Daily Hi Lo

[stevefromnaki]

Hi again,

Thinking back to one of the first posts when it was identified by TalonD (post #30) that the optimum TP was about 55, i decided to re-run the SQL with TP = 50 and SL = 25 pips.

Interesting, after running this the results are:
Total pips: 13,565 (close to doubled)
Winning Ratio: 25% (50 pip profit)
Losing Ratio: 44% (25 pip loss)
Time Stop: 31% (average 14 pip profit on time stops - end of day)
Total Trades: 2,393

Again data is only EUR-USD from Jan-01-01 up to June 30th 2010.

I’m sure with support/resistance, candles, and Fibs (or a combo) then the numbers can be improved, but unfortunately i can’t check this in SQL

[RC64]

Could you try running the test as bounces off the high/low rather than breaks? Something like…once price touches the high/low and reverses 20 pips you enter the trade and have a take profit of 40 pips with stop loss back at the high/low. That’s only 60 pips total movement and should be within the average daily range of eur/usd. Also, using the time from new york close to new york close the next day (5pm eastern to 5pm eastern) for the daily high/low.

[EpoXi]

Did someone worte an Expert adviser for this system?

[TalonD]

I was wondering with the SQL could you try it with GBP/USD ? My favorite pair.

[Synergistik]

I had written an EA for this, with the option the trade the breaks and the bounces. The breaks were complete failures on several pairs for the past three months. Breaks were slightly profitable. Adding other factors such as fibs maybe help, but that takes away from the simplicity of the method.

Synergy

[stevefromnaki]

I was wondering with the SQL could you try it with GBP/USD ? My favorite pair.

I have a database set up with minute price on GBPUSD so can use the current code on this database, will do it on the weekend and get back to you.

[TalonD]

I have a database set up with minute price on GBPUSD so can use the current code on this database, will do it on the weekend and get back to you.

Thanks, it will be interesting to see the results.

[stevefromnaki]

Could you try running the test as bounces off the high/low rather than breaks? Something like…once price touches the high/low and reverses 20 pips you enter the trade and have a take profit of 40 pips with stop loss back at the high/low. That’s only 60 pips total movement and should be within the average daily range of eur/usd. Also, using the time from new york close to new york close the next day (5pm eastern to 5pm eastern) for the daily high/low.

Let me have a think about this one, it looks interesting but will need to change the code a bit, will look into it and let you know how i go.

Let me make sure i get what you mean, are you talking about a contrarian strategy, where you enter a sell order if price reaches the previous day high and reverses 20 pips down, enter at that point with a TP of 40, and SL of 20, using daily NY time?

stevefromnaki

[polexa]

this is great and very fruitful discussion here share by all like minded…thanks

past few days market has been so range and using this hi/lo has been terrible. Currently I am trying 100 t/p and 50 s/l , without big movement this system produce too many stop.
so ultimately the aim is chicken and egg. may be a will suffer a few more stop and wait for the one big move or shall I attempt t make more small win and avoid one big loss.

but I think this simple hi/lo is already better than many many indicators

[RC64]

Let me have a think about this one, it looks interesting but will need to change the code a bit, will look into it and let you know how i go.

Let me make sure i get what you mean, are you talking about a contrarian strategy, where you enter a sell order if price reaches the previous day high and reverses 20 pips down, enter at that point with a TP of 40, and SL of 20, using daily NY time?

stevefromnaki

Yes, that’s exactly how I meant it. The entry and tp could be changed but I figured the 20 risk with 40 reward would give it a nice R:R while keeping the trade within the average daily range of eur/usd (making it more likely to be successful). I use the 5pm eastern to 5pm eastern as im pretty sure that time period is considered the official forex day.

[stevefromnaki]

Thanks, it will be interesting to see the results.

Hi all. This is interesting.

With GBP, first i ran 25/15, which as you may expect was worse than the EUR due to the TP a bit low considering the cable has higher daily range and the SL of 15 pips too tight. Total for GBP with TP=25 and SL=15:
40% TP Hit, pips = 21,375
48% SL Hit, pips = -15,330
12% Time stop, pips = 756
Total pips from 2119 trades = 6,801 over 9.5 years.

Then i ran TP=55, SL=25. This is where it gets interesting. The number of losses is about the same, but now there are only 27% TP’s. It got me thinking that if you leave the SL at 25 pips and still close out the orders that didn’t hit SL or TP at the end of the day, if i look at the TP’s i might find there is a more optimal TP. Just because the order stops when TP of 55 is hit, it might be that if prices moves in the direction by at least 55 pips it might actually go a lot more (logically this makes sense, there are days when prices exceed high/lows by a lot more than 55 pips!). I will re-look at the TP trades and identify if there is a new optimal TP (for the trades that did get hit with a TP of 55 and will not hit the new optimum TP, i will calculate that trades time close, or determine if SL is subsequently hit, and rework the numbers).

Before i go on too much, here are the current results of TP=55, SL=25:
27% TP Hit, pips = 31,790
46% SL Hit, pips = -24,375
27% Time stop, pips = 6,825
Total pips from 2119 trades = 14,240 over 9.5 years.

Another interesting fact, if you look at the time close results. In the first scenario (25/15), the time stops account for 12% of the trades and about 11% of the total pips, suggesting parameters are too tight as TP/SL get hit too soon (makes sense on a daily strategy). But for the 55/25 scenario, the trades closed out by time (SL or TP not hit) is 27% of the total trades, yet account for almost 48% of the total pips - hinting further that a more optimum TP might exist above 55 pips…?

Thats all for now,
stevefromnaki

[polexa]

actually if the stop is too tight 15-25, often your position get stopped.
and if you notice,for example if the market does break day high, most likely thats the trend and even after some swing, eventually it will go higher to touch the T/P.

[TalonD]

here is a variation that you can try. open up 20 charts (daily TF) and look for the ones with the best set ups. current price should be at or near the 2 day average high or low. You may find 2 or 3 or 4 or 5 charts like that, then close the rest of them. on those open a trade as usual so you have maybe 5 trades going at once. Do this during early NY session. Watch your floating profit / loss, when it is positive close all trades even the loosing ones.

[dobro]

At the risk of being called a traitor I recommend you look at FF>Trading System> “Trading Naked…etc” by Lawgirl21. I have used her 1H channel breakout with some success. Using IBFX or FXDD here in the US means her 4 candle count starts in late afternoon and ending in ealy evening (8pm for me) so one can very easily put on a trade before bedtime. Very low stress. I am currently using the number of pips from hi to lo times 80% for TP (and ATR might also be good X 80%), still playing with SL ideas. I may use a bigger SL for a reverse R/R but I think you brought that up in this thread too. Take a look, it’s a good breakout strat. if 30-40 pips is good enough and of course with MM you can juggle the # of lots for greater rewards.

Again, not trying to derail your thread but I have found something that is working for me and it is along the lines of this thread. d

[TalonD]

At the risk of being called a traitor I recommend you look at FF>Trading System> “Trading Naked…etc” by Lawgirl21. I have used her 1H channel breakout with some success. Using IBFX or FXDD here in the US means her 4 candle count starts in late afternoon and ending in ealy evening (8pm for me) so one can very easily put on a trade before bedtime. Very low stress. I am currently using the number of pips from hi to lo times 80% for TP (and ATR might also be good X 80%), still playing with SL ideas. I may use a bigger SL for a reverse R/R but I think you brought that up in this thread too. Take a look, it’s a good breakout strat. if 30-40 pips is good enough and of course with MM you can juggle the # of lots for greater rewards.

Again, not trying to derail your thread but I have found something that is working for me and it is along the lines of this thread. d

don’t worry about derailing Good ideas are always welcome as far as I’m concerned. I’ll take a look at that. Thanks

is this the one?
Trade What You See - Almost Naked Trading
Trade What You See - Almost Naked Trading @ Forex Factory

[dobro]

Yes, that’s the one. She writes about 3 separate strategies but I only trade the 1H as it is convenient for me, suits my personality well, and so far it is profitable but I don’t look for big moves. trade well, d.

[Ray_1]

Yes, that’s the one. She writes about 3 separate strategies but I only trade the 1H as it is convenient for me, suits my personality well, and so far it is profitable but I don’t look for big moves. trade well, d.

Hi dobro, thanks for the link. The H1 4 candles breakout looks suitabel for a trader with a day job like me.

[dobro]

Hi dobro, thanks for the link. The H1 4 candles breakout looks suitabel for a trader with a day job like me.

Exactly. I have been quite conservative, got +30 shorting the E/$ overnight but the move produced over 100 before backtracking. I want to play with TP ideas more and it may well be that I look for +10 with a large position, 20-30%, and keeping the SL just above/below the opposite line of the channel. Although if I can get 30 pips regularly then trading safe would seem to be better. Finding a strategy is easy, making it work is something else. Have a nice weekend all, d.

[TalonD]

Hi dobro, thanks for the link. The H1 4 candles breakout looks suitabel for a trader with a day job like me.

Exactly. I have been quite conservative, got +30 shorting the E/$ overnight but the move produced over 100 before backtracking. I want to play with TP ideas more and it may well be that I look for +10 with a large position, 20-30%, and keeping the SL just above/below the opposite line of the channel. Although if I can get 30 pips regularly then trading safe would seem to be better. Finding a strategy is easy, making it work is something else. Have a nice weekend all, d.

hey Ray_1 8 to 5 day job for me too.

I have another trading method I’ve been using lately and going to stick with it for a thorough workout. But I did like the breakout idea. with the 1hour 4bar breakout I would have to look for trades at 4am my time, eastern time zone right? I could force myself to get up early if it makes a profit!

[d-pip]

Hi dobro, thanks for the link. The H1 4 candles breakout looks suitabel for a trader with a day job like me.

I’ve also been following Lawgirl21’s “Almost Naked” thread and like her 4 1-hourly bar breakout method. IMO what really separates this breakout methods from most others is the way she suggest we use the weekly, daily and 4h 3 period RSI direction as a filter.