Micros Trading Recap: March 26, 2021
For my personal FX trading, I am currently aiming to provide monthly P&L recaps. The idea of making this public was inspired by Nico, a guest on the Chat With Traders podcast. In a way, it's to hold myself accountable by making it an obligation to review and reflect on my past-period performance.
Overall a good week. The stats are quite favorable, which I don't think I'll be able to sustain. My winners are over 50'% and the average winner is larger than the average loser. This led to an expectancy of $9.18 based on one NASDAQ micros contract per trade. Again, I don't think the actual P&L matters too much. I'm focused on keeping my expectancy positive. Once I do, I'd like to average this out to see what I can attain in the long run.
Despite closing the past week at a loss, I still consider it a win. The first thing to note is that more contracts were traded. Did I over-trade? I don't think so. What happened is best explained in a timeline.
Now that I am essentially funded in the Topstep futures trading program, I figure it'd only make sense to do the same. Rather than jumping directly into a fully funded account, I am in what's considered a "Pro" account. My trading stats will essentially be wiped once I hit the profit target outlined in this Pro account. As such, I believe it makes more sense to do micros trading recaps weekly rather than monthly.
The actual P&L figures themselves don't matter that much in my opinion. The key figure that I'm focusing on right now is my expectancy, which looks at my win rate and sizes. What I hope to achieve is consistently positive expectancy. Once I am able to do this, I'll have the stats to confidently scale into larger positions. This may be increasing the number of micros contracts traded or jumping over to the e-minis.
This post will comprise of my stats for the past two weeks. Going forward, I'd ideally be posting micros recaps on a weekly basis.
Week Ending March 19, 2021:
Overall a good week. The stats are quite favorable, which I don't think I'll be able to sustain. My winners are over 50'% and the average winner is larger than the average loser. This led to an expectancy of $9.18 based on one NASDAQ micros contract per trade. Again, I don't think the actual P&L matters too much. I'm focused on keeping my expectancy positive. Once I do, I'd like to average this out to see what I can attain in the long run.
With regards to what I don't think I'll be able to sustain, I expect my win rate to drop below 50% in the future. The idea here is that I'll have more scratched trades along with taking on smaller losses in order to capitalize on fewer, stronger momentum plays.
Week Ending March 26, 2021:
Earlier in the week (Monday-Thursday), I took fewer trades and lost on the majority of them. I committed a full trading day on Friday (yesterday) and recouped all of my losses. I was about to end the session with a small profit until I saw MNQ just rally higher near the market close. What did I do? Being the contrarian that I am, I tried selling into this parabolic move. After several attempts, I ended up being in the red. Essentially, I returned all the profits made throughout the day. I started the day negative, went positive, and then negative.
Why do I consider this a win? From a "mentality" standpoint, I didn't fall into the gambler's mindset that I had a year or two ago. I didn't try to double down, flip my position, etc. Instead, I maintained my contract size of one and continued to look for signs of weakness. This loss only symbolizes my need to develop a better methodology for fading parabolic moves. Either that or just sit out completely.
For the week ahead, I expect to bring my expectancy back to positive territory. It should be an interesting week as economic events continue to wreck havoc. Based on my observations so far, major indices should sell off if next Friday's employment figures come out stronger than expected.