Which 12 pairs are you using?
wenlong, when peter was asked this question before, he answered just the twelve with lowest spreads, assuming those were the most active pairs. if he monitors the thread, maybe he can be more specific for us. i like basket trading, but won’t do it with any big money without some kind of stop loss. best wishes for your trading.
Ok. thanks for the reply.
By the way, one thing to clarify. When you mention previous day, which day are you taking with reference to in GMT time? Because my yesterday time period (in Singapore) may be different from UK or US yesterday time period. To simplify, can I start the 24-hour trading day with reference from Monday’s FIRST trading hour?
wenlong, below is something i prepared just today for a similar question on my triple threat thread. i don’t know about using just one hour as a basis for entry. here’s how i handle monday trades with ibfx. the broker starts datafeeding only a couple of hours before monday 00:00, their platform time. i usually get two, sometimes only one hour bar before they start the new day. monday is a little dicey to trade anyway, so i require +/- 11 to enter. that extra spread is just to give a little time to settle down. i have also mentioned that there may be some merit to using the open +/- some spread of pips, maybe 12 to 20, but i have not checked that out for sure.
from triple threat thread:
the issue of what to call a “day” has come up before and this is a good opportunity for me try to get a thorough explanation all in one place. a discreet data set called “day” is defined by each broker according to their platform. in hourly bars, you will see the day start and a new bar begin to build at 00:00, platform time. in an hour, we will see 1:00, then 2:00, etc. but, depending on where you live and who your broker is, that 00:00 could be any time for you. i trade with oanda and ibfx. oanda’s platform is on eastern time. since i am in the central time zone, oanda’s day for me is 11pm to 10pm. the ibfx day is on gmt and that is 7pm to 6pm for me. in other words, if i am trading ibfx, their day will conclude as, my time, the 6:00 pm one-hour bar or the 6:59 pm one-minute bar finishes. at 7:00 pm, my time, they will begin their 00:00 (new day) bar and that is when i will be at the charts to enter buy/sell stop orders, assuming i want to trade ibfx and use their definition of day for my orders.
to keep some consistency and point of reference, i use ibfx data and their platform day for all results reporting to this thread. the high of the day is the high between their platform time 00:00 and 23:59, and so on. conveniently, the platform allows me to select “show period separators” which, on a one-hour chart, draws a vertical line at 00:00, the beginning of the day. unless the close yesterday just happens to be very close to the high or low for the day, we should have plenty of time to place our entry stops soon after the 00:00 bar begins.
take note that, unless your broker happens to be on the same time as mine, you will come up with different entries and exits. just like if i use oanda instead of ibfx, i get different numbers. sometimes the different brokers end up pretty close together on a day’s data, sometimes not. i have used a utility program called vitrite which can make a chart transparent. select an oanda daily chart, place the ibfx chart on top and make it transparent, line them up and you visually see the differences. for example, eur/usd, june 29, 2012, oanda’s high for the day was 1.2692, low 1.2252, range 140. same day, ibfx high 1.2691, low 1.2431, range 260. this was a profitable day for the method. trading ibfx, eur/usd +25, +75, +75. trading oanda, +45, +25, +25. you can see that, while both platforms were profitable, the differences may get to be significant. i have not done exhaustive studies to determine just how much difference platform times may make and will recommend that you study some time period for your platform and compare results to what i’ve posted here.
now, could you define “day” as any 24 hour period that happened to be convenient for you to trade and would that be profitable? all i can say is, probably. are you going to miss some significant moves if you aren’t willing to set alerts to wake you up or otherwise be available to your computer during the london session? yes. will we ever have an ea that takes care of all this while we sleep? you’ll have to ask someone with more programming knowledge than me. would i have the nerve to use it if we actually had it? no.
could you also use the ibfx timeframe to place orders on a different platform, i.e., enter orders at 7:00 pm central time no matter what your broker’s time is and come very close to replicating results shown here? yes. back to vitrite and we see that when we match up bars using transparent charts, the broker feeds are within a few pips of one another on virtually every bar. in this case, we would be entering oanda trades on the 20:00 bar, which is the 00:00 bar for ibfx, 7:00 pm central. if you were doing this, you would have to enter all orders one at a time by hand and would not be able to use the very handy order entry ea built for us by rpotor which enters orders based on the prior bar.
Read more: 301 Moved Permanently
Thanks for your reply. I read from your previous posting that sometimes you post some trades recommendation according to your break day price action. For instance, on 16 July, you post the following:
july 16, today we are:
g/j short @ 123.15
a/u short @ 1.0218
e/u short @ 1.2233
u/j short @ 79.00
One thing I want to ask is that if I do not have the time to monitor the market the whole day to see if today market will break yesterday’s high or yesterday low, can I place 2 trades per currency pair, that is, Long GBPJPY @ (Yesterday High + 1 Pip) and Short GBPJPY @ (Yesterday Low - 1 Pip). So when the market trigger either Long GBP or Short GBPJPY, the other trade will be closed. Can I place the 2 trades in this manner?
In any case, will you also place your trade alert (like what you have done in 16 July 2012) daily, so that it is easier for us to follow if we are doing the right thing? Thanks!
wenlong, the entries i provided were given after the fact. by the time i wrote those, we would have already been short g/j at 123.15, etc. these are actual positions that would have been entered using ibfx datafeed on my platform. i did that so those following the thread can have a few reference dates to understand the method and check their work. the real use of those numbers is so you can look at your own platform and ask what time you would have had to enter to approximate my entries. once you have done that, those numbers have served their purpose and the entries are simple enough to determine after that. the important thing, really, is for you to check your datafeed, determine it’s definition of day, decide when the best time is for you to enter buy and sell stops, retrospectively follow as many trades as you have the patience for, and conclude if you would have been profitable.
regarding your entries. at the risk of telling you something you already know, there are many varieties of hedge positions. one kind of hedge is when you have entered both long and short on one pair. for our purposes, we are talking about this kind of hedge and a balanced hedge where you are long and short the same amount. in your case, where you have left resting entry stops on both sides of the market and run the risk of both being triggered. our studies on this are preliminary, but the advantage of having your loss limited to yesterday’s range appears to be outweighed by taking a loss on only one side, so we are thinking to avoid the hedge.
in the united states, our regulators, in their infinite wisdom, have decided they will not permit hedges. in a perverse way, that actually helps us out a bit with our daybreak entries. at the open of a new day bar, we can place both sides of our orders, buy stops for three long positions if hit and sell for three short positions if hit. if, during the course of the day, one entry is triggered and we should be unfortunate enough that prices reverse all the way to the other entry, our second set of orders will elicit a pop-up window saying, “hedge not permitted,” and those orders will not be filled. i don’t know how it works where you live and you will need to check your broker’s policies. here are some options.
if your broker operates as i just described, then you can follow the same procedure and place your resting stops without concern that you would end up in a hedge. another option is to place only one set of orders. in this case, you would probably want to place those closest to their entry point. it is also possible that your broker allows “oco” orders. most brokers in the united states don’t allow these orders, but an oco is “one cancels the other” and it just means that if one side gets triggered, the other side orders go away. still another possibility is to locate an ea that serves a “kill” function. that is, when orders on one side are initiated, it kills the rest. the thing you would have to watch for here is to be sure it would allow all three orders on one side and not just allow one order and kill the other five. i don’t know, but there may be one in the metatrader library or on one of the many fx forum sites.
one last comment. this is a fickle trading method and, historically, shows times when it just didn’t work. if you trade it, keep a close eye on your equity curve and be ready to pull the plug if it starts losing. this is not the grail.
hope this helps. best wishes for your success.
Spirit
Good day. I have been reading this thread aand the EA you coded for Daybreak. Thank you Pipwoof for the trading system and thanks to Spirit for his effort in coding the system. When will you fix the reopening of new order with the old ones when the platfor reopens?
I still have not understand one important thing. When should be placed the orders.
Assuming that I am living in Rome, at 23.00 the day close. Then should I place the orders immediately at 23.01 or should I wait?
Furthermore…at the end of the day all trade should be closed?
most of this information is from a previous post and i hope it will help answer your question. the issue of what to call a “day” and when to enter orders has come up before and this is a good opportunity for me try to get a thorough explanation all in one place. a discreet data set called “day” is defined by each broker according to their platform. in hourly bars, you will see the day start and a new bar begin to build at 00:00, platform time. in an hour, we will see 1:00, then 2:00, etc. but, depending on where you live and who your broker is, that 00:00 could be any time for you. i trade with oanda and ibfx. oanda’s platform is on eastern time. since i am in the central time zone, oanda’s day for me is 11pm to 10pm. the ibfx day is on gmt and that is 7pm to 6pm for me. in other words, if i am trading ibfx, their day will conclude as, my time, the 6:00 pm one-hour bar or the 6:59 pm one-minute bar finishes. at 7:00 pm, my time, they will begin their 00:00 (new day) bar and that is when i will be at the charts to enter buy/sell stop orders, assuming i want to trade ibfx and use their definition of day for my orders.
to keep some consistency and point of reference, i use ibfx data and their platform day for all results reporting to this thread. the high of the day is the high between their platform time 00:00 and 23:59, and so on. conveniently, the platform allows me to select “show period separators” which, on a one-hour chart, draws a vertical line at 00:00, the beginning of the day. unless the close yesterday just happens to be very close to the high or low for the day, we should have plenty of time to place our entry stops soon after the 00:00 bar begins.
take note that, unless your broker happens to be on the same time as mine, you will come up with different entries and exits. just like if i use oanda instead of ibfx, i get different numbers. sometimes the different brokers end up pretty close together on a day’s data, sometimes not. i have used a utility program called vitrite which can make a chart transparent. select an oanda daily chart, place the ibfx chart on top and make it transparent, line them up and you visually see the differences. for example, eur/usd, june 29, 2012, oanda’s high for the day was 1.2692, low 1.2252, range 140. same day, ibfx high 1.2691, low 1.2431, range 260. this was a profitable day for the method. trading ibfx, eur/usd +25, +75, +75. trading oanda, +45, +25, +25. you can see that, while both platforms were profitable, the differences may get to be significant. i have not done exhaustive studies to determine just how much difference platform times may make and will recommend that you study some time period for your platform and compare results to what i’ve posted here.
now, could you define “day” as any 24 hour period that happened to be convenient for you to trade and would that be profitable? all i can say is, probably. are you going to miss some significant moves if you aren’t willing to set alerts to wake you up or otherwise be available to your computer during the london session? yes. will we ever have an ea that takes care of all this while we sleep? you’ll have to ask someone with more programming knowledge than me. would i have the nerve to use it if we actually had it? no.
could you also use the ibfx timeframe to place orders on a different platform, i.e., enter orders at 7:00 pm central time no matter what your broker’s time is and come very close to replicating results shown here? yes. back to vitrite and we see that when we match up bars using transparent charts, the broker feeds are within a few pips of one another on virtually every bar. in this case, we would be entering oanda trades on the 20:00 bar, which is the 00:00 bar for ibfx, 7:00 pm central. if you were doing this, you would have to enter all orders one at a time by hand and would not be able to use the very handy order entry ea built for us by rpotor which enters orders based on the prior bar. note that this ea was built for the triple threat application used as an adjunct to daybreak. it will provide all the order entries for daybreak, but you will have to manually change the stop losses.
apfrezza, if i understand correctly, you will currently be on central european summer time which means you are gmt +2. i am in the central time zone, so it is now 10:00 am here and 5:00 pm your time. i don’t know what your platform time is, so you will need to determine that and do some extrapolating. i based results on ibfx and their platform time is gmt. i enter orders at gmt 00, which is 7:00 my time, but would be 2:00 am for you. it is the equivalent to me getting up for the london open. if your broker happened to define day as ending gmt -3, that might certainly be more convenient for you. best wishes.
Read more: 301 Moved Permanently
Read more: 301 Moved Permanently
Thank you very much! Now I’d like to know if you close the order always when a day ends or you have a tp?
hey pipwoof ive got an idea about your system that i think you should try out. try using an 8 hr time frame instead of the daily. ive noticed that the candles are a lot better and you would only have to place orders 3 times per day. going to start testing it using a 50 pip trailing stop but its looking really good based on candle data and charts.
I shall read this page to page post to post in the coming month.
I like it when things are kept simple.
this particular system was designed strictly for traders who can’t monitor their trades. it is a “set it and forget it” method and, as such, has certain limitations that you should read about through the thread before you make any real money commitment. it was originally tested as a method that simply enters a single position on a break of yesterday’s high or low and holds the position until the close of today. it was tested with ibfx data using their platform time. they are gmt 00, so trades were entered at 00 as their new day began. for me, that is 7:00 pm central time. again, for testing, trades entered were closed at the end of the 23:00 bar, except on fridays when ibfx shuts down datafeed at 20:00.
daybreak was tested using a spreadsheet with daily ibfx data. limitations of this kind of testing are discussed in earlier posts. very simply, we take the break and subtract the close, limiting maximum loss to our published stop-losses for each pair. a wide stop-loss is recommended to allow as many trades as possible to proceed from open to close while avoiding an inordinate meltdown. historically, this method shows profit in some time periods, including the six and a half year testing period. there are periods of time when it does not show profit, so it should be monitored carefully and paused if the equity curve reaches a determined point of loss.
so, while there may be any number of intervening variables that cannot be measured by this kind of testing, we have something that uses very few points of reference. there is the entry, which is just yesterday’s high or low +/- 1 pip, except on mondays when we require +/- 11 pips. there is the exit, which is at the close of today. lastly, there is the stop-loss that varies by pair traded.
i am finding that entry time could possibly be an important factor that affects results. if you intend to use other entry and exit times, be sure you do your own backtesting and compare results. best wishes for your trading!
nikita, these entries and exits are very simple and desgned for someone who has obligations and is not able to monitor open trades. if you do have the good fortune to be able to keep your eye on open positions and move stops periodically, be sure to check my other thread which uses these same entries, but has a variable exit strategy requiring more attention.
http://forums.babypips.com/free-forex-trading-systems/45633-triple-threat-exit-strategy.html
rory, always open to ideas. you may be on to something here. i have tried to maintain daybreak as a system to be used by people whose other than trading obligations prevent them from paying too much attention to the markets. in the united states, this method would be suitable for people who get home from work by 7:00 pm central time, when they can place their entry stops and stop-losses and not look in again until same time next day.
i like breakout entries in pretty much any time frame. i have always thought that if price is at a and is ever going to get to c, it will have to go through b first. and b is whatever it breaks on its way to c. i have even done some preliminary work with hourly bars, using high/low of previous bar for entry, close of current bar for exit. looks promising. if the pursuit of your idea shows merit, by all means continue and post your results. you might call your method, “8 break,” or, “day thirds.” best wishes.
I made an EA this weekend that trades the daybreak system on the hourly bar… I am forward testing it starting today on the AUD/USD. I chose AU because it has a low spread with my broker, and this pair is more directional then say GBP/USD. At the end of this week I will give the results. I will run the EA for 24 hrs a day… But I suspect enhancement to profitability on the hourly chart would be increased if the EA ignored breakouts occurring between an hour before New York close and to an hour or two after Sydney open. But I will leave the optimization until after the system proves its potential.
I like the idea of using the hourly bar better then daily bar because it reduces risk, and it reacts faster to market headlines… Only downside is that spread of a pair is going to eat a larger percentage of profits because the profit per trade will be smaller.
thank you for the post. good luck with the test.
I m gonna try this…thanks to pipwoof
hello sir
i understand entry buy daily high +1 pip and sell daily low -1 pip except monday move and u tell s/l also wat is the idol tp can u tell me this too thnq
there are no tp’s with this system. you hold the positions until close of the day.