First 30 Trades

the numbers

£			% (R)
Start Bal	£3,000.00		Start bal %	100.00%
Current Bal	£2,771.47		Current Bal %	91.75%
Gross Profit £	£153.93		Gross Profit %	5.55%
Gross Loss £	£382.46		Gross Loss %	13.80%
Net PL (Diff)	-£228.53		Net PL (Diff)%	-8.25%
Average Win £	£30.79		Average Win%	1.11%
Average Loss £	£15.30		Average Loss %	0.55%
Av net PL£	£15.49		AV net PL %	0.56%
Total Wins	5		Hit Rate	16.7%
Total Losses	25		Hit Rate Diff	83.3%
Total Trades	30		Expectancy	-0.27%
Total Longs	5		Total Longs %	16.67%
Total Shorts	25		Total Shorts %	83.33%

Gross Win MFE	18.00%		Gross Loss MFE	38.10%
Gross Win MAE	1.75%		Gross Loss MAE	21.00%
Average Win MFE	3.60%		Average Loss MFE	1.52%
Average Win MAE	0.35%		Average Loss MAE	0.84%

quick summary

So from this new method we can see I'm down -8.25% / -£228.53,  My hit rate is 16.7% and my expected payout is -0.27%. Certainly nowhere near a business!

However there are some promising numbers. In my MFE (Maximum Favourable Excursion) we can see my trades have been hitting healthy numbers. So what went wrong?

problems

1. I cut my winners short (92% of the time): Collectively these trades had an MFE of +44%, see "Gross Loss MFE" where many of these trades ended up. Many winners simply didn't get out of the gate due to my fear based trading and my desire to trail my stop too quickly to reduce risk! This occurred in three ways 1. trailing to BE too quickly. 2. Trailing a little too tight, not respecting the spread. 3. Taking profit too early.

I appreciate of course that I won't be getting anywhere near the full +44% MFE in reality. However even if I average out all my winners and "potential winners, ruined by George" (+44% / 12 trades = +3.66%), take away the the trades that didn't achieve the average (6) and multiply the remainder by the average (6 trades x 3.66% = +22%) I would easily have got into profit.

2. Taking weak setups (50% of the time): These occurred in three forms too. 1. Candle setups that were sub par, particularly weak IB, MRC and Engulfing patterns not showing reasonable reversal strength. 2. Setups that weren't actually at S/R 3. "Experimenting" with setups that weren't in the plan!

Collectively these trades accounted for -8.5%. Just avoiding these alone would have got me back in the black.

3. Taking STAM 3 or counter trend trades (13% of the time): All failed but the numbers have been accounted for in "weak setups".

observations

Not conclusive but I would say that on the whole, and particularly if these all occurred at the same time, my trades had the biggest runs in my favour when...

• setups experienced deep pull-backs prior to their occurrence
• setups were on what I call polarity change levels, where S becomes R or R becomes S
• setups were on or near the 50SMA
• setup triggers were Pins, MRCs or IBs. 

going forward

Letting Winners Run: 90% of my winners I am closing too early! It's also worth noting that had I not cut the legs off my winners I would be looking at a hit rate in the region of 30%. Ironically it seems this fear based trader needs to expose capital to preserve capital!

Reducing Mistakes: What has flagged up and that has greatly surprised me, is that 50% of the time I'm taking sub-par setups! Be they simply a weak candle pattern, a setup not at S/R or worse not a setup at all, mistakes are happening as often as I am making good decisions! Before I start again I need to make a concerted effort to reduce these if I am going to see an improvement in my numbers.

Going Forward: It is of course blindingly obvious that I need to avoid points 1-3. So firstly I am going to revisit and rework my Tactical Trade Plan with the aim of preventing them and their subcategories. I will then make note of my observations. Finally I need to take time to include what I have learnt from VTP Stage 2 so far. I am going to be vague here as it's not mine to share but I will say it involves building positions.

Once my TTP is updated the plan is to start the next 30 trade sample in a micro real account, which doubtless will create its own issues ;-)