August blues

August is coming to an end, and after a great July, August has been a month of a slow death by a thousand cuts. The account is down -24% for the month. Hardly any of my trades were winners. I stuck to my system on most trades, but did make errors on some. The slow markets are very frustrating and sometimes lead to impatient trades, which in hind-sight were not right. But mainly, the results reflect the fact that my trading style is not suited for range-bound markets. The ranges this month have been incredibly small by comparison with other months over the past few years. I hope markets don’t become like this permanently!

I have 2 options for dealing with such markets: a) Develop another system for ranging markets, or b) Just don’t trade.

Developing another system has 2 big drawbacks:

1. It is hard for one person to have two contrasting trading styles simultaneously. In fact I don’t think it is possible. Every decision-point will have two or more possible answers, and that is a recipe for disaster.

2. The other issue is how to know when to use a particular system. Range markets can be labelled as such only after a little time has passed and even that is uncertain – how long should one wait? By the time it becomes obvious that we are in a ranging market we may be close to a break-out.

To be clear, there are some clues that point to a ranging market. For example, after a significant move in either direction, one can be sure that the market will range and consolidate for a while. So we could switch to a range-market strategy immediately after a big move. Once the range is decisively broken, we have a trend. There are still many questions that need answering and I will have to do more research.

Until then, option (b) is preferable. Just don’t trade in August or similar periods!

August has been a little unsettling for me – I have felt out of sync all month. The detailed results for the month are in the next post.



4 thoughts on “August blues

  1. gomesfx

    Hi zen, do not get me wrong but,

    Forget range markets !!
    Trade only trend markets !!
    Trade only A+ setups !!
    Trade only higher time frames !!
    Have patience and discipline !!
    Have a very good money management
    Remove indicators !!

    August was a good month !! Just like any other month of the year !!
    Don´t blame the market saying it´s in range. If you with five currency pairs, dont see a trend in at least one currency pair, i´m sorry.

    Definitly you wrote the answer for your question !!
    “… and I will have to do more research”

    I doubt that you are a professional trade, i´m sorry.

    Just never give up and continue with your journey!!

    Best tip: Think out of the box !!


    1. ZenFXTrader

      Hi Gomes, thanks for your feedback. I shouldn’t blame the markets. I agree with most of your suggestions, eg trade only A+ setups; remove indicators (I don’t use any indicators); have patience and discipline (that’s a never-ending quest); have good money management (I’m comfortable with my MM). But things are a little more subtle. eg trade only trend markets and forget range markets – as I wrote, this becomes obvious only after the move has already started. Did you see any A+ setups in any pair in August, i.e. trending and not ranging?


  2. gomesfx

    Hi zen.

    If you wanna make money you need to agree (and do it) with all my sugestions.

    About your question.
    “Did you see any A+ setups in any pair in August, i.e. trending and not ranging?”

    Yes !!

    I trade eight pairs including your five pairs.
    And in those five pairs, i had setups in two of them.
    My others setups were in the other three pairs that i trade.

    When we understand the market as traders and not as analysts, become more simple.

    I do not like to showing, but i open an exception …

    Report for august 2013
    5 setups
    35 trades (35 wins 0 loses)
    +50% in account



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