As many members here know, I have been a scalper for quite some time now, but due to recent changes by my broker, scalping has become less profitable for me. As a result of this I have decided to return to swing style day trading. I have backtested a trading system that is neither extraordinary nor radically innovative. It does, however, have a positive expectancy, and with proper money/emotion management, I should do just fine.
My maxim will be to cut losses short, and let the winners run. More losses can be expected during choppy or range bound conditions, but once a trend is established, losses should be made back quickly.
Beginning today I will be forward testing this system from a live account. Actually, I have two accounts that I will be using. I have one for aggressive trading (2% risk per trade) and one for more conservative trading (.5% risk per trade). I will trade one currency pair (EUR/USD), one timeframe (5 minute), and I will have a maximum of two positions open at any one time. My broker is Oanda, but I will be using MT4 from Ikon-Global for my charting needs. Indicators, theory, etc should be somewhat apparent from the charts, but if you have questions, I will do my best to answer them.
I only take trades from 6am-11am EST. I don't trade news announcements, and I take off days when there is news that creates high volatility and unpredictability such as NFP and FOMC (which is why I won't be trading tomorrow).
Here are some statistics from my backtesting (3/1/08-7/31/08). I did my backtesting manually bar-by-bar, so it is susceptible to all the flaws inherent to that method of testing. The best month netted around 700 pips and the worst month ended around breakeven. All the other relative stats are below.
My maxim will be to cut losses short, and let the winners run. More losses can be expected during choppy or range bound conditions, but once a trend is established, losses should be made back quickly.
Beginning today I will be forward testing this system from a live account. Actually, I have two accounts that I will be using. I have one for aggressive trading (2% risk per trade) and one for more conservative trading (.5% risk per trade). I will trade one currency pair (EUR/USD), one timeframe (5 minute), and I will have a maximum of two positions open at any one time. My broker is Oanda, but I will be using MT4 from Ikon-Global for my charting needs. Indicators, theory, etc should be somewhat apparent from the charts, but if you have questions, I will do my best to answer them.
I only take trades from 6am-11am EST. I don't trade news announcements, and I take off days when there is news that creates high volatility and unpredictability such as NFP and FOMC (which is why I won't be trading tomorrow).
Here are some statistics from my backtesting (3/1/08-7/31/08). I did my backtesting manually bar-by-bar, so it is susceptible to all the flaws inherent to that method of testing. The best month netted around 700 pips and the worst month ended around breakeven. All the other relative stats are below.
Visit my journal here.