April started off looking great with over 1,700 pips of profit in equity... but quickly turned into one of those ranging months that whipsaws your open profits away. The month's total loss was only (-446 pips), once again a blip on the radar screen according to the big picture (look at the chart above... can you even see the drawdown?) In fact as I write this results post the market has been moving fast and furious again and every pair I trade has an open trade that is well into profit... well over 3,000 total pips right now. While I obviously won't count these pips as profit yet (you only have to look at April to understand why you can't do that), I feel good knowing that these trades are there to help me reach a new high in my account balance before the end of May.
During months like April I inevitably get questions about why I don't close out the trades when they're "overextended" and take the profits before they can retrace. It's simple... you're looking at the trades with hindsight. You know now that they retraced and set up in ranges that cost the open equity... but you didn't know that when it was the present time and you had to make the decision. It's just as likely that the moves could have continued in the same direction and instead of losing 446 pips in April I could have profited 4,000 pips! But if you exited the trades early before getting an exit signal you would have missed out on these pips. A similar situation is setting itself up for May as we speak... if I close out the 3,000+ pips I have now will I be better off than waiting to see if the moves continue? Maybe, maybe not... but I don't have to make this decision... I let my trading plan/system make it for me. This removes my emotional attachment to the "paper" equity money that I don't really have yet and allows me to make intelligent decisions regarding my trend following. When you start second guessing your trading plan is when you invite disaster. FPM has proven itself to be extremely reliable and resilient (again, look at the graph above of my account value in pips since I started tracking my live trading). Have a good plan (including good money management) and stick to it... and forget about your small losses... they don't do any damage to your trading... only your emotions about them do!
Here's a breakdown of my April results trading the 8 pairs I trade on the 4 Hour chart:
42 total trades
14 wins - 1,932 pips
28 losses - 2,378 pips
(-446 pips)
33% win rate
Avg win - 138 pips
Avg loss - 84 pips
Avg risk/reward ratio - 1.64 to 1
Here are the details by currency pair (best to worst):
USD/JPY: 2 W, 2 L +252 pips
GBP/JPY: 2 W, 4 L + 88 pips
USD/CHF: 3 W, 1 L + 34 pips
EUR/USD: 1 W, 3 L (-28 pips)
EUR/JPY: 2 W, 4 L (-160 pips)
AUD/USD: 1 W, 5 L (-199 pips)
USD/CAD: 1 W, 4 L (-214 pips)
GBP/USD: 2 W, 5 L (-219 pips)
That's it for April... if we don't see a repeat of all of this open equity vanishing I'll once again be at a new account high by the end of May!
Here are the results for the year so far:
January: +823
February: +669
March: +434
April: (-446)
Total: 1,480 pips
Avg: 370 pips per month
For more information regarding the Forex Profit Monster system (and my day trading system Forex Day Monster) visit www.forexprofitmonster.com.
To purchase either system visit my eBay page at http://myworld.ebay.com/jimsgr8stuff4less.
Thanks for reading this and best of luck in your trading!
Jim
www.forexprofitmonster.com
http://myworld.ebay.com/jimsgr8stuff4less
