Thursday, 10 August 2017

Summer Lazy Markets

July and August are summer holidays for the northern hemisphere, which includes our biggest markets, i.e. Europe, London and New York.

I know a few people call the markets "lazy", but really it is just low volatility and a lack of trading opportunities.

We can see in our copy trading results that we were crushing it right up to the 4th July long weekend and from there our results dropped off considerably.

With the lack of trading opportunities and the low volatility, we saw that many of our trades just failed to follow through and we lost many a trade right in the last seconds as the erratic markets changed direction.

I do see that July and August each year are pretty poor times to be trading binary options and next year I will pause trading over these 2 months completely.

I have noticed that many of the bigger copy trading firms have done this and on reflection, we should have done so too.

An example of one of the bigger copy trading companies halting trading is FoxSignals.

FoxSignals halt trading for summer

However, we did not stop trading and we will continue.

Our baseline accounts with the various money managements are down about 10% from their starting amounts, trading $100 per trade which is about 1% of the account balance.

I have my own account trading around 1% of it's balance and am also down around 10% this last month, which is a drawdown of 10% which is not too bad as far as drawdown goes in challenging markets.

I suggest that if you are trade copying that you also have your trade amounts right down to about 1% or pause your trading by deleting your API token in your account until the 4th September which is officially the end of summer holidays and when the volume and better trading opportunities generally come back into the market.

We are still monitoring the markets and taking our trades when we see an opportunity arise and will continue to do so.

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