week11 50% ROI. Linear or Compounded growth?

After 3 months of using myfxbook to track this account which trades om trappedtraders signal, a humble but yet truthful & realistic of 50% ROI was reached. Profits was regularly withdrawn to protect them. This was to mimic how traders who “traded for a living” would function. It also brings to discussion on whether a trader should focus on linear growth or compounded growth.

linear growth

The equity curve should ideally be gradually slanted up. However there will be no exponential growth as profits are mot compounded as they are withdrawn.
week11 50% roi 170316

Compounded growth

A system that aims to compound its growth will have an equity curve that looks like this:

week11 compounded growth

While compounding the account is a very possible & sexy notion which is what attracts many people to leveraged trading in the first place, it is also the reason why many accounts are burnt. A workable profit withdrawal plan is required in order to chart equity growth. Whether am account cam multiply or not depends om the following:

week11 compoumdimg accoumt 170316

While update again when account reaches 75% ROI.

(short in progress) week10 GBPCAD D1 super pivot A-Grade setup

D1

A superpivot trappedtrader signal was fired off last night which happened to appear at a resistance confluence of
trendline and psychological resistance.

week10 g6pcad d1 super pivot 100316

h4

Week to week, there is a clear bearish trend with consecutive lower high weeks. As of yesterday, the print of a super pivot signal validates the resistance of the confluence zone, which is in tandem with a bear flag continuation pattern. This becomes an A Trade setup.

week10 GBPCAD h4 week to week downtrend with bearflag 100316

( short in progress) week9 AUDUSD D1 accumulating short positions at resistance confluence

D1

A very nice resistance confluence is validated by a bearish trappedtrader’s signal.
This is a chance to accumulate short positions.
week9 AUDUSD D1 bearish trappedtrader 290216

h4

The chart pattern at this confluence zone seems kind of mixed at this time. It is not really clear whether the topping pattern has completed already or not. So batching in short positions will be a good idea.

week9 AUDUSD h4 right shoulder sell limit 290216

week8 30% ROI , 93% win rate: using myfxbook in charting progress

In Dec 2015, a myfxbook account was started for readers to be able to see how trades were entered according to charts shown in current website,

 

Please follow this twitter link to myfxbook account:

 

facebook: https://www.facebook.com/Retail-Trading-in-Forex-Indices-and-Commodities-909208749092015/?ref=hl

This was a good platform shed light on the details in how trades are entered, stacked, managed, exited or mitigation of losses which cannot be seen from mere charts alone.

Account was shared with trades placed in real time.

Some trading concepts of this account:

-Entries were made according to analysis posted on website and twitter, timed by signals fired off from #trappedtraders system. Not 100% accurate, so always leave enough for 2nd or 3rd batch of stacking in positions.

-Book profits fast, focus on securing actual trading returns of 0.3%-1% instead of waiting for wins calculated by pips

-Conservative preservation of trading capital
a) focus on postional sizing risk instead of pip risk. i.e trades in red can run up to 500-600 pips, but it is ok as long as capital risk is contained within 1-2%.

b) regular withdrawal of profits and resetting account to original amount to constantly be kept on toes.

-Focus on booking winners, and keeping the losers until they turn profitable.

32% ( 1/3 capital ROI) in 2 months

keeping account constant and focus on regular withdrawal
week8 myfxbook 250216

High winning percentage

High winning percentage with 97% of shorts won , 73% of longs won.
RRR is generally poor, as I tend to hold on to big losses before finally able to exit them. Although this goes against textbook trading best practices, it is important to develop styles that suit the individual personality instead of trying to change our personality to fit standard, boxed-in notions of what constitute successful trading is. After all, retail trading and professional trading are separate endeavors. Besides profitability, factors such as lifestyle, and ease of mind needs to be considered as well. Hence with a high winning percentage, my trading morale is constantly kept high and in turn my confidence is tremendously boosted, giving me the conviction to last my trades and believe that each trade i place will always turn out to be a winner. As records are tabulated, in turn the high winning percentage becomes a statistics ( of 97% win rate) to build my trading conviction for future trades.

week9 high win rate 250216

Keeping account stable, keeping profits real and credible

While it is not diffiult to rack up 100% ROI with just a few winning trades, it is equally easy to burn it down. Most beginning traders are overly greedy and overestimate their ability to time the market. A good way to determine if the account is stable from account meltdown can be analysed through the concept of risk of ruin.
As of current writing, this account should be relatively safe from meltdown, as seen from the table.

week9 risk of ruin 250216

Summary

I will like to surmise that this account has a stable growth, high winning accuracy with a system to lock in profits. Although the RRR is inferior according to classic trading practices, it is designed in mind for traders who plan to trade for a living. Keeping the account healthy, and withdrawing regular profits as the main focus is a good proposition and a compulsory stage before transcending to the next trading stage. ( more to come)

Do continue to follow this live account and the next update will be when 50% ROI is reached.

( short in progress) week8 Nikkei D1 head and shoulders at trendline resistance

D1

A simple line chart shows that current price is forming a head and shoulders distribution pattern with
pivot points aligned with a trendline resistance. This is in line with current downtrend of past 10-20 weeks.

This head and shoulder is also meaningful because it is printed at 16000 psychological level. Hence it is likely this level is being rejected by market after a span of 5-10 days. It is perhaps a sufficient indication of true market intention for the next phase of movement.

Overall a simple concept of Support turn Resistance is being enacted out here.

week8 mikkei d1 h&S 240216

It is hard for traders to pinpoint exactly when a trade will start moving. Many a times an entry might be made but the pattern will continue to evolve, causing the trader to be stuck in an inferior position for a while. Creeping negative thoughts may come in and that is when thoughts of exiting may be entertained. This twitter shows how a chance appeared early last week to enter short. However price chart continued to evolve.

( SHORT in progress) week5 EURNZD shooting star and head and shoulders seen

D1

It has become easy for decision making. When I see a shooting star in line with my trend bias, I will go for short immmediately without thinking too much.

week5 EURNZD D1 shooting star 020216

h4

On h4 it is more apparent that the short is immiment, with the completion of a h4 head and shoulders
A h4 super pivot helped to complete the right shoulder.
I shorted immediately on tuesday open and am ready to short more with sell limit should price does an intra-day retracement.

week5 EURNZD h4 hns super pivot 020216

week5 EURSGD head and shoulders fully formed, awaiting downmove

D1

this chart shows how a large head and shoulders is already fully formed. This was completed with resistance confluence zone appearing. What is left now is the breakage of the bearflag to start an avalanche of downmove.

week5 EURSGD D1  big bear flag hns 300116

I also wish to highlight on observation and effectiveness of line chart pivot. Price seems to follow line chart well on D1. What needs to be done is to ignore the candlesticks version which shows the daily fluctuations. As such putting stop loss is a fallacy that may not help much in trading, as there tends to be regular episodes of spikeouts that serves to kill off traders with tight stops. Imo, these traders have believed that having a tight stops equates to having goo risk management. Where in actuality, good risk management is about having a good level of technical charting proficiency together with smaller and bearable position size.