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Hedge trading spieler system derived from futures spread trading

  • #1,581
  • Sep 10, 2008 2:27am Sep 10, 2008 2:27am
Stcktrdr, not necessarily. The reference point is the previous day's close. I always calculate it manually to get to understand what is really happening. remove every indicator and have a daily chart, calculate -0.25% or +0.25% from previous day's close, you should be able to pin point where your trade is.
  • #1,582
  • Sep 10, 2008 2:28am Sep 10, 2008 2:28am
Everyday, there is a "new" starting point. That is why it changed and why you had a loss.

Have you read the thread starting from the beginning? If not, you need too.

Quoting Stcktrdr
I must have done something wrong. I opened a trade long both pairs, when EURCHF indicator was -.25%.

Then I closed MetaTrader and went on with my life.

When I opened MetaTrader next day i saw EURCHF indicator was at +-0.00 but I had substantial loss on my trade. I thought entering long at -.25 and closing at 0 would results in profits?

I'm not sure how to approch this to find the error?
  • #1,583
  • Sep 10, 2008 3:27am Sep 10, 2008 3:27am
hi all, i have been a silent lurker on this thread recently. I have seen the potential for this nice method . Thank you Speiler.
just wondering if we can have an alert where the +- 20 , +- 40 , etc can be sent to our mobiles. This would be an excellent tool to be on top of things without being stuck to the screen.
  • #1,584
  • Sep 10, 2008 3:51am Sep 10, 2008 3:51am
Spieler, do you have any advice for those of us who are still long from Aug 25? I was thinking about closing, when the price gapped, with a loss but I didn't because there was no rule for that.
  • #1,585
  • Sep 10, 2008 4:18am Sep 10, 2008 4:18am
fisu, our man spieler is in europe and it doens't look like he is trading or available this week
  • #1,586
  • Sep 10, 2008 5:14am Sep 10, 2008 5:14am
OK, I see. So basically I need to calculate my exit point at the time of entry, and have that as "take profit" goal. right?

I have read the thread, but need to read it more times to understand it. I just want to try it "hands on" as I learn. Sinks into my head much better.

I have done some pair trading in stocks, it's different than this approach. Harder to understand this in forex with three pairs...

Quoting Big1red9
Everyday, there is a "new" starting point. That is why it changed and why you had a loss.

Have you read the thread starting from the beginning? If not, you need too.
  • #1,587
  • Edited 7:19am Sep 10, 2008 6:20am | Edited 7:19am
12:20 gmt

short at eurchf +0.35% 1,5968

eurusd 1,4103

usdchf 1,1322


edit 13:10 gmt

close at eurchf 0% 1,5913

eurusd close 1,4082 = +21

usdchf close 1,1295 = +27

total : + 48 pips


Regards
  • #1,588
  • Sep 10, 2008 6:57am Sep 10, 2008 6:57am
Not at time of entry.

Every days close, becomes tomorrows new entry point. The exception is Friday - depending on what happens on Sunday.

For Wed the zero point is 1.5912 - which is Tuesdays close.

Positions are taken in EURUSD and USDCHF based on price movement up or down in EURCHF. The same holds true of the exit.

Read the first pages of the thread.

BR

Quoting Stcktrdr
OK, I see. So basically I need to calculate my exit point at the time of entry, and have that as "take profit" goal. right?

I have read the thread, but need to read it more times to understand it. I just want to try it "hands on" as I learn. Sinks into my head much better.

I have done some pair trading in stocks, it's different than this approach. Harder to understand this in forex with three pairs...
  • #1,589
  • Edited 2:55pm Sep 10, 2008 8:56am | Edited 2:55pm
another short entry eurchf +0,30% 1,5960

eurusd 1,4124

usdchf 1,1299

I'll take next entry at about +0,60%



edit 20:50 gmt


closed at eurchf 1,5916, 3 pips above 0%

eurusd 1,4032 = +92

usdchf 1,1344 = -45

total: +47 pips


Regards
  • #1,590
  • Sep 10, 2008 9:11am Sep 10, 2008 9:11am
Hi Ashes,

I'm with you.
  • #1,591
  • Sep 10, 2008 9:42am Sep 10, 2008 9:42am
Quoting ashes
12:20 gmt

short at eurchf +0.35% 1,5968

eurusd 1,4103

usdchf 1,1322


edit 13:10 gmt

close at eurchf 0% 1,5913

eurusd close 1,4082 = +21

usdchf close 1,1295 = +27

total : + 48 pips


Regards
way to go ashes
  • #1,592
  • Sep 10, 2008 4:25pm Sep 10, 2008 4:25pm
Hi everyone
I have been following this and hopefully someone can point me to the right post or answer for me.
Lets say I show eur/chf -.25% and I enter a long position on the eur/usd and usd/chf. the next day I show that eur/chf went down again -.25% and I enter another long. Now on the next day it goes up +.25%. Am I supposed to enter a short at that time while I have my long positions open.

Thanks for your help

Ed
  • #1,593
  • Sep 10, 2008 5:09pm Sep 10, 2008 5:09pm
Quoting silenroc
Hi everyone
I have been following this and hopefully someone can point me to the right post or answer for me.
Lets say I show eur/chf -.25% and I enter a long position on the eur/usd and usd/chf. the next day I show that eur/chf went down again -.25% and I enter another long. Now on the next day it goes up +.25%. Am I supposed to enter a short at that time while I have my long positions open.

Thanks for your help

Ed
Hi Ed,

I would take every day as a new setup. So you'd enter accordingly. Like this you also make up for possible losses if a position goes way against you.

Regards
  • #1,594
  • Sep 10, 2008 5:14pm Sep 10, 2008 5:14pm
Ed,

If you think of this trading activity (in your mind or in reality) as having 2 accounts. A long account and a short account it may make it easier to follow.

So while your closing long positions to book profits, yes you can be opening short positions.

Being that at this time I choose only to test trade the long side. I have not put together a spreadsheet that would show how the long account vs short account cancels each other out to minimize trades. Clearly if your long in account "A" and short in account "B" composite cash = "0" change.

BR
  • #1,595
  • Sep 10, 2008 5:33pm Sep 10, 2008 5:33pm
Hello,

I have a problem regarding the trades that could go against us for a long time.
How are we supposed to handle them? I've read one rule saying that after 10 days you close your position no matter winner or loser. But what if the trade has already become a high loser after ten days? Is there an additional rule to handle this problem?

If one would have entered a long position on 7th of august 08 and would have closed it after ten days while an exit hadn't been triggered, one would have lost about -200 pips.
The same position up to today would have drawn down the account for about -600 pips, while no profitable exit seems to be in sight.

I have roughly checked historical data, I was searching for peaks and valleys on eurchf to enter a trade there and check on how many minus pips one would have to stand through before the price made a profitable turn. The largest was about -165 pips in may 08.

During the next days I will do some backtest again. I think there might be a possibility to create a rule concerning the maximum loss one would be willing to take in relation the average of winners.

Please let me know how you think about this problem.

Regards

ashes
  • #1,596
  • Sep 10, 2008 7:19pm Sep 10, 2008 7:19pm
Quoting mackus
Open short at EUR/CHF 1.5955. One thing that I will have to get passed with this system is to ignore what I percieve to be the trend in the EUR/USD to take trades in the opposite direction if thats what the price action is saying to do. Right now going long EUR/USD seems so absolutely rediculous because I think its on its way back to the mid 1.30s. However, Big1Red9 is booking profits on the long side trades that I pass on. Love the system, lots to learn.
Closed my short position for a profit earlier today. Could have closed earlier and then entered short again to pick up another profitable trade in the same day but I can't watch the charts all the time.
  • #1,597
  • Sep 10, 2008 7:42pm Sep 10, 2008 7:42pm
Quoting Big1red9
Ed,

If you think of this trading activity (in your mind or in reality) as having 2 accounts. A long account and a short account it may make it easier to follow.

So while your closing long positions to book profits, yes you can be opening short positions.

Being that at this time I choose only to test trade the long side. I have not put together a spreadsheet that would show how the long account vs short account cancels each other out to minimize trades. Clearly if your long in account "A" and short in account "B" composite cash = "0" change.

BR
I've been unsuccessfully trying to find the rules that Spieler posted 2-3 weeks ago. I don't remember having both long and short open at the same time as being part of the system.
  • #1,598
  • Sep 10, 2008 8:16pm Sep 10, 2008 8:16pm
Ok guys
Thanks for the response. I guess it all comes down to taking the positions when the signals are there, not to overleverage your account, and to cash out on profit.
Warren buffets strategy was to never sell a loss. As long as you sell a profit you will never lose.

good luck to everyone here.

Ed
  • #1,599
  • Sep 10, 2008 9:15pm Sep 10, 2008 9:15pm
If you can't trade both ways then whom is in the right direction? The person closing a long or the one accumulating a short?

BR

Quoting mackus
I've been unsuccessfully trying to find the rules that Spieler posted 2-3 weeks ago. I don't remember having both long and short open at the same time as being part of the system.
  • #1,600
  • Sep 10, 2008 9:23pm Sep 10, 2008 9:23pm
Quoting ashes
Hello,

I have a problem regarding the trades that could go against us for a long time.
How are we supposed to handle them? I've read one rule saying that after 10 days you close your position no matter winner or loser. But what if the trade has already become a high loser after ten days? Is there an additional rule to handle this problem?

If one would have entered a long position on 7th of august 08 and would have closed it after ten days while an exit hadn't been triggered, one would have lost about -200 pips.
The same position up to today would have drawn down the account for about -600 pips, while no profitable exit seems to be in sight.

I have roughly checked historical data, I was searching for peaks and valleys on eurchf to enter a trade there and check on how many minus pips one would have to stand through before the price made a profitable turn. The largest was about -165 pips in may 08.

During the next days I will do some backtest again. I think there might be a possibility to create a rule concerning the maximum loss one would be willing to take in relation the average of winners.

Please let me know how you think about this problem.

Regards

ashes
A while ago I asked the same question and even posted charts to make the point. Once you start building up a position, you should keep your own pace with +-%. Let's say August 7th 0% line was at 1.6330. Your position in following days would be built like this:
Long @-.25% 1.6290
Long @-.50% 1.6250
Long @-.75% 1.6210
Long @-1.0% 1.6170

You'd had 4 lots (average price 1.6230). On August 12th high of the price reached up to 1.6240. 4*10-spread= no loss or tiny profit, but now you are all money and can start building on a short side.
That's how I understood it. Doesn't matter what everybody else is doing at the time, once you started building up a position you should do keeping increase or decrease in % from the 0 line you started from.
then you close the position when you are profitable or at least b/e if it is a long trend against you.
There is also a hint, exiting half of the position at 0 line, but to be frank I don't get it. For me - averaging of a price and exiting with profit from average price looks good enough if I were in trouble.
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