calc probability it's 120%*98%=118%+
if all hit s/l, annualized loss is -20%*12=-240%, calc probability it's -240%*2%=-48%

wow... we can get a 70% return by trading 12 deals a year and win 98%, lose 2% of deals...(A+ setup!!!)
that's a terrific return
======================let's temporarily forget about over leverage using position > acc till proven=================================
I am thinking since 1 trade a month chances are still rare, could possibily hold a few 1/5 acc positions every now and then
in that way we constantly have some holdings but risk is diversified in uncorrelated markets...
and we can jump in 1 order with 1 week duration when see a once per month chance.... after all there is a leverage to use it's not cash acc.

so maybe use position size=1/5 acc on 5 different uncorrelated instruments.
===============================the working strategy, always hold some month-long A positions plus A+ hunting.=========================
ps: another calc if use position size=0.2x acc on 1 sigma possibility
set s/l at -5%, set t/p at +1%,
so maximum dynamic loss is -1% of acc (or -2% if use 5k$ acc to open 1k$ position), gain is +0.2% per deal
hold for a month period, there could be one kind of this oppotunities in a week in at least one of the instruments

if all hit t/p, annualized return is 0.2%*50=10%, calc probability it's 10%*84%=8.4%+
if all hit s/l, annualized loss is -1%*50=-50%, calc probability it's -50%*16%=-8%

this will give a expected 0 return but still worthwhile since keep track with market will find oppotunity later....
a for-sure break/even trading system is good enough for my start of learning trends and fundamentals in futures market I guess.

============================granularity, safety of intial capital and compounding===================
well what is the very benefit of having a system which is sure safe for initial capital??
... it allows you to be assured to keep a compound growth, I saw in another journal, 5% a month is 60% a year is 300% in 5 year, sounds right?
but if you compound, 1.05^(12*5)=1868%, that is 1768% of return in 5 year if it's compounding...
having a proven system which has granularity and safety of initial capital will assure us to do the compounding instead of withdraw (of coz broker safety is another)

===================last part===========================
examples of 1 sigma possibility (A setup) and 2 sigma possibility (A+ setup)
from trend, fundamental and investor/speculator senti point of view (convergence), 3 sigma setup (claw) is a trade secret I kept for myself

see the chart explains itself.

for the short term, 1 week, 1 month, most things correlate

but for the long term, different instruments have different growth expectation (that's basically what pair is for... it's a correlation ratio)

if we can find a proven and promising long term growth industry leader and follow it. (has to build on concrete math, profit, cost, return... not 2% a day blabla)

over the long run ~ 30..50 yrs, it will have market beating performance.

problem is where to find it, and when to enter

the same as we need to prove our trading system and money management so we have a confidence and conviction that it works and execulte without doubt/fear and with discipline.

I was reviewing some of the future tradings journals back on another home domestic future forum,
many people, after commodity market ranging for one or two month and turns a little profitable at begin of Apr. cut the profit and exit... some even jump in shorts.
it is true that market prediction is not possible to rely solely on, but short term top/bottom guesses are even more unlikely to be correct and more risky to trade upon.

it's much safer to be sticking to one thing that we're convinced to have steady growth and stick to it...
we can sell into the greedies and buy into the fears... but most important of all, we have the conviction, that we're staying with a index that beats the market... that will kill our greedy and fear and avoid moving in/out too much and making too many wrong judgments.

eventually we'll get compound growth returns by reinvesting on the same market beating index
instead of change our mind every day and hand lots of fee to brokers...and instead of having no knowledge of what tomorrow we'll trade after finishing trade today.

i cant see why ur so proud to be a scalper, you even post your scalping journal....

oh, hi john:
sorry was out to eat just now.

yes it was intended to be a day scalping at beginning... at Feb there seemed to be a wide popularity of scalpings...
I was just started to clone a scalping role model at the time.

by now the role model is still doing well
but I come to realize that I cannot tolerate the market noise at 5M/15M, draw-down at 10x leverage and the extensive effort needed (>6hr a day)...

so I have moved up to daily T/F right now and feeling fine.

however the multi-hundred trades over 30days on smaller trends still gave me much education on S/R and break-outs and news impact....
I almost learned trends for free so I appreciate very much.

by now I still think I should be able to b/e by scalping 5M.
just return / effort ratio is not satisfactory for me.

the plan of gradual monthly deposit and slowly increase trading lot is still a valid plan.

what I added recently is noise filtering on higher T/F, high probablility picks, and risk control (just this weekend)...

the plan of gradual increased profit target every year at beginning of this is still doable assuming no leverage, but I removed unrealistic profit expectation by pips * 10x leverage which is not doable.
I am committed to this as mainly a learning journey because otherwise I will be forced to buy in over-valued realestate and stocks and I don't like to do that... that is why learning here prove a value for myself.

I do very little trades (1 trade a month) recently and not a lot of charts/too many words, so not sure if what I wrote make any sense.
Pls feel free to point out different opinions, I'll be glad to learn.

in the end we everyone needs to figure out what's in it for me, I was a value investment and arbitrage believer and I think in this market will give me more access to different instruments but my picks and trading duration will be same as if a value investor or an arbitrager... coz I don't see any edge in my by trading simple trend alone as there is no reason any other trader in the world cannot use a same system and discipline to do it better full time, I should have no edge trading a single forex alone.... that is a valuable training but will not generate a profit for me I know. my profit model will be a combination of forex, cfd, futures, real stocks as hedging arbitrage... as well as getting cross country biz info to get better info in search of a great instrument for life time investments. ... it is far from done but if I can do it in 20yrs period (I'm 30 now) my later years would prove to benefit significantly by compounding deposits, knowledge, profit model and experience.

OK I was able to do a excel calc base on the theory of all m-m parametres

will publish all 6 strategy one by one in follow posts
================================================
i) if take a trade with probability=1sigma or 84% win (A setup) for a +1% correction, over 1 month period
use a leverage of position size=0.1x acc
i.e. 1k$ position which is offered on typical forex micro/sp500/gold (fxsol is ideal, or delta)

set s/l at -16%, set t/p at +1%,
so maximum dynamic loss is -1.6% of acc (or -3% if use 5k$ acc to open 1k$ position), gain is +0.1% per deal
hold for a month period, there could be one kind of this oppotunities in a week in at least one of the instruments

if all hit t/p, annualized return is 0.1%*50=5%, calc probability it's 5%*84%=4.2%+
if all hit s/l, annualized loss is -1.6%*50=-80%, calc probability it's -80%*16%=-13%
so by probability loss over a year is expected to be -9%, risk is well controlled, spread is ignorable since low leverage

.... summary is this is a weekly T/F S/R rebounce or trend riding or correlation/correction trading with an order holding duraton of 1 month, 4 order a month, an expected return of -9% a year and max position=0.1x acc.

ii) probability=2sigma or 98% win (A+ setup) for a +1% correction, over 1 week period
use a leverage of position size=1x acc
i.e. 10k$ position which is offered on typical forex mini/dow/10xgold/2x future 0.1lot (fxsol or fxpro)

set s/l at -200pips, set t/p at +100 pips,
so maximum dynamic loss is -2% of acc per deal, gain is +1% per deal
hold for a week period, there could be one kind of this oppotunity in a month

if all hit t/p, annualized return is 1%*12=12%, calc probability it's 12%*97%=11.6%+
if all hit s/l, annualized loss is -2%*12=-24%, calc probability it's -24%*2%=-0.5%
so by probability loss over a year is expected to be +11%, risk is well controlled, spread is 0.1%*12 or 1% cost of acc

.... summary is this is a daily T/F S/R rebounce or trend riding or correlation/correction trading with an order holding duraton of 1 week, 1 order per month, and an expected return of +10% a year and max position=1.0x acc.