Any feedback on the methodology described below would be helpful.
so there is plenty of information on the web regarding best times/days to trade what currency pair is most volatile etc…
I have come up with following:
Trade USD/JPY (long only) this is historically quite a volatile pairing at the times mentioned.
Trade Wed and Thu only
Enter market 1pm UK time (at prevailing price)
Exit market 5pm UK time (at prevailing price)
Stop 12
Limit 6
majority of times your limit will hit or you will get stopped out before the 5pm exit.
Of course observe the trend (positive), MA cross over for a long trade
I look at 5 min and 15 min chart.
I have been following this strategy for 8 months (verifying the history with Bloomberg data) and it is so far profitable, although you do get some losing months. So far 2 losing months out of 8.
I have been spread betting on the currency pair small amounts only.
Can anyone back test this system? For the purpose of the back test you can ignore the trend and MA indicators as these are subjective (i believe it is still profitable).
I know that historical performance does not dictate what the price is going to do in future, but given the system is trading volatile periods and a volatile pairing, the majority of times you are hitting your limit and making money…