Forex 10 Bar Strategy

Forex 10 Bar Strategy Test

Currencies traded

USD EUR GBP JPY CAD AUD NZD

Number of pairs traded: 21 Timeframe: hourly

Test Results:
Monday 8th Jan 2018
10 pairs traded
5 win 5 loss
Trades closed at end of trading day
Total pips -28

Tuesday 9th Jan 2018
5 pairs traded
1 win 4 loss
Trades closed at the end of trading day
Total pips -102

Wednesday 10th Jan 2018
9 pairs traded
9 win 0 loss
Trades closed at the end of trading day
Total pips 389

Thursday 11th Jan 2018
7 pairs traded
6 win 1 loss
Trades closed at the end of trading day
Total pips 233

Weekly Total: 492 pips

No test from Fri 12th to Friday 19th Jan 2018 as I was away and had no computer

Monday 22nd Jan 2018
6 pairs traded
6 wins 0 loss
Trades closed at the end of trading day
Total pips 375

Tuesday 23rd Jan 2018
3 pairs traded
1 win 2 loss
Trades closed at the end of trading day
Total pips -43

Wednesday 24th Jan 2018
6 pairs traded
4 win 2 loss
Trades closed at the end of trading day
Total pips 138

Thursday 25th Jan 2018
4 pairs traded
3 win 1 loss
Trades closed at the end of trading day
Total pips 67

Friday 26th Jan 2018
1 pair traded
0 win 1 loss
Trade closed at the end of trading day
Total pips -37

Weekly Total: 500 pips


Monday 29th Jan 2018
4 pairs traded
2 win 2 loss
Trade closed at the end of trading day
Total pips -100

Tuesday 30th Jan 2018
5 pairs traded
0 win 5 loss
Trade closed at the end of trading day
Total pips -318

Wednesday 31st Jan 2018
8 pairs traded
3 win 5 loss
Trade closed at the end of trading day
Total pips -169

Thursday 1st Feb 2018
3 pairs traded
3 win 0 loss
Trade closed at the end of trading day
Total pips 153

Friday 2nd Feb 2018
4 pairs traded
3 win 1 loss
Trade closed at the end of trading day
Total pips 176

Weekly Total: -258 pips


Monday 5th Feb 2018
5 pairs traded
4 win 1 loss
Trade closed at the end of trading day
Total pips 499
Trade Explorer started Monday 5th Feb 2018
*Dashboard EAX with jagzuk PIN*
Dashboard closed trades early due to a wrong setting by me
Total pips 168

Tuesday 6th Feb 2018
3 pairs traded
3 win 0 loss
Trade closed at the end of trading day
Total pips 260
Trade Explorer
*Dashboard EAX with jagzuk PIN*
Dashboard manually closed due to computer shutting off and missing TP (also opened 3 trades due to wrong setting by me)
Total pips 68.5

Wednesday 7th Feb 2018
6 pairs traded
6 win 0 loss
Trade closed at the end of trading day
Total pips 265
Trade Explorer
*Dashboard EAX with jagzuk PIN*
Dashboard manually closed an hour or so before NZD central bank rate
Total pips 168.8

Thursday 8th Feb 2018
2 pairs traded
0 win 2 loss
Trade closed at the end of trading day
Total pips -195
Trade Explorer
*Dashboard EAX with jagzuk PIN*
Dashboard set with basket SL however computer turned off and SL did not happen
Total pips -199

Friday 9th Feb 2018
4 pairs traded
1 win 3 loss
Trade closed at the end of trading day
Total pips -36
Trade Explorer
*Dashboard EAX with jagzuk PIN*
Dashboard set with basket SL however computer again turned off and SL did not happen - trades closed a few hours before end of trading day
Total pips -278.7

Weekly Total: 793 pips

Dashboard Weekly Total: -72.4 pips

Forex 10 bar strategy is a very simple idea that I came up with.

I simply count the number of bullish bars from the Daily Open (17:00 EST) to the London Open on the hourly chart- total 10 bars (or candles)
I do this for each currency pair ( total 21 pairs) and enter the number of bullish candles on the spreadsheet.
I then match the USD based pair numbers verses the crosses and see if there is a difference.

This gives me a signal to either buy or sell a particular currency pair as London Opens.

Unfortunately I don't know how to code, so I have to manually enter each position, but this strategy would be ideal to be made into an EA for testing different ways to trade the numbers as it is a totally mechanical process.

I will be testing this strategy and posting results in the first post and perhaps attach a demo trade explorer too.

If you have any ideas or questions let me know!!

Hi!

Thank you for sharing!
Can you explain what is your exit?
I did not catch how you calculate the figures for crosses and how you decide to go short or long.

With regards,
SP

Hi SuperPip,

Exiting trades is still a work in progress. At the moment I am holding trades till the end of the day (17:00 EST).
However I have a few ideas such as an aggregate $ amount TP or SL, or a time TP such as London close, or a fixed TP and SL for each pair. Lots of options to test.

Also I have to consider the possible volatility differences in each pair e.g if trading NZDCAD and GBPNZD in same basket do I adjust Lot sizes to try to eliminate the basket being too weighted toward the pairs with a traditional higher Daily range? Something to consider.

I calculate the figures for the crosses the same way as for the USD based pairs. I simply count the number of bullish 1 hour candles in the first 10 bars for each pair.

I will give you an example from last Friday on how I calculated the EURGBP sell.
From Daily Open (17:00 EST)
EURUSD had 4 candles that closed up out of the first 10
GBPUSD had 5 candles that closed up out of the first 10

Using these 2 number I make an "expected" number for the EURGBP cross.
e.g if the EURUSD number was 5 and the GBPUSD was 5, I would "expect" EURGBP to also be 5 bullish candles out of 10
if the EURUSD number was 6 and the GBPUSD was 5, I would "expect" EURGBP to be bullish for 6 candles
if the EURUSD number was 7 and the GBPUSD was 4, I would "expect" EURGBP to be bullish for 8 candles

So the "expected" number is the deviation away from the number "5"

So on Friday the "expected" number for EURGBP was "4"

However the "actual" number of bullish candles was only 3 - which means sell.
If the "actual" number of bullish candles was "5" (or more)- then it would be a buy signal.

Now I know this seems all pretty simplistic - counting bullish 1 hour bars.
But my logic is this-
The USD based pairs are your "benchmark"
If the actual cross is deviating from the benchmark, perhaps the price action is giving clues to which way the market movers are trading.

A good example was on Wednesday last week.
EURUSD 4 bullish bars
GBPUSD 6 bullish bars
EURGBP expected number would be 3 bullish bars
EURGBP actual number was 6 bullish bars (+3 from expected number)

Signal: Buy EURGBP
And if you look at the chart you will see that from London Open EURGBP took off long even though it was actually down on the day.

Also I only Buy when the trading pair number is above 5
And I only Sell when the trading pair number is below 5 (I think this filters out some bad trades)

So maybe this is all coincidence and my logic is faulty. But what I like about this strategy is that it is purely based on numbers and can easily be tested and also new ways of calculating the numbers can also be tested. Maybe certain pairs work better than others - maybe only use with certain price action. Lots of things to test!

If you have any ideas please let me know

Ok so it took me a little while to manually work through the numbers, but here are the trades for today according to the strategy. I will leave the trades open until the end of the day.

EURGBP sell
EURJPY sell
EURCAD sell
EURAUD buy
EURNZD buy
GBPAUD buy
GBPNZD buy
CADJPY buy
AUDCAD buy
NZDCAD Sell

hello nice to see your effort to plan something to trade based on numbers...

could i ask you a favour?

could you make a mathematical expression on this:

"A good example was on Wednesday last week.
EURUSD 4 bullish bars
GBPUSD 6 bullish bars
EURGBP expected number would be 3 bullish bars"

i stil don´t get why 3 is expected?

thanks,

V

Hi vicentis,

I work it out like this for any pair:

Separate the currency pair you want to work out
e.g EURGBP separate into "EUR" and "GBP"

Start with the first currency of the pair - EUR
EUR has a number of 4 bullish bars - this is the starting point of the equation.

Now the 2nd currency of the pair can change that number if it is greater or less than 5
If the 2nd currency number is a 5 then there will be no change (same number of bullish bars)
If the 2nd currency number is greater than 5 then the number will drop (less number of bullish bars)
If the 2nd currency number is less than 5 then the number will rise (greater number of bullish bars)

GBP has a number of 6
6 is greater than 5 (obviously 5 + 1)

So EURGBP expected number is 3 (4 - 1)


So to recap- it works like this

EUR 4 GBP 5 EURGBP 4 (no change)
EUR 4 GBP 6 EURGBP 3 (if 2nd currency greater than 5 number goes down)
EUR 4 GBP 4 EURGBP 5 (if 2nd currency less than 5 number goes up)



Another important thing to know:
If you are working out USDCAD or USDJPY you don't inverse the number of the 2nd currency


Example: Lets say you wanted to work out the expected number for AUDCAD

AUDUSD 4
USDCAD 7 (5 + 2)

So the expected number for AUDCAD in this example is 6 (4 + 2)

So if the actual number was "4" then that would be a sell signal


I hope this makes sense??



So a calculation could be this: x + 5 - y = n
x is first currency number
y is second currency number
n is the expected number

Example:
EURUSD 4
GBPUSD 6
EURGBP expected number 4 + 5 - 6 = 3


However if you are calculating USDCAD or USDJPY the number is inverted

Calculation would be x - 5 + y = n

Example:
EURUSD 7
USDCAD 4

EURCAD expected number 7 - 5 + 4 = 6


And finally to calculate CADJPY where both numbers are inverted

Calculation would be (x-10)*-1 - 5 + y = n


Hopefully my math is correct!!

thanks for the answer.

tomorrow pre london open i wil try to experiment in one pair,

best wishes,

V

Yep sounds good. So far EURGBP is looking the most promising. 4 positive trades in 4 days. But still very early days

Here are the latest results from the spreadsheet. I've added another column with the expected number next to the actual number for quick reference.

Ok so these are the trades for today as per the system

EURGBP buy
EURCAD sell
EURAUD sell
GBPJPY sell
GBPCAD sell

Ok so here are the results of yesterdays trades. Not too good.

Here are todays trades according to the system

EURGBP buy
EURJPY sell
EURNZD sell
GBPJPY sell
CADJPY sell
AUDJPY sell
NZDJPY sell
NZDCAD buy
AUDNZD sell

Great results from yesterdays trades. All with positive pips!

Hi!

Results for 6 days.

Pips won: 460
Average win: 23,78
Average lose: 13,78
Win%: 65
Kelly value: 0,45


SP

Today's trades according to the system

EURGBP buy
EURNZD sell
GBPJPY sell
GBPCAD sell
GBPNZD sell
NZDJPY buy
AUDNZD sell

Good results from yesterday's trades

Hi!

Thank you for posting!
It is interesting, how looks the backtesting in papertrading?

SP

Zondervan, thanks for this very intriguing strategy.

It occurred to me that being a basket strategy, this might work well plugged into a Dashboard such as EAX. So I have created an EAX PIN to automate the entries, and the Dash can do the rest. You can find the setup over in my tools thread:
https://www.forexfactory.com/showthr...1#post10691671