Quote:
Originally Posted by Azy
Hi Phil,
nice to c u back. I find ur system very interesting.... but want to share few of my concerns... I was laid off few months back so back tested some systems... they work amazingly for few years.. but then go down when u go back 6-7 years... so i wish v could check ur system... lets say up to 2000 or so... I trade with fxcm and my cnadles are a bit diff then urs... plus I have EST in canada... and fxcm starts trading at 17:15. but d advantage which FXCM offers is dat even with a micro account they offers u the charts which go back up to 1993!
Reg,
Az
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While it is true that I haven't tested it back any further than 2005, I feel that the 5 years worth of data that we have is enough.
I may be wrong, but I just can't see how a system like this one could work so well for such a long time and then suddenly stop. This system is 100% adaptable to any market condition. If the markets become more volatile, then the ATR and candle sizes increase, which in turn increases our TP and SL. If the markets start ranging the opposite happens and our TP and SL levels come down to match.
There will be an adjustment period of a month of two before the system adapts, of course, but if you're using proper money management that shouldn't be an issue.
In fact, anytime you're using a system with proper money management you shouldn't be concerned with your system failing. This was proven recently by the failure of the NickB scalp line system that a lot of us on this forum trade. I traded it profitably for almost 2 years before it started failing. Once I saw there was a problem with the system I first reduced my lot sizes, then when it didn't turn around I stopped trading it altogether. The money I lost when the system failed was a drop in the bucket compared to what I made during the previous 2 years.
When in comes to Sunday breakout trades I would need well over 100 losses in a row to wipe my account out, and I would need over 25 losses in a row to make me lose all the profits I've made with this system since I started trading it. If I got 10 in a row I would stop trading this live, so there's really no way I can lose. Even if I lose money on the next 10 trades and never see another winner from this system I'd still have made a lot of money from it.
It all comes down to money management. If you're overleveraging yourself then you need to be afraid of losing streaks, but if you risk a conservative amount per trade then you don't have to worry about it.