been trading demo for the last couple of months, my favourite is FXCM… I have read through countless systems and I found that I had been trying all of them with varying success, some better than others, until I found one that truly has worked. I’d like opinions on this one because I have yet to lose with it. It goes like this…
USD/JPY has consistently over the last month or more (I averaged roughly 9 out of 10 times) had a low somewhere between 48-594 pips from its midnite (est) open. what I do is open a short postion right at the open regardless of the rate and set a limit of 20 pips with no stop loss. By the time I get up around 8am (est) I am 20 pips richer. I have lost once in the last two weeks. If you check the daily open price and daily low for this pair, you will see what I mean. I’m too lazy to post reports, but if you check the chart, you will get the jist of it.
Not really a “system.” Sure it’s worked 9 out of the last 10 times, but what about when it fails 20 out of 20? Kind of seems like a coin flip to me. I suppose your odds are really not much less than other systems, but the no SL is a big no no.
just backtested… went back 300 days… on a daily basis if you were to set a limit of 20 pips you would have won 250 times and lost 50 and if you held those 50 losing postions for and extra day or two you would have won aprox 275 days out of 300. if you set your limit at 10 pips you would have won 290 times out of 300 and again if you held those 10 losing postions for a day or two more, half would have came in as wins. I can post the chart if you don’t believe me.
I agree on the stop loss, I am currently thinkng of how to set one with out stopping me before my 10-20 pip limit hits… it usually hits the limit in a couple of hours but during that time it can swing alot,
Next, your new and your demo trading. You are asking for an opinion about a trading system you found. bkr1969 is correct when he states that what you have described is not a system. It is better described as a “setup”. Also, bkr1969 gave you his opinion and I would second what he says. I just quickly took a look at trading from 2/1-2/5 and need to ask what are you going to do about the trade when you wake up on 2/5. You are upside down and it gets much worse as the day goes on.
Ok, but then you respond by stating in your next post that you have just backtested a years worth of trading. Would you mind posting your EA or script? I would like to take a look and of course I will share my observations.
Take a look at some of the tools available on this site. This is a tremendous resource.
I don’t have an EA or a script… I use FXCM and just enter a short postion for USD/JPY and set a limit of 20 pips. It has also worked for GPB/JPY as well as GPB/CHF. I am trying to figure out what a good stop loss would be to protect me on the few off days.
bladelawless, did you take the trade last night? If so, I trust that your SL of 2% of balance was not = to 200 pips. Of course it is only one trade but last night was not a good starting point for your setup. Also, it was not a good sign that the preceeding hourly candle was green. Just a couple of trade entry conditions you might want to consider would be only short the open at midnight if the preceeding hourly candle was red. Also, you could add an oscillator like stoch that may help the decision making process.
not gonna really get into this one but i have one fund devoted completely to a hedge situation on GU.
at specific times of day (45 minutes before the standard reversals) i place a long and a short for 5 pips each with 2 lots each and walk away — inevitably, because of the small amount of pips, the trade gets completed relatively soon, but i have also had to wait for a few days for some to come home to roost, but roost they do !
i do this on average 5 times a day and simply let it run, with no stop loss involved (or i would get stopped out, of course)
you must not overtrade obviously, but it does set a ridiculous winning streak over a period of months.
not to say it will always be so, but working like a charm for a year or so now !
[B]the saving grace in any thing like this is the small amount of profit per move you seek — that is what keeps it working for the most part, although as people say, it aint ALWAYS gonna work as you think and perhaps a purely mental stop would serve you well ![/B]
enjoy and trade well
mp
[I][B]Within the great hall at Elfinore stands a wondrous coffer, precisely four cubits square and securely latched against the outside world. Inside that repository, shut away from impertinent eyes, abides many an intriquing trading secret garnered from around the world and over the ages !
As a child, i used to watch from the darkness as the secrets were debated and annotated by the elders. No one there held a single thought of my presence – BUT I KNOW WHERE THEY HID THE KEY !!
[/B][/I]
I have tested this method using both and ea that I created and an ea that was created based on his “system”. Both fail catastrophically every few months.
Even though it was presented as an “easy” system, I am pretty sure Mike never meant it to be completely mechanical, and has mentioned on a few occasions that it should not be treated that way.
My suggestion, do not trade this type of straddle without first testing it for a very long time.
