The end of a dramatic month.

I suffered another full loss today, getting stopped out in a trade where price turned round and eventually went on to make my target. The loss was -17.25 points.

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These kind of losses are particularly disappointing and tempt you to fiddle with the system, but it is crucial to maintain your trading discipline. Losing is part of trading, and sometimes you suffer a run, even in a system with a good positive expectation.

Reviewing the week, I lost 44.75 points which is the worst weekly result I have had in several months.

However, let’s put this in context for the month of February. It has been a remarkable month in the wheat market. There has been record highs, combined with unprecedented volatility. Since the start of the month, daily limits have expanded 450% and margins have increased by approximately 150%.

These are truly freakish – and dangerous – conditions, but I have been able to trade calmly through it all following my normal trading process. In reviewing the month, I have included a loss of 16.5 points for 1st February, which was a night I didn’t trade, but would have lost if I had done so.

During the month, there were seven losses, six days with no trades (all because of limit moves), and seven wins. Because the average win was larger than the average loss, I made 53 points. After all costs, I made a profit of 10.55% on my account. This is not as spectacular as it might have been without the losses in the past week, but still acceptable. It demonstrates one of the benefits of disciplined day trading, the ability to maintain a positive cash flow over a reasonable time scale despite a run of losses.

Looking forward to March, I am hoping the sharp sell off will continue, limits will revert to 60 cents, and the "hot" money will be flushed out of the market. We’ll see! 

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