Monthly Statement – February 2021

The Monthly Statement for February 2021, like its counterpart, February 2020, was evil. This month was a boxing match and I took a pounding from the pound. Not once, not twice, but three times in a row, and let’s say I still need stitches.

The total loss for February is 472.43USD and that is 112.07USD more than the profit from January. The bad part is that I can’t wait for March and just reset the score and start over. And the moment I am down 635USD in open trades, from which 337.83USD are open only on GBPUSD. The other 296.58 are the EURUSD pairs I was planning to close in March and April, positions that are open from the date of 23.03.2020 .

But let’s see how we got into this situation.

February Breakdown

The month started very well, with more than 100USD profit in the first week, moment we also did the withdrawal (first small blue dot from left to right).

February 2021 key poins

But everything changed when the news started to appear. Multiple strengthenings of the GBP against the USD made me do mistakes and the robot got caught in the contra trends. I didn’t want to believe that I can be in problems, as I was trying to avoid the 2020 fiasco. So I didn’t look at the signs.

After getting stuck on the contra trend (I was selling and the GBPUSD was long) I waited two days until I decided to take the big hit of –270USD. It was close to nothing as I knew that there was the potential to recuperate. Also 240 USD was my risk tolerance at that time, as I have a strategy to close the open positions when I hit the loss of -13% on the open transactions. After some good days of positive gains, I got stuck again. And again on the counter trend and after I was down 110, got emotional and closed the transactions. Of course, after one day the trend rebounded and I could have avoided the loss.

Then, things get wild. I realized that the market is way too volatile for the current settings I had on the robot, so I fabriced new ones. I made all the simulations on the amount I had in the account, but did not take into consideration one fact. My equity was not equal to my account value, as I had the EURUSD positions open. This mean, that my lot size was way higher that it needed to be, to be on the safe side

The third loss appeared after I was sure that the trend would rebound, I let the transactions run and then read an article, got scared and closed it. This was not a big loss, only 60USD and I even recuperated 20 on that day. But everything affected the account and open equity.

Every close trade can be saw in the previous chart with a small dot.

The last loss was the biggest pain of this month. The GBPUSD was still long, I was waiting for that correction, I was pushed to the extreme (emotionally), I was still selling the GBPUSD, hoping for that rebound. That was the first time in a while I got a bit scared that the account can be blown off. So I folded, took the -300 USD and went home.

Until the end of the month I made some small gains and went from -560USD to -480 USD. But the surprise arrived Friday, when GBPUSD took the dip. I am not sure if this dip is over or not, but I have buys positions. I was not expecting a correction of this proportion, in a small period of time (basically just 1 day).

Not, as expected the situation is a bit bad, but I still believe that the GBPUSD will continue its trend (or at least this is what I want to believe). Monday is a new month, and I will just take the filling of the market then.

What went wrong

It can be simple be put in a list:

  • After the first loss, I got scared and the 2nd loss we took was corrected, so was the third. If these two losses were let open, they would have been a win, small win, but wouldn’t hit the account so bad. With that money, I wouldn’t feel the pressure to close the 4th bad trade and it would have corrected itself two days later
  • I closed for times this month, every time the correction happened in less than 1 week (usually after 2 days), with that period that the trend continued with less volatility and number of pips
  • I modified the settings of the robot during trades, without closing it and resetting everything. And I adjusted my position size with bad information. If I did it right, the 3rd and 4th trades wouldn’t have been a problem. As info, I went down from 0.04 lots to 0.02.
  • I become emotional trading with a robot. Exactly why I chose a robot, not to get emotional. Feel the irony.

What can I do

Now, reading the article, it is very cringey. A loss is a loss not a sentence to death.

The short plan for now is to manage to get that transactions to close without taking a big loss and then step by step, close the open position we have from the first attempt of hedge (oh yea, we tried that after the 2nd loss, smart!).

Probably after seeing the direction the GBPUSD will go, I will deposit 200 USD to give some room for opening trades, as the margin is negative at the moment.

For the middle term plan, is to balance the account to 0 as we are 808 USD short for a break-even.

Fingers crossed that March will be better than his 2020 brother.

Thank you guys for reading this. See you with the next big news.

Disclaimer: I am not a financial consultant, all the information you find here are my decisions, I taken at that moment, on my own analysis. I am open to any type of discussion about money. If you want to replicate my portfolio take into consideration that it is your money.

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