Exactly, and the total result of the week is on profit.
It is especially pleasing to note that with the box-based system the same days would have been losing and winning ones, meaning a total loss for the week.
Itās not a huge profit but itās still some extra pips 
Maybe this single week sounds small, but it is well in line with the overall potential of the system. Iāve been thinking about the accumulating profits. When using 20-48, you only need 3 profitable trades out of 10 to be at BE. I donāt have exact figures, but I believe the real figure is somewhere around 4-5 out of 10.
So far I have not used that risky position sizes, but being properly profitable in the long run means that you need to establish proper money management. The perceived risk should establish the upper limit for the size of individual trades. Iām expecting to see maybe 3 weeks of losing trades in a row at most. If you invest 1% per trade, that would mean 15% decrease in your account. On the other hand, 2 weeks of winning trades would grow your account by 25%. Iām thinking to use a slightly smaller risk, maybe 0.75% per trade.
That risk would have meant 1.5% income this week. Letās assume that the average profit is still a bit smaller, around 1%. That would mean about 4% income in month. If you update your position size once per month according to the growth of your account, and assuming that you have no variance in the result, then the annual result would be 60%. Being even sightly more conservative and assuming 3% per month, this calculation would still yield over 40% per annum.
I would be happy to see these figures over a long period of time!
20-48 or 20-50? This is another question of a very small pip difference. If you have a trade that wins 48 pips with 20-48, but loses 20 with 20-50, that means a difference of 68 pips. When using 20-50, you need 34 successful trades to catch up the loss of one such trade. If you have 50% of the trades winning and 50% losing, it would take roughly 3Ā½ months to catch up one trade. I cannot say what is the expected number of those trades in 3Ā½ months that would win on 20-48 and lose on 20-50, but my bet is that there is at least one on the average, and if that is true, then 20-48 could be a little bit more profitable in the long run than 20-50. But if Iām wrong, it is not a big issue anyway. So Iām going to continue with 20-48.
depends on the win ratio doesnāt it?
Youāre saying if price reaches 49 pips and reverses then someone using the 20-50 strat would lose out on a potentially profitable trade.
However, you could say the same for 45 pips, maybe a 20/45 is more profitableā¦and then you keep going, maybe a 20/35, etc. There is a balance at one of these points where youāre not winning enough to cover the losses. In the long term, a few pips difference can add up to a lot but we donāt have enough hindsight nor do we operate in a constant market to accurately determine this.
True. That chain of thoughts was spurred by your backtesting results where 20-48 was slightly better than 20-50. I havenāt looked at the underlying trades more closely, just speculating why either of them would be better. But maybe this speculation is nothing more than an attempt to squeeze the last pip out of a system, which is usually not very productive.
2 wins, 2 losses this week = 50 pips for me (20/45).
Last night would have been a good one to set up the trades early, dead flat, then boom up it goes. I got a chunk of that
but then lost some later on 
For 20/45 thats good. Hoping this LBS strategy comes back in āfashionā on a regular basis soon.
Is it only SanMiguel and me who are trading LBS as discussed in this thread now, deducing from the recent few posts? Iām not happy about my week, although it was a profitable one, as I broke the rules twice. I increased my position sizes this week, and that may be the reason. The irony in this is that I made more by not following the rules than I would have done by following them.
Monday: skipped because of US banking holiday. Would have been a loss.
Tuesday: loss.
Wednesday: would have been a loss with 20-48, but I bailed out with a small profit. Apparently that trade would have profitable with 20-45. Sometimes a couple of pips can make a difference.
Thursday: profit. Again I bailed out with fair profit.
Friday: no trades.
Iām not trading it really but still keeping the concept in mind while trying other things.
I wonder is the originator Trevpic still trading it? what kind of results lately?
Today we had a nice breakout - but unfortunately it was a bit too short-lived. 20-48 was a loss, but I got out a bit above BE after manually trailing the stop by 30 pips. I think that this is a reasonable addition to the system, although I have no backtesting data to back me up. If the price retraces by 30 pips, the breakout is probably already broken and the price could well retrace back to the initial limit, like today. Iām intending to use this rule with this reasoning whenever I can, even when the stop is still below BE. Any comments?
I did try a move to breakeven after 30pips some time ago and it proved less profitable on that test but Iām afraid we donāt really have the data to back that up as it might have only been a few trades that broke out, returned, and then probably bounced againā¦most likely around a SR line. However, emotionally it was far easier to cope with being stopped out at breakeven than taking a loss. As usualy, the test doesnāt account for a re-entry, which you could take if momentum was good and you were managing the trade manually so it seems a good option.
If ā¦ youāre NOT in Europe or the U.K., and youāre trading any of the following strategies ----
[ul]
[li]London Breakout Strategy (the Win Ratio thread on the Newbie Island forum)
[/li]
[li]London Breakout-1 (on the Free Forex Trading Systems forum)
[/li]
[li]Sunday Breakout Strategy (on the Free Forex Trading Systems forum)
[/li]
[li]or any other GBP, EUR or CHF strategy which is sensitive to time-of-day in Europe
[/li][/ul]
Then ā¦ you need to take note of the weird time-changes occurring THIS WEEK ONLY:
[ul]
[li]the market will open in Europe, and in London, one hour later than usual
[/li]
[li]news releases in Europe and London will occur one hour later than usual
[/li]
[li]the London Breakout Strategy overnight period will occur one hour later than usual
[/li]
[li]the London Breakout-1 five-candle period will occur one hour later than usual
[/li]
[li]the key 8pm GMT Sunday candle on Philās Sunday Breakout Strategy will be one hour out-of-phase
[/li]with the London and European markets; there is no way to compensate for this.
[/ul]
For my time zone (EDT in the eastern U.S.), the times for this week are:
[ul]
[li]Zurich open 3am
[/li]
[li]London open 4am
[/li]
[li]GBP news releases (typically) 5:30am
[/li]
[li]London Breakout Strategy overnight period 3pm - 1am
[/li]
[li]London Breakout-1 five candle period 1am - 6am
[/li][/ul]
I wrote these on a Post-It Note, and stuck it on my monitor.
For other time zones, Iāll leave it to you to make the appropriate adjustments.
Starting next Sunday, we will be back to ānormalā times.
Clint
Hi Clint, thanks ! Glad you are good at keeping track of time changes. That always gets me confused. I know that my EDT is 4hours from GMT, the rest I have to think about.
Youāre EDT too? What state? Georgia here.
Now that the dust has settled on time changes for Fall 2009, I thought it would be useful to make a table of the key time periods used in the various ābreakoutā strategies, converted to local times in 12 time zones. So, here it is:
Notes:
1. These 3 strategies were originally created for trading the GBP/USD pair at [B]specific times in the London trading day[/B].
These times are highlighted in the table, above.
2. [B]Phil's Sunday Breakout Strategy[/B] is based on the [B]20:00 GMT candle[/B] on the 4-hour GBP/USD chart. This strategy is
explained here: http://forums.babypips.com/free-forex-trading-systems/23601-sunday-breakout-strategy-148.html#post107933
3. [B]The London Breakout Strategy[/B] is based on a 10-hour "overnight" period, [B]7pm-5am London time[/B]. This strategy is
explained here: http://forums.babypips.com/newbie-island/25058-win-ratio-146.html#post113669
4. [B]The London Breakout-1[/B] strategy is based on a 5-candle period on the 1-hour GBP/USD chart, [B]5am-10am London time[/B].
This strategy is explained here: http://forums.babypips.com/free-forex-trading-systems/29863-london-breakout-1-a-43.html#post139152
Great stuff Clint.
Wondering if anyone is still doing the London Breakout strategy? If yes how is it going? If no, than can San Miguel run some tests on the last two months or so to see how things are going?
I havenāt traded it in a while, been concentrating on bollinger bands and MAs
I am not as I find London Breakout 1 far more profitable.
However, I have found an interesting twist on this method called the ā5 min of fury methodā, which is posted here:
Furious Angelās ā5 Minutes of Furyā Method
Watch the video on post 1 and read the PDF on page 3.
I can run some tests for you later today/tomorrow on the original.
Anyone still using this? Iāve been looking at the London breakout 1, So looks like a hybrid of the two may work well.
use 5:00 to 7:00 London time as the range. Set your horizontal lines at the highest high and lowest low of that range. Then set your pending orders just above and below those lines. If you live in a time zone where you arenāt asleep that time of day, it works better if you monitor instead of set it and forget it.