High Quality forex trading end-of-day by michal9

One winner closed today.

EURAUD winner, exactly a kind of trade I like. Missed onle level below, got a fill on a new level above.

One would-be winning , on USDCAD, trade entry missed by 3 pips.
Another, on EURGBP, maybe I should not trade it, entry missed by a spread (on chart the bid price was below my long entry, but ask was above).

Uptick on equity curve and the week ended flat.
Have a nice weekend.

I wish you the best of luck Michal. Just keep learning and you achieve your goal.

Thanks a lot ProsteJa. I appreciate and trust you are right :-)

One losing trade closed today.

USDJPY, not a good trade, luckily half size.
A few more orders in place.

Trend on my equity curve remains unfortunately unchanged ;-)

Well, it is great in trading that performance is so clear, isn't it? And fully dependent on my own decisions. Reflecting the quality of my system and the quality of my execution of it. That's great. Next trade. Then next system if needed.

As many as five positions closed today, 3 losers, 2 winners (one of them half size), net result is zero.


EURUSD, looks like a good trade. Will see, looks like price stalled 3 pips below my stop. So now it will probably reverse (just kidding, no depression yet ;-)
This was a half size trade.

GBPUSD, good trade, this was a half size trade, as a correlated with the EURUSD one. But this one luckily worked. Nice 2R. Nice entry & exit. That's what I am looking for in this system / method / approach. Recall this is all while trading 20 minutes per day end-of-day only.

EURGBP, two trades on the same pair closed one day. One short , one long. One winner, one loser. Luckily both normal size, to winner two times larger than a loser (at least position sizing I tend to to right ;-)

USDCAD, lastly, there is a loss here. This is not a particularily good trade. I should have cancelled the order after this level worked 4 times and I got no fill, it was predictable that at some point this support will break, so it did, taking me from my entry directly to my stop loss.


After this "busy" day, my P&L is flat, to be precise: about two U.S. dollars loss, but certaily my broker is happy (note lots spike on my fx book screen.... this is microlots anyway).

No trades closed today.

Technically speaking, there is one trade, a loss, a trade I took on the same account, but outside of SDH1 system, so I am not placing it here.

It was a XAUUSD long on the break of the bullish candle from April 24th, 2014, which formed at a key level (it rejected 1275), and I had a near stop at 1285 and the market sucessfully taken it ;-) Anyway, I should not mix systems on one account, but I could not resist not taking this one, as it looked like a very good trade, and ended as usual. That's OK. Next good trade.

I will be back to trading on Monday May 5th.

Two winning trades closed today.
I said I would be back on Monday, but the market did not sleep, and I found time to have a look, my orders were in place.

EURJPY winner. A good trade, but... I have just closed it manually... it missed the TP level by 2 pips! Again. And retraced. I do not want to leave it open for weekend and risk 2R in the hope to make 0.5R more. So I closed it.

GBPUSD is a second winner, and this one was closed without any manual intervention, as per set & forget orders, lucky exit. Sometimes, it seems, luck is on my side, too.

Also, fortunately, both trades were full size, so there is a nice uptick on my equity curve. Sadly, let us not pretend that I am back in profit, which I am not.
With my risk of approximately 0.5% account per trade, and current result of minus 1.6%, my net result so far, after 91 trades, is minus 3R.

Another fun fact I felt like sharing... I am also testing a variation of a morning breakout system on demo and on forex tester, it uses buy stop and sell stop entry orders on a break of the fractal, on 5M TF, after the first breakout of the night range, around London open time, also set & forget, with 1R TP or and 15-25 pips SL. And today, on payrolls data, I made 180 pips in total, on 5 different currency pairs, in 10 seconds! On demo ;-) (but with a live data feed from STP/ECN, for example a gap on EURUSD was around 13 pips, so my profit was 2 pips insted of 15 pips, but more lucky with other pairs). I am looking into adding this system to my traded systems, as it also looks like may be possible to co-exist with my full time job, as it requires a glance at the market early morning, and then just a 10 seconds look if there was a breakout and a correction, which I could set an order to follow if there is a follow-up.

Last thing I wanted to share with the readers, another book that I am reading and is great, it was recommended in the Bellafiore books, and the books is... by Brett N. Steenbarger, "Enhancing Trader Performance Proven Strategies From the Cutting Edge of Trading Psychology". I strongly recommend. One key take-away: use simulator.

With this, have a nice weekend, and I will be back on Monday May 5th, 2014.

No trades closed today.

A few entry orders in place.
One good trade missed on OIL.

No trades closed today. No trades open. 7 orders in place. 9 more days until pre-planned May 15th checkpoint that will conclude this 3 months live trading of this system.

One losing trade closed today.

XAUUSD losing trade. Looks like... not a very good trade. Level below was stronger, and this is where the price stalled. But I traded the one I did. Why? It looked like it was also a strond support level, previously resistance. OK.

Believe it or not, but one entry missed by 4 pips, another by 3 pips. Both would be around 1.5R winners already.

Downtick on equity curve.

Two losing trades closed today, luckily half sizes.

EURGBP loss. Poor trade. And not a good pair to trade either. And not before Draghi speaks.

EURUSD loss, this technically looks like a good trade. There is a level, a trend, a pair in play, we could say.
But I over-traded, it seems.

That's it for today. My fx book shows not much reasons to celebrate today, and it looks like it is time to embrace this result of this system in this time...


Note, in my previous post there is a screenshot with wrong colors of candles... switched the computer, was adjusting, did not notice at first.

One losing trade closed today.

GBPUSD. As you can see, did not work out.

My fx book performance updated accordingly, in line with its evident downtrend (makes me wonder: should I have traded reverse positions each time ;-)

OK, back to seriousness, there are 3 pending orders in place, as we are entering the last and final week of the 3 months period of live trading of this system.
I believe they are high quality trades, to finish this right.

I wish you all a nice weekend, if somone still reads this journal after seeing the results, but stay tuned for the summary, after next week, which will be my attempt to answer the question why the live results were so much different than demo. Was it poor execution? Psychology as one could think? Resulting in poor execution? over-trading? Or maybe market conditions that were favorable Dec'13-Feb'14 but unfavorable March-May'14? or maybe this system, even if executed properly is plain not good enough and great demo result was a coincidence? All this is possible. And with a journal analysis I will try to find the answer...

I wrote a blog post on using a trading simulator, which I strongly recommend, and have used before I started trading this system. In simulator I was profitable, so was I on demo as you could see in this journal, live I am not yet, so obvioulsy it does not guarantee profitability but reverse is likely true: if you are not profitable in simulator, you will not be live, unless by coincidence.

No trades closed today.
4 pending orders in.

No trades closed today. One position open. 3 orders in place. 2 more days till checkpoint.

One winner closed today.

AUDUSD, a one good trade.

Higher low printed on equity curve ;-)
Result went up to -1.99%, looks like a nice price point, "I lost less than 2%", I can say. ;-)

One loser and one winner closed today.

The loser is SPX. It did what it had to do. I am glad I had a stop.

The winner is XAU. I closed it by hand, a bit before TP, but I wanted to be flat on this system as I move on to the assessment of the last 3 months.
Today is the checkpoint day.

And the result is... after 3 months of trading this system, on a live account, with high Quality to the best of my abilities and discipline....
... a loss of 1.87%.

My fx book.

Now I will analyze the journal to answer the question why in previous 3 months on demo I had a 29% profit, so what happened, and whether or not to continue trading this system, or what to improve with the system or my execution. I will post the results.

For now, given the result above, my live trading of SDH1 system is on hold.
Of course, if the Murphy's law is true, this is the moment when market conditions change and this system would have start making money ;-)
Let's find out. I definitely stay in the business.

And, independently from this financial outcome, I am very happy I executed my plan: trade the system, consistently, for 3 months, every day, with quality, in a journal, with the right money management. I did it. Great learning experience and time to look for improvements.

Thanks to all readers of this journal. Again, I will be back with the journal analysis outcome.

Don't trade May
not long anyway
sell in may really does apply to the currencies, check other yrs and you ll see

OK, it is time to summarize last 3 months.

On February 15th, 2014, I started trading the SDH1 system live, after previous 3 months of demo.
Demo result was 29% profit with 7% drawdown.
Live result is 2% loss, with 4% drawdown, as shown on my fx book screen in the post above.


This has been a great learning experience. I am happy I was able to trade a defined trading system, in a consistent way, for 3 months on a live account. The monetary outcome is negative 2%... which is what many traders lose on a single trade. It took me 100 trades.

My journal analysis leads me to think I traded the system with high quality, although not without some poor trades.

Net outcome is likely a combination of a not strong enough edge this simplistic system offers, unfavorable market conditions, and quality of execution.

With this, I am putting this system on hold. Experience was great. I continue to think S&D levels is a good method, just that I was not able to make money with the way I approached it at this time.

I traded the SD zones on H1 charts, with limit orders on a end-of-day basis, with a set & forget SL and TP. Idea behind this system was to get a simple system, that offers freqent trading opportunities even though a trader looks at the market only once every 24 hours.

Equity curve has a clear downtrend, so a loss is not a result of a single or a few trades. I used equal dollar risk per trade position sizing model. Number of taken trades, almost 100, also makes it unlikely for this result to be random.

Transaction costs had its impact... for convenience of a platform I like, I used a broker with a high 2.5 pips spread.
I could say that if only the spread was smaller and I had just 2 or 3 more winners, the net outcome would be positive.

I believe the reason for this performance is a mix of the following: system weakness of not great enough edge, a couple trading errors in my execution, unfavorable market conditions for the system, transaction costs.

What's next: as per the criteria I set upfront, given the result was a loss, I am taking a step back. Live trading of this system is now on hold.

This is a sucess. Seriously. I was able to consistently trade a specific trading system, for 3 months, taking 100 trades, traded it with high quality, and in an end-of-day mode. I am happy that I executed against my plan. This was also my executing of the "Trading in a zone" book exercise. This has also been a great learning. And , I hope, a significant step towards becoming consistently profitable, with a variation of this system, or another one.


Thanks to all readers of this journal and your inputs, ideas, comments and encouraging words.
I definitely stay in the business of forex trading.

I will be very happy to hear any closing comments you may have on this system and my approach and the past 6 months exercise (3 months demo, 3 months live).

Then I move on. I already have two new forex trading opportunities ahead, also one that can be effectively combined with a full time job, systems that have end-of-day preparation and 2 minutes to place an order, three times during the day, should a specific setup occur on a specific hour. I may start a new journal for that.

That's it for now.
Thank you.

Well done Michal, you have inspired my first ever post on FF. I think your method of testing on demo, then going live is one I wish I had used more patiently myself in the past.

I hope you continue to post here and link any new strategies to this post as I would enjoy following further.

Best regards