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Searching for market changes to keep EA current

  • #1
  • First Post: Edited 5:54pm Aug 5, 2018 12:32pm | Edited 5:54pm
I am starting this thread for the purpose of finding a formula to back test a successful EA I currently have running. The formula could apply to manual trading as well.

Everybody knows the markets change from month to month, year to year. It is the reason why most EA's ultimately fail because they are designed for a particular market and when the market changes the EA will crash. I am searching for a method to recognise these changes. I am mainly referring to stop loss / take profit levels but that also incorporates volumes, trends, range etc..

I currently use an hourly ATR measured on a daily basis. I can see when the markets range is starting to expand or contract and can back test my EA for further forward trading. I'm not talking about large shifts (due to world fundamentals) just the subtle changes in the ebb and flow of the market.

My EA is simple (though I didn't design and don't know the inner workings). It is signaled by bar size (I believe) and the parameters include bars to wait, pips from signal bar and time to trade. There is a little more to it (especially inside I believe) but that's it in a nutshell. It is a very old EA but I restarted using it at the beginning of the year (Jan). It is currently up 300% on a small live account with 5% risk, so to say I'm happy with performance is an understatement. The last month and half has been a bit whipsaw-ish in results and I can see from long term back testing that these results wont hold unless I recalibrate the EA.

Here's an example of results Jan-current date (though my current results aren't as pretty as this):

2018
Attached Image (click to enlarge)
Click to Enlarge Name: 2018.jpg Size: 175 KB


Now here are those same settings from the previous year (2017):

2017
Attached Image (click to enlarge)
Click to Enlarge Name: 2017.jpg Size: 182 KB


This example is backwards to what live trading looks like on EA's. The EA is released and looks like 2018 (pic) and after another 6 months looks 2017 (pic). The market has changed. Though the example has a low frequency of trades I am referring to a higher volume of trades (it was just the settings I was playing with at this time).

So to sum up.
I am looking for a method (ATR, volumes, trends etc) to make small changes within my EA as the market changes, earlier than a total downfall of my profits (though small losses are acceptable).

Thanks in advance for any help.
As the lights go by so too do the shadows move
  • #2
  • Aug 6, 2018 1:50am Aug 6, 2018 1:50am
Here is the secret

Your system is no good , you need to improve it , so it remains current.Yours is a weak system, you only need one system "pippro trendpro forex professional's system" which is a free system .Forex is not a very clean trendy instrument , the performance of EAS can be much poorer in forex, forex trends are very choppy.

EAS succeed well with smooth trendy instruments.
  • #3
  • Aug 6, 2018 5:34am Aug 6, 2018 5:34am
Quoting loozers
Here is the secret Your system is no good , you need to improve it , so it remains current.Yours is a weak system, you only need one system "pippro trendpro forex professional's system" which is a free system .Forex is not a very clean trendy instrument , the performance of EAS can be much poorer in forex, forex trends are very choppy. EAS succeed well with smooth trendy instruments.
Your talking to 10 years of experience "new member".
As the lights go by so too do the shadows move
  • #4
  • Aug 6, 2018 6:37am Aug 6, 2018 6:37am
Sorry master

I was only trading and developing 200 eas for last 15 years, I only watched the forum for last 15 years.
  • #5
  • Aug 6, 2018 9:59am Aug 6, 2018 9:59am
Quoting loozers
Sorry master I was only trading and developing 200 eas for last 15 years, I only watched the forum for last 15 years.
Ok, I will work on the basis that what you say is true. I have yet met an EA that can keep up with market changes. I spent my forex childhood spending top dollar on all the latest and lost many dollars trying them out. I am experienced at the back testing and forward testing, both are very complicated; understanding PF, DD, trading sessions, risk and a multitude of other settings... an easy thing to do but difficult to master.

There are probably $1000+ EA's that can do the essentials and keep on top of the market but imo the best EA's are probably kept hidden, why would you bother trying to make money selling it when it already makes you money on the market.

I am mainly a manual trader but have being playing with this EA on a small account with success.

I am far from a master but was looking for comments a bit better than "Here is the secret Your system is no good". My system is good but I am always looking for improvements, hence this thread.
As the lights go by so too do the shadows move
  • #6
  • Aug 6, 2018 10:06am Aug 6, 2018 10:06am
This is one of my strategies for watching the market range. It allows me to see how my EA trades on the same range in previous years. When the current market exceeds its testing range I apply new settings that have been tested to apply to the new range. It is however tiresome to enter a years worth of ATR onto a template heh.
Attached Image (click to enlarge)
Click to Enlarge Name: ATR.png Size: 61 KB
As the lights go by so too do the shadows move
  • #7
  • Aug 6, 2018 11:30am Aug 6, 2018 11:30am
Quoting Matts Micro
{quote} Ok, I will work on the basis that what you say is true. I have yet met an EA that can keep up with market changes. I spent my forex childhood spending top dollar on all the latest and lost many dollars trying them out. I am experienced at the back testing and forward testing, both are very complicated; understanding PF, DD, trading sessions, risk and a multitude of other settings... an easy thing to do but difficult to master. There are probably $1000+ EA's that can do the essentials and keep on top of the market but imo the best EA's are...

You need to code logic into your EAS as follows

a)at time of entry there is trend and EA can read price action confirmations logic before entry
b)there is higher volatility in atr readings (for last few days)------- in trend volatility is higher
c)price has been rejected counter trend
d)fundamentals are driving trend, it can be coded in EA
e)price behavior wants to continue trend, EA will read logic for this

You have to do the job of writing this logic for coder.
  • #8
  • Aug 6, 2018 11:33am Aug 6, 2018 11:33am
Quoting Matts Micro
This is one of my strategies for watching the market range. It allows me to see how my EA trades on the same range in previous years. When the current market exceeds its testing range I apply new settings that have been tested to apply to the new range. It is however tiresome to enter a years worth of ATR onto a template heh. {image}

atr is only applicable for last few days.

365 days atr/365 = average.
  • #9
  • Aug 6, 2018 12:07pm Aug 6, 2018 12:07pm
Quoting loozers
{quote} atr is only applicable for last few days. 365 days atr/365 = average.
Thanks for the posts. Yes, these are things I am looking for. For the EA to be scripted this way it needs to read its information from a source ie a ATR indicator, perhaps a stoch. and maybe a MA or 2 with a cross over. It's what I am searching for in this thread to see if people will share how they perceive market shifts that happen perhaps 2-3 times year, sometimes more and others less.

An ATR on less days is easier to see changes, though yes, it can be more volatile; but it does also trend.
As the lights go by so too do the shadows move
  • #10
  • Aug 6, 2018 1:50pm Aug 6, 2018 1:50pm
Quoting Matts Micro
{quote} Thanks for the posts. Yes, these are things I am looking for. For the EA to be scripted this way it needs to read its information from a source ie a ATR indicator, perhaps a stoch. and maybe a MA or 2 with a cross over. It's what I am searching for in this thread to see if people will share how they perceive market shifts that happen perhaps 2-3 times year, sometimes more and others less. An ATR on less days is easier to see changes, though yes, it can be more volatile; but it does also trend.

atr is lagging, ma cross is lagging and stoch is lagging.All too late to make any profit.

I have the answers , but need to think deep.

If you learn about these indicators , they may have the answers.

https://www.forexfactory.com/showthread.php?t=802856
  • #11
  • Aug 6, 2018 9:46pm Aug 6, 2018 9:46pm
Quoting loozers
{quote} atr is lagging, ma cross is lagging and stoch is lagging.All too late to make any profit. I have the answers , but need to think deep. If you learn about these indicators , they may have the answers. https://www.forexfactory.com/showthread.php?t=802856
Thanks for link. I understand correlation and how to read the general market, I trade everyday manually and have mainly dropped my reliance on indicators. I have studied many ways to trade and depending on market conditions use them all in some degree, some more than others.

This thread is designed to identify long term market changes, lagging indicators can identify this to some degree but it's why I'm here because it is a gap in my knowledge. I am more of a short term trader and looking for advice on the long term stage.

Cheers, Matt.
As the lights go by so too do the shadows move
  • #12
  • Aug 7, 2018 1:28am Aug 7, 2018 1:28am
How would you code logic with weekly and monthly candlesticks to identify long term market changes?Look at your weekly and daily charts and code candlesticks for long term market changes into your EA.

apply followng


The following indicators are from "pippro trendpro pipmaster professional profitable system", a free system .Use it only on 4 hour and weekly/daily charts combination. All the buy signals are not valid, only sell signals are valid , due to interest rates expectations.

The following information was available on november 20, 2017
Professionals trade forex when there are expected rises or falls in interest rates, as a result of expected rises in interest rates, Eur/usd and gbp/usd have fallen in 2018.They set a target of 1.10 for eur usd, I don't know if this will make the target.

Goldman Sachs Predicts That the Fed Will Hike Interest Rates Four Times in 2018

Goldman Sachs said it expects a tight U.S. labor market and more normal inflation picture will lead the Federal Reserve to hike interest rates four times next year.

If you had listened to the big boys like Goldman Sachs and interest rates expectations, search for it google, for U S is expected to raise interest rates 4 times this year, and gone short on the weekly time frames on Eurusd and GBP/USD , you would have made over 2,000 pips on both of them. This expected raise in interest rates caused the dollar to get stronger, "interest rates expectations and how they drive dollar on weekly and monthly basis".This is not something new to fx trading, it has been going on since the 1970s, as far as I know. Interest rates expectations and economies change over months and years.This is how big currency traders trade.It worked 50 years ago and it worked in 2018.This is why dollar got stronger.The market does the same thing , over and over again.
  • #13
  • Aug 7, 2018 4:44am Aug 7, 2018 4:44am
[quote=Matts Micro;11334993........ Everybody knows the markets change from month to month, year to year. It is the reason why most EA's ultimately fail because they are designed for a particular market and when the market changes the EA will crash.........[/quote]

The "markets change" because the mix of traders is always changing. At certain times of year the large traders disappear (June, July, August). The state of the economies and political situation change.
These factors are outside the scope of an EA to capture.
Trade what is happening, rather than what you expect to happen and you will prosper.
Cheers, H
  • #14
  • Aug 7, 2018 4:57am Aug 7, 2018 4:57am
Quoting Aich
{quote} The "markets change" because the mix of traders is always changing. At certain times of year the large traders disappear (June, July, August). The state of the economies and political situation change. These factors are outside the scope of an EA to capture. Trade what is happening, rather than what you expect to happen and you will prosper. Cheers, H
Hi Aich. Thanks for post. Yes I agree with you on the most of it, it's why I am a manual trader, nothing like the now. I am running this EA as a hobby more than anything. It is true these factors affect the market but trends during these times even during uncertainty are established. Obviously reading these trends will be lagged but often they last long enough to recognise and establish a strategy.

Green pips,
Matt.
As the lights go by so too do the shadows move
  • #15
  • Aug 7, 2018 5:15am Aug 7, 2018 5:15am
Quoting Aich
{quote} The "markets change" because the mix of traders is always changing. At certain times of year the large traders disappear (June, July, August). The state of the economies and political situation change. These factors are outside the scope of an EA to capture. Trade what is happening, rather than what you expect to happen and you will prosper. Cheers, H
You can always code EAS not to trade in august and trade less in june and july. Weekly and monthly charts reflect everything.
  • #16
  • Aug 7, 2018 5:59am Aug 7, 2018 5:59am
Most forex eas 99% of them fail?It is unlikely anyone will ever produce a consistent forex EA, there are fundamental reasons why they can not produce them.

Several internet discussions on "why do 99 % of robots expert advisors fail of eas fail?"

A forex pair consists of two economies, both are always changing, and interest rates expectations change over months and years.Volatility becomes noisy with 50 % related to one currency and 50 % related to another.This kills smooth trends in forex. Daily banking transactions by the banks , central banks and businesses create a lot of noise moves for the trends , with fake moves and breakdown of real trends This creates noisy forex trends, these trends break down regularly.

No one can program profitable EAS for the above behavior.
  • #17
  • Aug 7, 2018 6:21am Aug 7, 2018 6:21am
Quoting loozers
{quote} You can always code EAS not to trade in august and trade less in june and july. Weekly and monthly charts reflect everything.
That's not the job of an EA. It's STRATEGY. You need to be able to recognise seasonal issues and other external factors. That's what makes you a smart trader. ie., a profitable trader.

Don't expect technology to do everything for you. Use your eyes. Use your history of trades over time etc and keep asking yourself "why did that happen??"
  • #18
  • Aug 7, 2018 6:30am Aug 7, 2018 6:30am
What if after each week of trading, you ran a backtest,, I don't believe in backtesting, but you can do it and optimize the parameters each week for the best results, it sounds like a curve fitting concept, but if market conditions changed (like daily range) your TP and SL pips will be irrelevant to the new conditions.
Decide a period that will be your limit of consecutive losing days, and when you reach this limit, it will indicate a market structure changes, then you optimize the EA to this new period as long as you are good with backtesting.
  • #19
  • Aug 7, 2018 6:54am Aug 7, 2018 6:54am
Quoting Mourad
What if after each week of trading, you ran a backtest,, I don't believe in backtesting, but you can do it and optimize the parameters each week for the best results, it sounds like a curve fitting concept, but if market conditions changed (like daily range) your TP and SL pips will be irrelevant to the new conditions. Decide a period that will be your limit of consecutive losing days, and when you reach this limit, it will indicate a market structure changes, then you optimize the EA to this new period as long as you are good with backtesting.
Hey Moroud. Well thought out, it's basically what I've been trying to accomplish. The area however is a little grey- has the market itself changed or has it just been a week / month of strong fundamentals? As with all trading strategies losses must be tolerated to allow profits, taking away current settings for new could be very damaging to an account. It's why I am looking for visible confirmations.
As the lights go by so too do the shadows move
  • #20
  • Aug 7, 2018 7:03am Aug 7, 2018 7:03am
Quoting Matts Micro
{quote} Hey Moroud. Well thought out, it's basically what I've been trying to accomplish. The area however is a little grey- has the market itself changed or has it just been a week / month of strong fundamentals? As with all trading strategies losses must be tolerated to allow profits, taking away current settings for new could be very damaging to an account. It's why I am looking for visible confirmations.

I'm still not a winner, I myself have my demons to fight against. I learnt coding, only to find out that I can't find a good system even if it needs development.
I trade horizontal lines, all types of them, and my worst nightmare is when price keeps fluctuating around this line. I tried to recover losses by adding the lost pips to the next trade TP, only to end up with a trade that has a huge target that will never be achieved.
Tried to add losses to the next trade in terms of lots to keep TP pips the same, yet if I had 2 consecutive losing days, I'm burnt. There's always something missing.
I hope you get your solution.
Have a nice day
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