I trust this post finds you well. Apologies for the slight delay in the posting of this month’s report.

Diving right in: The majority of my time this past month has been invested into my latest EA system, while our new Head Trader managed the Hunter account portfolio, and the Razor did its thing largely by itself until early this month.

Official August Results

• NMi Hunter Evolution

  As outlined in our last monthly report, our new Head Trader now manages this portfolio. He commenced trading part-way into August, and after a great start gave back most of the gains he’d made, finally posting a small positive gain for the month. There is a bit of a learning-curve when coming up to speed with the multi-account-management software that we use, which led to a couple of good trades placed on his own account being missed on ’s — not to mention that due to his conservative nature, one trade had its SL moved to the break-even point where it was taken, only to see that trade turn again and move further into the traders favour. So it could very easily have been an excellent month if not for those near misses, both of which have been a learning experience, and are unlikely to be repeated.

  From what I have seen so far, I can easily conclude that we now have at the least one of the best traders I have seen! He has a fantastic trading style, where every trade is hard stopped, and never risking more than 1% of the account. Each trade is closed in 3 parts, each part being incrementally released as and when the price moves further into the traders favour. He’s capable of holding trades for big gains too, which a lot of traders are unable to do. Not only that, but every trade is always placed with a well considered in advance pending order versus a finger on the button style entry. He always lets the market either hit his designated preset take profit or hard stop, while the hard stop is typically moved to a break-even point as price moves in the trade’s favour, and then promptly moved again to protect profit too. So far there’s been next-to-zero drawdown — in fact its usually the opposite, with open trades running in profit more often that not!

  The trading executed last Friday was a supreme example of what I am trying to communicate, and as I have stated to him – consistent application of this style of trading is exactly what I am looking for. In short is very fortunate to have secured his services and it’s my strong belief that over the coming months you will be very happy with what you see.

• Razor Accounts

  These accounts were making some nice ground during the month, up by around 5-6%. As usual, as the momentum backed off, the EA stood aside and did not place further trades. At this point it’s looking to close its positions on the next chance and go flat and just wait. The market got within 30 pips of this — excruciatingly close; I walked away, only to come back and find that the market had then rallied strongly against those open positions, marking what has since become the start of a EUR/USD rally.

  This is all very much in the character of this EA: It picks entries well, but the exit plan runs just a little shy of the market sometimes, which is why I tend to run it at lower leverage, and look to add to its position on retracement so that I can manually average out of a negative position. To do this well, I have to be right on the ball and take the first chance I get, because there’s not often a third chance before being left holding positions against the trend.

  As it has eventuated, the EUR/USD closed right at its high last Friday and I elected to protect accounts from further erosion of account equity by installing a hedge. Shortly thereafter the market did indeed reverse leaving the hedge high and dry. This in combination with some whipsawing of the market into this week to foil the trading plan in place to deal with this, leaves us behind, albeit now short EUR/USD, early into this month. Currently the bad fundamentals for the EUR have recently been revived and the EUR is headed south against most major currencies, provided this also plays out versus the USD which I expect it to, this will play back into the Razor accounts now currently short bias, otherwise further downside account protection is in place.

• Momentum EA

  Due to the fact that I have invested the majority of my efforts this month in the further development of the Pendulum EA, presently Momentum is on the back-burner.

• Pendulum EA

  We’re now 3 months into development of this exciting new system.

  Pendulum is absolutely my pride and joy at the moment, with many a very early morning invested into its development. I still hold this EA out to be the best-of-the-best, and ’s premier achievement when it finally does come to fruition. Our Marketing Director, Gary — who is a master coder with almost 30 years of experience — was instrumental in the considerable progression of this EA due to his input about a month ago, which I’ve been able to build on further with the EA coder. I now have some tests that show phenomenally low DD for extended periods of time, but with extreme high rates of return. How high? Well, on some test settings, it’s returned in excess of 250% monthly – non compounded over the last 9 months run on complete autopilot and in live FWD testing with manual input nearly twice this (ahead of of further development to automate this presently manual input). So I am quietly confident that there’s definitely something very special about this system with its future use, pending real money performance, is still being carefully considered.

Managed accounts moving forward

It’s still business as usual. Aside from overseeing our Head Trader’s activities, and providing him with the support and resources he requires, as well as the basic maintenance required for the running of the Razor accounts, I’ll continue to focus on the longer term EA projects, and the upcoming Pendulum EA. It’s my objective to have the new managed Pendulum account or some such offer of the system available before the conclusion of 2010, which by then would represent 6 months of solid R+D of the system; involving well in excess of 1000 man hours (and counting) because the process of development is an ongoing one.

As always, if you’ve any questions please feel free to ask right here by leaving a comment below, or you can use the contact form to reach me directly. Either way I’ll always aim to give you a quality response by the next business day.

Sincere Regards,

Adam