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Hedging/averaging trades without prediction

  • #2,661
  • Mar 8, 2024 10:14am Mar 8, 2024 10:14am
Quoting Fiox89
{quote} Interesting approach. I've been experimenting with an EA (not mine) for a few months. I've sunk several demo accounts, but not this one. Why? I imagine thanks to the more optimized parameters, or perhaps purely luck. For the curious, the EA opens a grid of pending orders at a fixed distance, both directions, with a distance of X pips from the current market price. No event/conditions are required to open the series of orders, simply after the take profit has occurred, the new pending grid is created. Too simple? I agree, but from October...
Many thanks for sharing, look forward to further results....
  • #2,662
  • Mar 8, 2024 10:19am Mar 8, 2024 10:19am
Quoting Fiox89
{quote} Interesting approach. I've been experimenting with an EA (not mine) for a few months. I've sunk several demo accounts, but not this one. Why? I imagine thanks to the more optimized parameters, or perhaps purely luck. For the curious, the EA opens a grid of pending orders at a fixed distance, both directions, with a distance of X pips from the current market price. No event/conditions are required to open the series of orders, simply after the take profit has occurred, the new pending grid is created. Too simple? I agree, but from October...
This is what I'm finding with my automated EAs, perhaps it will all blow up one day, but not yet. I'll post weekly results on my demo and live tradings laters.
Sounds like a lot of screen time to me.
  • #2,663
  • Mar 8, 2024 10:19am Mar 8, 2024 10:19am
Quoting Fiox89
{quote} Interesting approach. I've been experimenting with an EA (not mine) for a few months. I've sunk several demo accounts, but not this one. Why? I imagine thanks to the more optimized parameters, or perhaps purely luck. For the curious, the EA opens a grid of pending orders at a fixed distance, both directions, with a distance of X pips from the current market price. No event/conditions are required to open the series of orders, simply after the take profit has occurred, the new pending grid is created. Too simple? I agree, but from October...
What are the parameters? I think I know what EA is it.
  • #2,664
  • Mar 8, 2024 10:49am Mar 8, 2024 10:49am
Quoting Whale
{quote} What are the parameters? I think I know what EA is it.
It's not a secret, just I don't spam other people's EA because I don't know if it's ok
The current settings are grid of 15 orders distance between orders 25 pips. As you might imagine, these values works on gold (for now) don't seem to work well on other crosses. It would be interesting to test different settings and especially take profit / stop loss. Too often we focus on the entrance, when in reality the exit is the only thing that really matters
  • #2,665
  • Mar 8, 2024 3:06pm Mar 8, 2024 3:06pm
Live trading positive swap only pairs, hedging/averaging only +.21% this week (flat).
So after 7 weeks: Profit = +5.21% = +0.74% per week.

EAs had a down week -£159
After 19 weeks: Profit = +12.15 = +0.64% per week.
Sounds like a lot of screen time to me.
  • #2,666
  • Mar 8, 2024 3:35pm Mar 8, 2024 3:35pm
Almost forgot about my averaging down experiment. This is a semi-automatic, in the evening I close every position to avoid DD. Here too, the entry system is almost irrelevant IMO, it is probably the take profit / stop loss that plays a positive role. Why do I say this? because in the same EA I have a function to "reverse" the logic of the positions (e.g. if the normal signal is buy, reverse is sell) and on two platforms, one normal condition only and one reverse condition only, I continue to have similar results using the same crosses and time frames.
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  • #2,667
  • Mar 9, 2024 1:55am Mar 9, 2024 1:55am
Quoting Erebus
Here is the latest trade entry, what do you think? I guess this is why I don't trade support & resistance, I just can't "see" it. I may ease off on posts, he has been ranting again, claiming he is getting many emails and posts about how he trades, definitely not from me, I love it. Also, there are some congratulatory messages, and praise for the excellent ""risk management"" ???? WOW What a woke groupie, only high-fives and back slaps allowed. Has anyone bothered to check it out? {image} TRADE RESPONSIBLY
I essentially use a similar system too, but I took GBPCHF & GBPCAD bcoz CAD & CHF are well known bears, but USD is only a bear on daily and not yet a bear on weekly strength meters..
  • #2,668
  • Mar 9, 2024 2:45am Mar 9, 2024 2:45am
Quoting Fiox89
Almost forgot about my averaging down experiment. This is a semi-automatic, in the evening I close every position to avoid DD. Here too, the entry system is almost irrelevant IMO, it is probably the take profit / stop loss that plays a positive role. Why do I say this? because in the same EA I have a function to "reverse" the logic of the positions (e.g. if the normal signal is buy, reverse is sell) and on two platforms, one normal condition only and one reverse condition only, I continue to have similar results using the same crosses and time frames....
Looks like you are on the right track.. you'll know the cyclic nature of the pair you trade can change rapidly if big systematic orders come in day after day. About 3 months live trading should give you an idea.

You close everyday? How are the danglers managed, if they have just been closed arbitrarily at end of day during your test period you may find you have very different results over a longer period?
  • #2,669
  • Mar 9, 2024 4:14am Mar 9, 2024 4:14am
Quoting LazyTrades
I don't trade cable as there's no positive swap, if I had a long bias on it I'd hedge it with something correlated and wait for the correlation to work in my favour. Here's my 'chart'. My fundamental and technical analysis suggest that NFP will make those 4 pairs move around a bit {image}
I love this chart!
  • #2,670
  • Mar 9, 2024 9:43am Mar 9, 2024 9:43am
Quoting Fagin
{quote} Looks like you are on the right track.. you'll know the cyclic nature of the pair you trade can change rapidly if big systematic orders come in day after day. About 3 months live trading should give you an idea. You close everyday? How are the danglers managed, if they have just been closed arbitrarily at end of day during your test period you may find you have very different results over a longer period?
Market orders, at each candle close when the position goes in DD. So far the EA has been lucky, the negative streaks are covered by the positive ones, but I'm sure some more important DDs will arrive. But in fact, it's an experiment and I'm putting the EA under stress.

The fact is, I am carrying out several experiments, but the most realistic ones for me involve EAs with manual user control. I don't like leaving the complete management of thousands of $ to an EA, nor leaving positions in averaging for days. Averaging can be done on the M5, and if possible I prefer to cut losses before they become huge, and sleep peacefully at night. After all, it's known that the achilles heel of averaging is occasional events with large losses, so my job is to find a way to prevent them
  • #2,671
  • Edited 1:15pm Mar 9, 2024 12:45pm | Edited 1:15pm
Quoting Fagin
{quote} I love this chart!
Made it as simples as I can, red is for the 2x short only pairs and green is for the 2x long only pairs, after that I'm just looking at where they all are in relation to each other. Trading live with a 5 figure account, no stopless and sleep very well.
Sounds like a lot of screen time to me.
  • #2,672
  • Mar 10, 2024 4:35am Mar 10, 2024 4:35am
Quoting Fiox89
{quote} Market orders, at each candle close when the position goes in DD. So far the EA has been lucky, the negative streaks are covered by the positive ones, but I'm sure some more important DDs will arrive. But in fact, it's an experiment and I'm putting the EA under stress. The fact is, I am carrying out several experiments, but the most realistic ones for me involve EAs with manual user control. I don't like leaving the complete management of thousands of $ to an EA, nor leaving positions in averaging for days. Averaging can be done on the M5,...
Me too. I've just developed an ea to do the donkey work of opening/closing trades but the risk side is manual and closing off danglers is manual. I've yet to find my happy place between risk/dd/profit but it evolves daily.

I've developed a love for chasing down the draw down more than chasing an entry. How you can change when your mindset shifts...

Good luck with it.
  • #2,673
  • Mar 10, 2024 4:35am Mar 10, 2024 4:35am
Quoting LazyTrades
{quote} Made it as simples as I can, red is for the 2x short only pairs and green is for the 2x long only pairs, after that I'm just looking at where they all are in relation to each other. Trading live with a 5 figure account, no stopless and sleep very well.
Makes complete sense, glad it's working out for you
  • #2,674
  • Mar 12, 2024 3:04pm Mar 12, 2024 3:04pm
Whilst the cable thread is very entertaining at times, I do like to search FF and find some genuine hidden gems, am enjoying some of the comments by FTI:
https://www.forexfactory.com/thread/...95#post1736295, may turn into a dead end but interesting reading and seems somewhat relevant to what we are doing here so far.
Sounds like a lot of screen time to me.
  • #2,675
  • Edited Mar 15, 2024 3:47am Mar 14, 2024 3:58pm | Edited Mar 15, 2024 3:47am
One more day to go before posting week's results but EA and live trading doing well so far. With 20 weeks of data from the EA to look at one thing appears over and over again and that is the loss/recovery/profit cycle repeating due to the tear, snap back and wave nature of the markets. More specificaly, moderate weeks follow moderate weeks whilst larger losing weeks always seem to recover to a similar or better value the week after.

My live swap/hedge trading is just ahead (in % wise) per week over the EA, which is obviously a good thing, and so far is yet to have a losing week overall, although this has to happen sooner or later.

More tomorrow.
Sounds like a lot of screen time to me.
  • #2,676
  • Mar 15, 2024 10:49am Mar 15, 2024 10:49am
Hedging swap positive only pairs (mostly shorting EURUSD vs USDMXN) no SL (obviously): +6.80% in 8 weeks (live trading) = 0.85% per week so far.
No input EA's also had a good week so after 20 weeks: +14.71% = +0.74% per week (demo only).
Have a good weekend all.
Sounds like a lot of screen time to me.
  • #2,677
  • Mar 16, 2024 2:05am Mar 16, 2024 2:05am
I folks i think that the grid Is a such good aproach by the way the only thing that i'm not sure Is the distance between the order.
Ergo i Guess that the distance should be dinamic in relation with the volatility.
More volatility more distance and viceversa.
  • #2,678
  • Mar 16, 2024 8:53am Mar 16, 2024 8:53am
If you are going to use rigid grids I'd just prepare for some pretty long DD scenarios, small trades in relation to bank and patience required. My research has shown there's no magic formula in relation to grid sizes, if that's what you want to do, it's all about risk vs reward. Here's a real recent UJ trade with 28 levels :o)
Attached Image (click to enlarge)
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Sounds like a lot of screen time to me.
  • #2,679
  • Mar 16, 2024 9:52am Mar 16, 2024 9:52am
Quoting dieguito80
I folks i think that the grid Is a such good aproach by the way the only thing that i'm not sure Is the distance between the order. Ergo i Guess that the distance should be dinamic in relation with the volatility. More volatility more distance and viceversa.

Safety should be first priority, if you want to stay in the Game and have smaller drawdowns then always use a wide grid, you never want to come into big drawdowns by small market moves, that just doesnt make much sense.

Either way i would not recommend grid, people who have sold gold beginning of March might never come out of it, who knows?

I would always create a higher timeframe bias and Plan forward, meaning how to Survive big moves with as little drawdowns as possible?

I personally rather do partial hedging, if im 0.50lot short, i rather Go 0.35long, i still have 0.15 short exposure, but i reduce my drawdown and i can average my price by closing the buy at a higher price, opening the sell exposure again, i belive its smarter then grid and Probbaly safer. If price falls i come out through the 0.15 net short exposure, if it goes against me i reduced the drawdown by a Lot through the partial hedge, from better prices it can be Opend up again.
Instead of adding risk you reduce risk first and then average up without adding more positions. Thats not exactly what i do, just what i would recommend instead of simple grid.
1k to 100k Copy Trading All Time Return: 367.9%
  • #2,680
  • Mar 19, 2024 6:35am Mar 19, 2024 6:35am
Quoting Thomas.
{quote} Safety should be first priority, if you want to stay in the Game and have smaller drawdowns then always use a wide grid, you never want to come into big drawdowns by small market moves, that just doesnt make much sense. Either way i would not recommend grid, people who have sold gold beginning of March might never come out of it, who knows? I would always create a higher timeframe bias and Plan forward, meaning how to Survive big moves with as little drawdowns as possible? I personally rather do partial hedging, if im 0.50lot short, i rather...
I would agree. Nearly every trader I talk to doesn't understand that they are ALL trading a grid. When I explain what they are actually doing, their ego gets crushed and a tiny light gets switched on or not if they are thick..
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