Reflections from the August Scare

Recently, all news avenues and friends have been talking supposed “Black Swan” event on the 5th and 6th Aug. S&P 500 dipped by 3% which is the biggest one day drop in 2 years and the forex markets have been haywire.

I am someone who uses the averaging strategy to time my trades into the market which is excellent for ranging markets. Even for myself, when I woke up on Monday (5th Aug) the entire portfolio was red 🥲. My averaging strategy did not seem to work anymore. I ended the last week of July with a 8% increase in my portfolio, when Aug started it all went downhill. I ended the week with a loss of -$60 with all my profits gone.

Is this a bad thing? Not at all as such events happen over the years and the market has a way of correcting itself. The discipline one should build is to cut losses if needed and move on as the goal in trading is about long term gains rather than short term gains.

Well when the market is trending and not ranging, does it mean that one cannot earn money? Well there are ways to also capitalise on the situation. stay tuned to find out in my next post 😉

#forextrading #algotrading #MyFreeTime #lessonslearned