• Dragostin Kozhuharov

Swing Trading, Increasing Size and Crisis Management

Summary of the period between July and the US election

CFDs and Oil – the good days

Done with hedging, I moved back to swing trading CFDs. I traded Oil and indices on longer timeframes. Holding positions from as low as intraday to a few weeks. This trading style fits my personality best. I can fuck up the entry and still make a profit. I can let a trade move against me or as other traders say ‘let it breathe’ before it goes in the direction which would give me the profit. Most importantly I can open a trade and then go away from the screen. Being able to see your PnL all the time could lead to bad decisions.

This led to a very successful period where everything was profitable. I shorted oil and indices most of the time. In July I made 12.29% return on my initial capital. This winning streak gave me confidence and I decided to double my trading size.

Doubling the size and personal trouble

I used the same strategy but doubled the position size in August. I got very good entry points for shorts – at the highs for the month. I wasn’t in the right mindset though and it was showing. When I opened a trade, I felt uncomfortable. The initial move against my position made me nervous. I was not in the good place.

Being in stress due to personal matters – my dog died, and also another family situation, affected me. I opened positions but gave up all the gains from July.

It was annoying in a different way – I didn't do bad trades or make mistakes. I had great entries, great risk reward ratios, but closed at losses due to my circumstances at the time.

All the gains returned to the market again, I decided to take a break and not trade until I am back to feeling normal. It turned out to be a good decision as more trading at the time would have done more harm than good.

It also meant that I get to keep my capital for trading at a later point.

Return to active trading – October 2020

The break refreshed me and I felt confident to trade in October. Clear mind and calm decision making led to great gains. I recorded the best month in my trading career. The main trades were – short WTI above 41 USD or close to recent highs, and then close the trade a few dollars lower. I made these trades and gains in 7 days. Then I stopped trading for the month. The decision making process was - it will be great for my confidence to close the month as my best ever. Another reason was the upcoming US election. I reached the conclusion that the markets leading to the election and shortly after would be too volatile. Even if I made money during that period it would be due to luck and being on the right side of a 50-50 event.

It was also going to be a good practice of discipline – Would I stick to the ‘no trading for a few weeks’ rule?

I am glad to confirm that I did stick to it and it reinforced my believe in strong discipline. It gave me the opportunity to work on other projects at the time.

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