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simplest strategy for GBP/ JPY

  • #81
  • Apr 12, 2007 5:44pm Apr 12, 2007 5:44pm
Quoting gagiul
You are partly right, but it doesnt mean that we have to run away from this pair. Actually there are a few systems here which work very well, including this one. Except whipsaws, GY can bring u some very large profits, using this strategy. We just need to refine its enter/exit rules. Hope to see more input from the owner of this strategy and others...im testing as well.
Good observations, gagiul.

Regarding entries, entering as the price crosses the first MA is an interesting technique.

The funny thing is that I don't believe that anybody has really tried doing the method as the author of the thread specified. I'm not saying that it would work - but it would be a good experiment!
  • #82
  • Apr 13, 2007 4:20pm Apr 13, 2007 4:20pm
brentmack, i can only speak for myself but i assure you, that the backtesting that i did was strictly according to the nicolas' rules – why would this be so hard to believe? the point was to see if the method in its pure form works or not and not to discredit it (like probably everyone reading this thread, i’d love it to work and would love to make my millions with it). as i wrote in the post #65, i only ran through about 5,5 months jan - mid may 2006 (i meant to carry on and post the results, however i've had too much work lately and couldn't devote my time to this), but i did it manually and there was a strong reason for that - being to avoid those trades where the 12 SMA just barely cuts one of the 32 and then goes back again, and enter only when the difference between the MAs was clearly visible. this helps save some pips contrary to those situations, when the EA enters the transaction based on the first symptoms of the MAs cross, and on the next candle reverses it, because it turns out that the 12 SMA actually just bounced off the 32 one without crossing it for good. i know that the time period was short but the results were a bit discouraging – imagine that you actually started trading during the month such as march 2006 (-1875 pips and about 57 trades – you’d probably blow your account). but if you’re in doubt as to whether i did stick to the original rules or not, then why don’t you download the trade record that i attached and see for yourself that i did? why else would i place it there?

as i’ve also mentioned in earlier posts, i too believe that the method has a big potential, it just needs to be improved. the entry method could be left as it is, but exiting could be done in stages (say 3), after a certain amount of pips is collected each time – the exact pip vaules are yet to be determined. an obvious filter can also be to trade only in the direction of the higher time frame trend – the H4 or D1, whichever you find more suitable. going against the trend almost always means making stupid trades. i don’t think it takes a lot more than this to make the system nice and profitable, except perhaps for patience
Money is merely a by-product of one's skills as a trader - M. Douglas
  • #83
  • Edited 9:26pm Apr 14, 2007 9:14pm | Edited 9:26pm
Quoting wookashc
brentmack, i can only speak for myself but i assure you, that the backtesting that i did was strictly according to the nicolas' rules – why would this be so hard to believe?
Wookashc -

I appreciate your interest in this system and the work you've performed on its behalf. I think we all recognize that it can produce a lot of pips, due to scaling up as the trend progresses.

And if you're not going to risk being "always in" - then the exit strategy is everything.

Regarding backtesting - that brings up one very large word: methodology.

Maybe your results were 100% accurate. I don't know and am not really asking you to explain your methodology.

But I've seen EA's for sale - based soley on backtesting - with a modelling quality of 40%. I've also heard of many backtesting claims that were based on watching the wrong the timeframe. And the flaws go on and on...

If you are in fact proficient at backtesting, I believe that you would readily agree with me in that backtesting isn't as easy or accurate as it's cracked up to be.

I'm just very jaded when it comes to backtesting. I find that I can eyeball most any Moving Average system and visually pick up on a method's strengths and weaknesses - and tweak accordingly.

And then I forward test anything that I'm interested in. Those are really the only results that I'm ever impressed with.

So, no offense, it's just the way I play the game.
  • #84
  • Apr 14, 2007 9:24pm Apr 14, 2007 9:24pm
Hey Nic -

Don't forget to check in sometime soon and let us know how you're doing.

Best regards...
  • #85
  • Apr 16, 2007 7:58am Apr 16, 2007 7:58am
If you didn't take the latest crosses on Friday, you simply chose to ignore price action on Friday. I am using this system to scale into my trades based on price action and wow! As close to perfect as you can get in forex. I mean, look at that huge 4h pin bar on Friday. After I saw that, I just cranked the microscope down to 1hr chart and waited for the ma's to cross. Granite, I was in when price closed into the 32's.
  • #86
  • Apr 17, 2007 4:26am Apr 17, 2007 4:26am
Hi Chartist,

My eyes aren't that great and I can't quite see what you've done to your chart in post 58. I'm also fairly new to this game and would really appreciate a simple explanation.

Thanks
  • #87
  • Apr 18, 2007 7:55am Apr 18, 2007 7:55am
Quoting Chartist
Nicolas and Brent,

After some thought, I came up with what I think may be a good system to use with yours. Call it an "Insurance Position", which you can open apart from the other 3 positions as the 12 crosses the 32's, and you are incorporating price action to help with whipsaws and to also get you in early, but with high probability. Check out the chart.
What I was trying to show here is that if you see price ie; candle or bar to CLOSE into the 32 ma's you could take an additional position, then if the ma's cross as per nicolas's original system, you would take those positions as well. The reason is that during choppy market times, doing this will tend to limit your losses. Also, I tried to show when to exit this position, when price comes back to touch the ma.
  • #88
  • May 1, 2007 6:05pm May 1, 2007 6:05pm
it looks pretty good on back test .. anyone else tried live with this?
  • #89
  • May 1, 2007 7:01pm May 1, 2007 7:01pm
since is a simple method... wouldn't be easier to write a EA to automatically trade it 24h a day? a team of traders will be bored in a week.

Quoting nicolas_nrjk
unfotunatly like all trend following strategies you'll have to monitor your chart for 24h per day. i am now organising a team of traders to do that you might concider doing that too.
  • #90
  • May 2, 2007 12:33pm May 2, 2007 12:33pm
I'm testing live this system....
and I've noticed... there is a correlation of best moves that can be catched with this method(the ones not ranging), in other currencies against the JPY. for example... right now.. 18:00 GMT I think is not a good moment to get the cross because other currencies are crossing in the opposite direction. If you check back in time all the best trades are when the EUR/JPY and USD/JPY are crossing also in the same direction. and when the angle of the 12 and the 32 SMA are significantly different. These tips may help also with other trend analysis tools to determine if there is a good trend to get.

even more... you can get some pips from the EUR/JPY and USD/JPY if you see all crossing in the same direction. it seems to be a good signal. only need a little patience...
  • #91
  • Jun 27, 2007 11:31pm Jun 27, 2007 11:31pm
Quoting emda
I'm testing live this system....
and I've noticed... there is a correlation of best moves that can be catched with this method(the ones not ranging), in other currencies against the JPY. for example... right now.. 18:00 GMT I think is not a good moment to get the cross because other currencies are crossing in the opposite direction. If you check back in time all the best trades are when the EUR/JPY and USD/JPY are crossing also in the same direction. and when the angle of the 12 and the 32 SMA are significantly different. These tips may help also with other trend analysis tools to determine if there is a good trend to get.

even more... you can get some pips from the EUR/JPY and USD/JPY if you see all crossing in the same direction. it seems to be a good signal. only need a little patience...
Hi.
Could those who are live trading this system please post your results?
I'm very interested to see the live results compared to backtested....

I too was wondering about the correllative pairs....only after I discovered that GBPJPY is not listed on alertfx.com to recieve alerts for...so I'm using EURJPY instead...I'll also start considering the correllative pairs lining up for confirmation....if this system works well on other pairs too then EURJPY may be worth considering because the spread is much lower than GBPJPY which could help to maximise results....feedback please ?

mike
  • #92
  • Sep 14, 2007 5:51am Sep 14, 2007 5:51am
all strategies work in some trend. a choppy strategy for choppy times is better to speculate.
Brainstorming ... the ...
  • #93
  • Sep 17, 2007 5:07am Sep 17, 2007 5:07am
Even in a strong trend prices just keep moving without 1 pips retraces.
Example:
- Price goes 1 pip above the lower EMA -> buy
- Price goes 1 pip below the lower EMA -> sell
- Price goes 1 pip above the lower EMA -> buy
- Price goes 1 pip below the lower EMA -> sell
- Finally the price takes of and moves to the next EMA

In the above, realistic, scenario a lot of profits are lost because of spread and slippage.
Do you just accept that or do you have a way to handle the whipsaws?

Thanks for sharing.
May the pips be with you.
  • #94
  • Sep 17, 2007 5:48am Sep 17, 2007 5:48am
How about 4H chart, ladies and gentlemen?
.
  • #95
  • May 11, 2008 12:05pm May 11, 2008 12:05pm
I would love to know how this really works. I am a new trader and need all your help. My direct e-mail is [email protected].

Thanks for your honest guidance.



is realy
Quoting nicolas_nrjk
i wa just developping and testing a new strategy for the GBP/JPY pair. it is very simple but it requires patience and good money managment.
it has an average of 1000 PIP per month or a 33% return on investment per month.

on a 1 hour chart of GBP/JPY add a 12SMA and a 32 SMA high / 32 SMA low / 32 SMA close.

buy w lot when the 12 SMA crosses ezch of the 32SMA. close and reverse when the 12 SMA crosses back downward. you'll have a total of 3 lots opened all the time.

based on back testing and maximum drawdown calculations, i recommend that you buy 3 lots for each 3000$ in your account. use micro lots if your account is smaller that 3000$

PS: the close and reverse is great since it costs no spread

i'll soon post the testing results of the system.
  • #96
  • May 11, 2008 4:13pm May 11, 2008 4:13pm
Looks ok, only problem is you would have to use an EA unless you wanna be trading 24 hours a day and not sleep.
  • #97
  • May 11, 2008 4:28pm May 11, 2008 4:28pm
heelo i read ur aticles for this though i will like to know u
  • #98
  • May 11, 2008 9:15pm May 11, 2008 9:15pm
Has Nic seriously not posted in 6 weeks? WOW!
  • #99
  • May 24, 2008 10:43am May 24, 2008 10:43am
It is amazing. How is that really possible!!!!
  • #100
  • May 24, 2008 6:20pm May 24, 2008 6:20pm
He vanished into thin air!

You will find this typically happens when the originator's system goes into drawdown, and the poster does not want to acknowledge the flaws in his system.
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