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Daily GBP/JPY Breakout System

  • #1
  • First Post: Edited Jun 27, 2008 2:26am Jun 16, 2008 1:41pm | Edited Jun 27, 2008 2:26am
Due to the success of nomask's Weekly GBP/JPY Breakout System, this is a thread attempting to apply the same rules on a daily basis. I don't see any reason it wouldn't work.

The Weekly method was introduced by nomask and modified by harold4X and bigricky.
Here is the thread:
http://www.forexfactory.com/showthread.php?t=66210


The weekly has racked up 23 winning weeks and 2 losing weeks since Jan.1. A losing week consists of 2 losing trades.
That makes 23W-4L. This is based upon a 1:1 RR ratio.
If 2% had been risked on each trade, that equals a 38% account growth, not including compounding.
If this W/L rate continues, a risk of more that 2% will be warranted.



I'll start the daily method with the following rules:

I'll be using IBFX data.

Take the range (H-L) of the 8 hours prior to 5 PM EST (2100 GMT).

If this range is <100 pips, go back another 4 hours and take the range of the last 12 hours.

If this is still <100, add an equal amount of pips to the H and L to equal a 100 range.


Set a buy stop at the H of the range+1+spread.
Set a sell stop at the L of the range -1.

The SL for the buy, will be the sell stop.
The SL for the sell, will be the buy stop.

The TP on each will be the amount of the SL.


If a trade is triggered and hits the TP, cancel the other order. You're through for the day.

If a trade is triggered and gets stopped out, set the TP for the opposite trade to 2x the original TP.

Clean everything up at 2100 GMT- Close any open position and delete any pending order.


Bobcat2 has been testing a similar version of this for the last week or two. I welcome his input.
NowAndLater has expressed an interest in trying other pairs. I welcome him too.

Anyone who wants to contribute is welcome.

If it'll let me continue editing, I'll keep the running results on this first post.



================================================================

Real time results-Each trade represents 2% of my account. We'll start with $1,000.

June 17, 2008 Win - +2% of account
Account = $1,020

June 18, Partial Loss - 1.2% of account
Account = $1,008

June 19, Win - +2% of account
Account = $1,028

June 20, Partial Loss - 0.3% of account
Account = $1,025

June 22, Partial Loss - 0.5%
Account = $1,020

June 23, Partial Win - +0.47%
Account = $1,025

June 24, Break Even
Account = $1,025

June 25, Loss -2.4%
Account = $1,000
  • #2
  • Jun 16, 2008 2:45pm Jun 16, 2008 2:45pm
Thanks bill blass for introducing the daily system. Will demo to see how it work. Good luck to all.
  • #3
  • Jun 16, 2008 3:15pm Jun 16, 2008 3:15pm
Quoting billbss
Due to the success of nomask's Weekly GBP/JPY Breakout System, this is a thread attempting to apply the same rules on a daily basis. I don't see any reason it wouldn't work.

The Weekly method was introduced by nomask and modified by harold4X and bigricky.
Here is the thread:
http://www.forexfactory.com/showthread.php?t=66210


The weekly has racked up 23 winning weeks and 2 losing weeks since Jan.1. A losing week consists of 2 losing trades.
That makes 23W-4L. This is based upon a 1:1 RR ratio.
If 2% had been risked on each trade, that equals a 38% account growth, not including compounding.
If this W/L rate continues, a risk of more that 2% will be warranted.



I'll start the daily method with the following rules:

I'll be using IBFX data.

Take the range (H-L) of the 8 hours prior to 5 PM EST (2100 GMT).

If this range is <100 pips, go back another 4 hours and take the range of the last 12 hours.

If this is still <100, add an equal amount of pips to the H and L to equal a 100 range.


Set a buy stop at the H of the range+1+spread.
Set a sell stop at the L of the range -1.

The SL for the buy, will be the sell stop.
The SL for the sell, will be the buy stop.

The TP on each will be the amount of the SL.


If a trade is triggered and hits the TP, cancel the other order. You're through for the day.

If a trade is triggered and gets stopped out, set the TP for the opposite trade to 2x the original TP.

Clean everything up at 2100 GMT- Close any open position and delete any pending order.


Bobcat2 has been testing a similar version of this for the last week or two. I welcome his input.
NowAndLater has expressed an interest in trying other pairs. I welcome him too.

Anyone who wants to contribute is welcome.

If it'll let me continue editing, I'll keep the running results on this first post.

My only concern would be expecting the pair to move 100 pips or 200 pips after breaking the 100 pip range on a daily basis. Not that it won't. If we choose to let the trades to run beyond the end of day, may be.

Expecting that kind of movement on a weekly is a different thing.

Just my thought..

All the best with this method.

TradeStar
Haste not to Enter AND Haste not to Exit !-TradeStar
  • #4
  • Jun 16, 2008 3:19pm Jun 16, 2008 3:19pm
Quoting TradeStar
My only concern would be expecting the pair to move 100 pips or 200 pips after breaking the 100 pip range on a daily basis. Not that it won't. If we choose to let the trades to run beyond the end of day, may be.

Expecting that kind of movement on a weekly is a different thing.

Just my thought..

All the best with this method.

TradeStar
Agreed. Those are my thoughts.
This is a starting point. I suspect it will end up letting the trades run until Friday and letting them stack up on top of each other. Either that or reducing the range.

I'm going to track this for a week or two and see what it needs.
  • #5
  • Jun 16, 2008 3:21pm Jun 16, 2008 3:21pm
Quoting billbss
Agreed. Those are my thoughts.
This is a starting point. I suspect it will end up letting the trades run until Friday and letting them stack up on top of each other. Either that or reducing the range.

I'm going to track this for a week or two and see what it needs.
Yeah. That might work.
Haste not to Enter AND Haste not to Exit !-TradeStar
  • #6
  • Jun 16, 2008 3:35pm Jun 16, 2008 3:35pm
Hi Bill!

Thanks for starting this Daily thread now that the Weekly GBP/JPY Breakout System seems to be working so well. My thanks to nomask for originating his variation on a popular theme which is essentially a GBP/JPY breakout straddle system, and to harold4x for further development. BUT Bill, it has been your implementation, inciteful commentary and high degree of success that has been the motivating factor for me.

You are now taking your data from IBFX rather than North Finance. Was this broker change merely for your convenience because you have a live account with IBFX? Otherwise, what is the reason for the change?

Today's trade entries (IBFX):

2 candles:
Hi: 212.75
Lo: 212.05
Range: 70 pips

3 candles:
Hi: 212.79
Lo: 211.84
Range: 95 pips

Add 3 pips to Hi, and subtract 2 pips from Lo to achieve 100 pip range:
Hi: 212.82
Lo: 211.82
Range 100 pips

Trade Entries:
Add 9 pip broker spread, add 1 pip to Buy
Subtract 1 pip to Sell

BUY: 212.92
SL: 211.81
1X TP: 214.03
2X TP: 215.14

SELL: 211.81
SL: 212.92
TP: 210.70
2x TP: 209.59

Please confirm my math.
  • #7
  • Jun 16, 2008 4:23pm Jun 16, 2008 4:23pm
Quoting Bobcat2
Hi Bill!

Thanks for starting this Daily thread now that the Weekly GBP/JPY Breakout System seems to be working so well. My thanks to nomask for originating his variation on a popular theme which is essentially a GBP/JPY breakout straddle system, and to harold4x for further development. BUT Bill, it has been your implementation, inciteful commentary and high degree of success that has been the motivating factor for me.

You are now taking your data from IBFX rather than North Finance. Was this broker change merely for your convenience because you have a live account with IBFX? Otherwise, what is the reason for the change?

Today's trade entries (IBFX):

2 candles:
Hi: 212.75
Lo: 212.05
Range: 70 pips

3 candles:
Hi: 212.79
Lo: 211.84
Range: 95 pips

Add 3 pips to Hi, and subtract 2 pips from Lo to achieve 100 pip range:
Hi: 212.82
Lo: 211.82
Range 100 pips

Trade Entries:
Add 9 pip broker spread, add 1 pip to Buy
Subtract 1 pip to Sell

BUY: 212.92
SL: 211.81
1X TP: 214.03
2X TP: 215.14

SELL: 211.81
SL: 212.92
TP: 210.70
2x TP: 209.59

Please confirm my math.
Thanks Bob,
It's been my pleasure contributing to the other thread. that method has been good to me

I have to thank you for being the inspiration for the daily version. I had considered it, but would probably have never acted on it had you not been working with it.

Feel free to follow your own ideas here. You can track them separately if you want. We can all work together and hammer out something that will make money.

I'm using IBFX for this because that's where my account is. I use North Finance to get my Friday range for the Weekly version for a couple of reasons- harold4x used it for his successful backtests- IBFX has a stunted 4H candle on Friday. It closes early and the range is usually quite a bit different from NF. IBFX is fine for the daily version, though.

Your math is correct. Actually, I caught a mistake I made by checking yours.

Thanks again for participating.
  • #8
  • Jun 16, 2008 7:48pm Jun 16, 2008 7:48pm
hi bill as for the tweaking i did with the gbpjpy when price was not 100 i didnt go back i adjust the last 8 hrs for example 20350 20280 + 70 pips i would add 15 to high and low also all these were done with north finance so the prices will be different with other brokers that dont have same close as them
  • #9
  • Jun 16, 2008 8:21pm Jun 16, 2008 8:21pm
Hi Harold,

I evidently was not following your method correctly, as I have been adding pips to the 3 candles Hi/Lo, if the 3 candles were shy of 100 pips.

So...if I understand correctly...if 3 candles are stilll shy of the 100 pip range, you return to 2 candles and equally add pips to the 2 candles Hi/Lo position(not 3 candles) to total 100 pips?

This has been working well, even if I have misunderstood ! LOL
  • #10
  • Jun 16, 2008 8:23pm Jun 16, 2008 8:23pm
no i use the last 2 4 hr candles and what ever the difference is is equallt add it to high and low
  • #11
  • Jun 16, 2008 10:22pm Jun 16, 2008 10:22pm
I would be interested in a BOX indicator
Meaning the chart paints the High and low range for the hours you specify inside a colored box

for example: you have a starting time of 09:00 (ibfx) and a stop time of 21:00 (ibfx) the box would show the exact high and low...then you can know your approximate entries for the trade.

please post the indicator if someone has it
that would help me out a ton for backtest and forward test...

thanks
M4X............ Hedging My Way To Profits!
  • #12
  • Jun 16, 2008 10:46pm Jun 16, 2008 10:46pm
Quoting harold4x
no i use the last 2 4 hr candles and what ever the difference is is equallt add it to high and low
Harold, this is what you posted on the weekly thread that I have been basing it on. Like Bob said- it works


Quote
i have done a manual backtest for year 2005 ihave altered his plan just a bit i use the same 2 candles on north finance charts if they didnt total 100 pips i would go to 3rd candle to increase range and it that didnt do it i would equally add the difference to top and bottom. my target and stop is the size of the range not double max trades for the week is 2 they only happen if 1st stop is hit here are the results 5 weeks we broke even where stop was hit but reversal won. the rest are 36 wins for 3600 and 14 losses for 1400 total pips for 2005 2200 this is significant since the market was a lot differnt and not as volitile many systems crashed during this year 2006 was also tough but only for half of year so when i get time i will check it out this could be a nice set and forget for me

http://www.forexfactory.com/showpost...45&postcount=9
  • #13
  • Jun 16, 2008 10:50pm Jun 16, 2008 10:50pm
Quoting M4X
I would be interested in a BOX indicator
Meaning the chart paints the High and low range for the hours you specify inside a colored box

for example: you have a starting time of 09:00 (ibfx) and a stop time of 21:00 (ibfx) the box would show the exact high and low...then you can know your approximate entries for the trade.

please post the indicator if someone has it
that would help me out a ton for backtest and forward test...

thanks

Try this one:
Attached File(s)
File Type: mq4 BreakOut-EAGLE_indicator.mq4   7 KB | 1,522 downloads
  • #14
  • Jun 17, 2008 2:19am Jun 17, 2008 2:19am
i've already use the similiar strategy, and profitable

gjsignal.blogspot.com => based on breakout
Lazy Forex
  • #15
  • Jun 17, 2008 2:39am Jun 17, 2008 2:39am
Tonight's trades were very inauspicious for me. The 3AM CDT candle is the most ridiculous looking doji I have ever seen...NO body and wicks extending 112 pips that simply gave me a double loss. Good thing I wasn't available to double up on the second trade! LOL

I have to put this in perspective as this is the 1st loss (albeit double) I have had with either the weekly or daily versions. All 3 of my weekly trades have been winners...so the daily results stand at 3 wins, 1 loss. I am still profitable with the daily approach.

Perhaps I should use some sort of Martingale approach in an attempt to compensate? Opinions, please. My personal preference is negative, but maybe someone out there has had good experince in implementing Martingale?
  • #16
  • Jun 17, 2008 4:50am Jun 17, 2008 4:50am
Quoting Bobcat2
Tonight's trades were very inauspicious for me. The 3AM CDT candle is the most ridiculous looking doji I have ever seen...NO body and wicks extending 112 pips that simply gave me a double loss. Good thing I wasn't available to double up on the second trade! LOL

I have to put this in perspective as this is the 1st loss (albeit double) I have had with either the weekly or daily versions. All 3 of my weekly trades have been winners...so the daily results stand at 3 wins, 1 loss. I am still profitable with the daily approach.

Perhaps I should use some sort of Martingale approach in an attempt to compensate? Opinions, please. My personal preference is negative, but maybe someone out there has had good experince in implementing Martingale?
Bob, What broker do you use?
I didn't get stopped out.
I took profit a few minutes ago, with my trade.


I'm not a believer in Martingale. Maybe someone will read this that has other ideas.
  • #17
  • Jun 17, 2008 6:42am Jun 17, 2008 6:42am
Same here. I trade MB and traded live. I didn't get stopped out either.
  • #18
  • Jun 17, 2008 6:57am Jun 17, 2008 6:57am
Bill,

My broker is Oanda. The doji on Oanda looked very suspicious as it barely touched my pending Buy order, and immediately retreated for a loss. Then, it repeated that journey with my pending Sell order. I hope that I am not the victim of "stop hunting", as I have come to consider Oanda as above all that.

BUT...Congratulations on yet another win for you! I am not even the least bit discouraged by my first loss, as the weekly track record has been terrific. However, I am considering switching over to your broker for a live account, if I can mitigate losses due to different broker charts and trading platforms. The other approach might be for me to take candle data from Oanda rather than from either MT4 broker. I'll start tracking the disparity between Oanda and IBFX (and maybe FXDD) in an attempt to determine which broker works best with the daily strategy.
  • #19
  • Jun 17, 2008 7:12am Jun 17, 2008 7:12am
Quoting Bobcat2
Bill,

My broker is Oanda. The doji on Oanda looked very suspicious as it barely touched my pending Buy order, and immediately retreated for a loss. Then, it repeated that journey with my pending Sell order. I hope that I am not the victim of "stop hunting", as I have come to consider Oanda as above all that.

BUT...Congratulations on yet another win for you! I am not even the least bit discouraged by my first loss, as the weekly track record has been terrific. However, I am considering switching over to your broker for a live account, if I can mitigate losses due to different broker charts and trading platforms. The other approach might be for me to take candle data from Oanda rather than from either MT4 broker. I'll start tracking the disparity between Oanda and IBFX (and maybe FXDD) in an attempt to determine which broker works best with the daily strategy.
Bob,
Maybe it was on the up-and-up. That doji came within 19 pips of stopping me out, using IBFX.
There are differences in broker's data. 19 pips isn't much on this pair.
Maybe the next time our situations will be reversed. Let's hope it evens itself out.
  • #20
  • Jun 17, 2008 8:00am Jun 17, 2008 8:00am
Quoting smurf
Thanks bill blass for introducing the daily system. Will demo to see how it work. Good luck to all.
Smurf,
How did you do?
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