Gold has broken through support, WTI Crude Oil has rocketed above resistance, and Bitcoin, Ripple and Ethereum have been rising incredibly.
This leads us to an exciting leaderboard with two traders comfortably above 100%, with third place sitting on 91.85%.
Let's take a look at some of the big moves in November across the global CFD markets:
· Nasdaq Index +9.3%
· WTI Crude Oil +25.4%
· NZDUSD +371 pips
· Bitcoin +38.5%
· Ripple +194.7%
· Gold -3.8%
And what keeps people interested in trading is the sheer volume of trading opportunities presented each month. Nothing feels better to a trader than when their trading system is in sync with current market conditions.
As a result of all this volatility, it doesn't surprise us to see our top traders' strong results in November.
Dongyuan Zhang has proven he can handle the increased volatility this month, and we'll be diving into his trading style and statistics in today's blog.
Bin Lu continues to outperform her peers, remaining firm in 2nd place at 123.66%. You can view her trading statistics here.
And Cheng Tao Lu has maintained his good form, rising from 76% when we looked across his trading statistics here to now sitting at 91.85%.
Let's run through the analysis on Dongyuan Zhang to see what he has been trading and his impressive month of trading statistics.
This is the first time we've seen Dongyuan on the Trading Cup leaderboard in 2020.
The potential here is with his focus on Gold, if he is long or short and offside, he might be looking to hedge his positions using USDCHF and USDJPY at different times. Just a thought.
While we can see Bitcoin in the mix, there have only been two trades, which have resulted in gains of $139.
Starting with his equity curve, you can see a large part of the month where he is trying to find the winning positions, but the market is moving enough in his original direction.
Lots of small wins followed by his first set of bigger losses.
Then, it looks like the market started to move in sync with his trading system, leading to a high number of wins, followed by his biggest win for November.
Yet again, we notice a unique theme whereby the leaders have an extremely high win percentage.
As you can see from the stats below, Dongyuan is winning 95.59% of the time.
So far, he has only lost on 6 out of 135 of his trades, as noted below.
We often see this with trading systems with a high win percentage combined with average losses that are much bigger than the average win.
One key aspect of his trading is that his best trade of $729.17 is around 2.4 times bigger than his average loss.
This provides some evidence that he has a method that looks for solid trading ideas but doesn't cut the winners off short.
Instead, he is willing to take a lot of initial positions with relatively small size, and then when he believes he is on to a trade that can run, he has an exit at profit to do just that.
You cannot see from the statistics provided above how consistent he is with his position sizing.
89.6% of his trades have been at the same position size.
I'm not going to give away his exact position size, as consistency is something he has developed through lots of trial and error and time in the markets.
But it would be fair to say that in relative terms, he trades at low levels of leverage with the same position size, trade after trade.
Another consistent factor with his trading is that he started trading gold on the 10th of November, right after the significant drop you see below.
Before the big drop, he had not placed a single trade on Gold.
From the 10th of November onwards, 77% of his trades on Gold were to sell it.
$2678.90 of his November profits have been by shorting Gold.
But on digging further into his analysis, 97.8% of his Gold trades were winning trades.
Is it possible that Dongyuan's strategy is to locate a market he knows well (i.e., Gold), then waits for a big move in one direction (in this case, Gold was heavily sold off), and then place nearly all of the subsequent trades in the direction of the big move?
From the 18th to the 23rd of November, Dongyuan placed 29 winning trades, accumulating $1,756.05 as the dominant direction had been found.
It is just a thought, but it could be the case.
Competitions nearly always bring out the best in people, whether it be Olympic athletes or traders.
There has never been a better time to set some goals around what you want to achieve and over which instrument you will be trading.
Then, you start to build a trading strategy that could potentially employ some of the methods used by the best traders we've seen in the Trading Cup contest.
The key is to find a strategy that works for you. One that fits your beliefs, time frame, and tolerance for risk. But only you know what that is.
Many of these strategies, like the basic Gold strategy we mentioned here, can be used as starting points. Then it would be best if you continued to refine the strategy to find out what works best for you.
One of our most consistent traders dabbled in markets for some time and then found algorithmic trading, which truly resonated with his style and knowledge base. You can listen to Gustavo's interview here.
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Ashley Jessen is the author of CFDs Made Simple and Chief Operating Officer at ACY Securities. He has been in the financial services industry since the year 2000 and worked for some of the leading companies in the CFD, Forex and Online Trading space.