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Trading Without Charts

Quoting Silkysilv
{quote} you know what they say....don't wrestle with pigs, because everyone gets dirty, but they enjoy it. {image} This is the results from sept last year. Go long when RSI is above 61 and go short when RSI goes below 40. Its a stop and reverse trade. its not looking good with these entry/exit rules, there is plenty of profits to be had before the exits. I think there is something here. This is a 5 min chart, with RSI on 5/15/30/1hr
Ha, so true - no more wrestling for me

Thanks for the test. A couple of suggestions:

Stop and reverse should be one of the weakest approaches. I haven't tried it personally due to that belief. What I tend to do is look for exits at defined levels. This will somewhat limit trade time and profit (and you will of course still experience reversals) but I've found it better to grab smaller and more regular profits. You should find the win rate greatly increases. A good starting point is 75 or 80 for long exits and 25 or 20 for short exits. You can then tweak from there depending upon what you witness.

I'd also suggest removing either the 30m or 1H from your calculations. Probably the 30m. I find 3 timeframes with a tiny bit of separation to be best.
Quoting LauraT
{quote} Ha, so true - no more wrestling for me Thanks for the test. A couple of suggestions: Stop and reverse should be one of the weakest approaches. I haven't tried it personally due to that belief. What I tend to do is look for exits at defined levels. This will somewhat limit trade time and profit (and you will of course still experience reversals) but I've found it better to grab smaller and more regular profits. You should find the win rate greatly increases. A good starting point is 75 or 80 for long exits and 25 or 20 for short exits....
Thank you for coming back to me. You are right, I have tweaked the settings to 5/15/1h, trading from a 5 min chart. I have tested it across various instruments and the strike rate is so so, at around 50% on average, but the profit factor lurks between 1-1.10.

However, when I use playback mode, and manually enter trades at RSI 60 and exit at 75, it seems way more profitable. There is a disconnect somewhere and I must figures this out. Do you use a SL of RSI40, or do you play it by ear? I have been using 40SL for longs and 60SL for shorts.

In the meantime, this is the best chart I have seen - However SL is 20.
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  • Last Post: May 20, 2023 5:46am May 20, 2023 5:46am
Quoting Silkysilv
{quote} Thank you for coming back to me. You are right, I have tweaked the settings to 5/15/1h, trading from a 5 min chart. I have tested it across various instruments and the strike rate is so so, at around 50% on average, but the profit factor lurks between 1-1.10. However, when I use playback mode, and manually enter trades at RSI 60 and exit at 75, it seems way more profitable. There is a disconnect somewhere and I must figures this out. Do you use a SL of RSI40, or do you play it by ear? I have been using 40SL for longs and 60SL for shorts....
Very interesting that manual testing suggests something different to automated. I am also a little suspicious about the automated results, as they are now in coin flip territory in terms of win rate and profit factor, which doesn't match my experience of trading this way.

I do manually scratch trades occasionally before they hit a numerical stop point. Unfortunately this is not quantifiable or scientific as it's entirely based upon my feel for what the number is doing. When you watch the number instead of the chart, you develop a bit more of a connection to how the number fluctuates over time - based on both speed of fluctuation or nature of it.

One other element that is likely a factor is time of trading. I'm guessing your tests have covered the whole 24 hours? During low volume/volatility periods, there will be more flips between 60 and 40. In fact, that will often become an active range, with the number not spending much time in upper or lower extremes.

Finally, there is the factor that I try to be flat leading up to 'red news' - as the increased volatility and reduced liquidity during those events will make the numbers much less stable.
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