EURUSD Experiment

[The Artist]

Hello,

I'm in a good mood and I want to test something out so I thought I'd share.

Trading solely EUR/USD (spot) and using fixed risk and fixed stop-loss of respectively 10% and 20 pips per trade, I'm going to trade until I gain or lose 100 pips during the month.

Conveniently, next Monday is July 1st so I'll have a tidy 6 months until December 31st to test this out. I have put $500 on a Oanda account which I just linked to myfxbook for tracking purposes.

So for instance in July I will start with $500, and risk 10% per trade ($50) with a 20 pips SL for each trade (i.e. 0.25 standard lot per trade). Even though I will only trade once a day on average it seems unlikely that neither +100 or -100 be hit over the course of a whole month, therefore I will either end up with $750 or $250.

If +100 is hit, the month is over; however if -100 is hit, there will be a second round of +100 vs. -100. At that point, another -100 hit will end the month; I have not yet decided what will happen if +100 is hit then, I'll figure it out when necessary.

Another thing is I like round numbers so I will always aim for multiples of 20 pips when it comes to winners, although slippage and co will make sure this does not always happen.

Lastly, this is not a $500 to $1,000,000,000,000,000 and some thread. I'm just trying to check whether I can potentially start to implement this kind of unconventional trading behaviour on a real income basis next year with any consistency.

 

[FringFX]

Don't you think your stop and risk should go the opposite way? That is, reduce the risk and increase the stop. 20 pips is too tight, unless you have a very precise entry or timing.

 

[The Artist]

Don't you think your stop and risk should go the opposite way? That is, reduce the risk and increase the stop. 20 pips is too tight, unless you have a very precise entry or timing.

Hi FringFX

Risk level is almost irrelevant here. I picked 10% because capital is very small and if I'm confident I can make +100 before -100 I might as well try to double up quickly. Otherwise, risk per trade would be within a more standard sub-2% range with a proper account.
As for the stop-loss, it's tight alright, but since the monthly target is +/-100, it's quite appropriate. If I use a 50 pips SL then I need a very high win% since a minimum of 2 trades can take me out. Or then I would increase the monthly target to say +/-200 pips, but here I will be looking at positions with average trade duration consistent with a 20 pip SL.

On a side note, I won't have time to preempt all trades here but will when possible. In any case I'll post statements when necessary.

For today, I'll go long on a confirmed retest of 13060 and short on a drift back down to 13020, using 13040 as a SL pivot.

 

[The Artist]

using fixed risk and fixed stop-loss of respectively 10% and 20 pips per trade

So for instance in July I will start with $500, and risk 10% per trade ($50) with a 20 pips SL for each trade (i.e. 0.25 standard lot per trade).

Ok so I did not pay attention when I quickly created the account about Oanda's fixed margin policy and turns out 10% equity per trade risk is a no-go. It's fairly annoying because I picked them for their direct myfxbook connectivity and the only other direct option is fxcm, aside from indirect link via MT4. FXCM's spreads are too wide for 20 pips SL and I can't stand MT4 so for now I will use 5% risk per trade for July and perhaps I'll worry about this issue later.
Re trades, no 13020 offer on knee-jerk ISM in the end but the 13060 long was filled in late LDN and is on. Could drift either way in Asia but prepared to wake up to a loss with 31 likely to cap any upside momentum.

 

[Jason Rogers]

Ok so I did not pay attention when I quickly created the account about Oanda's fixed margin policy and turns out 10% equity per trade risk is a no-go. It's fairly annoying because I picked them for their direct myfxbook connectivity and the only other direct option is fxcm, aside from indirect link via MT4. FXCM's spreads are too wide for 20 pips SL and I can't stand MT4 so for now I will use 5% risk per trade for July and perhaps I'll worry about this issue later.
Re trades, no 13020 offer on knee-jerk ISM in the end but the 13060 long was filled in late LDN and is on. Could drift either way in Asia but prepared to wake up to a loss with 31 likely to cap any upside momentum.

Hi TA,

It's important when looking at spreads to compare similar execution types. In addition to our No Dealing Desk (NDD) forex execution, FXCM also offers a Dealing Desk execution option for traders whose primary concern is low spreads.

The information above is taken from Forex Factory's live spread table comparing several brokers on dealing desk execution.

Jason Rogers

 

[The Artist]

Re trades, no 13020 offer on knee-jerk ISM in the end but the 13060 long was filled in late LDN and is on. Could drift either way in Asia but prepared to wake up to a loss with 31 likely to cap any upside momentum.

Ok, so 13100 did cap big time indeed so that 13060 long on Monday was stopped out, then yesterday a 13030 long was stopped out as well. Today, another two buy orders, at 12970 pre-ADP which was stopped out then post-ADP which was closed at 13010 for +20 net. Overall -20 then, and not going against the trend on purpose, it's just worked out that way I haven't been able to get in on the downside this week, rather annoyingly, especially yesterday.
Tomorrow I will probably not be able to update in real time again due to high vol. Unless I trade in the morning which is unlikely as E/U should relatively flatline until the Draghster comes on.

Recap:
1/7 -20
2/7 -20
3/7 +20

 

[Babyblush]

So you mean to say if you do not hit the +100 or -100 and inbetween the floating loss or profit then you will realize it.