Tips From The Geek Recap: January, Well, It Sucked!

Tips From The Geek, Recapping January Trading Activity

I’ll be honest, January sucked really bad. I think it’s the only time I have had two losing months in a row since I started trading binary options. It’s my own fault, I made the trades, but when it comes down to it the month brought a raft of challenges that we often don’t see. In an average month the market will deal with a bad event, or maybe 2 or even 3 things that weigh down sentiment, add volatility and make trading a challenge. This month there were at least a half dozen different catalysts in the market, none running in line with each other, all causing currents, undercurrents and rip tides strong enough to wipe the savviest trader out of the market. In the end what are you to do? Me, I’m sticking with it and moving on to the next month, a little wiser, a little smarter and only a little bit less rich than I was the month before.


Total Cost Of Trading = $11,500

Total Return On Investment = $11,100

Net Return = -3.5%


Well, there were 4 Monday’s in January which means a total of 20 tips. I made a couple of bonus trades this month as well, 3, all winners, and that is really the only reason why my losses were not much greater than they were. Out of the tips I only had 9 winners, a win rate of only 45% and very weak. Adding in the 3 bonus trades brings up the total to 12 wins and win rate of 52.2%, not great but a lot better than 45% and just a hair shy of the requisite 54% needed to remain profitable. The good news is that my long term stats, while slightly diminished, remain profitable at 56.75%.



What The Hell Happened In January!?!?

Looking back on the month and all the swirling undercurrents I am actually a little surprised I did as well as I did. My technical approach to trading the fundamentals works well, but typically when the fundamentals are little more clear and at this time calling them cloudy is an understatement. Just to give you an idea about what I am talking about consider this. .


Earnings expectations looking forward into the end of the year are positive, there is expected to be growth, but not until the second half. The first half of the year was expected to be good, but expectations have been in decline for at least 2 months, not to mention that the robust growth expected for the second half has been downgraded to only tepid growth. . . So, positive yet declining expectations for earnings. At the same time oil prices are falling hard on supply/demand imbalances, hurting energy sector earnings expectations and driving the market lower as well… whenever rumors of a non-OPEC/OPEC deal to support prices don’t have them shooting higher. Central bankers and their policies remain divergent, but not as divergent as they were. The ECB may increase QE, the FOMC is still expected to raise rates more in 2016, but not as much as previously expected. The result is a weakened dollar, despite rate hike expectations, that is helping with forward earnings expectations and also helping to support the price of oil. In between all of that China is still slowing, and the fiasco with the circuit breakers that occurred in the early part of the month didn’t help us get of to a good start. In the end a mish mash of conflicting fundamental signals that have yet to work themselves out.



Week 1 – 01/04/2016

This is the week that started it all. While we were waiting for the January FOMC meeting we got some super strong NFP data, and a major scare in China (circuit breaker fiasco) that began the flight to safety in gold that has driven prices up to the highs they are at right now. This was my worst week by far, only one win, on the USO/Oil, but only because fundamentals were in play, not the rumors.


Week 2 – 01/11/2016

This week was OK, I won 3 out of my 5 trades, mostly due to the fact that I was able to take a step back and see the market downturn for what it was, a downturn. Trades on the S&P 500, Oil and the yen profited, my trade on the euro failed (ECB expectations were in flux ahead of the meeting), as did my trade on gold (I was still bearish on gold, not recognizing how strong the flight out of China/Asia would be).


Week 3 – 01/18/2016

This week wasn’t my worst week but it was dam close. I had taken the stand, appropriate or not, that the market was in down turn, driven primarily on falling oil prices, only to have that pesky rumor about a possible OPEC/Russia deal to support prices pop up and give me the smack down. Only 2 trades closed in the money, the S&P 500 by the skin of its teeth and gold. Both the euro and yen trades were hurt by central bank meetings, the ECB hinted at QE but did not do it, the BOJ moved to negative interest rates and gave the dollar a quick pop.


Week 4 – 01/25/2016

This week was a little better, I made 3 wins, but the really good news is that the wildly shifting news began to calm down a little bit and my analysis were coming more in line. The S&P 500, gold and the euro profited, oil was still reeling from rumor more than anything else and the USD/JPY hadn’t yet made up its mind that a weaker dollar was what’s on tap.