Donchian Channel Trading - Page 40
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  1. #391
    Join Date
    Mar 2013
    Posts
    236
    hi guys,

    i am back at trading DCs...last days i read the whole thread again and gave the ideas some thought...

    Quote Originally Posted by bobbillbrowne View Post
    LOL I'm happy to be the back testing *****!!!
    ...
    So this is what I observed on back testing across several pairs on the one hour chart. Using a multiple of ATR as a trailing stop was indeed a viable exit strategy. A multiple of 1 was the most profitable but also occurred the greatest draw down. When it wins it wins big but losses are frequent. At multiple of 2, returns where greatly reduced by still signification. Draw down was reduced but probably of an excessive size especially if you only trade one or two pairs. At multiple of 3 returns again are reduced returns but draw down was the best

    Of course there are other factors, I look heavily at expectancy and total trades. And of course know what time of day it is and where about in the monthly news cycle you are. With that said IMO I would stick to the multiple of 2 x ATR. And trade as many pairs as possible. 10 pairs at 0.2% risk is a far better option than 4 pairs at 0.5%.
    based on the great testing done by bob when the thread started, i will go with the DC 24 on 1h TF...i am still thinking about going with ATR based trailing stops or better with a classic DC (opposite DC is manual trailing stop, always a position open)...maybe i do some backtests during the weekend and then start on monday...
    Last edited by Forexmike; 04-21-2017 at 04:19 PM.

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