My graph does not look so pretty at the end of this week...
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- #1,203
- Oct 10, 2008 7:56am Oct 10, 2008 7:56am
- Joined Sep 2007 | Status: simmer down now | 1,251 Posts
Bob and pip-chasing colleagues,
In reference to the current challenge of how to trade this crazy volatile market you might experiment with the following strategy which has produced good, though short term, success. Though this global market crisis is tragic for many retirement funds etc., it is a unique opportunity to stress test optimal settings in a trading strategy. If we find a system and settings that does well in catastrophic market market moves unique in 20-90 years, we can coast into our golden years stress free.
Bob had mentioned in the past that one difference between his 100+40 expert and the 50+40 was that the first usually carried a positive balance during the day while it closed TP trades. In contrast the 50+40 carried a negative balance while it regularly closed trades reaching 50 pip TP.
The brillance in Bobs strategy as we've all noted is the regular closing/opening of the expert in order to keep it working with the trend. This is not so critical for profits in ranging markets but very critical during strong trends like we see this week. Taking this concept an extra step is just to close open trades and re-open several times in the day. Others have noted this.
The 50+40 expert spends most of its time in negative balance moving >$0 only a few times during the day. On a demo account with 50+40 D1.8 expert, I added a global close expert to a new non-trading chart which will close all account trades when a total profit is reached. I set this profit to +$1. With the 50+40 expert this has produced a very smooth profit curve during this last week as it restarts several times during the trade day and makes sure trades stay on the long side of the MA. Meantime it keeps closing small TP trades which is where the steady profit comes from rather than closing all trades when the total account is in profit. So the addition of the +$1 close automates the strategy of multiple mid-day restarts of new trade positions.
I haven't tested but I think this profit setting could produce the same result with the 60+45 expert but not with the 100+40 expert.
In the attached chart you see a before and after. The initial ragged drops in equity are manual closings when the regular expert settings had the trades staying on the wrong side of the market with deep equity draw downs. Where the smooth upward line begins, is where I added the global shutdown at +$1. You can choose which part of the equity curve you prefer (!)
The Account Analyzer is an indicator which when attached provides projected Rate of annual return which can be inspirational.
Again this only represents short term, 1 week results. Please demo test this before you run it on a live real money account. Bob's suggestion to stand aside during this current chaos is wise advice. If these settings for trading do survive the chaos it could be helpful as we don't know how many weeks (months?) this type of volatility will continue.
LeoM
Thanks for the EA and indicator. I am testing it now. It works as you describe.
You need a fairly large balance in the account under these conditions, as you can imagine. I set it up with $3000 in the demo and because of these huge swings in the market it would have been margin called in a live account -- and eventually you would blow out your account.
I will let it run today and post the results after the markets close later. Then I will open another demo account with $10000 Monday to see if that gives it enough room to move. So far it is doing very well.
It could prove a very profitable addition to the 50x50.
The 50x50 just keeps grinding out the profits for you if you can withstand the huge drawdowns that can happen in minutes.
Maybe Bob could recommend a minimum account balance to use with this EA to be sure not to blow out.
You should check this EA out, Bob. This may be exactly what we need to make some big money with the 50x50 without blowing out the account.
Also, Bob the 100x40 is still weathering the storm very well in the last few days. It had some times where the drawdown was around $2500 for awhile but it recovered.
I think I may know why some people are having eratic results with the EA. On my MT4 platform in the last few days I have had many times when it had a connection status "No connection." That is happening a lot with at least three different brokers on the platforms I have running all the time, MIG, IBFX, and FXDD. These bucket shops use every trick in the book to screw you out of your profits. I'm sure these convenient "disconnects" happen at just the right time to benefit them, not you.
PD
- #1,210
- Oct 10, 2008 11:38am Oct 10, 2008 11:38am
Correct. Also of note, I ran some back testing on the 100/40 and my bastard for this entire year, and the 100/40 beats the bastard by 20%. The goal of the bastard is to provide many more options than the 100/40 in terms of indicators and buy or sell from those indicators. It still does very well, but not as good as Bob's 100/40 for the year.
In fact, I can only smile, because if any of you actually read the code of the 100/40, you can see where nanningbob and whoever else may have helped write it, ALREADY DID the same things I am doing. The code for multiple indicators and more options is IN the 100/40, it's just commented out. I can only assume that bob 'took it out' after his almost full year of testing. I'm keeping the bastard, but only because I want to test opening 2 trades in opposite directions to see how that works out for me
Again, Bob did an amazing job with this thing. Read the code and you will see for yourself. (and yes developers, I know he left vestige functions in the code which is not as 'clean' as some would like, but it shows the evolution he went through to get where it is today and I like it!)
In fact, I can only smile, because if any of you actually read the code of the 100/40, you can see where nanningbob and whoever else may have helped write it, ALREADY DID the same things I am doing. The code for multiple indicators and more options is IN the 100/40, it's just commented out. I can only assume that bob 'took it out' after his almost full year of testing. I'm keeping the bastard, but only because I want to test opening 2 trades in opposite directions to see how that works out for me
Again, Bob did an amazing job with this thing. Read the code and you will see for yourself. (and yes developers, I know he left vestige functions in the code which is not as 'clean' as some would like, but it shows the evolution he went through to get where it is today and I like it!)
Pistol, I'm doing almost the same thing. As I mentioned earlier, I have tweaked the EA a bit. I'm currently running 8 pairs with the 100/40 and the same 8 pairs with a bastard version of the 100/40 based on my indicator (from another thread). About 50% of the time, the bastard version opens a trade in the opposite direction as the 100/40.
As the market ranges, they BOTH make money. When a death trade is starting, I close the 'bad' trade and let the other one keep going. If monitored closely, this is a win-win.
I ran a quick test using the idea by LeoM and it looks like that has good potential the way he describes, and not using it the way I was thinking about trying, so I think I will play with some different numbers on that and see what it does. Maybe increasing the profit target to $2 or $3. That should take a few days to see what works best.
Keep us informed on how your method is working for you too.
Have a great weekend and let's see what next week brings.
- #1,219
- Oct 10, 2008 10:16pm Oct 10, 2008 10:16pm
- Joined Jun 2007 | Status: Teach men to fish | 7,384 Posts
- #1,220
- Oct 10, 2008 10:31pm Oct 10, 2008 10:31pm
- Joined Jun 2007 | Status: Teach men to fish | 7,384 Posts