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trading system help required

  • #1
  • First Post: Apr 28, 2004 9:50am Apr 28, 2004 9:50am
Hi, I've been looking for a forum where systems are discussed and this seems like the place, as I recognise some of the system names here. I was wondering if anyone has heard of the market exhaustion system and how they have found its results. It claims to have a faultless record although drawdowns can be large. I have already spent, if not entirely wasted, money on some other systems so if anyone has heard of this technique I'd be grateful for some thoughts before I make a decision.
  • #2
  • Apr 28, 2004 12:05pm Apr 28, 2004 12:05pm
Quoting jambotrader
Hi, I've been looking for a forum where systems are discussed and this seems like the place, as I recognise some of the system names here. I was wondering if anyone has heard of the market exhaustion system and how they have found its results. It claims to have a faultless record although drawdowns can be large. I have already spent, if not entirely wasted, money on some other systems so if anyone has heard of this technique I'd be grateful for some thoughts before I make a decision.
can you post link to the Exhaustion System? What other systems have you tried (the worthless ones)?
Relax and be happy.
  • #3
  • Apr 28, 2004 1:40pm Apr 28, 2004 1:40pm
Quoting merlin
can you post link to the Exhaustion System? What other systems have you tried (the worthless ones)?
Hi Merlin, well I have spent a few hundred on various systems. I fully expected to not get my money's worth but I thought I could combine the pluses of the various systems I bought, and pull out the minuses. I sort of am doing so, but it isn't as easy as I thought. One system I have bought involves using the 9, 21 and 50 day moving averages and you enter depending on then crossing. From my testing, it can work but only in volatile market; it doesn't work so well in quiet markets where the crosses can happen without letting you make a profit and the delay can be terrible as you find yourself buying at the high or selling the low sometimes. Also I have bought many books which claim to have clear answers but they only explain forex rather than provide concrete trading systems. In fact the nearest I've come across is a book on system building called design and optimisation of trading systems.
But I have come across some systems for sale on ebay and wanted to know what people thought. The system I am considering is on ebay for £50 and comes with two systems that cover various currencies, but I think both are similar with slight differences. The seller has been helpful with my questions but I just wanted some opinions, as there is plenty of feedback there which means people must have bought it - I am just looking for those people for their opinions as I too am tempted but I don't want to get fleeced! Any help would be appreciated.
  • #4
  • Apr 28, 2004 2:14pm Apr 28, 2004 2:14pm
Quoting jambotrader
One system I have bought involves using the 9, 21 and 50 day moving averages and you enter depending on then crossing. From my testing, it can work but only in volatile market; it doesn't work so well in quiet markets where the crosses can happen without letting you make a profit and the delay can be terrible as you find yourself buying at the high or selling the low sometimes.
hello
MA's are lagging indicators so its better to use them with some oscillators (i.e. stochastics) and buy/sell only in oversold/overbought area..
and ADX can help you to recognize trend... MA's are good in trending market but fail when it is moving sideways.
  • #5
  • Apr 28, 2004 2:40pm Apr 28, 2004 2:40pm
Orion thanks. I have found that buying when things are overbought in rsi can lead to very quick gains of 30-50 points. I only learned this because a system suggested selling when overbought! (I should add also it used the 5 day average through the 14 here, not just pure rsi over 75). After testing I found the opposite works better in the very short term and overall it's very hit and miss if used on longer term charts (say upwards of one hour). Stochastics sounds interesting and I know a lot of people use them, but I always thought that what the majority do or use will lead to failure so I've been hesitant in looking at it in any detail.
  • #6
  • Apr 29, 2004 8:52am Apr 29, 2004 8:52am
Regarding that system I was on about, don't worry anymore. I managed to get some free trade predictions in the austrailian dollar which worked out well (I didn't trade them for real just noted the levels). Thanks for your help anyway guys!
  • #7
  • Apr 29, 2004 11:27am Apr 29, 2004 11:27am
I am relatively new to forex trading. I'm still developing my trading system..and...
I have problems with following even my own system. (it works better when i look at it on paper than in real trading..and it should work)
That's why i think it's better for me to master my own system rather than purchase it.

I need better discipline first.
  • #8
  • Apr 29, 2004 5:42pm Apr 29, 2004 5:42pm
I have purchased that system. You are correct in your suspicion about no losing trades. This is because of extremely large drawdown acceptable. It is basically a scale trading system for currencies, where you continue to fade the market, adding to losing positions at certain intervals, thus, improving your average entry price, until the market turns your way. But, as you know, in this business, there are no guarantees that the market will turn your way before you lose hope and abandon the positions. Not saying that it won't work, but you have to ask yourself if you could continue to add contracts as the market is going against you. Goes completely against the addage that the "trend is your friend". The profit target is very small relative to the risk and drawdown, which is another thing that helps them claim "no losses"



Quoting jambotrader
Hi Merlin, well I have spent a few hundred on various systems. I fully expected to not get my money's worth but I thought I could combine the pluses of the various systems I bought, and pull out the minuses. I sort of am doing so, but it isn't as easy as I thought. One system I have bought involves using the 9, 21 and 50 day moving averages and you enter depending on then crossing. From my testing, it can work but only in volatile market; it doesn't work so well in quiet markets where the crosses can happen without letting you make a profit and the delay can be terrible as you find yourself buying at the high or selling the low sometimes. Also I have bought many books which claim to have clear answers but they only explain forex rather than provide concrete trading systems. In fact the nearest I've come across is a book on system building called design and optimisation of trading systems.
But I have come across some systems for sale on ebay and wanted to know what people thought. The system I am considering is on ebay for £50 and comes with two systems that cover various currencies, but I think both are similar with slight differences. The seller has been helpful with my questions but I just wanted some opinions, as there is plenty of feedback there which means people must have bought it - I am just looking for those people for their opinions as I too am tempted but I don't want to get fleeced! Any help would be appreciated.
  • #9
  • Apr 30, 2004 2:43am Apr 30, 2004 2:43am
Quoting Jambo
I have purchased that system. You are correct in your suspicion about no losing trades. This is because of extremely large drawdown acceptable. It is basically a scale trading system for currencies, where you continue to fade the market, adding to losing positions at certain intervals, thus, improving your average entry price, until the market turns your way. But, as you know, in this business, there are no guarantees that the market will turn your way before you lose hope and abandon the positions. Not saying that it won't work, but you have to ask yourself if you could continue to add contracts as the market is going against you. Goes completely against the addage that the "trend is your friend". The profit target is very small relative to the risk and drawdown, which is another thing that helps them claim "no losses"
Another James I see! Thanks for your thoughts, I really was hoping to track down the people that bought the system to see what they thought. As you say some of the drawdown figures look large, in particular for the euro dollar. But you have bought it, so what are the results like if you don't mind me asking? I could certainly live with the canadian dollar drawdown if it's what he says it is; he claims maximum of $193 on ebay. How did you find it? If it's true that profits are always made I wouldn't mind living with the drawdown ONCE I was playing with profit money if you know what I mean. I am under no illusions when it comes to this business of systems, but maybe I could manipulate his system into having a reduced drawdown, as it's my aim to try to take the best bits out of all the systems I have and make them into something I am able to use and profit from. Really appreciate your views jambo, thanx.
  • #10
  • Apr 30, 2004 3:26am Apr 30, 2004 3:26am
watch out for systems with large draw downs...the most you should risk is 4 or 5 percent of your account on any single trade or idea. as systems trader (following my automated systems) i only risk 1 or 2 percent per trade. it is only when i have a fundamental conviction that i will risk 5%.

are any of you guys using tradestation? id be willing to let you "borrow" a strategy if you are. if you are using tradestation, i can basicly send you a .dll file that will let you see all the trades a strategy has made, and also see them as they are made...

http://www.forexfactory.com/strat_chart.gif
Relax and be happy.
  • #11
  • Apr 30, 2004 7:44am Apr 30, 2004 7:44am
I came across tradestation a while ago but it all seems to be directed at the direct access market for stocks, or at least that's what I gather from the website. Somebody on another forum suggested supercharts but I have no luck finding that. In fact I can't find tradestation for sale in the UK anywhere even though there is supposedly a UK or European version distrubuted to these shores.
  • #12
  • Apr 30, 2004 8:20am Apr 30, 2004 8:20am
Don't know what the Canadian is, have not back tested that currency. My personal computer is sick, so I don't have access to Euro info at the moment. But, I believe in 2003, it made 19 Euro trades. Profit target is about $300. Largest was probably around $1000. Biggest drawdown was probably $6000 with 5 contracts. So, you have to take into account the drawdown and margin for 5 contracts to determine how large account you will need. The system also does not use stop loss. You just keep buying as market is going down, or keep selling as market is going up, with no guarantee of when it will finally turn. Good Luck.




Quoting jambotrader
Another James I see! Thanks for your thoughts, I really was hoping to track down the people that bought the system to see what they thought. As you say some of the drawdown figures look large, in particular for the euro dollar. But you have bought it, so what are the results like if you don't mind me asking? I could certainly live with the canadian dollar drawdown if it's what he says it is; he claims maximum of $193 on ebay. How did you find it? If it's true that profits are always made I wouldn't mind living with the drawdown ONCE I was playing with profit money if you know what I mean. I am under no illusions when it comes to this business of systems, but maybe I could manipulate his system into having a reduced drawdown, as it's my aim to try to take the best bits out of all the systems I have and make them into something I am able to use and profit from. Really appreciate your views jambo, thanx.
  • #13
  • Apr 30, 2004 8:33am Apr 30, 2004 8:33am
Quoting Jambo
It is basically a scale trading system for currencies, where you continue to fade the market, adding to losing positions at certain intervals, thus, improving your average entry price, until the market turns your way. But, as you know, in this business, there are no guarantees that the market will turn your way before you lose hope and abandon the positions. Not saying that it won't work, but you have to ask yourself if you could continue to add contracts as the market is going against you. Goes completely against the addage that the "trend is your friend". The profit target is very small relative to the risk and drawdown, which is another thing that helps them claim "no losses"
hello
are you simply adding same amount or double your entry with every trade?You need a huge account to do this.If I do this i would face margin call very soon.
  • #14
  • Apr 30, 2004 9:40am Apr 30, 2004 9:40am
Quoting Jambo
Don't know what the Canadian is, have not back tested that currency. My personal computer is sick, so I don't have access to Euro info at the moment. But, I believe in 2003, it made 19 Euro trades. Profit target is about $300. Largest was probably around $1000. Biggest drawdown was probably $6000 with 5 contracts. So, you have to take into account the drawdown and margin for 5 contracts to determine how large account you will need. The system also does not use stop loss. You just keep buying as market is going down, or keep selling as market is going up, with no guarantee of when it will finally turn. Good Luck.
Nevermind about the canadian, I only mentioned it because it had tiny drawdown which sort of stuck out from the rest. But I don't understand how for example you can buy the euro at say 1.10 and then average down all the way to say 1.05 and still make a profit unless you quadruple up each time. On the ebay page it says something like $10000 starting balance required to make $3000 on the euro so far this year. Using the leverage and size of trade he states it can't mean more than 3 or 4 buys surely. Also it's funny that the system is called the euro system as he quotes better results for the other currencies he lists there. Anyway, it does lead me to think that there's something I could take from the system even if I don't apply it directly maybe. Anyway, thanx for your update.
  • #15
  • Apr 30, 2004 11:43am Apr 30, 2004 11:43am
I don't want to give away the system, but here is an example. You buy at 11900, profit target is 11930. Target is not hit and market continues down. You buy at another interval set by the system, let's say 11850. Your average entry is now 11875 and target will be 11915. But, market does not bounce up, so target of 11915 is not hit. Market keeps going down, you buy another at predetermined price, average entry is lowered. Hope you get the picture now.





Quoting jambotrader
Nevermind about the canadian, I only mentioned it because it had tiny drawdown which sort of stuck out from the rest. But I don't understand how for example you can buy the euro at say 1.10 and then average down all the way to say 1.05 and still make a profit unless you quadruple up each time. On the ebay page it says something like $10000 starting balance required to make $3000 on the euro so far this year. Using the leverage and size of trade he states it can't mean more than 3 or 4 buys surely. Also it's funny that the system is called the euro system as he quotes better results for the other currencies he lists there. Anyway, it does lead me to think that there's something I could take from the system even if I don't apply it directly maybe. Anyway, thanx for your update.
  • #16
  • Apr 30, 2004 12:01pm Apr 30, 2004 12:01pm
Quoting Jambo
I don't want to give away the system, but here is an example. You buy at 11900, profit target is 11930. Target is not hit and market continues down. You buy at another interval set by the system, let's say 11850. Your average entry is now 11875 and target will be 11915. But, market does not bounce up, so target of 11915 is not hit. Market keeps going down, you buy another at predetermined price, average entry is lowered. Hope you get the picture now.
I totally understand, but thanx for giving me at least an idea of what it's about + your opinions.
  • #17
  • Apr 30, 2004 4:16pm Apr 30, 2004 4:16pm
Quoting Jambo
Don't know what the Canadian is, have not back tested that currency. My personal computer is sick, so I don't have access to Euro info at the moment. But, I believe in 2003, it made 19 Euro trades. Profit target is about $300. Largest was probably around $1000. Biggest drawdown was probably $6000 with 5 contracts. So, you have to take into account the drawdown and margin for 5 contracts to determine how large account you will need. The system also does not use stop loss. You just keep buying as market is going down, or keep selling as market is going up, with no guarantee of when it will finally turn. Good Luck.
Jambo - no offense my man, but a system that buys into a loosing position is about the worst thing you can do. read market wizards and new market wizards....at least 10 of the traders in those books point out that buying more contracts on a loosing position is a bad idea. you can and WILL eventually wipe your whole account out by doing this

you want to add contracts to winning positions, not loosing positions!
Relax and be happy.
  • #18
  • Jun 9, 2009 8:34am Jun 9, 2009 8:34am
How can I determine trend with Moving Average for 1H timeframe.

I m using 12 EMA and 26 EMA.

If ;

12 EMA is above 26 EMA than trend is up
12 EMA is below 26 EMA than trend is down


can you correct of confirm.

I m waiting your response.

Regards.
  • #19
  • Last Post: Jun 9, 2009 9:09am Jun 9, 2009 9:09am
Quoting osmanbastan
How can I determine trend with Moving Average for 1H timeframe.

I m using 12 EMA and 26 EMA.

If ;

12 EMA is above 26 EMA than trend is up
12 EMA is below 26 EMA than trend is down


can you correct of confirm.

I m waiting your response.

Regards.


FYI


Buddy, this thread is old - 5 years.

Look at the date. I don't think you'll get a reply.
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