I had a question in the chat box that i thought deserved an answer in more depth - so here goes.

Tarrentino: Soul, very very interesting stuff in your blogs. I have spent the last three years messing about with automated system development but have yet to get the smooth equity curve we're all searching for. My systems worked well over 2-3 years but there was always one period which made the whole thing FUBAR. Got an article being published in e-Forex in Jan which you might find slightly interesting although there's nothing revolutionary. Are you an ex bank trader?


hi tarrentino - (your films suck by the way :) ) seriously tho, no, not a bank trader just a self taught trader but i have met with many bank traders and know the score.

Automated systems can work but i don't believe they will for retail traders over the long term - the mega players have them that win but they take very small wins that we can't get because of retail spreads - institutions have spreads as low as 0.1 pip and often zero - those people have automated systems.

There's also the calibre of programming tools at our disposal - Until we get some real artificial intelligence then i no longer believe that automated trading is a way to go - it worked for me for just over a year and then as you say FUBAR.

I dont think it's possible yet to programme a computer with the instinct that a trader has. I'm sure that in the future someone will prove me wrong, but as yet i've not seen it.

I actually now find trading so easy that I couldnt be bothered to automate it - trading is a numbers game - take enough of em and hold on to em when they win and you can't fail - all you need is time and money - both of which sadly most traders do not seem to possess. They want everything today in a hurry and don't have the funds to even trade with a long term conviction.

Trading is 'the long game' - that takes money and time. Thankfully I think that i've now found that out. I very rarely go below a daily chart anymore and that's where the real money is.

xmas eve

Stops moved to be on all positions, might close out before close of business today and call it quits for the year.

Catch ya later if i make changes, if not MERRY CHRISTMAS!

morning all, new week.

gbpusd kicked in, in the hole at the mo

NEW TRADE SHORT USDCHF @ 1.0997 sl 1.1235

NEW TRADE SHORT USDCAD @ 1.2155 sl 1.2255
Theres quite a few opportunities this morning but enough exposure at the mo.

Stay lucky

New Trade (order) Short GBPUSD at 1.4865 if seen - expiry xmas eve 6pm

new trade

NEW TRADE half position long audusd @0.6926 200 pip stop

that's it!

USDCHF closed at 1.0700 for +1070 pips - nice one.

it may well continue to bollock down now however i think there will be sufficient profit taking around here to hold it up.

My little punt didnt give it enough roon, c'est la vie' as they say so -33 on that one

I'm not sure i'm interested in any more trades this side of Christmas but keep checking, im scalping shorts on gbpusd this morning for fun but won't be making calls.

scores on the doors are:

Closed Results +3433 Pips since Oct 23rd 2008.

This Month +859 Pips on closed trades

stay lucky

punt

popping a punt on usdchf for the possible bounce also -

NEW TRADE long usdchf @ 1.0703 IF SEEN sl@ 1.0670 so only a 33 pip risk for a possible 600 pips ish trade if the bounce is significant. worth a punt if you ask me for a standard stake.

take profit level

Normally i dont do 'take profits' cos i believe that you let em run.

however this move is a bit off from the norm so i'm placing a take profit at 1.0700.

Reason ive chosen that level is from the september lows - there is almost bound to be a bounce back retrace there and then i'll be looking to get back in.

That will be yet another 1000+ pip trade though - see what i mean about waiting your time. its currently at 1.0800 at +960 pips and i dont normally visit the blog at this time of day, but i thought i'd post the take profit decided upon so no nobhead can say 'yes, its easy in hindsight' when in fact it's easy no matter what!

catch you in the morn

midweek

see, all good things come to those who wait!

usdchf now 600+ - 500 pip trailer is in place. lets see how far this will go.

of course chances are if you are an unseasoned trader you wouldnt have got this far - took your money early and spent the rest of this week kicking yourself.

another lesson then - patience is a virtue, especially in trading.

speak soon

new week

New week then - the usdchf order to short kicked in Friday afternoon and is now 50 up. stop is at 1.2030

Nothing else interesting - been doing some scalping on cable to get the account back up - did about 80 pips on Friday and -11 this morning but feel free to ignore those - no way i could call them live!

Nothing else looks any use long term so i'm hanging off for maybe till the new year - very busy this end - did i tell you i'm a radio DJ?

Anyway, catch you soon

GBPCAD failed - half position remember so -85 pips

Closed Results +2396 Pips since Oct 23rd 2008.

This Month -211 Pips on closed trades

this month is getting tedious - leaving the market for a few days.

have actually done a little short term trading this morning to get the account back up a bit but not listing them here cos not real time.

catch you soon when the market begins to move again

shitstorm then - cad closed for the +33 pips, cadchf closed -146 pips, eurchf still running but looking a bit sick.

never mind.

Closed Results +2481 Pips since Oct 23rd 2008.

This Month -148 Pips on closed trades

nothing much interesting at the mo on the charts, 4 hour looks tempting for cable and might take a punt later when i'm out. also like this one

NEW TRADE shoirt gbpcad half position @ 1.8581 sl 1.8750

might be a fast one just to redress the balance for the month - cant see anything else.

Sunday night 7th dec 2008

ok, update, sorry couldnt do this on Friday but was busy as hell.

eurchf stop was moved to 1.5425 which was hit and taken out for -100 pips.

usdcad went to over +500 at one point so the trailing stop kicked in (500 pip trailer) - stop is currently 1.2507 locking in an amazing 33 pips lol.

so far the month has done fuck all worth bothering with. some will be saying - "yes, but if you had taken say 200 pips on each trade then you would be well up now" and yes, i would - but i dont trade that way - all i want is one good trade a month that makes say 1000 pips and i'm made - to find that one trade takes some shit shovelling.

so far weve had lots of minuses for a couple of hunreds and a few wins which matches em up

Closed Results +2594 Pips since Oct 23rd 2008.

This Month -35 Pips on closed trades

I dont sit here all day watching the markets - I have other businesses that i'm in to and so only trade for prob an hour a day and then just leave em alone.

Now, usdcad could go for new highs and properley break the top - i'll be having a good look in the next day or so and might start moving the stop up closer -0 lets see how it unfolds. currently +250

I note that it's now 87p for a euro - thanks a bunch Gordon Brown you fuckwit. he thinks that a weak pound will spur the recovery from imports - oi thicko!! they don't have any money abroad either you thick scottish twat!

anyway,

NEW TRADE SHORT CADCHF@0.9574 SL 0.9720 -nice low risk trade - retrace from the downtrend on friday leaving it at a clearly identifiable resistance level to short.

another interesting one - even tho i got stopped out of this on Friday im back in

EURCHF short from the open on @ 1.5529 and a 100 pip stop - some serious resistance around here and i still see a downtrend so still worth a punt.

Nothing else interesting - stay lucky!

cad stop to break even

Thurs 4 dec 08

No change to existing trades, looks like cad is starting to move but i dont expect fast moves on this, might be in a week or so

got a funny feeling about usdchf - take a look at the monthly chart, it's actually a bearish pair overall on a retrace - interested to see if she breaks down so in anticipation im putting in an order at 1.7770 for short with an expiry next weekend.

there are a few more trades i'd like to take, however the market just doesnt 'look right' to me at the moment - i cant really find anything apart from nzdusd short that looks low risk and I just dont like looking at nzdusd at the mo.

so that'll do for now.

if you're thinking about shorting the pound then remember - sell the rumour buy the fact - i have a feeling this will be the play today and if i was around i'd buy cable just before noon with a tight stop - they are all expoecting another big drop - personally i dont think it will happen so a possible news fact trade there.

then again what the fuck do i know - just follow the money and you can't go wrong!

close

eurjpy closed at +130 on stop

new trade made yesterday but losing so i guess it's alright to post

short eurchf @1.5325 stop at 1.5450

That's it - market still skittish, not that interested at present

Closed Results +2694 Pips since Oct 23rd 2008.

new trade - long usdcad 1.2474 200 pip stop

stop change on eurjpy to 119.40

-130 on gbpaud remember tho was a half position so -65 pips - also it's a 65% pair so risk was very low.

Eurjpy stop moved to 120.30 now a bet to nothing. Dont normally move em so fast but it might just go retrace tomorrow - can always get back in again around 121.50

Closed Results +2564 Pips since Oct 23rd 2008.

Keep an eye on eurchf. a retrace back to 1.5350 or higher tomorrow will see me consider an entry short.

gbpaud now looks good to short following the retrace back 400 pips - almost guaranteeed to drop back down and test those lows again. hmmm, will consider.

nothing yet tho, speak tomorrow

another

ok, one more chancer then - half position on this as it's risk is higher

gbpaud long at 2.3600 stop at 2.3470

new chancer

fancy a chancer on eurjpy tonight so gone short @120.70

theres a few i fancy but the markets skittish so this will do for starters

no trades

EURAUD closed for -200 which might upset some people because at one point it was 300 up. Doesnt matter, as i said earlier you get periods of losers until the market takes off again but you have to give them the roiom they need under the current conditions you are operating in.

Lets not also forget that it's just a 66% pair (pip value is just65.90 per mio)

Nothing interests me now so i guess we might be settling here for the month

Closed Results +2629 Pips since Oct 23rd 2008.

That makes 1458 pips for November, That's a good month. 700 pips for me and 758 for the pot - always make sure you pay yourself, ive known traders with 1mio accounts that drive around in a battered ford and then go and lose a shitload - always take some out when you win.

Looking forward to December as it's often been a boom month.

Stay Lucky

gbpchf closed for +70 buggar! too close on that stop move, but market is a bit changeable

euraud still running, in profit as i write but could go either way yet - no changes

Nothing else interesting at all - going to sit on hands a while

Closed Results +2829 Pips since Oct 23rd 2008.

just a quickie this morning, stop on gbpchf moved to 1.8070

500 pip trailing stop applied to euraud.

have fun.

closes.

Ok, some closes now then

usdchf closed on stop at 1.2140 for +320 pips. not bad from what i thought would be really crap.

usdjpy closed on stop at 96.52 for +112, poor performance from that trade.

gbpaud closed on stop at 2.3270 for -261 pips.

audusd closed on stop at 6450 for +112 pips.

gbpchf is still running with a break even stop and my little chancer from earlier tonight isnt looking good but we will see.

Overall this changes the pip count by +283 on closed trades

Closed Results +2759 Pips since Oct 23rd 2008.

for the sake of this blog i count a pip as a pip - but something for you to think about is wether all pips are created equal (ask George Orwell lol), which they arent. for a true pip count one would have to calculate the pip based on pip value per contract.

I'll explain this to you. A pip on gbpusd is worth $100 for each $mio traded. However on usdchf the same contract is only worth $83.70 and on gbpaud the price is $63.50. to get a true pip count in value one would have to multiply the pips made by the per contract price - so for example 500 pips on gbpusd is 500 wheras 500 pips on euraud is actually only 325 pips (500 X 0.65) amd another example is that -261 you see above is really -170 - lol, that'll keep you happy for a while.

Don't worry, i'm not going to change the count for this blog, but it might make you think to check the pip value when calculating the risk you are taking - a 300 pip risk on euraud for example is equivalent to a 195 pip risk on cable.

Interesting eh?

Anyway, bit of turmoil expected in the next few days so i think i'll be playing things a little light for a while and may just stay out of the market till something really juicy comes along. Check back tomorrow night for any news.

Be Lucky.

lots closed today - full report later however

new trade, another low risk high reward trade - long euraud 1.9880 200 pip stop

just wanted to tell you - be back l8r tonight ot tomorrow morn

new week

stop moved tp break even on gbpchf

stop moved to 0.9652 on usdjpy

stop moved usdchf 1.2140

new trade, bit of a chancer for big reward. long gbpaud 2.3531 stop @2.3270. potential risk / reward around 8:1 or more.

thats it, good luck :)

Closed Results +2476 Pips since Oct 23rd 2008.

changes

A few changes then and a new trade

stop moved on usdchf to 1.2070

stop moved on usdjpy to 97.25

stop moved on audusd to 0.6450

USDCAD short order cancelled

NEW TRADE low risk stop - long gbpchf 1.8000 120 pip stop 1.7880

That's it for now :)

no changes

no changesto report. almost getting tempted back short into cable but think it may just be some up and down for a while so leaving alone.

swissy now making some headway at +300, usdjpy still lagging as is audusd - all in positive though. happy to sit on my hands for a while and advise the same.

update - taking profits

Ok, update time.

Cable closed on stop on both positions - this made +955 on one position and +565 on position two
a total of +1520 pips.

Closed Results +2476 Pips since Oct 23rd 2008.

Still running is USDCHF at +159 stop moving to 1.1870 to lock in some profit allbeit only a bit. Lets face it swissy has been shit.

Usdjpy still running also, moving stop on that to break even at 9764

audusd stop move to 0.6635.

everything looks ready to turn for a while so now holding back on new positions except for one - New order short USDCAD at 1.2080 IF SEEN 500 pips stop - order good till 7pm Friday.

everything else can wait a while

catch ya tomorrow

new week

Sunday night always a bit of a nail biter - will it gap? will it go my way?

well it didnt gap and all still going as expected.

usdcad still setting up for a potential 'fool me' trade, would need to drop from here and then go to 1.1300, long signal would be triggered at that level. - I'll explain it i it comes off next week.

It wouldnt suprise me this week if we did see more of the falling pound but you never know, cable is ready for some serious retracing back to 1.56 ish to test that level that stemmed the third fall. so would need some good news to make that happen. all the ellioticians are saying it was wave five, or is it the b move etc etc.

take my advice - all that is bollocks. just follow price and give it room. just learn to manage risk and forget the direction you want to choose - far too much time is spent on your 'system' or decision. learn to manage risk and you'll do ok.


So funny last week seeing Gordon Brown talk about tax cuts, the one man that made taking money out of your pocket without you knowing it asks for tax cuts - amazing!

Funny thing is he's going to borrow money to try to buy himself out of a recession. - another 20 billion or so to give you in tax cuts so you spend it - why not just not give it out and save it you fucking moron.

Let me ask you a question; if you were in a deep hole that was leaking shit from below that kept getting bigger and bigger - what would you need to get out? a bigger spade and some more digging so more shit an come in?

What a twat.

end of week

stop on cable moved now to 1.5025, swissy moved to break even cos it's shit. no other changes. all to run over thge weekend unless stops hit tonight.

have a good weekend all

update 2

wow what a day!

cable now dropping like a nutcase - 500 pip trail now in the same place on both positions. actually saw 1300+ pips on pos1 today and over 1000 on pos 2.

swissy looking crap still and usdjpy made a mean retrace. got a feeling that might die before morning as my stop is 9840. it came within 10 pips today.

hoping cable continues, stop currently 1.5063 on both positions. would think that cable is due a strong retrace but hey, dont catch a falling knife!

if nothing else happens now i've made my money for November and still two weeks to go. Fill ya boots as we say :)

no change on audusd

That's it, catch you soon.

update

Mornin'

Cable steaming ahead now - position 1 is +1105 pips, poition 2 +721 pips, both full positions. 500pip trailer is holdin the stop at 1.5320, bit too close for my liking really, would have preferred 1.5520 to stay above yesterdays range but then it was a large day. will leave the 500 trail in.


Swissy is holding up the rear tho not doing much, don't know sometimes why i bother with swissy but it's 106 up - not far enough to move the stop yet.

usdjpy finally made it's move also +230 as i write. stop remains at 98.40 so no locked in profit yet.

audusd now 160 up on yesterdays new position, stop moved to 0.6735.

that's it, nothing new i want to risk.

this then is typical of a daily chart trader - last week we lost a few hundred pips - cant remember how many but around 400-500 pips in several trades. then you find good ones and ride em like a cowboy on a bronco. cable has been in since the 3rd nov so 10 days already but remember that was my second bite at cable.

so my impressive +1400 in 2 days score went down to 900, but now looking at +2000 in open trades. Providing you trade small enough and manage your risk then you can make good money even at a few dollars a pip.

That's it, off for the day - hope you have luck.

Closed Results +956 Pips since Oct 23rd 2008.

Update

Just my luck, gbpchf kept going! ahh well, can't win em all.

Cable now making it's money on two positions. Pos 1 is +600 and pos 2 +200 if 1.5250 goes we should be in clover for a while. stops moved to 1.5890 and a 500 pip trailing stop activated.

usdjpy isnt doing what i expect tho still hanging onto it - at the mo going from plus to minus hourly but still biased shorty. in fact i like it a lot so still chance to get in if you arent - stop is moved to 99.60

Swissy (usdchf) kicked in and is now long for small + numbers, stop remains at same level of 1.1670

New trade short audusd at 6562 stop at 7060 - that will make or break today or tomorrow.

that's enough trades in but for info a few 'fool me' trades are starting to setup. usdcad looks a good candidate - first a lift to a lower high, then a drop to 1.1300 to pull the suckers in short and go long at that level - classic 'fool me' trade if the lower high forms. there are quite a few of these setting up at the mo.

That's it for now, good luck!

Results +956 Pips since Oct 23rd 2008.

all still chugging along.

close gbpchf @1.8500 +85 just dont like how it's going

new order on breakout

usdchf long @ 1.1820 if seen, stop at 1.1675

Results +956 Pips since Oct 23rd

fun time

ok, market beginning to make it's move so some trades to take

lets update whats running to start with

gbpusd - 2nd position now in so stop on all now at 1.6125. first position is almost 400 up but still nothing locked in on profit, hopefully tomorrow night can lock some in

gbpchf still short stop at 1.8829 so no profits locked yet

New Trade - USDJPY short @ 97.64 stop @ 101.25

That's enough running for now., very tempted to go short audjpy with a 350 pip stop so if youve nothing running you might like that one, nice 1000 pip target minimum at 3:1.

anyway, catch ya soon

mistake

not very often a mistake goes in my favor - didnt place the stop any trades so all still running.

no changes tonight

cable stop is 1.6425 and not 6125 as prev stated - the 6125 is on the new position if it kicks in @5590

sorry for the confusion

update

usdcad died so minus 100 on that one.

Cable went from +380 to -125 and now back again, this is the thing with longer term trading, especially in volatile times - you have to be able to ride the dragon sometimes.

I'm now moving the stop on cable to 1.6125 which reduces my risk to about 150 pips ish. I'm also going to place a second position on in the form of a breakout order so short gbpusd @1.5590 if seen

new trade also short gbpchf @1.8584, may also add to this position if 1.8320 is broken. stop is at 1.8750.

Results +871 Pips since Oct 23rd

ps, canx audusd order

update

cable off an running , currently +200

New order placed on audusd short if 0.6536 seen half position

taking a low risk long on usd cad with 100 pip stop from 1.1825 - potential is 12:1 rr so worth the risk.

chfjpy look interesting for a break below 8350 but got enough running now.

check back for update tomorrow

dead

euraud dead - minus 400 pips but half position so -200

Cumulitive Results +971 Pips since Oct 23rd

order placed to short cable at 1.5970, apart from that standing aside for a while

new trade

cable about to die i think but still there as i write

looking like returns to trend could be in so taking a half position long on euraud from 1.9215 with a 400 pip stop.

this is a low risk trade with upside potential of 1500 pips or more. good risk reward is the key to trading and staying in the game, as I said before I do have a fair few losers trrading this way but the winners far outweigh the losers.

there, cable dead at -200 as i write

Cumulitive Results +1171 Pips since Oct 23rd

new trade

Taking a flyer on cable long - just putting a toe in the water to see if things are truly turning.

Long at 1.6377 with a 200 pip stop at 1.6277

time for a retrace it may be but i'm not fully confident yet. a single trade may get the ball rolling if it is truly a turn around. tomorrow will tell - might be looking for something else if this turns good.

nothing doing

think i'll leaave it for a few days - market is in flux so nothing is a safe trade.

was tempted to short gbpchf with around a 200 pip stop but leaving it, everything looks to be retracing and possibly turning. Only need a few good trades a month to make a good living and october is taken care of so no rush.

Have fun

and the next

AUDCHF also gone now on stop

shorted 0.7793 closed at 0.7325 result 468 pips

Cumulitive Results +1371 Pips since Oct 23rd

all trades closed, nothing new remotely intresting as yet.

check back tomorrow

one down ...

one down then - EURAUD was taken out by 3 pips at the stop

entry 1.9277 stopped out 2.0180 result +903 pips

AUDCHF still running no change to stop

Cumulitive Results +903 Pips since Oct 23rd

sunday night

stops moved

audchf 0.7325

euraud 2.0180

no new trades

Stops move

Stops moving on both open positions then

AUDCHF is now +330 ish - stop moved to break even

EURAUD is now +730 stop moving to 1.9180 - still leaving around a 100 pip risk on this trade

the audcadI was observing has now started to move so will see where it sits tonight, a retrace back to 8300 by close will see me consider an entry.

Nice overnight trades running there.

Have a good day all :)

new trade

Ok, just taken a new trade - taking this one small because of the recent volatility on this pair - just $1 per pip.

Last time i took this two weeks ago it netted over $1500 at $1 a pip so worth doing.

Long EURAUD 1.9277 stop at 1.8880 - almost 400 pips. I think we will either see new highs or it will correct back down to the 1.81 area. 400 pips risk for a potential 2000+ pip gain means a 5:1 rr ratio.

lets see.

keeping an eye on audcad for a return to trend (short) as it's currently testing previous support around 0.8400. not taking it yet though, will watch tomorrow morning and tomorrow night.

2nd trade is short AUDCHF from 7793 stop 7925 target new lows. $2 per pip

PS, as you see these trades take shape you will see quite a few losers - but when they win they typically win big. all trade sizes mentioned are for a typical $10k account.

The market may be going into a flux state as i call it where it's undecided - at these times i typically take small positions just to get in the potential trades - if i get two or three losers then i'll sit back and wait a while.

You'll get used to these periods as we go on.

Fingers Crossed then.

Hi all

Hi everyone.

Seen a few questions around so thought i'd chat.

No, I have not blown my account however i did have a hard time for the last few months - heck if leahmans can die then what chance do we have eh?

I lost some accounts too (clients) but i did expect that and am sad that it happened.

Life goes on though I've pulled back in October creating a large gain but i'm not going to start harping on and telling you how much because it's pointless and no-one would believe it anyway.

Im now trading daily charts on longer term trades and have done very well. Im in several positions at the mo but won't tell you what they are as they are already running.

I will however from now on for a while post any new trades i take for your entertainment so keep an eye on the blog if you want a laugh.

I'm now in another business also completely removed from trading and that is taking up a lot of my time so daily charts are really the only way i can go.

I could never do them before because i was sat here all day and i'd just fiddle with trades. Now i'm not here i just take em at night around 11pm or in the morning around 7am and dont see them until the next check, they win or lose.

Anyway, time will tell as i'll report em here as we go on. Might be a while though because i'm in five trades as we stand.

catch you soon.

Delta 7 Gains 21% for April!

The Delta 7 managed account has produced superb results for April 2008 continuing the account highs for another month.

March losses were smashed and a great gain on top - this often happens after losing months.

Expected shocks in the banking sector did not happen and as such we had smoother runs without opposing forces changing direction and shaking us out of trades.

The average gain of managed accounts this month under Delta 7 was 21% This would show as a gain of $21,000 on a standard 100k account. This gain is based on conservative leverage of just 3:1 which is within most clients comfort zone.

For 2008 the returns so far are 30.5 % gross compounded one of the best available in the forex sector

Delta 7 is still available as an investment vehicle which is operated under a personal POA document and tended to individually. This means that the program can be tailored to suit your level of risk/reward comfort level.

For full information on the program or if you have specific questions then just contact me.

Soultrader.

email managed "at" simpleforexsystems.com

skype: search for 'soultrader desktop'

Managed Accounts - March

Before the managed accounts report just to let you know that there is now a voice chat room for serious traders who like a bit of company during the trading day. - hope to see some of you in there http://squawkbox.ivocalize.net/


A lot of people lost their shirts last month. Hedge funds crashing all over the place, Banks in meltdown, Bear stearns almost going to the wall etc and many traders have been unable to manage risk and are in big trouble.

Delta 7 made a small loss in March of around 7%. The volatility in the markets gave us trends to make money but that same volatility often triggered our safety stops. In a strong trend our stops remain untouched but these moves although strong also have opposite moves just as strong. as such we were unable to ride these trends and instead opted for safety and avoid excessive loss.

This is the first loss on Delta 7 since May 2007 and so is not to be viewed as a system problem.

	2004	2005	2006	2007	2008
J		2.0	-2.7	9.3	6.7
F		-7.2	12.0	-3.4	7.7
M		12.4	9.1	-10.3	-6.1
A		6.3	10.6	-1.6
M		-6.1	22.7	-7.0
J		-2.1	3.3	0.3
J		22	13.9	0.6
A	3.2	1.8	-4	9.8
S	13.5	10.3	11.3	11.8
O	5.1	-6.3	13.8	0
N	1.4	6.6	9.1	7.6
D	9.0	5.0	-11.1	5.6
Tot	36.4	49.8	126.8	22.3	7.9

Figures above based on 3:1 leverage.
Leverage can be customised to fit client risk appetite for an illustration
of various risk levels please email


Please email me managed@simpleforexsystems.com for full details should you be interested in managed accounts.

Managed Forex Accounts Update

Sorry for the lack of updates of late. Just been so busy with stuff like signing up with a new capital management company in the states etc.

Account wise i didnt do so well in the back end of 2007 - there were no large losses or anything, just no good gainers. November had a single digit percentage loss and december had very small losses also.

Cyborg was not performing as expected and so I took the decision to reccomend my clients to move the account onto my more successful and sedate Delta 7 programme before it eats away at the gains from August.

Delta 7 has much more historical trading and is my 'workhorse' trading method. Until recently i was tied to using this only with a single investment house in the USA but have since negotiated the right to place my own clients on the programme.

This past month Delta 7 produced 7.7% gain on the month which is about average for the method traded at a modest 3:1 leverage.

Please email me managed@simpleforexsystems.com for full details should you be interested in managed accounts.

Free MT4 Indicator for ya

Hi all,

I've got hold of lots of software for traders using Metatrader 4.

One in particular i've wrote myself :)

it's an info indicator - shows on the chart the swap rate long and short, the pip value per lot, the daily ranges, auto calculates the 2% rule and even gives the high and low for the day. I find it very useful.

If you would like a free copy of it and maybe some other stuff in the future then just send an email to forextraders 'at' getresponse.com sorry I cant give a link but the spambots pick em up like crazy.

October 2007 Comments and Managed Account Report.

For three weeks of the month I was unwell, with quite a lot of time spent at hospital.

During this period no client accounts were being traded.

The month finished off with a net loss of 10.3%.

There are two reasons I can cite for the losses this month.

In the second week of the month the mid term trends began to change to short and then changed back again to longs. As a trend trader I was trading short when it flipped long again and hence suffered the losses you see on accounts. The drawdowns were in accordance with the figures previously agreed and are acceptable.

Then there was almost two weeks on non trading whilst I was ill and tradingbegan properly again last week. Unfortunately the two weeks of non-trades meant I was unable to pull back the months figures in time for month end. I will not increase risk just for the monthly pay packet.

Since trading recommenced accounts have been steadily building and had I used the same leverage we would be back to break even for the month. However as the market was clearly in a state of confusion I took the decision to reduce leverage to safeguard capital.

The Coming Month.

At the moment many currency pairs are ready for a good retrace. Of course this doesn’t mean they will retrace but it does mean that we are at a higher risk than when our ideal conditions are met.

For the first two weeks of the month I expect to be short term trading again or even not trading whilst looking for the longer trades to appear

Some trades will develop early but I think the main bulk of the months trades may take a while to form.

If clients have any questions I am available as always via skype, phone or email.

From The Desk Of ...

Soultrader

September Comments

Managed Account Report

The first two weeks of the month were quiet for me with a steady decline into a drawdown of around 14%. markets were consolodating and doing nothing really.

The woes of the Sub Prime mortgage fiasco changed all that in week 3 with the virtual collapse of Northern Rock (NRK). Britains 2nd largest mortgage provider.

same old story as before, they were suffering liquidity problems all because of these clever American companies who thought it would be good to lend money to people who had no chance of paying it back.

Northern rock suffered first because mortgages were just about the only sector they were in - others have insurance business to fall back on. The bubble burst when the Bank Of England blew the whistle and told the world they had extended credit to NRK as the 'lender of last resort' - basically the death knell.

This of course caused widespread panic in the money markets this side of the pond.

Strangely enough I didnt make that much from the NRK effect but it did jolly up the markets enough for us to turn a healthy profit by month end.

The Coming Month.

I'm predicting yet more shocks in the market, in fact I think this sub prime effect will last into the new year - which is great news for us, bad news for the banks and hedge funds.

My methods thrive on volatility and we have that in spades at the moment, bring it on!

September Results:

Increase Percentage: 20.2%

Individual accounts may vary based on client’s comfort level of risk

The monitor account updates every hour and is live for the current month - you can see the last update time in the top right corner Have a look at it here

Please email me managed@simpleforexsystems.com for full details should you be interested in managed accounts.

August 2007 Comments

Managed Account Report.

August was unusually active. One week of this month was an anomaly due to the shocks in the sub prime motgage sector and it’s good to see an interesting August (a month usually devoid of strong trends due to trader holidays)

At a time when many were losing money hand over fist the small trader had an advantage. A hedge fund or bank cannot just dump a position in which they have been building for many months. It’s not easy to drop some billions into the market without it dropping like a lead baloon.

Smaller traders have the advantage in these moves as they can get in and out at will without the disadvantage of having to unwind large positions. Remember, when banks and hedge funds are losing money someone is always on the other side of those trades.

The turmoil in week 2 resulted in a drawdown bigger than expected along with a profit bigger than expected – rather strange to have both inside a week. Please note though that the figures for drawdown are misleading this month as when I was in drawdown on closed trades I had open trades of twice the drawdown level in positive. Therefore my system shutdown level of 45% was not initiated.

The longer term trend following aspect of the programme had great gains followed by a significant drawdown, whilst the shorter term trend aspect had massive gains previously unseen.

All my previous personal records were broken this month:

• Biggest ever single trade – 1287 pips AUDJPY
  
• biggest day 3531 pips on closed trades,
  
• biggest week 4480 pips on closed trades 13-17 aug 2007

Clearly I do not expect this kind of performance every month, but once every three years or so this kind of situation presents itself. The last time this kind of action happened was in December of 2004. And I was ready for it then too making my previous records of 485 pips in a day and 1856 in a week. Now smashed.

The Coming Month:

I see September as continuing the volatility and with increased risk. To cope with this my leverage will be reduced to protect assets from large swings into drawdown.

I have also initiated a new limit on exposure. For this month I may have a maximum of three positions on any single currency – so for example three yen trades, three usd trades etc – think about this – what this means is that usdjpy is 1 usd trade AND 1 jpy trade – this will limit my exposure to risk.

as for the fundamentals, well think of it this way - the fed providing liquidity and cheap loans will not in any way change the fact that hedge funds and banks aroiund the world are overexposed to debt from the sub prime sector. it may be just a temporary repreive.

On saying that all this debt exposure could just be rumour - and we know what rumour can do - sell the rumour and buy the fact.

In reality I don't give a toss about news items or alerts. If the market moves I will be moving with it in whatever direction it goes. If i am the wrong way around then i will soon be shaken out of the trade and going the other way. Thats what we trend followers do, we don't predict or make the trend we just follow it.

August Results

Increase Percentage: 128%

Individual accounts may vary based on client’s comfort level of risk

The monitor account updates every hour and is live for the current month - you can see the last update time in the top right corner Have a look at it here

I currently have only four places available for managed accounts. Please email me managed@simpleforexsystems.com for full details should you be interested.

Managed accounts

For those interested in my managed accounts and the performance.

At the end of june I began trading an account as I would the managed accounts so i have a record.
This is a real money account that started off at around $6,000 at the end of June 2007.

The account updates every hour and is live - you can see the last update time in the top right corner. Have a look at it here

I currently have only four places available for managed accounts. Please email me managed@simpleforexsystems.com for full details should you be interested.

Questions:

Following my post on The Grailtrading Blog i've been asked some questions. I'd rather post the answers here if I may because i want to leave that blog as a bit of history now :)

15 Aug 07, 02:31

jay: excellent lessons to have passed on soul - can you divulge any more of the legal stuff now? Cheers JK

Afraid not JK, all sorted now anyways and all parties happy.



Sgguy: It's been a real pleasure following your blog Soul......here's wishing you the best in your future.

Thanks very much SG Guy, stuff will continue over in this blog

Just sayin: I guess this put's to bed the whole 'mt4 backtester does not work' excuse, based on what is presetned here it would seem to be entirly accurate. Now there is a great question, allow me to share my thoughts with you The answer to that is kinda No. the first tests we did had to be conducted on an MT3 platform and even today that gives us the most accurate results. Eventually we managed to get the MT4 backtester working well enough to trust the results, but it's only been that way since around November 2006. even then it had to be a specific broker (Mig) and specific backtest data (alpari data dump). this was because the alpari timeframe matched that of Mig and that Mig is the only broker i would trust to deliver accurate real time data. So many of the others have many missing bars and ticks - just look at a one minute chart on most brokers and see the missing bars - this affects indicators an amazing amount. Mig has the least number of missing bars consistently. Then the programming had to be perfect. im talking about us making sure each line of code was needed and worked right - it must have taken us 3 months just to get the expert working good enough to backtest and at that we had professional programmers on board. eventually yes, the MT4 backtester was reasonably accurate - well, but that i mean within about 5% of reality. of course we had to verify this by eye to confirm before we could do any simulation tests - we eye tested every single trade for four years of data and can confirm that mig ran with alpari 1 min back data is accurate to about 95% - but note, the 5% is quite a difference, and it's always 5% worse in real life, not better :) Suggestion to those looking into backtesting would be to buy the new book The Way of the Turtle: The Secret Methods That Turned Ordinary People into Legendary Traders It has an excellent part about backtesting and the effect of randomness on a trading system - made me open my eyes i can tell you. The rest of the book is excellent also.

19 Aug 07, 22:59 dan: soul its great the way you are trying to help people understand what went wrong with the grail are you working on anything new thats looks promising best regards Hi Dan, thanks very much for the comments, just hope it's useful to you. Yes, good things happening right now and very happy. Grail took some time to get over emotionally and it took about 6 months. Recently been working on a system which is really great, getting back into my trend following roots and doing really well. That strategy netted me over 4000 pips last week! That was of course not the norm, was because of the sub prime thing, but it was nice to break personal records of 1 week and 1 day closes. My previous best was in December 2004 when i closed 485 pips in a single day and did 1890 pips in a week. This time is closed over 3300 pips in a single day and almost 4500 in a single week. More than the grail system made over two years in a single week! I just wish that i had been in the position i was in 8 months ago where I was trading 125 lots of client money and £120 per pip of my own - now that would've been some party! The system is robust now and is producing better returns than grail at half the previous leverage and I've recently setup an agreement with a broker to handle managed accounts myself rather than through the company I worked with before. My first client with $70,000 will be depositing in the next 2 weeks so all looking good to go. I'm also trading on Zulutrade.com properley now so you can watch the performance over there - just look for the soultrader account. Thanks everyone for your thoughts, keep the comments coming

Update

Hi all,

Thought i'd give you an update on what im doing.

Grail is still trading as a basket and just trickling along, not winning but not losing either, kinda stagnant.

The markets as a whole have constricted into much smaller daily ranges which makes it difficult for an intraday trend trading strategy to make money - that's why grail is struggling still.

My own trading has now taken a suprising turn. I started trading a mean reversion strategy taking 2-10 pips out of the market per trade 3 or 4 times a day.

I had an amazing run of 67 winning trades on the trot - sounds good eh?

Not so, the trouble with mean reversion is that you add to losing trades in the misguided hope that price will revert back to the mean.

A single trade wiped out those 67 wins and more besides. so much for a great strategy eh!

So, i'm back doing what i do best - Trend following. I used to do nothing but trend following on the dow jones and did pretty well and now it's back as my main trading system albeit on a longer term view.

My belief has always been that you cant make serious money in this game unless you let your profitable trades run and run.

Those who used to frequent the moneytec chat room back in 2004 will know that i would hold onto a trade for grim death, trailing the stop unti the trend was truly exhausted. - my motto was 'never take a profit manually, always let the stop take you out'. It served me well being the only person on there to take over 230 pips from a single one minute trade!

So, I'm back onto this but with a twist. Im now trend following using a four hour and a daily chart. I dont look any lower than that and so far i'm starting to get the feeling back that i'm in control.

Now just because i say 'you cant make money taking small profits' doesnt mean it's true. After all i don't know what i don't know and I have known people that make lots of money from small scalp trades - BBMac being one such outstanding trader and just about the only person i know that can make money from scalping.

Personally though I cannot, no matter what i try i cannot make money from small market moves.

So, you may ask why have i gone to longer term trading - the answer is simple. When we were flying high with grail the daily range of cable was usually around 110 - 150 pips per day - an average of around 138.

The last time the ranges were like this was in the back end of 2006 and they are just compressing and compressing. Grail was an intraday strategy which exploited trends but you cant exploit a trend on a daily basis when the market is only moving 70 pips or so and your system is designed to exploit a 130 pip range market.

So, what's to do - easy - extend the time of the trade so that you arent restricted by the daily range. and that's exactly what ive done.

I have trades running today that i opened last wednesday and are still running. They are with trend and are doing well. I have had losers, but they are closed quickly for small losses like 30 or 40 pips and the winners just run and run. Cad is being very good to me at the moment coupled with the dollar and aud - in total im almost 200 pips up on each trade.

Im trading flat money on each trade but can take multiple trades. For example a $10,000 account would allow you to have up to 10 trades at $1 a pip or 5 trades at $2 a pip. I generally have quite large stops to begin with but because the amount traded is small relative to the account size then it is very comfortable.

So, that's what im doing - just following the trend. I don't predict, i dont pick tops or bottoms, i just wait for it moving and hop on board until it stops. I have no idea when it will stop but whilstever its moving there is no reason to get out.

That's my reccomendation to you if you are struggling at the mo. stop fighting the flow and just slip into it. I couldnt believe the amount of money that has been buying into USDCAD this week - whilst all the time it's dropping like a stone.

People who pick bottoms get stinky fingers as an old friend Brad used to say :)

Valius

valius:

soul, how do you manage with winning streaks. i mean, when there comes 20 winning trades in a row, how do you fight with the feeling that finally you found the holy grail? Thank You.

Hi Vallius, thanks for popping in.

Firstly the answer to your question lies in your testing.

Let me explain.

I dont know if you've ever seen the 'Firebird' strategy. Its an expert advisor for metatrader which takes small profits with hugh stops - in fact in some cases with no stops. Last time I checked this thing took 6 pips on winning trades and lost 300 pips on losing trades.

For that to make money you have to have something like a 99% win/loss ratio to make money - ie in 100 trades you make 99 X 6 pips but one loser X300 pips = 294 pips profit per 100 trades - just one trade less winning equals disaster - 98 X6 pips = 588 pips but 2 losers = 600 pips.

People are often drawn by these strategies because they hardly ever lose - however the real drawdown is in the open positions and people who trade these often just cannot face taking a loss. You can run with this whilstever you have money in your account but it's not a sustainable strategy in my opinion, however i could be wrong and often am.

So, back to your question.

If you come across something that has 20 wins on the trot then keep testing it till you have a good sample size - I tend to work on a sample size of around 600 to 1000 trades for 'one a day' trades - 400 for swing trades but nothing lower than that. if the figures look good after that then I would have initial confidence in the system. Just dont get excited by 20 trades :)

Hope this helps

continued ...

Peter said...

Thanks for your reply, you have given me plenty of information to digest.

No worries :)

An issue I'm struggling with at the moment is finding a viable way of determining if my system does actually put the odds in my favour. My strategy is nothing flash, 34,55&200 MA for trend, S&R and reading candlesticks on 30min and 1hour. I either trade the breakout or trade the bounce. I use metatrader and have an account with IG index (who i hate but have yet to find better - recommendations of brokers would be greatly appreciated).

Ok, first of all IG is not a broker - it's a bookmaker - just to make sure you understand that. Although it's virtually the same as trading on a broker they do have different motives.

Because my system is largely based on identifying S&R and candlestick reversals etc it is hard to back test the data due to not having a clue how to actually transfer all this info into excel. As you say how can i repeat a gut feeling of where i deem a Support or Resistance line is identically correctly placed in a future scenario?

However you have presented me with an interesting theory, 1 that could definitely make my life easier and completely remove the discretion from my decision making process....

Theoretically, i should just scrap everything I've learnt this past year with S&R and candles etc, find a dumbass MA crossover strategy (which i always hated the thought of because of the sheer no brains simplicity of it), play with the MA's, stops and profit limits and backtest until i find the best probability and just trade away blindly to probability success.

Is it really that simple? Is that the holy grail? Am I talking gold dust or just crap?

Your time and thoughts into this are greatly appreciated.

Peter

thanks again

Ok, the last bit then.

Firstly let me say that some people (albeit a small number) can trade like that with s&r pivots etc and consistently make money, lots of it in fact.

But as it is gut feeling based and given that you can only develop gut feelings with experience - this method takes years and years to be good at. I can do it and it took me about 2 solid years of 12 hour days watching charts to get good enough. even when you are good enough your results are affected by outside influences like your health, mood, women etc.

There aren't many people who can do that and that's why they make the big bucks.

It's not how I personally choose to secure my future earnings. You have to understand something fundamental about me personally.

The way that i discovered trading in the first place was by asking myself a single question. and I still ask the same question every day.

"How can I make the most amount of money ... with the least effort"

To me trading s&r, Pivots, MA's etc etc is hard work and draining. what's more it's very hit and miss. This is why I do not choose to trade in this manner.

As for your question - is it really as simple as just testing ma's and money management - is that the holy grail?

My answer is yes it is. finding one that works is the hard bit, and believe me there is no moving average cross that works on any pair in any combination - how do i know that? - because i've tested them ...all.

But that does not mean you shouldn't test them - trading methods are like the notes in a song - despite the fact that every note has been used billions of times - every day someone comes up with a new song from the same seven notes. The same is true with methods of trading and you may just have the next winning system. But unless you have a way of measuring it then you won't know if you have a winning system or a bag of crap.

What I can tell you though is that systems that make little money are not super rare - there are many ways of making a little money in this game - however I can tell you that winning systems that consistently make money time after time after time with enough profit and consistency on which to place some serious money - are as rare as hens teeth.

My trading at the moment takes roughly 30 minutes a day - but i spend the other 10 hours doing nothing but research and testing. Testing a single system properly takes about 2 man months

Ive worked that way now day in day out for around 2 years , and it's not just me, there are several others in my team- 10 hours a day research and development for 2 years - lot of hours i think you will agree. How many systems do you think I've developed in that time that deserve real money placing on them - and I'm not talking a few thousand here ....

Well I'll tell you - two systems, that's all. and just one of them is plenty enough to make me millions and millions. see, - rare as hens teeth.

My team have tested hundreds of systems - but there are hundreds more that we have not even heard of yet. that's why we keep on testing and testing, day after day. When the systems we have have made us the money we want then we will probably stop but for now ... back to the grindstone I'm afraid :)

My advice to you for your next step? - learn to use Excel :)

Peter ...

Ok, nice first question then from Peter below - if you would like to ask anything then please use the comments link at the bottom of this post.

Hi Soul,

Ive had a real struggle with accepting that the forex is a neutral market and that anything can happen, in fact, so much so that i flip a coin every time before entering a trade to remind me i have as much control in predicting heads or tails as i do in getting the market to do what i want or predict. As tedious as that sounds it helps me to not take the loss personally and to keep my psychology in check.

Am interested in knowing what it took for you in your trading walk to switch your psychology to that of a winning mindset.

And yes i am a 1 year old trader trading $1 lots however sod it, I've learnt enough to realise that the key to being successful is by thinking probabilities and not searching for holy grails of signals and indicators.

Peter



Hi Peter, and thanks for the question, it's a very good one

Firstly if you are a year in and still at $1 a pip then well done, you are demonstrating that you have two of the most important things needed in a trader - Firstly determination in the fact that you've managed a year, and secondly discipline in the fact that you are still playing with minimum lot size.

Many traders would have a) given up by now and b) if they had not given up then they would have blown the account by trading higher and higher. You are probably already in a 20% minority so pat yourself on the back.

The lesson to be learned there is that if you cannot make money at $1 a pip that you will not make money at $10 or $100 a pip.

The revelation that you cannot control or predict the market is the most important one you will ever learn. and you can only learn it from the experience. No matter how many times you read it in books or articles makes no difference at all - to actually make it part of your belief system you have to prove it to yourself. It seems you are beginning to get there.

When you know for a fact that you cannot predict the market all sorts of wonderful connections begin to form in your head. How can you possibly beat yourself us for 'getting it wrong' if you had no control in the first place?

so, your question was how did i move into a winning mindset - the answer to this was in your next sentence - knowing the probabilities.

A winning trader can tell you exactly what the percentage of wins they have is. they can tell you exactly how many consecutive losers they expect, exactly how many pips per trade on average they expect and exactly what their average month has been for the past year.

Think about this - if you knew that you won say 60% of the time, that your winners were bigger than the losers combined - that even if you had a bad run that the method over time would bring you out a winner - how would your mindset be?

The important thing here are the words 'if you knew' - Most traders don't know. They don't do exhaustive testing and monitoring to find out these things. They have a feeling that they do OK and that their method works - but they don't actually know it for a fact because mostly they can't be bothered to do all the testing and logging stuff.

When things are going well it's fine not to have the tests that prove beyond doubt that you win - because you are winning anyway. But when a bad run comes along their belief is shattered and they start changing this and that, convinced now that their method does not work. Maybe it doesn't - but then maybe it does - but because they did not put in the testing they will never know.

These magic words 'winning mindset' bring up all sorts of pictures of the successful businessman in his suit, striding along without a care in the world. Traders aspire to be like that yet do not want to put in the work.

Having a winning mindset is akin to putting you feet out of the car after a journey - you know for a fact that there will be ground under your feet - you don't know if the ground will be muddy, quicksand or good solid ground - but you do know that if it is muddy and slippy that if you continue to move around you will get to solid ground. You know this for a fact because you learned as a child.

Of course there is always the chance that you will step out into a gaping chasm - but the probabilities are stacked way in your favor that ground will be there. even so, to make sure you aren't going into a chasm you always take a glance- and a check. winning traders do the same thing, constantly checking their perception is right.

When you take trades day after day unless you test those trades, log them, analyse them and explore them then you don't know that there is ground beneath your feet and you won't know if the ground is moving.

In the trading world you are a child and you have lessons to learn. but just like a child learning not all your lessons can be simple and some require work on paper.

A winning mindset comes from actually knowing that your method works and that the probabilities are in your favor. You have proved it by doing lots and lots of work.

A winning mindset comes from knowing that you can repeat your trades over and over again in a systematic way. This is why I've always tried to get away from discretionary trading - how can you repeat a gut feeling?

This is the real work of the trader. Being a trader is not about pressing buttons at the right time and watching charts - the real work of a trader is done way before those trades are placed. The real work of a trader is being hung over a spreadsheet for months on end and checking checking checking against a one minute chart. A trader with a winning mindset has done all this before trading and just has to go through the motions.

Once the work is done THEN comes the payback. The trading is easy - just button clicks without any emotions - repeatability again and again - then comes the rewards.

Forget learning to trade - trading is merely the process of clicking buttons.

Learn to test, log and analyse instead and the winning mindset you desire will automatically come.

Hope this helps

New Blog Purpose

Hiya.

This blog is now changing it's tack. It's basically a place where you can ask your questions to me as an experienced trader or just share your views on market shit etc.

I have decided to totally abandon the forums around the Internet and now agree with Dirk De Troit - they are social clubs for losers. well, we cannot all be winners in this game can we.

every time i go into chat rooms or forums it seems like I'm regressing into a former life and going into the dungeon of hopelessness.

it also seems that those who cannot trade to save their life want like crazy to give me advice, like they have the pearls of wisdom that i lack.

I'm always open for some serious discussion, but come on, a one year trader telling me that i should be using trend lines ???? There he is with his poxy $1 a pip trade and I'm trading over $1000 a pip and he's giving me advice??? what a crazy world.

so anyway, Moneytec, Strategybuilder, Elite Trader, forex factory etc - I've left em all and won't be going back so this is the only place you will find me from now on.

Its an open discussion for Q&A so feel free to comment or use the chat bit on the right - please though don't start giving me advice - what i don't know now i'll have to learn by mistakes and not by some newbie with an ego bigger than mine was :)

bring it on.