By the way, I do not use the cap Channel arrows either. But I have started counter trend trading a little while back after price breaks one of the outer cap Channel lines.
yeah, i dont think it will make too much difference in the way im using it, i use it more to set TPs
I use the 25 ema channel for entrys and cap channel for tps and trigger the 25 ema entry. First i need for the lower 25 ema touch the lower cap for me to look for a sell, or the high 25 touch the cap high for a buy. then i wait for the ema 7 cross the 25 channel from below for buy, or from above for sell. If the channel dont touch cap, i wont enter any 25 cross signal. Stop in the last swing high/low and my take follows the cap channel.
i use 1m chart for my backtest, will start to foward test it live on monday in the NY session.
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For highest win rate, enter on fast EMA crossing over bottom blue EMA or under top blue EMA at Cap channel edges.
whats your normal/medium RR in each operation? i know its not fixed amount but know your medium return rate for your winners?
Hi Arakian,
I donāt usually use a SL unless high impact news is coming and I wasnāt able to close before it hits, so no average RR to calculate. If Iām in profit, I may decide to close any time.
I most often enter on the fast ema crossing over the outer 25 ema, rather than the countertrend entries if I want to use a larger lot size.
Countertrend is for multiple small lot size entries.
I close whenever I am satisfied with the profit. I should let trades run more, but it doesnāt matter when the win rate is so high.
Multiple wins with an occasional loss. That is what most of my days are like. I try to not lose more than I can recover the same day.
Nice, i just backtest of EURUSD in the 1h TF from jan/2023 to dez/2023 with live replay so i can see the actual CAP channel before the repaint. I wait for price break of the CAP channel and then I wait for the cross of 7 EMA from above(for sell) or from below(for buys) of the the 25 ema channel. If the cross happens and the price is too close from the middle CAP, I wait for a pullback where i can set a reasonable distance of it and put the trade. If price touchs middle CAP before that i dont do this trade even if it pulls back after.
Im using 3 forms of closing the trades. 1st got best winrate of 65%, with 1:1R, always aiming the middle CAP as TP. total of 28R in gains with 88 trades in total.
Second one had more rules, the distance from the start of the trade and the SL is the same from the start till middle CAP, 1:1, but the 1st take was 50% lots at the middle of CAP and the other 50% at the end of the CAP channel. If 1st take was trigged I put SL at BE and let it run. Total of 36,85R in return with 88 trades, 35% loss of 1R each, 40% win of 0,5R and 26 wins (35%) with a median of 1.95R of each of the 26 trades.
The last one was the same as the second, but with no 50% TP at middle Cap, insted just put SL at BE and let it run. Had the best result of then all, with 44,2R over 2023. 35% of trades was loss of 1R each, 40% was 0R(BE) and 26 win(35%) with a median of 2.85R each.
Hope i could help some1 out with this informations.
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Interesting. Whatās the thinking there?
How are you back testing. Like what app or software are you using?
Did you notice any particular market conditions or trends that favor one strategy over the others? Also, how do you handle trades when there are significant news events or volatility spikes?
Those win rates are all terrible.
A good trader who understands the market will blow them all away.
Targets are targets, not always reached or hit.
But they donāt have to be in order to win a trade.
Making a profit is winning a trade. Placing a SL in a mechanical place creates additional losses that never had to be taken.
My believe is that using a strategy for a while trains the trader how to use it best. It doesnāt have to be this strategy. It could be any of hundreds of them. The trader needs to learn how to use the information the indicators are providing and take into account news, volume changing to zero at the top of the hour in many cases.
Thereās a lot that the testing can never account for, but WE can.
So with that in mind, its obvious from your diligence in testing the strategy that you have all the necessary desire and intelligence to make the strategy you choose to use work. I have no doubt you will be successful and I look forward to hearing about your successes always.
Thank you Arakian.
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Hi buddy,
I have been thinking that if I enter a long trade when there is an ema channel cross that happens near the top or bottom of the Cap Channel, its a 1 entry with larger lot size and I look for at least 1 good candle of profit or let it ride to one of the exit signal points.
If Iām countertrend trading, Iām going into it with a smaller lot size and expecting to need several entries for the cost averaging effect. There could be 1 or 2 entries, or there could be 10-20 entries. Its a lot of fun, but extremely interactive.
Its working well for me and on the M5 its just up to me if I want to make money. The market is not in control, I am.
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Im using strategy tester on metatrader, it allows to see candle by candle.
Nope, i would say that all 3 are valid and it all comes up to your style of trade. There where no consecutive loss highier than 3, but in the 3rd backtest there where consecutive loss followed by lots of Beakeeven, so some traders would not have the heart to follow this strategy, even if it will get us more return at the end of the year.
About the spikes, in the 1h timeframe I found those spikes not too relevant, the 25 ema channel cross kind of gives us a good filters for trades, and when thoses spikes occurs normally it gives us a ema cross but it goes beyond the middle CAP channel, making it an invalid entry for me.
How do you maintain confidence in your strategy despite those consecutive losses and breakevens? Also, could you explain a bit more about how the 25 EMA channel cross acts as a filter for you?
Thx man. You are right, every strategy works if you know how to make it work. I already have mine and get 75% of winning days with it, need some more work to be better but it works for me, but i like to test other stuffs while im working in mine too, it helps giving me better ideas.
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Ah okay cool. How do you like MT4 (or 5?)? Having used TV so long, MT4 just looks so old and itās hard to move around.
Hey AT,
Are those the only settings in your Envelopes indicator? 40 smoothed and .08atr? Looking to see if I can find something like it in TV. Thanks!
Yes.
So far Iāve only looked at the M5 charts for settings that looked close to the Cap. All I did was check to see if the price was generally within the envelope, but touched it occasionally and didnāt go too far outside of it.
See what you think.
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Hmmm, the 3 envelope indicators I just tried donāt look right. Envelop is either too tight, or super super too wide. Iāll keep looking.