Bodger Breakout Method | Page 3 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

bo7a method... method for GBP/JPY 205 replies

Trend Breakout/Breakdown Method 37 replies

Another London Breakout method 46 replies

Simple Breakout Method 31 replies

Bodger SAR Method 46 replies

Attachments: Bodger Breakout Method
Exit Attachments

Bodger Breakout Method

  • #41
  • May 4, 2007 11:01pm May 4, 2007 11:01pm
in my daily chart i apply 1000sma so from the daily chart we see that the last cross with 1000sma is at 2 april 2006..
so from that date we just open buy?
  • #42
  • May 4, 2007 11:10pm May 4, 2007 11:10pm
here is the picture
Attached Image
  • #43
  • May 5, 2007 8:14am May 5, 2007 8:14am
Quoting budi_838
Bytebodger write

4) The 1000 SMA shows you the LONG term trend. If the previous day closed above the SMA, you are looking to buy. If the previous day closed below the SMA, you are looking to sell. In other words, you are looking to trade with the (very) long-term trend. GBPUSD is currently above the 1000 SMA, so we will be placing buy orders.

why don't you just open buy and sell (two direction)?



buy is above 55 pips above from open and sell is below 55 pips from open...

When I did my initial testing, I found that the trades going with the trend were much more profitable. Sure, there are days when it would be profitable to sell into a bull market or vice versa, but the percentage of successful trades increased greatly when I began to filter it with the SMA. This effect was more profound on some pairs than others. For example, GBPUSD was significantly more profitable when only trading with the trend, while other pairs were more evenly profitable trading with or against the trend. It's also worth pointing out that lower SMAs were very unsuccessful in filtering out losing trades. It was only when I blew up the timeframe to 1000 that I started to see a large number of losing trades filtered out.

Having said this, my original process of testing was rather rudimentary due to a lack of data. As of this morning, I am still loading the minute data from 15 different pairs back to 2004 into my database. Once that has finished loading, I will begin a new round of highly-accurate backtesting and I will probably retest the effect of trading with or against the trend. I also plan to tinker around with some different filters.
  • #44
  • May 5, 2007 8:16am May 5, 2007 8:16am
Quoting budi_838
in my daily chart i apply 1000sma so from the daily chart we see that the last cross with 1000sma is at 2 april 2006..
so from that date we just open buy?
That is correct.
  • #45
  • May 5, 2007 10:55pm May 5, 2007 10:55pm
Quoting Bytebodger
As of this morning, I am still loading the minute data from 15 different pairs back to 2004 into my database.
Wow, I can't believe it's still loading. Thats a lot of data I guess.
  • #46
  • May 6, 2007 8:44am May 6, 2007 8:44am
Quoting Squash
Wow, I can't believe it's still loading. Thats a lot of data I guess.
It didn't take all day/night to load. I was loading it in batches divided by pair, so there were 15 different batches to run, each one taking roughly 45 minutes to complete. By the time I went to bed Friday night, I had finished about 12 of the batches. I loaded the final batches yesterday morning, and now I'm trying to eradicate the bad data which was imported during one failed batch. Long story, but I've been running into MySQL errors.

At any rate, I should be able to start compiling backtest results today.
  • #47
  • May 6, 2007 8:53am May 6, 2007 8:53am
Well I ran the testing for GBPJPY from Jun 04. Settings were a Threshold of 10 and a SL of 100 for all 5 orders, all orders closed at 1600 GMT. Bad news, I lost over 11000 pips in 11 months trading this way. I'm not sure if I misinterpreted your testing above, if that 5 month period was just a good run or the data you had was not accurate enough, but I think I can safely say this is a no go.
  • #48
  • May 6, 2007 4:48pm May 6, 2007 4:48pm
Quoting Squash
Well I ran the testing for GBPJPY from Jun 04. Settings were a Threshold of 10 and a SL of 100 for all 5 orders, all orders closed at 1600 GMT. Bad news, I lost over 11000 pips in 11 months trading this way. I'm not sure if I misinterpreted your testing above, if that 5 month period was just a good run or the data you had was not accurate enough, but I think I can safely say this is a no go.
Well, I could post a bunch of numbers here but, in a nutshell, you're right. I went through and started running large-scale backtests against the last 3 years' worth of minute data. I was able to confirm your results on GBPJPY, losing about 11000 pips in the span of a year.

The fact is that one of the previous comments left in this thread was quite prescient. I ran tests against many different pairs and all of them - including GBPJPY - were profitable across the entire 3-year span. However, the system produced some horrific drawdowns and, in the end, the ROI is simply not there. You end up placing thousands of trades over the course of years and in the end you get a return that would have been better realized (and far easier to achieve) if you simply put your money in an ETF.

So without further ado, I think we can put this thread to bed. Sorry for wasting everyone's time with this adventure, but I thought at one time (as recently as a few days ago) that this may be a viable, profitable system. It took several years of real data to reveal the long-term inefficiencies of this approach.
  • #49
  • May 6, 2007 5:27pm May 6, 2007 5:27pm
Quoting Bytebodger
Well, I could post a bunch of numbers here but, in a nutshell, you're right. I went through and started running large-scale backtests against the last 3 years' worth of minute data. I was able to confirm your results on GBPJPY, losing about 11000 pips in the span of a year.

The fact is that one of the previous comments left in this thread was quite prescient. I ran tests against many different pairs and all of them - including GBPJPY - were profitable across the entire 3-year span. However, the system produced some horrific drawdowns and, in the end, the ROI is simply not there. You end up placing thousands of trades over the course of years and in the end you get a return that would have been better realized (and far easier to achieve) if you simply put your money in an ETF.

So without further ado, I think we can put this thread to bed. Sorry for wasting everyone's time with this adventure, but I thought at one time (as recently as a few days ago) that this may be a viable, profitable system. It took several years of real data to reveal the long-term inefficiencies of this approach.
WOW! I have to applaud you for searching for the truth. Whether it was in your favor or not. Some things do not work and some do, but recognizing the truth is indeed the most difficult thing... I am impressed..

Thanks for this great thread and the very interesting exploration..
  • #50
  • May 6, 2007 6:47pm May 6, 2007 6:47pm
I will second this in a very BIG way.........you sir, are a gentlemen!

PS.............you have posted some very useful data for us 'Fozzy' traders............thanks!

Quoting smjones
WOW! I have to applaud you for searching for the truth. Whether it was in your favor or not. Some things do not work and some do, but recognizing the truth is indeed the most difficult thing... I am impressed..

Thanks for this great thread and the very interesting exploration..
  • #51
  • May 7, 2007 3:20am May 7, 2007 3:20am
Thanks for your honesty Byte, your efforts are appreciated, it was unfortunate we didn't get better results.
  • #52
  • May 8, 2007 8:02pm May 8, 2007 8:02pm
Bytebodger, best wishes to you my FXbro. What you have accomplished through the help of your fellow posters and doodlers in this thread in such a short time is a great statement to the commradery and teamwork that is soooooo Forex-Factory.

One to the next adventure!
Cheers,
Thom
  • #53
  • May 9, 2007 1:41am May 9, 2007 1:41am
Bytebodger, thanks for u'r effort in this thread.

can't wait to see u in the new thread...
wish u luck ....
happy trading
  • #54
  • Last Post: Edited 3:54pm Jun 28, 2012 11:45am | Edited 3:54pm
Quoting TheRealThing
I find your volatility breakout system concept refreshing.

I know it is frustrating to trade the way you've chosen, but the odds do favor you. The big moves that inevitably occur make the temporary frustration worthwhile.

I know that your concept does have an edge, but it might be less than most traders might be willing to tolerate considering the potential risks.

Since I also use a volatility breakout system (VBS) on forex, I've found out that the more time you can handle in a profitable trade really tends to improve the risk/reward overall....
I've landed on this thread while I was re-reading all TheRealThing and Peter Crowns posts, which are full of wisdom.

I'm surprised this has remained closed. Let me say a couple of things:

- Maybe a 1000 SMA is not accurate enough to indicate wether the trend is up or down. Too much time. Shall I suggest something like a 200 SMA or a crossing of 50/200 SMA's? I think it could have a good impact on our right/wrong trades. I also wouldn't use any MA below 200 if it had to stand alone.

- Talking of volatility, if we find that one pair's average volatility is 50, what should we do? If we go up, do we put a buystop order 50 pips up, or shall we put it 25 pips up (half of the volatility) and count another 25 pips below as room for it to go down? Or perhaps we may start on our time starting point regardless of the price position and give it some 50 pips of room behind?

- I also would suggest that 5 orders every day on each of those 19 pairs are too many orders, and I don't think it would be very reasonable in terms of money management.

- Once we have an edge and some good money management, all we need to attain is to solve the profit stop question. This can rely on something as simple as our mentioned 50 SMA, for example.

- Another issue is the S/L discussion. Yes, a 100 pip Stop Loss will give us enough room to... to lose more pips if we are wrong. In my humble opinion, this is a matter of R/R. We can discuss stops based on MA's or average volatility mainly because at least they are not arbitrary and they are moving and adaptative, but not fixed numbers, which to me are pointless and difficult to explain with logic.

- Oh, I forgot the timetable topic. You want to trade when most others trade. That means London session and some of the US session. This is when your day begins, no doubt about it.


This could be an excellent system with clear and adaptative rules, boundaries that cut losses short and let profits run with really no effort at all. I think I will give it a try with the main pairs (EURUSD, GBPUSD, USDCHF and USDJPY) and maybe a few others like AUDUSD, GBPJPY, EURJPY, USDCAD and even EURAUD.

Ok, that's it. Now, can somebody put some light on all the nonsense I've written?

Thanks, mates
Carles


In addition: Both Peter Crowns and TheRealThing (and others, of course) insist on something: the best entry points are often the ones that go inmediatly in the right direction with no doubts, and the ones that have tight stops but start to move with conviction. Of course, another reason for them to be the best is that they offer the best R/R ratios.
Visit my Drumming & Percussion Blog - DrumsCult com
0 traders viewing now