Market is an almost stochastic process. Almost because it has some bias like trends, pivots, fibs, psiho levels, etc.
If you want to win you have to fight against the market with its own weapons : randomness.
To use randomness we should define stochastic processes inside stochastic process of markets.
The simpliest process I can imagine is to place 100 random orders with the same SL and TP. In time, the equity will oscillate along an average value which ideally would be the initial balance. All you have to do is to close all of your position when equity is above balance. If you define well your stochastic process it will happen for sure. Almost for sure, which means that most of the time will happen . Good enough to get rich.
I will ilustrate by graphics some examples of stochastic processes defined by me inside the market which always show maximums and minimums.
First graphic shows an ea producing only buys during january 2011. The second graph shows the same ea producing only sells. Please notice that in each case we have maximums, which are only we are interested in.
The second and third graphics show the same ea for the year 2010.
The last graph shows another ea (another stochastic process) applied for today’s (8 march 2011) London opening. This last ea doesn’t care about direction of the trend , it will always have maximums regardless the up or down trend, if there is one. And there is always one, near the London opening and not only then.
Ok, but having a total amount of 1 microlot opened orders all of them very close to the last major resistance or support, on a account of 200 euros, is rubbish too ?
The last major resistance in EURUSD whas 140 pips ago, on 7th march. This means about 980 euros profit in less than 2 days (about 500% ). But that is not the way this method should be traded, because it’s not everyday we have such strong trends. Instead, almost everyday we have trends of 30 - 50 pips. Enough to double your very small account (200 euros seems to be a blow-proof account for intraday, more than 2000 for monthly). But again, the safest amount of wins per day is 30 - 50 euros (and that is regardless of how big is your initial balance).
The advantage of chaos is that it follows the market.
Or you consider rubbish the fact that I could mantain the balance at the same level for an whole year (not speaking of not blowing the account), and in the same time I have peaks of equity ? And I almost forgot to say that during all this period you have every single minute a total of 1 microlot opened orders (all of the same direction).
Oh please - can we have some decorum on the forum.
aguy - Ok, so I can’t categorically say that your strategy won’t work, but from my experience it won’t, when I started out I wrote a nearly endless number of EA’s etc, some were very promising, I even had one that showed consistent profit for something like nearly ten years before falling off a cliff, and no matter what there was no way I could come up with something that you could trust and leave to operate on it’s own.
Wouldn’t it at least be more helpful to suggest why you think that it would not work? There is no compulsion to post on these fora, after all. It is pretty hard for someone to learn from an answer that simply dismisses their ideas as rubbish. It is of no wider value to other viewers of this forum, either. Also, as many other threads have established, it is possible in Forex for two traders to be successful while using strategies that the other would never trade.
Any new strat needs confidence and testing. By simply lobbing in ‘seems like rubbish’, you offer no constructive criticism, yet do risk putting people off posting their ideas in the forum, particularly newer traders for whom trading confidence can sometimes be hard to come by.
Sorry I am sorry to sound negative, but there have been an increasing number of blunt, unhelpful and, on occasion, rude posts on here, largely from some newer members. I felt I should speak up when I saw a far more experienced member joining in, as it is really unhelpful.
(Sorry, aguy, for diverting the thread briefly: re. the strat, in your position I would test it for a while, come back here with results and show people how it works. Once you have results to post you will hopefully get some constructive feedback).
let me show you a graphics for today works of that ea. Well, of course that I let the SELL robot run today because I saw the trend but by letting BUY robot run I would only have postponed the occurence of peaks. Unfortunately I cant upload the html statement. This robot started to run 3 hours ago and was stoped by me when its equity raised enough. i was running two more robots on demo accounts, one that made strong peaks during london open, it did that but I missed the opportunity to close orders(I am at job now and I control my robots via remote desktop, because they are running at home).
but I could provide strategy testers exactly for today, or for any day you want since 2001.
Yes , in fact there is an issue with my method. For example I could have made more than 1000 euros with a 200 euros account in two days, but I stoped the ea at 35 euros profit. Somedays I don’t stop it at all and it misses the peak, and go down, but still not blowing your account, it goes slowly down. Like almost in any strategy, it’s a psihological problem, you have to clearly define what profit means to you, and stick to it, even though sometimes you won’t reach target.
And in NO CASE this method is a robot. It is not to be left alone. I use mq4 only to place orders in a specific alghoritmic way, otherways I could place them manualy but they are to many.
I like the idea of “randomness”, and in fact the system that I use bases itself on some random theory.
However, attempting to run a system using an account of 200 EU or dollars, even using microlots, really wouldn’t get far (in my opinion anyhow), since the first bad trade or need to average out a trade would kill the 200 Eu/$. In order to really give a system a good run, and catch the oscillations from random moves (or reverses) you would need an account of 3-5K upwards.
Not , if your first order is 0.01 microlots. The whole process builds progresively on 0.01 microlots, until the sum of them reach 1 microlot. And think about I am using 1:500 leverage which is a killer, but still works for me (it kills for me:) ).
Ok, if you plan to use the ea more than one days, I agree 200 euros is not enough. But when deciding to trade intraday , then your aim is to catch the first significant peak, which will almost sure occur long before your equity is in danger.
I show you an monthly example, where you need about 2000 uros to survive until first peak. Well in this case it was enough 500 euros, but it’s not always like that.
OK got you… however, I don’t know too many brokers who are prepared to go with 0.01 microlots…?? so why not just open an account with 3-5K and use microlots as per normal?
Unless you want to somehow prove that you can “turn $200 into thousands!”, which would be a good marketing tool yeah, but not too helpful for newbies here… or as a “correct way to win at Forex” for 99.9% of people…
No , I dont want to prove that. It is only an unhappy limitation of this method. Tha fact is that even if you start with 1 million euros you will win the same amount at the end of the day or month as if you started with 200 respectively 2000. It is the nature of this method that brings this limitation. I observed that 200 euros is a decent lower limit of the initial balance in order to be able to catch the first peak.
As regards newbies, only those who have lost a lot would appreciate this method, and perhaps it’s not the case with newbies, they are always searching for holly grail.
The reason I use 0.01 microlots is that I need many orders to have a statistic cloud. My broker limits me to 100 simultan opened orders, otherways I would have killed him long time ago. Ok, if you use normal accounts where 1 lot is 100000 dollars, then you would use 0.1 lots, the minimum possible. Got the ideea ?
Je suis honore, but still not confident in my results, so I need more researchers to exchange infos. In particular I would like to talk with somebody who knows about random walk.
If drawdown means balance lowering, yes. But your real money is not the balance , is the equity, and unfortunately in mt4 statements you can’t see the equity. Look at the second graphic of the same period. There is actually no money loss anywhere. I have seen drawdowns of 150 % while equity was 300 % in profit.
Now please observe that equity line touches balance line in two points, first time at trade nr. 93 (around 6:45 hours) and at trade 210 (around 8:06 hours). These are entry points for this method. Look what happens if I start my method at 6:45 and 8:06, in the last two graphics.
