I’m using the 5 min timeframe, and doing it for each month in the past. I started in June '07 because I wanted to test the strategy for at least a year’s worth of data. I’m up to April of '08 now, which yielded 9 pips for the month for the EU - again is no where near the results you got. I think it’s probably pointless to continue backtesting until I figure out what I’m doing wrong. So I’ll await your info
If you’re using Oanda, I think they will provide records of your trades online for at least a year. (I’m especially interested in the months of November '07, Feb '08, and April '08, which should fall in that range.) You can even filter it out so that only trades would show up, or trades for a specific pair. (If it’s okay, please include trades you did for other pairs too) You can simply print it out in pdf form and email it or post it electronically.
im not near a computer. Im in the Netherlands right nowwhen I get back I will email you those dates. I know of Oandas system. I didnt bring a computer with me here. I suggest demoing also with back testing. These low pips dont really make sense to me I dont really know whats wrong. I cant go back that far Oanda only lets you go back about a day on there 5 min charts to back test. I tried to look at it this week at the hotel but its super slow.
The low pips seem to come from the fact that my win rate is only about 60%. Because the SL is slightly bigger than the TP (to account for spread), I end up around break even at the end of the day. My problem seems to stem from two issues:
How to define the trend? You said that you looked at the 15m for trend, but how is it defined? By the proper stacking of the MA? (Ie When they�re stacked in the correct order, if the slowest MA is at the bottom, then it�s an uptrend?) What about when they�re not properly stacked, do you stay on the sidelines and not trade at all? Or do you have a different method of defining the trend? What about when prices seem to generally going downwards on the 15 minute, but is starting to turn upwards? Is it still considered a down trend for this system?
You said to stay out when the MAs are �vibrating�, but how do you know that they�re vibrating until AFTER you�ve been stopped out at least twice? By then, you gave up a big chunk of your previous gains. This seems to be my biggest problem: the whipsaws. I don’t know which crossovers to ignore until AFTER I gave up my gains. By then, it’s too late.
Thanks for taking the time to answer my questions Pablo. I know you didn�t sign up to be anyone�s mentor. I just wanted you to know that I really appreciate it.
Instead of worrying about the trend, just try using the 5 minute chart only. Get in at a cross and get out after 5-10 pips. Just look back through a 5 minute chart on some of the pairs today. As I write this, just in the last hour there were at least 6 profitable trades.
Oh good, I was hoping a newer user of the system might chime in too . I appreciate all feedback�
Actually, I tried the system both way, with and without the trend. Going with the trend didn’t seem to help, since it wipes out a big portion of the trades without really improving your win/loss ratio.
Yes, I see that there are lots of profitable trades lately, but a system is only sound if it fairs well in the long run, and that�s why I�m backtesting it as far as one year. What I found is that past performance is not as stellar as recent performance – UNLESS I�m doing something wrong, or I�m testing it wrong.
Please see attached as an example of a more typical week in the months that I tested. These trades in particular are for the EurUsd for the first week of November 2007 during the timeframes that Pablo indicated (5:30 am -11 am EST, Monday through Thursday). The arrows indicate direction of the trade, and the colors of the arrow shows �win� or �lose�. Since Pablo said that he didn�t trade before the news, I put an �X� over trades that were within about 15-20 minutes of impending news.
As you can see, the result for this particular week is 11 wins and 9 losses (or 55% win rate). If you took out pre-news trades, then it�s 10 wins and 7 losses (or 58% win rate). So, even if you have more winning trades than losing ones, since each loss is slightly more than each win(because of spread), you can end up breaking even at the end of the week, or even a small pip loss.
I use 5 minute chart with TRO indicator that show support and resistance. It tell me when to enter and make the pips. I see price with my eye and know which way it goes.
Sorry Dahlia, but your charts are too small for me to see. All I can tell you - for the last few weeks, I’ve used this system on a 5 minute chart only. I’ve never looked at another time frame while using it. And news - don’t know what that is. Both my EMA’s are colored yellow. My SMA is blue. When I see the yellow lines cross, I immediately get in, either buying or selling - buy if the blue is pointing up and sell if the blue is pointing down. I only watch the candle I got in on. As soon as I get in, I open a window to close the trade. As soon as the candle goes 5-10 pips, I click on that window and get out. Never more. And I never stay in more than that one candle. Sure a lot of times the candle will keep going and I could’ve made a lot more. But it can turn against you just as fast. If it starts going the opposite way I wanted it to, I give it 4 pips to correct or I click out. With the spread, the most I lose is 6 pips. So far it’s working roughly 70 percent. Of course, once I start using real money, the whole thing could blow up in my face. But so far it’s very promising.
Hmm… I thought Pablo said that all 3 lines have to cross, not just the EMAs? I have to run to dinner, but I’ll try to post a bigger chart when I get back…
Most of he time I get in, all 3 are crossing. One more thing I forgot to add - I trade only when the spreads are low - never over 2.5 - and have tweaked my Onada page to watch certain 8 pairs only. At this time, only one pair - EUR/USD, has a low spread. All the others are above 3. It’s too hard to sit there and have the candle make up a large spread before you start profiting.
More power to you if you can scalp 8 pairs and keep an
eye on them. I only do EUR/USD and EUR/JPY.
Ideally, EUR pairs are the best bets in terms of
manageable spreads and lends to decent technical
analysis. Most other pairs are too dicey. I avoid
all of them.
I gotta agree with you there. It isn’t easy to watch them all, and the majority of trades is with the two pairs you mentioned. Are you using the same method we are discussing in this thread?
Okay, second try with the charts, this time each day separately…
Looking at the charts below, would you guys have done anything differently? After this week (below), I would have made about 19 trades and ended up at break even. Am I doing something wrong?
I wonder what types of orders you guys use for this strategy? I always set a limit orders at the close of the candle. But sometimes the price are too fast for me to catch and my order never get filled.
Hmm… How long do you wait between trades on each pair?
That was one of the questions I had above - how do you define the trend? By the proper stacking of the MA? What if prices seem to generally going downwards on the 15 minute, but is starting to turn upwards? When is it considered a change of trend in this strategy?
Hope you had a great time in Amsterdam and looking forward to your return
I have 2 charts open when I trade 15 and the 5 if there is no clear trend on the 15 min i dont trade the 5. I just open another pair and see if a trade might be coming.
about 15 its any where from 50-80 pips per lot. If i have been a trtade for 3 sticks and havent reached a TP i close it. I dont like to be in the market that long.
. I appreciate all feedback�
Both my EMA’s are colored yellow. My SMA is blue. When I see the yellow lines cross, I immediately get in, either buying or selling - buy if the blue is pointing up and sell if the blue is pointing down. I only watch the candle I got in on. As soon as I get in, I open a window to close the trade. As soon as the candle goes 5-10 pips, I click on that window and get out. Never more. And I never stay in more than that one candle. Sure a lot of times the candle will keep going and I could’ve made a lot more. But it can turn against you just as fast. If it starts going the opposite way I wanted it to, I give it 4 pips to correct or I click out. With the spread, the most I lose is 6 pips. So far it’s working roughly 70 percent. Of course, once I start using real money, the whole thing could blow up in my face. But so far it’s very promising.
