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Bodger SAR Method

  • #21
  • May 10, 2007 8:12am May 10, 2007 8:12am
Quoting DavidH
Maybe a filter for this is that once you get the reversal, make sure the 1 hour lines up. If so, set your limit order for the HIGH or LOW of the 4-hour bar.
Another option is to put your buy/sell order on the PSAR dot just before it got triggered, or the High/Low of trigger bar, whichever is highest (short)/lowest (long). It looks like you get in at a better price, but don't increase risk too much.
  • #22
  • May 10, 2007 11:09am May 10, 2007 11:09am
I took a few hours this morning to look at the last few months trades. I started with 4H and placed a verticle line on closed bar with SAR change and then went to 1H and entered on first closed bar in agreement with 4H and closed the trade with close of 1H SAR change.
There was one trade that was exited with the change of 4H instead of 1H.
I only looked at GBP/US and no spread:
Jan...+497, Feb...+503, Mar...+29, Apr...+48 and so far this month looks good.
I would love to do an extensive manual backtest for each pair of consideration all the way back to beginning of 2005.
I think locking in profits a.s.a.p. or move to 'BE', along with a few other tweeks, and this has merit.
  • #23
  • May 10, 2007 11:18am May 10, 2007 11:18am
Quoting drayco
I took a few hours this morning to look at the last few months trades. I started with 4H and placed a verticle line on closed bar with SAR change and then went to 1H and entered on first closed bar in agreement with 4H and closed the trade with close of 1H SAR change.
There was one trade that was exited with the change of 4H instead of 1H.
I only looked at GBP/US and no spread:
Jan...+497, Feb...+503, Mar...+29, Apr...+48 and so far this month looks good.
I would love to do an extensive manual backtest for each pair of consideration all the way back to beginning of 2005.
I think locking in profits a.s.a.p. or move to 'BE', along with a few other tweeks, and this has merit.
Thank you for sharing those results! I am going to sit down tonight - and in depth this weekend - and do some extensive backtesting. By "eyeballing" this it seems to perform quite well - but I know that eyeballing charts for too long can be dangerous. I really need some concrete numbers to go from. Your feedback starts that process.

As for locking in profits, I couldn't agree more. I think the best case scenario would be to find a system (maybe this one, maybe not) that works, to some extent, with a very rigid and unemotional TP point (like the reversal of the 1-hour PSAR). But once you've found that unemotional TP point, you might very well be able to improve the performance by injecting some solid MM tactics.

For example, my GBPUSD trade is currently in very solid territory. I have not received a close signal, so it is still open, but I have at least moved the SL to BE to ensure that I will lose no money on this trade. I will post some early trade results in a few minutes.
  • #24
  • May 10, 2007 11:28am May 10, 2007 11:28am
The 1600 GMT 4-hour bar provided no new trade opportunities, so I'm still working on the trades that I previously posted. Here's where I'm at:

Buy AUDCAD @ 0.9204, SL @ 0.9163 = still open
Buy EURJPY @ 162.50, SL @ 161.80 = closed @ 162.62 (+12)
Buy EURCAD @ 1.5004, SL @ 1.4942 = stopped out @ 1.4943 (-61)
Buy EURGBP @ 0.6803, SL @ 0.6775 = still open
Sell GBPCHF @ 2.4224, SL @ 2.4325 = still open, SL moved to BE
Sell GBPUSD @ 1.9910, SL @ 1.9976 = still open, SL moved to BE

Running total = -49

That may not look encouraging, but I'm optimistic. That one SL was nasty, putting me in the red with regards to realized P/L, but I have good gains sitting on the table and I can do no worse than BE on two of them. I'm hoping that I can report some positive pips on these once they close.
  • #25
  • May 10, 2007 11:30am May 10, 2007 11:30am
Hey.....I'm the only member known as BB around here, this thread belongs to Bb..........

Sorry Bb...........I just couldn't resist.................


Quoting PeterFM
Hi BB
I use this exclusively for entries, and look for other PA for exits.
  • #26
  • May 10, 2007 11:33am May 10, 2007 11:33am
Quoting BeachBum
Hey.....I'm the only member known as BB around here, this thread belongs to Bb..........

Sorry Bb...........I just couldn't resist.................
Maybe I can be "little BB". I'm not getting into a turf war with you - you're quite the voice around this forum!
  • #27
  • May 10, 2007 11:34am May 10, 2007 11:34am
Quoting Bytebodger
For example, my GBPUSD trade is currently in very solid territory. I have not received a close signal, so it is still open, but I have at least moved the SL to BE to ensure that I will lose no money on this trade. I will post some early trade results in a few minutes.
Hey... I can think of a good trailing SL technique. Use the PSAR itself! That's what it's there for!

I'm being serious here. The only difference is you would lag it by one bar, so that you can still get out at a better price on the close of the bar that flips the PSAR in the other direction. Basically just put your stop order at the PSAR dot of the previous bar.
  • #28
  • May 10, 2007 11:35am May 10, 2007 11:35am
Quoting BeachBum
Hey.....I'm the only member known as BB around here, this thread belongs to Bb..........

Sorry Bb...........I just couldn't resist.................
Then I guess that'd make me "bb"

Oy... this is getting confusing.
  • #29
  • May 10, 2007 11:37am May 10, 2007 11:37am
no need for a 'war'...........I really enjoy reading your posts (and you have shared some very valuable data with us Fozzy traders!) Keep on.......

Quoting Bytebodger
Maybe I can be "little BB". I'm not getting into a turf war with you - you're quite the voice around this forum!
  • #30
  • May 10, 2007 11:38am May 10, 2007 11:38am
Quoting bluebuddha
Then I guess that'd make me "bb"

Oy... this is getting confusing.
...............................
  • #31
  • May 10, 2007 11:40am May 10, 2007 11:40am
Quoting bluebuddha
Hey... I can think of a good trailing SL technique. Use the PSAR itself! That's what it's there for!

I'm being serious here. The only difference is you would lag it by one bar, so that you can still get out at a better price on the close of the bar that flips the PSAR in the other direction. Basically just put your stop order at the PSAR dot of the previous bar.
You know, I really like that idea. I hate automated trailing stops - IMHO they generally tend to get you OUT of positions that you'd much rather be in. But I'm a big fan of the manual trailing stop - a trailing stop with human discretion. And your note about the PSAR level itself seems like an ideal place to put that SL. In fact, employing such a strategy would have saved me some pips on that EURCAD trade this morning.

What do you say? Man Law? (looking around for confirmation)
  • #32
  • May 10, 2007 12:31pm May 10, 2007 12:31pm
Trade update (new trades in bold):

Buy AUDCAD @ 0.9204, SL @ 0.9163 = closed @ 0.9216 (+12)
Buy EURGBP @ 0.6803, SL @ 0.6775 = still open, SL moved to 0.6802
Sell GBPCHF @ 2.4224, SL @ 2.4325 = still open, SL moved to 2.4224
Sell GBPUSD @ 1.9910, SL @ 1.9976 = still open, SL moved to 1.9888
Sell EURJPY @ 161.76, SL @ 162.46
Sell EURCHF @ 1.6462, SL @ 1.6495

Running total = -37

At the close of the 2000 GMT 4-hour bar I was getting sell signals on every yen-based currency. I'm honestly not sure what's happening to the yen, but I didn't have the guts to short all of them. So I just grabbed the first one in my list - EURJPY - and shorted that one. Several minutes after I did it, I realized that I probably should have shorted almost any yen pair except that one, because now I am triple-exposed on the euro.

Oh well, I'm not terribly worried about it, but in retrospect I should have left EURJPY alone and shorted another yen pair instead.
  • #33
  • May 10, 2007 5:04pm May 10, 2007 5:04pm
Trade update (new trades in bold):

Buy EURGBP @ 0.6803, SL @ 0.6775 = closed @ 0.68085 (+5.5)
Sell GBPCHF @ 2.4224, SL @ 2.4325 = still open, SL moved to 2.4176
Sell GBPUSD @ 1.9910, SL @ 1.9976 = still open, SL moved to 1.9825
Sell EURJPY @ 161.76, SL @ 162.46 = still open
Sell EURCHF @ 1.6462, SL @ 1.6495 = still open, SL moved to 1.6475
Sell AUDUSD @ 0.8269, SL @ 0.8306
Sell USDJPY @ 119.805, SL @ 120.40

Running total = -31.5
Winning trades = 3
Losing trades = 1

In the spirit of just blabbing at the mouth for anyone who cares to listen, I have to tell you that this is the best day I've ever had in forex. And yes, that statement is a reflection on A) my total lack of experience in this game, and B) the fact that my initial track record over the last several months has been abyssmal. I mean, I know that you have to pay your dues, but my recent streak has been more than just poor skills - it's been outright bad luck. So to have a day like this where I'm watching my open positions rise and I'm closing winning trades is just the breath of fresh air that I needed.

What does this day say about the Bodger SAR Method? Admittedly, absolutely nothing. I really started trading this last night - completely out of character - without adequate testing and a single day's results say nothing about the efficacy of the system. In fact, in looking at the day's activity, I have to admit that this looks like one of those "easy" days in forex - days where pairs soar or dive in a given direction and almost any signal will be sufficient to get you on the train in the right direction. So I won't be able to say with any certainty whether this system is valid until I've had the chance to do some rigorous backtesting over the weekend.

Still, I can't help but be pleased, even if it might just be luck. Consider:

  1. I made a few bucks today on EURGBP - that is a pair that had absolutely confounded me until today. During previous trials of other systems, I had routinely just removed EURGBP from any consideration because it stubbornly refused to yield any positive results.
  2. I'm currently sitting on more than 100 pips of profit on GBPUSD. I've never even had a +50 pip trade, so yes, I am ecstatic.
  3. I'm currently looking at 6 open positions, all of them in various green states. I'm usually happy if I have 1 or 2 green positions out of 6.
  4. The pessimist in me is stuck on the fact that today was such an "easy" day - everything trending so hard in one direction. But you know what? I've been doing this on-and-off now for several months and there have been other "easy" days when I lost a lot of money. I was either out of the game or, even worse, I was on the wrong side of the big trend. So, if this system does nothing more than get me in on big moves, it's at least worth doing backtesting on it.

  • #34
  • May 10, 2007 8:14pm May 10, 2007 8:14pm
Trade update (new trades in bold):

Sell GBPCHF @ 2.4224, SL @ 2.4325 = stopped @ 2.4163 (+61)
Sell GBPUSD @ 1.9910, SL @ 1.9976 = still open, SL moved to 1.9802
Sell EURJPY @ 161.76, SL @ 162.46 = still open, SL moved to 162.23
Sell EURCHF @ 1.6462, SL @ 1.6495 = still open, SL moved to 1.6460
Sell AUDUSD @ 0.8269, SL @ 0.8306 = still open, SL moved to 0.8288
Sell USDJPY @ 119.805, SL @ 120.40 = still open, SL moved to 120.17
Buy USDMXN @ 10.8598, SL @ 10.8208

Running total = +29.5
Winning trades = 4
Losing trades = 1

(Note: I've never bothered with USDMXN before. We'll see if I ever bother with it again...)

I am currently doing backtests for this system against EURUSD. I probably won't have results until this weekend.
  • #35
  • Edited May 11, 2007 1:20am May 10, 2007 9:39pm | Edited May 11, 2007 1:20am
I just finished backtesting this against EURUSD only and only for the period from July, 2004 to June, 2005. I will do the entire backtest from 2004 to the present, but I'm getting pretty tired and I can't finish it tonight. But I wanted to share some of the initial info.

[NOTE: Data removed because I have to re-run this test. Sorry for "repainting" my results. ]
  • #36
  • May 10, 2007 10:07pm May 10, 2007 10:07pm
Trade update:

Sell GBPUSD @ 1.9910, SL @ 1.9976 = stopped @ 1.9802 (+108)
Sell EURJPY @ 161.76, SL @ 162.46 = still open, SL moved to 162.01
Sell EURCHF @ 1.6462, SL @ 1.6495 = still open, SL moved to 1.6453
Sell AUDUSD @ 0.8269, SL @ 0.8306 = still open, SL moved to 0.8286
Sell USDJPY @ 119.805, SL @ 120.40 = still open, SL moved to 120.04
Buy USDMXN @ 10.8598, SL @ 10.8208 = still open

Running total = +137.5
Winning trades = 5
Losing trades = 1
  • #37
  • May 10, 2007 10:57pm May 10, 2007 10:57pm
Bb.......what kind of test spreadsheet is this?

Quoting Bytebodger
I just finished backtesting this against EURUSD only and only for the period from July, 2004 to June, 2005. I will do the entire backtest from 2004 to the present, but I'm getting pretty tired and I can't finish it tonight. But I wanted to share some of the initial info.

Stats:
Winning trades = 71
Losing trades = 56
Total pips = 2260
Maximum drawdown = 10%
Most consecutive losing trades = 5

The attached image shows the cumulative pips over the course of the year. The final total includes 3 pips which were subtracted from each trade to account for broker spread.
  • #38
  • May 10, 2007 11:15pm May 10, 2007 11:15pm
Quoting BeachBum
Bb.......what kind of test spreadsheet is this?
That is taken from MS Excel. As you know, I can program my own backtests, but I haven't yet figured out how to calculate the PSAR values - so I've just compiled these results manually.
  • #39
  • May 10, 2007 11:37pm May 10, 2007 11:37pm
The 4H EUR/USD has been in a downtrend (SAR above the price bars) since around 0800 5/8.

Do you enter a new trade each time the 1H converts from up to down?

That has happened twice since 5/8.
  • #40
  • May 11, 2007 12:53am May 11, 2007 12:53am
I don't think the manual backtest i did is accurate. Looking at how the vertical line works is confusing. For instance, when you place a vertical line on a closed 4H bar then switch TF to 1H i don't think you are not looking at the same time. It must be about 3 hours behind. I think the 1H bar that the vertical line now rests on is really the first 1H (of 4) that make up the 4H bar. The closing values are different.
Can someone please explain how this works?
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