Question to Advanced System #14 (Simple trading with Daily)

[john225]

Hello
The comment section for the advanced system is closed and i ask here is anyone still using this system? Is it still profitable?

[Traveller]

I don't know, would you use a system if comments to it were closed?
I would

It's just so there were no new threads started about it yet.

[Pendolan]

I have started using this system this week.

Tuesday: +280 PIPS with 1 trade still active and 1 trade in the Cue (10 pairs traded). I have just started using it on my live account, ignoring all the tweeks except the ratio of 1.5:1 rather than the 2:1 ratio.

Although the risk is not optimal, it seems that volume is key to profitable returns. It worked well on the practice account, now we'll see how it works on a live account.

I am currently trading a MICRO account with 1K lots.

Although the ride was a rollercoaster, last night every trade was creeping towards my SL when I turned in for the night and I had grim visions of losing over 600 PIPS, but when I checked this morning 8 of 9 trades closed out with 7 hitting my TP (+286 PIPS) and 1 Hitting the SL (-112 PIPS). 1 Trades still active with a value of +69 PIPS/-90 PIPS and 1 Trade still not triggered. Even if both hit the SL I will be up over 140 PIPS.

[Pendolan]

I got hammered the last couple of days. Results are as follows:

11 May 2010

EURUSD: -84.3
GBPJPY: -161.4
GBPUSD: -111.4
EURGBP: +30.7
GBPCHF: -112.9
USDJPY: No Trade
USDCHF: No Trade
AUDUSD: -58.8
USDCAD: No Trade
EURJPY: No Trade

Total Gains: +30.7 PIPs
Total Losses: -528.8

Overall Loss: -498.1

12 May 2010

EURUSD: -107.3
GBPJPY: -204.7
GBPUSD: -144.7
EURGBP: +30.2
GBPCHF: +74.7
USDJPY: No Trade
USDCHF: -78.1
AUDUSD: +37.4
USDCAD: +42.7
EURJPY: No Trade

Total Gains: +185 PIPs
Total Losses: -534.8 PIPs

Overall Loss: -349.8 PIPs

13 May 2010

EURUSD: +52.4
GBPJPY: +102.7
GBPUSD: +73.2
EURGBP: -59.2
GBPCHF: -146.8
USDJPY: -89.9
USDCHF: +36.2
AUDUSD: +36.0
USDCAD: +40.9
EURJPY: -265.3

Total Gains: 341.4 PIPs
Total Losses: -561.2 PIPs

Overall Loss: -219.8 PIPs

So this week was definitely a bust. Overall I lost $144 from my MICRO trading, however I have noticed some key things going on with the trades. I think that Stuart (the originator of this strategy) has stumbled onto a potentially profitable system. The PIP gains from winning trades show definite merit and as you can see from the trading on 13 May, 6 of 10 trades hit the TP. However the trades that hit he SL completely wiped the profit out.

So what have I determined?

1) The TP/SL ratio has to be refined to at least 1:1
2) I use OCO orders, however in many cases the movement of the currency pair would trigger the wrong position first and thus cancel out the profitable trade.
3) By placing an OCO order I ignored the trending movement of the currency pair.
4) The current strategy does not look at the OPEN price of the Currency pair, thus we do not calculate how much movement is above or below the OPEN. This has had some disasterous results as you can see from the above results. When a trade is triggerred, in many cases the is no possibilty that it will hit my TP because the overall PIP gain/loss is to small to reach the TP for the trade, resulting in a retracement and hitting my SL (ouch twice the pain). Because we set our Entry point 25% above/below the CLOSE and our TP 25% above/below the Entry point we are in fact trying to catch 50% of the overall AVG daily movement, this can be huge.

So What is the next Step?

1) I have reduced the ratio to 1:1 by setting my SL the same amount of PIPs as my TP.
2) Using the OPEN price I have adjusted the spreadsheet to calculate when a LONG or SHORT position is unlikely to occur and therefore I will only open a position that "should" be profitable. I did this by determining how many PIPs the currency pair moved above/below the open price of the previous day. If it moved less than 50 PIPs the trade is unlikely to be profitable (based on taking 25% of the movement).
3) I adjusted the Order Entry point to be 10% above/below the previous days CLOSE(this is 10% of the actual PIPs it moved above/below the OPEN). Previously the Entry point was 25% above/below the overall AVG daily movement for the currency pair,
4) My TP is now 25% of the actual PIP movement above/below the OPEN instead of 25% of the overall daily movement. (ie HIGH-OPEN=PIPs Upward movement, OPEN-LOW=PIPs downward movement).
5) I will only trade Sun -Thurs as Fri trades can potentially carry over the wknd and when trading opens on SUN and it can be disasterous. (I am located GMT -6 therefore for me the Asian market opens Sun 4PM Local time and closes Fri 4PM Local)

As I have only completed the revisions on the spreadsheet for the EURUSD. For those traders that would like to try this system I will post the spreadsheet in the next few days when I have revised all currency pairs.

I will post the results of my trading and the end of next week.

[Pendolan]

Here is the new spreadsheet that determines the most likely trade for the currency pair based on previous days action. I have protected the spread sheet so that only the cells that you need to enter information for are accessible. However if you would like to modify the sheet to your own particular taste you can unprotect each sheet from the EXCEL -> TOOLS ->PROTECTION menu item.

I have include the data from Apr 30 to May 14 as provided from FXCM.

I hope that you enjoy this and good trading.

[Pendolan]

Trade results for May 16/17:

EURUSD: Not Trade
GBPJPY: +58.8
GBPUSD: +29.3
EURGBP: Still waiting
GBPCHF: No Treade
USDJPY: +23.8
USDCHF: No Trade
AUDUSD: +28
USDCAD: No Trade
EURJPY: +69.3

Total PIPs: +209.2

Now this loooks a lot better than the previous week.

[Pendolan]

No Trades for 17/18 May as I was not home to set the trades.

[Pendolan]

Trades for 18/19 May 2010

EURUSD: +16.2 (MANUAL CLOSE)
GBPJPY: +55.7
GBPUSD: -43.3
EURGBP: -16.8
GBPCHF: -27.7
USDJPY: NO TRADE
USDCHF: +17.1 (MANUAL CLOSE)
AUDUSD: +37.2
USDCAD: +21.2
EURJPY: +67.4

TOTAL PIPS: +127

[Pendolan]

Trades for 19/20 May 2010

EURUSD: -42.7
GBPJPY: +62.2
GBPUSD: -28.5
EURGBP: -23.1
GBPCHF: -49
USDJPY: NO TRADE
USDCHF: +22.2
AUDUSD: +72.4
USDCAD: +36.7
EURJPY: -16.5

TOTAL PIPS: +66.1

[drew]

Pendolan,

I just want to say thank you for posting your variation of this strategy and your results. They are extremely helpful. I did my first test of your strategy last night and my results were mixed based off of the fact I entered in the wrong numbers (newbie mistake). The trades that were entered properly did well.

From your posts it looks like you are in Mountain Time, like Colorado? I live in EST. Do you trade at Midnight, your time?

Thanks for sharing your thoughts!

-Drew