January 2022 Trading Review

January 2022 Trading Review

The journey continues, with ups and downs. January was no easier than December. But challenges help me grow. I failed my first FTMO challenge and immediately enrolled for a second one - this time 2x bigger account (20K GBP). I thought it would force me to develop faster and become a better trader. Did it lead to a spectacular result? No and yes.

My 2nd challenge account was a windfall. Almost a month of continuous losing. After a "casual" emotional breakdown, I seeked for help. I reached to Andrew from DisciplinedFX and also read some articles. He replied to me with a wonderful email full of encouragement - I am very grateful for that. By the way, he's great at smashing prop challenges. And he's been doing that with a mechanical "once-a-day" or "up to 3 trades per day" kind of strategies crafted by himself. I realised that I would love to trade like that too. What am I doing glued to the screen 8am-5pm? It doesn't seem that it helped me to achieve results.

So I crafted such a mechanical strategy in one day (with backtesting for 1 month only) because I had just 5 trading days to save my 2nd FTMO account and get a free retry. My strategy was "once or twice a day" kind of strategy, targeting volume expansion at the first part of London session. I prepared a risk management strategy which would allow me to have 3 shots and only one of them had to be a winning shot (doesn't matter if it's first, second or last shot). Solely for the purpose of getting above zero point to gain a free retry. And here's how my balance curved look like in the end:

The 1st day was a no-trade day. Even though "my move" happened but I was too late and my strategy didn't allow such an entry.

On the 2nd day I've got an entry. So the 1st shot was a losing one. Of course I got a bit nervous but I knew this was just probabilities - that's the nature of a mechanical strategy. I entered into 2nd trade on the same day, with a limit order. When I saw the entry, it looked horrible. I thought it will be another losing trade and then I'll have 3 days remaining but just 1 shot. But of course, I had to stick to my rules and couldn't exit the trade. Rules are above gut feeling. It went against me for some time, but then it reversed with a lot of power. My 2nd shot was the winning shot!

And how serendipitous - my last shot was the 111th trade on this account! And if that wasn't enough - my max loss recorded on FTMO dashboard was -£1,113.77! I know that 111 or 1111 is a message from the Universe telling you that you're on the right path. I started to see these numbers quite frequently since May 2020 - the day when I went on the first date with my soon-to-be-soulmate. We were from different cities and decided to meet at around the middle point and then drive further to the sea. When I arrived at the place and took my phone to call her, the time was 11:11. That was the day when these numbers started appearing in my life in ridiculously unexpected places. I could probably write a book about it - if only I took notes. But reading about it would be a shallow experience. The real thing is to actually experience it! Anyway, now we live together with my soulmate and enjoy life's treasures and challenges together. I don't know if it's angels who are transmitting these messages, but I'm very grateful for it!

What I'm doing now? I'm waiting for February 4th - that's when my challenge period finishes and I'll get a free retry. At the same time I'm backtesting my new strategy for a longer period and thinking about how to improve it. I want to prepare a simple, mechanical strategy, once-a-day or twice-a-day type and backtest it properly to build confidence. And then I'll dive into FTMO challenge again and will trade the strategy consistently, with an appropriate risk management plan. Andrew has some great ideas about risk management for prop firm challenges and I'll use some of his ideas. The main idea is that if you're trading a mechanical strategy then most likely you have to manage your risk differently in the challenge phase to gain a bigger return in a shorter period of time. After the challenge, you can resort back to your usual risk management plan.

Also, I'm keeping my CTI challenge account on hold. Since I was experiencing horrible losses, there was no point to transfer those losses to CTI account as well. I'm at around 3% drawdown there out of 5% allowed and 6 months to go to reach the 7% target. Once I become disciplined and consistently profitable with a robust strategy I'll get back to CTI. Since I'll need to risk less there, it may take more time than the FTMO challenge, but I'm confident that if I start soon, 6 months is more than enough to complete CTI's challenge.