DislikedI think instead of basing our risk size on average loss size, it ought to be based on max-drawdown. This is a stat that I have not been able to keep track of, with the exception of what is listed on the Zulutrade site.Ignored
Trading Systems or Trading Setups 9 replies
Brainstorming Session: OctaveJay's Weekly n Daily Trade Setups 61 replies
Intraday setups with Weekly TF 30 replies
High Probability Trading Setups for the Currency Market 6 replies
DislikedI think instead of basing our risk size on average loss size, it ought to be based on max-drawdown. This is a stat that I have not been able to keep track of, with the exception of what is listed on the Zulutrade site.Ignored
DislikedI'm having a hard time comprehending exactly what you are saying here. If a 200-pip move has the potential to wipe out 29% of my capital, then all it would take is 689 pips to completely wipe out the account (100%/29% x 200 pips).
It would not take much to be on the wrong side of a currency like the GBPJPY and see this totally wiping out the account.Ignored
DislikedMy own curiosity got me thinking. According to the rules I laid out, I only trade in the direction of the trend. In other words, I only trade from 20% to 80% or 80% to 20%. The theory behind that is that I'm more likely to be on the right side of the trade more often that way. But in my mind, I always knew that the price corrects, otherwise, I would never get an entry. So maybe the 80/20 system is only living up to HALF its potential. I decided to start tracking what would happen if I traded back and forth between the 20% and 80% level. In other words, if I am long at 20%, I TP at 80%, and immediately go short until 20% is hit again. Imagine a ping pong ball bouncing back and forth between those two levels. Trades should happen about twice as often, and results should be just as successful.Ignored
DislikedYes, this is very interesting.
I noticed that a few of my open trades this week (which are currently in the red) would have already posted a win if I had set up trades in both directions.
Perhaps we don't even need to wait for the first trade in the direction of the trend. We could just use the 20-week trend as a method of projecting the position and magnitude of the new weekly range. Within that range we can set up both long and short orders, without any directional bias. The TP orders can be slighting inside the 80/20 levels so that they get triggered before the reversal order is triggered.Ignored
DislikedMath,
The more I think about your mathematical analysis, the more I think we need to determine individual risk allocations by currency pair. The 200-pip loss that you based your numbers off of was a good start for the AVERAGE pair. Unfortunately, pairs like GBPJPY range a LOT more than pairs like EURGBP. Over time, I think it is possible to determine the best risk/reward scenario for each pair traded, based on max drawdown, as we've both already agreed on. What do you think?Ignored
DislikedYes, absolutely. The more we can customize our experience, the better. The research I did was an overall average. It was based on data that came from trades across multiple currencies, therefore it is a good gauge for the average pair. Ideally we have a separate scheme for each currency pair, each with its own idiosyncrasies.
Lately, I've been thinking about the basket of currencies I'm trading. I think that I should diversify a lot more. I thought maybe I would trade the USD against a variety of currencies, e.g. GBPUSD, USDCHF, USDCAD, AUDUSD, USDNOK, USDPLN; then the EUR against the same set: EURGBP, EURCHF, EURCAD, EURAUD, EURNOK, EURPLN; finally some other crosses that don't involve the USD or the EUR, like GBPJPY, GBPCHF, CADJPY, AUDNZD...stuff like that.
I'm really not sure exactly what pairs I want to trade, but I'm pretty sure that I want to have a lot of diversity.Ignored
DislikedYes, absolutely. The more we can customize our experience, the better. The research I did was an overall average. It was based on data that came from trades across multiple currencies, therefore it is a good gauge for the average pair. Ideally we have a separate scheme for each currency pair, each with its own idiosyncrasies.
Lately, I've been thinking about the basket of currencies I'm trading. I think that I should diversify a lot more. I thought maybe I would trade the USD against a variety of currencies, e.g. GBPUSD, USDCHF, USDCAD, AUDUSD, USDNOK, USDPLN; then the EUR against the same set: EURGBP, EURCHF, EURCAD, EURAUD, EURNOK, EURPLN; finally some other crosses that don't involve the USD or the EUR, like GBPJPY, GBPCHF, CADJPY, AUDNZD...stuff like that.
I'm really not sure exactly what pairs I want to trade, but I'm pretty sure that I want to have a lot of diversity.Ignored
Disliked...Over time, I think it is possible to determine the best risk/reward scenario for each pair traded, based on max drawdown...Ignored
QuoteDislikedMaximum Adverse Excursion
Analysing price fluctuations for trading management
or
Campaign Trading
Tactics and strategies to exploit the markets
DislikedHas anyone traded USDCNY? Any comments about it?
I was just looking at the daily chart and it has been in a near perfect linear trend. I thought this currency pair would be a great candidate for this system since it uses a linear projection based on the past 20 weeks. I wouldn't be surprized if the 80/20 projections were right on the money most weeks.Ignored
DislikedTwo things about this pair. First of all, it is nearly in a perfect line, because the Chinese are controlling the rate of appreciation. The weekly candles are very tight and not a lot of pips to be gathered between 80 and 20. Finally, Oanda (and most other brokers) have very high negative interest rates if you trade the CNY. You'll be tying up a lot of margin, with Oanda taking most of the profit.Ignored
DislikedI see that CNY has a lower rate than USD. So going short in USDCNY would cost interest. On the other hand, long trades would be making interest.
I guess I'll stay away from this one for now.Ignored
Dislikedhello folks,
firstly, Flyjetz, thank you so much for sharing your stystem.Ignored
DislikedI`m very impressed with your results so far; more so because its a mechanical system.
Forgive my ignorance, but I can`t see spreads being a problem in some pairs, because you`re in and out with limit orders.Ignored
DislikedEarlier you really needed a trend to get your pips, but now your are trading both ways, is a trending pair not needed so much anymore?Ignored
DislikedDo you really need to trade that many pairs to spread the risk? I wonder if it would just be enough especially if you still needed trending pairs to look for the best uptrending and downtrending pairs to neutralize the USD like buying USD/JPY or USD/GBP(uptrend) and selling USD/MXN or USD/CZK for down trend.
The same for EUR/GBP/CHF/AUD pairs.
That way you would trade 10 pairs all together.Ignored
DislikedBefore I embark on further analysis, I wondered if you`ve already thought about this and I would love to hear your opinion.
btw I calculate the slope by comparing the 1st candle mid point with the 20th midpoint and divide that figure by 19.Ignored
Dislikednow you trade in both directions. say we have an uptrending pair. would you wait for the 20% level to be hit to buy like before and short at 80% for the retracement?
or if that uptrending pair is above the 80% price at the beginning of the week would you short it once it reaches the 80% mark?
For a downtrending pair if price at the beginning of the week at say 98%, would it be wiser to have your order sitting at 90%?
hope you dont mind all these questions.
thank you for your time.Ignored