Dark clouds still persist
Silver lining observed on USD trades
Watching to know if USD charts could be making higher highs next
Risk averse mechanisms are in place when maxDD is breached
Precise rules are in place to bring to safety
I owed you an update on how the trades are doing and what is the next course for action. I am still working out to get us out from the drawdown that is still prolonging. I managed to close GBPJPY trades on 2/2 with a nice profit and this let me to place new trades on AUDJPY and CADCHF as part of risk management rules.
I'd shown the USDPLN chart below on my last update (see below). Since then, we saw USD price run-up for several days and closed above the critical level. Then we are again seeing a pullback and negative sentiments continue to plague the recovery.
Right now, I am watching how the price going to play out this week and early next week. We made a new high and this pullback should not make another major low. A retest of the low is possible. So, price above is still a good indication that we can make next higher highs and close our trades at most opportune time.
Drawdown is part of the game and as you know it is really not easy to control. But it can be managed to a great degree with proper risk management. I advise people that the drawdown is akin to catching a virus or flu and robust system like Genesis would eventually recover from it.
When the drawdown started to reach a critical threshold, I put the necessary risk averse actions to protect the capital. The DD level is a risk indicator and not a level for the Genesis model to initiate any closing trades. Genesis model employs quantitative mechanisms to exit bad trades at the appropriate level.
I am working all out to bring the equity to go higher once again. I have no reason to overreact or worry. There are concrete rules I have been taking and not allowing my emotions or pride to take control. What I am trading isn't discretionary, but based on probabilities and calculations to beat the odds. That's the difference trading together with me.
I am confident that Genesis Asset Monitor will stick around for a long time and have no reason not fold this signal anytime now.
Quote: "You know, you don't throw a whole life away just 'cause he's banged up a little" - Chris Cooper in Seabiscuit
About the Author
Ramesh is an active trader producing over 200% gain in 2017 and author of 3 trade strategy development books sold on Amazon. He is the creator the 10/20/30 Rule™ that could transform a mediocre trading system to become a top performer by following a systematic and thoughtful approach on strategy development.
Books By Ramesh Selvarajoo