Trade Journal: When Geopolitics Stand on Your Way Just Shut Up & Ride

6 min read
tarantula fx

tarantula fx

Head of Trading

Dear Traders,

Another interesting week is behind us. Although the market conditions remain choppy, we were able to make some important conclusions.

The biggest impression for me was the counter-trend add-on to the existing MTF system which has shown excellent backtesting results but in practice it completely failed. I’ll explain why.

This article also shares my own biking experiences with some cool pictures so make sure to read (or scroll) to the end. 🙂

Tough Market Conditions Continue

General market conditions were again heavy to trade except at the end of a week. Slow markets, Trump tweets regarding Tariff wars, made markets very unpredictable and spiky. Most of the markets we usually trade have either tanked or rallied massively, so I felt it was time for counter trend setups.

During the last month, I have extensively been backtesting the counter-trend trading module, which is based on various technical variables such as loss of momentum, overbought and oversold conditions and price patterns. The code that we put into the counter-trend indicator had all of these, and during backtesting on 4h charts, it showed excellent results. However, 7 out of 8 trades were losses. How come?

Source: Counter trend trading backtesting sample

One of the reasons is definitely the US president mr. Donald Trump. Each time has started to talk and tweet, markets get violent. When markets are tanking, he comes and says something like the US-China talks is positive. The impact that he has on markets is simply too much. See what DAX did 3 mins after his tweets re China-Us talks.

However, another reason for our losses might be in the code itself. Although the indicator has been thoroughly tested, similarly to EA, backtest usually differ from real results. That’s why I have decided to dismantle the code, rework it and invest the money into a real account that will be used only for counter trend setups in the next 3 months. Until I see positive results with both backtesting, forward testing and real money testing, there won’t be any official counter trend setups with ecs.LIVE.

Source: DAX30 chart

Trend Is Your Friend

Luckily there is good news too. After the bad start with countertrend setups, we managed to finish the week in a positive note. The Cammacd.MTF template has proven its shine again with 48 pips on Friday. Coupled with London Open EA’s 12 pips, Friday was a good trading day.

You have probably heard it many times before – “The Trend is Your Friend”. Trends are created by powerful institutions and different economic factors. That is why I always say – “Follow the Banks!”. Think of the bank as a shark and yourself is a fish. The smaller fish always follows the shark and eats the remnants of the shark’s food. Translated to trading terms that is exactly what you should do – support the big companies that actually shape trends and avoid to be caught in the wrong side of the market.

That is what CAMMACD.MTF and LOA do, and the focus will be on those two Camarilla trading methods along with potential breakouts.

Source: CAMMACD.MTF

In the end the MTF score is highly positive adding to an overall success of the CAMMACD trading method.

Source: MyFXbook

Riding Is The Part Of My Life

One of the things that I love doing on weekends is riding my BMW F800GS. I like going out for beautiful night and day rides. However, during the weekend, I enjoy time with my friends too. I have formed a motorcycle group named “Thunder Crew”, and we go together for trips over the weekend. That includes motorcycle rides to the heartland, across the country both off and on-road.

 

These things make life goes on in a never dull way. Both ups and downs are a part of life, and every time we fall, we get up stronger. For example, during this off road ride, I couldn’t make it through the mud, but that’s life. You get up and continue. Eventually, we reached the destination where you can hardly come without a capable off road bike.

Life Is Beautiful

We need to find the beauty in every freakin’ moment, no matter what. We’ll always face difficult situations in life, some dire and drastic, others small and irritating, but we can’t rid our lives of difficulty, pain and struggle. Given that we’ll never have the ideal situation, can we make the most of what we’ve been given?

As Eleanor Roosevelt said:

“The purpose of life is to live it, to taste experience to the utmost, to reach out eagerly and without fear for a newer and richer experience.”

Cheers and safe trading,
Nenad

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