Sounds like a good approach @PhillR, well done. In the last 12 months, about 250 trading days, I only see 7 which ended at 2pm better than +7r. So cutting winners at this level seems likely to catch the best profits of the day.
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Its been a tough start to May so far, Iāve marked the strategy down at a net loss of -9r so far, with 5 double-loss days (though one may or may not have been a no-trade day due to a wide 0700 30-minute bar).
But is 5 double-loss days unusual? Statistically its not unusual for any month. Of the last 12 months, 10 of the 12 months had at least 5 double-loss days. 3 of those 10 months ended up as net losers, but the other 7 of the 10 ended up as winners.
On top of which, I canāt see the GBP/USD chart as looking like anything exceptional recently. Its possible there is more hesitancy in the markets, which translates into more hesitant moves and more failed moves, though May has seen only 2 inside days this month, which is about average for where we are.
So Iām intent on just ploughing on, hoping to get a good result tomorrowā¦
All the best.
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Another difficult week with not much price movement. Mondays remain a no-trade day, Tuesday printed a wide 0700 bar so no-trade also, then two small losses and a small win. Net result about -1r. Disappointing but not as bad as the previous weeks.
Onwards and upwards.
Itās been a good week on the FTSE100, +4.13R
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Good work.
And it raises a point - I wonder if this points to some statistical research - is there a negative correlation between the behaviours of GBP/USD and the FTSE100? Does the FTSE have nice wide-ranging easy momentum days when the GBP/USD flip-flops? Now that would be niceā¦
That certainly would be nice and something I thought about looking into when time permits.
Of-set the loses when one has a losing month, or boost the profit if they both stick to their statistical edgeā¦ perfect!
I have yet to back-test the FTSE100, but I ran it this week on demo to see how it would fair out of interest.
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Caution anyone using this strategy or a variant.
Tomorrow is a UK public holiday: though forex and indices quotes might be available to us price action will be thin and atypical.
Tuesday is therefore the first London trading session of the week and maybe its going to be like a Monday - high probability of a narrow range day, possibly an inside day bar, with weak and hesitant price action. I will trade Tuesday but no great expectations.
Good point Tom and worth remembering for learners - although the market has changed in recent times.
Edit: Tomorrow is memorial day which is a fed holiday - will also affect price movement.
You should say itās going to be a quiet day more often! Good day on the GBP/USD and FTSE100.
Looks like strength in the GBP across the pairs today.
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Yes it was a good day! Finally! Glad I stuck with the basic rules and played this today even though today could be argued to be a ākind of Mondayā.
Yesterday would have been tedious with public holidays in the UK and US. A short off the 0700 M30 bar would have triggered but been stopped and the long triggered if youāre playing stop-and-reverse, and then that would have been manually exited at 1400 for a small loss.
We live in interesting times.
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Late update.
May is finished - thank the lord!
Trading Tuesdays-Fridays only I make this a net result of -14r, the worst of the last 13 months. Actually, including Mondays (apart from the UK public Holiday this month) would have made the net result slightly better, improving it to -9r. Still pretty bad. Think I might as well go back to trading 5 days a week, whatās to lose?
I suppose there are consolations - at least the worst month recorded was also the most unique - the national economies of both the UK and the US are crippled by the respective responses to the covid crisis. So perhaps it would have been a worryingly anomalous indicator if the strategy had done well in May. Maybe every strategy should be under-performing right now.
But the worst thing is that there is no concrete indication on the long-term charts for May that this should have been any worse a month than April or March. And thatās worrying because although current unique conditions might have led to the monthās poor performance, how will we know when these conditions are passed?
There might be some things to be done to optimise poor performance under current conditions -
- as ever, keep r to a small percentage of the account capital (should be a constant rule, but maybe reducing r might be prudent)
- price moves are failing, whether long or short: consider setting a TP at a conservative level, say +3r or even +2r: right now the rule is to conserve capital rather than maximise profits
- if feeling a bit more aggressive, use a third entry order, set only after the first has been stopped out: so if the long is triggered first and is then stopped out (at which point the short is triggered), set a second new long at the original long entry level: if the short is triggered first and then stopped out, set a new short at the original short entry level. I donāt have stats for this but a look-back over charts suggests this would work.
Onwards and upwards.
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Another tough week.
Seems like every move is followed quickly by a counter-move, then a counter-counter-move.
If anyoneās trading this strategy, make sure your positions are small, you may want to consider tight TPās, trailing stops, with-trend entry orders only, etc. Its a matter of protecting capital through the covid episode right now.
The thing that annoys me is that the strategy can only be seen to not work when it doesnāt work.
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No, it is not that simple
Apologies all for a late update on last weekās performance of this strategy.
It wasnāt a bad week in the end, and certainly an improvement on those just previous.
I logged Monday as the only single trade day of the week, running to +2r by 1400hrs. Tuesday and Wednesday were double trade days, each running to -1r by 1400, and Thursday was a double closing at +4r. Friday was a double trade day but net break-even.
The impressive performance from Thursday is a little misleading as the Bank of England made an announcement which pushed the second trade further than it otherwise would have been expected.
My own performance has been moderated by using small positions but also taking profits where available before 1400. Iāve been using +1r as TP for the first of the two trades triggered and +2r for the second, net result for the week +2.5r. After the shocking run in May Iām happy with that.
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i only use backtest with MT4.
When I try to backtest on another flatform, I see errors a lot.
this, leading to my EA programs when designed to run on Mt4 would not be accurate when running real.
Therefore, I only focus on system backtest, my EA on MT4.
Perhaps, you should too
Last full week of June, and just a few more days to go for a monthly summary.
The week was not as bad as it could have been on recent experience. 5 trading sessions, net result -1r. I actually managed to get a profit of +1r over the week by using a +1r TP rather than open-ended entry orders.
Things might be slowly improving but weāre still in a pandemic crisis and protection of capital is the rule for the time being.
Big Ben summary for June.
OK, weāre still in a global pandemic with widespread lockdowns and economic paralysis. So the small net loss for June is very encouraging - for me at least.
Net result -4r out of 35 trades in 22 days. Days with single trades were more common this month, which is perhaps a sign of a market that is regaining confidence in moving firmly away from the open either up or down. Still too many days with double losers - 9 this month, which is above average and really hurts the net gain result.
Still, the long-term performance remains OK. Over the 14 months, the strategy would have returned +90r. This is fine if you use a standard trade size of a fixed percentage of your account capital. There have been 9 winning months and 5 losers. The net average monthly gain is +6r. The 12mth rolling net gain is +95r.
Obviously Iām pressing on with this strategy, but still using a conservative TP and small position sizes while markets are so jittery.
Happy July all!
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Weekly Big Ben update.
Another difficult week with too many double trades.
Mon - double trade, +1r result
Tue - double trade, both losers, -2r result
Wed - long trade only, +2r result
Thur - double trade, both losers, -2r result
Fri - double trade, -1r result
Weāre clearly still in bunker market conditions so Iām continuing to trade small with conservative TPās (could be worth trying OCO orders for these bracket set-ups). Thereās certainly no early strong commitment from the London open, which is what the strategy depends on for the multi-r wins to bump up the returns. Hey ho.
Have a good weekend.
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I have been using this strategy for a few weeks now with quite a bit of success. Except I have been pairing it with a 50MA, Stochastic, and RSI for extra confirmation. I find support and resistance on the Daily, check on the 4H, then see what is happening on the 1H, typically working my way down to the 15M for entry.
I only sell when the stochastic rsi, and regular rsi are overbought, and vice versa. Patience and mindset is huge with this, it isnāt uncommon to sit in substantial drawback for hours at a time.
I prefer dividing my lots into 1/5th of my accounts worth so I can play the chart both ways, or find a better entry and collect back some loss, or even free myself up for another pair I am watching.
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Looking forward to hear how your July went, Tom. Some improvements on last month I hope.
I didnāt run a forward test on demo this month due to my schedule being different to normal but Iāll back test and record the results for July over the weekend.