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4H 5EMA System

  • #1,161
  • Nov 16, 2008 3:45pm Nov 16, 2008 3:45pm
Quoting bullrock
The problem with E/J an G/J their behavior is very erratic on lower timeframes. How about the 1D timeframe? I think it should work.
There are so many combinations of pairs and timeframes that I just dont have the time to test them all. I welcome anyone who has an idea to backtest it. Being that this system is completly mechanical you can, if you take your time backtest with 100% accuracy. That being said I will trade my system on any pair in a timeframe where you can take every trade. That being said it clearly needs to take more that 500 pips on average for me to change the direction of this thread from the 4H chart on the G/U.

I see so many people that want to change this system and I guarantee everyone that wants to do that makes no where near 500 pips a month on average. Im not talking about you at all here Bullrock or anyone in particular. Im open to change but if your not making that much a month, why wouldnt you just trade the system as is and keeping looking for a pair or timeframe that will optimize the current system? Im just saying ive givin you guys something great, something you can completely duplicate! Something ANYONE can trade regardless of your knowledge. Take advantage of it!

-Sterling
Founder of Day Trading Forex Live
  • #1,162
  • Nov 16, 2008 3:48pm Nov 16, 2008 3:48pm
Quoting stersuhr
Bullrock nice post and I couldnt agree more about EA's. Even when we have one I will not use it for the most part. Maybe only to test new ideas and such, but even still I feel to be the most accurate this needs to be done live. If people examine why EVERY rules is there they will see that every rule is there because of support/resistance which in affect is market psychology and that will never fail in ANY market. Good post bullrock.

-Sterling
Thank you Sterling.

Price action here price action there. Unfortunately the market behavior chnages. That is a fact. One cannot automate the market because in some inexplicable way the market does change. So sometimes you might want to change/improve the rules. If that would the case, one would invent one system without change and intervention and would make money without doing anything for life. Holy grail. I do not think so. (Even the best ever quant/technical funds do have difficulties these days.)
Someone has backtested this system for 2006 and 2007. I am referring to the excel files. So what is the reason for the phantastic results for 2006 and still excellent but not that phantastic results for 2007. This year, that year. They change. There is a change in the volatility, distribution and style of trends (frequency, elastticity, length, etc). But the fundamentals will be there for the next few thousand years, as long as markets do exist BECAUSE humans are behind markets in one way or another and humans do not change.

Regards
BR
.
  • #1,163
  • Nov 16, 2008 3:48pm Nov 16, 2008 3:48pm
Quoting tcmm
2.) If you get stopped out you then reverse the trade. If you are long and get stopped out you enter short when you get stopped out. So not only do you have your stop in the market but you also have your order to change the direction of the trade should you get stopped out. Only put a trade to go the other direction in the market after a proper reversal bar closes.

[size=4]3.) [color=black][font=Arial]Lets say you...
I don't know if these rules can be made any clearer, I'll also admit I found them hard to understand at first, the real picture of how it works can only come from looking at all the sample charts sterling and others have posted along with these rules to help you visually understand what this and that means as well.
The best thing for you to do is have a go at trading it manually placing orders where you interpret them to be, follow the thread, Sterling or at least someone will pots a chart or trade that we are currently in, if yours is not the same, take a picture and post it here explaining what you did and we can correct you there- That is the easiest way to learn practically and visually, well I found I learn't very quick like that.
  • #1,164
  • Nov 16, 2008 3:53pm Nov 16, 2008 3:53pm
I really can't wait to try the "perfect" EA for this system, so we can backtest all the timeframe, periods, pairs and so on.

how is the developing going? is there some way we can help?
  • #1,165
  • Nov 16, 2008 3:58pm Nov 16, 2008 3:58pm
One more thing.

Being consistent throughout the years. Makes sure that the results are not random. So you are not fooled by randomness. Good systems resist more or less to changes. I like simple systems that have max 3 variables. More simple the better. The system should not be perfect, ie fitted to the market, otherwise the robustness is hurt. I am going to write some code to backtest through markets. I believe this should work through markets and that would prove the robustness and simplicity. When I will have time I will do some 4H but on 5 min data backtest and will see. Hope will be Okay.

The main thing by the way is money management and consistency. The survival is the most important. That is why big capital is the winner because can sustain difficult times. So just do not bet the farm.

Regards
BR
.
  • #1,166
  • Nov 16, 2008 4:11pm Nov 16, 2008 4:11pm
Quoting bullrock
One more thing.

Being consistent throughout the years. Makes sure that the results are not random. So you are not fooled by randomness. Good systems resist more or less to changes. I like simple systems that have max 3 variables. More simple the better. The system should not be perfect, ie fitted to the market, otherwise the robustness is hurt. I am going to write some code to backtest through markets. I believe this should work through markets and that would prove the robustness and simplicity. When I will have time I will do some 4H but on...
I couldnt agree with you more. Trading more than 1 standard lot per $20,000.
Founder of Day Trading Forex Live
  • #1,167
  • Nov 16, 2008 5:31pm Nov 16, 2008 5:31pm
Hi Sterling
What is the stop loss on the current buy trade and also What are the reverse sell order and stop loss on the reverse trade ?
Bhupinder
  • #1,168
  • Nov 16, 2008 8:46pm Nov 16, 2008 8:46pm
Quoting ziko123
gbp was up 1000 pips one point last month and ended +50!,
I'm attaching the performance of gbp,eur,jpy this month

gbp +550
eur -450
jpy -800

The only reason that i reply to your post the way i did is because on one needs to hear that we are in a slump because of last month and we have had a few bad trades. This system provides every one a opportunity to make 500 pips on average. so if you would like to post something that is up building that would be great.
  • #1,169
  • Nov 16, 2008 9:08pm Nov 16, 2008 9:08pm
Quoting ziko123
gbp was up 1000 pips one point last month and ended +50!,
I'm attaching the performance of gbp,eur,jpy this month

gbp +550
eur -450
jpy -800
Ziko, what EA are these tests from? If it is one published already from this forum they do not follow the rules correctly so far anyway, so results cannot be accurate.
  • #1,170
  • Nov 16, 2008 9:11pm Nov 16, 2008 9:11pm
Quoting viperzz
Ziko, what EA are these tests from? If it is one published already from this forum they do not follow the rules correctly so far anyway, so results cannot be accurate.

this is an EA I created, still missing the 50% and friday rules,
you can review the trades in the zip file and you will see they match the rules
  • #1,171
  • Nov 16, 2008 9:20pm Nov 16, 2008 9:20pm
Quoting bhupinder
Hi Sterling
What is the stop loss on the current buy trade and also What are the reverse sell order and stop loss on the reverse trade ?
Bhupinder
The way that i see it the new Buy stop price is 1.4771, stop loss 1.4651. That is what i have in the market now. IF it hits the buy stop order then you would use your stop loss as the sell stop price.
  • #1,172
  • Nov 16, 2008 9:37pm Nov 16, 2008 9:37pm
Thanks for your help Hiranya ,very much appreciated
Bhupinder
  • #1,173
  • Nov 16, 2008 9:39pm Nov 16, 2008 9:39pm
Quoting Hiranya
The way that i see it the new Buy stop price is 1.4771, stop loss 1.4651. That is what i have in the market now. IF it hits the buy stop order then you would use your stop loss as the sell stop price.
I think you forgot about one rule. Rule 1 under the additional rules section states that if you exit a trade on Friday you re-enter the trade with the same stop loss if the trade should still be on. This is the current situation. We were in a buy on friday and exited 5 minutes before close. The market gapped down but not enough to stop us out, so we at open should have re-entered the buy and have are stop loss at 1.4552 We should also have a sell stop order at the same price. Let me know if you dont understand this.

-Sterling
Founder of Day Trading Forex Live
  • #1,174
  • Nov 16, 2008 9:49pm Nov 16, 2008 9:49pm
I understand now .Thankyou Sterling.What would be the stop loss for the sell stop ?
Bhupinder
  • #1,175
  • Nov 16, 2008 9:56pm Nov 16, 2008 9:56pm
Quoting bhupinder
I understand now .Thankyou Sterling.What would be the stop loss for the sell stop ?
Bhupinder
Let talk about the rules as they apply to the current case. We entered a buy so if we get stopped out and it triggers the sell then we enter are stop loss for the sell 5 pips above the highest high while in the buy trade. If we would have been in a sell and the stop got triggered on that thus putting us in a sell we would put the stop on the buy 5 pips below the lowest point it went to when we were in the sell. So the stop loss on the sell if it gets triggered is 1.4964 I hope this makes sense.

-Sterling
Founder of Day Trading Forex Live
  • #1,176
  • Nov 16, 2008 10:06pm Nov 16, 2008 10:06pm
I was debating between 1.4908 and 1.4964 as stop loss for sell.I got it now .Most part i understand the the system but at times i need to confirm. Thanks again Sterling
Bhupinder
  • #1,177
  • Nov 16, 2008 10:11pm Nov 16, 2008 10:11pm
No problem...some rules dont get used very often and therefore need an explination.

-Sterling
Founder of Day Trading Forex Live
  • #1,178
  • Nov 16, 2008 10:31pm Nov 16, 2008 10:31pm
Quoting stersuhr
No problem...some rules dont get used very often and therefore need an explination.

-Sterling
Thanks for the infor. before.
My Email For Help: [email protected]
  • #1,179
  • Nov 16, 2008 10:34pm Nov 16, 2008 10:34pm
Quoting tcmm
Thanks for the infor. before.
Yeah no problem man anytime.

-Sterling
Founder of Day Trading Forex Live
  • #1,180
  • Nov 16, 2008 10:43pm Nov 16, 2008 10:43pm
Quoting stersuhr
Yeah no problem man anytime.

-Sterling
Asian Markets doing good now may help that reversal bar on GBP/USD.
My Email For Help: [email protected]
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