Saturday, August 02, 2014

What a difference a year makes!

July 2013 was a great month, as was discussed here. This was simply a result of getting into a number of decent setups around that time which decided to trend in my favour. It was also my most active month in the last two years, in terms of trades taken.

This year, July has been pretty much been a non-event. Hardly any trades were taken due to a lack of decent setups coming up on my scans, together with the general indecision in the indices.

This just proves once again how you cannot force anything from the markets. You can only take what it is prepared to give. It is for this reason I (or anybody else) can never say whether a trader can make a specific amount over the course of a year from a trend following approach.

All I know is that markets periodically switch from trending states into non-trending states, with fluctuating levels of volatility along the way. The probabilities are that I will make more money in trending, low volatility periods, and will struggle in non-trending, volatile phases. That is just the way it is. I don't fight it, and I certainly don't force it. This is an example of why patience and discipline are key components to long-term success, and why my trading activity has tailed off in recent months (see the trading frequency chart here).

No comments:

Post a comment