fugly's mech system 100 pips a day

I tried my best just wanted to share what I've found thats all

Billbss the 3 exit strategies are my ideas thats why i posted here I'd like you guys input as to formulate the best exit strategy as I said earlier

I used the 3 exit strategy .... but it may not be the most profitable.

All I've found is if you have a down close or a downward movement and there is a likely hood of an upward candle and if it is upward and crosses one of the said levels its likely it will go through to the next level which is 24 pips profit. I don't know why but it does !

If you try it on timeframes lower than 1 hr then its not that effective coz the candles dont average 25 pips you'll have to look at some other levles probally in multiples of 10 or something ..... I don't know. 1hr seems great plenty of opportunities and good average height of the candle.

Try it and improve it thats what we all want.

Fugly, Buddy

You don't realize you've actuually stumbled onto something. You just don't know what it is yet.

I'm laughing with you, (I promise not at you) because I thought this was something really cool too when I first encountered it

In a nutshell, it can be a very helpful directional indicator to assess the short term trend in the next hour or two.
In other words, I wouldn't trade against it without a strongly compelling reason (ex: the D1 is up, up, up and 1HR is red).

As for a system in itself, The Rumpled One shows some of this in his thread a while back and the idea makes sense
but must be coupled with some common sense as well. The market breaks thru support after support
and suddenly a green candle appears. I don't wanna buy that. You get what I'm saying.

Thank you for bringing this up. It really does have value. How it's used can make it more valueable.
Do not be discouraged. This could help you make money or lessen losses under the right conditions.
You'll have to decide if it's something worth pursuing.

Pipo

How do i draw this chart, shall i total up for dec 5 and tell you?

Thanks for your kind words lets all try and develop the idea, I think the idea is profitable.

Thats what the forum is for

hi Fugly, hi all,

Whats' this??

I am not a forex trader, I trade futures on indices. (reason why i am at FF is because I use metatrader).

I just looked at my favorite future, put SweetSpotGold on it, with sublevels on a distance which suits good to my first thoughts. It was on M1

I found for yesterday following results:
29 profittable trades and 14 loss trades

Promissing......

thanks for sharing Fugly! Doesn't look ugly

same test method on december 4th:

57 trades, 20 Losses and 37 Winners

This has nothing to do with intellect, technical analyses and everything I have learned.

You see, Fugly

Everybody sees something different when they look at a picture.
There's someone who took it another direction and sees potential $$.

It's what you do with it that makes it profitable.

Anyway, back to the price action. Market will either bounce @ the levels (25, 50...) or it will break.
Even on a break, it often retests the break, especially if there's a small gap in price (a pip or 2) when it broke.
In case it bounces instead, the market is just saying there were more buyers than sellers at that price and
a temporary imbalance presented itself. It sometimes presses the number again and then breaks because
the buyers are gone and the bears (sellers) exert more pressure. Yen pairs get this kind of treatment often
at round numbers and technical levels (doesn't necessarily have to be a 50 or a 100).

Don't think the brokers aren't aware of this little tendency and since they're the one's taking the other side of
these trades much of the time, the price action on any retail platform will reflect this bouncing and breaking
in such a way that you can just about tell in hindsight where those stop orders were.

Now, the trick is to not get stuck at say xx.25 or even xx.28 with a spread/slip when during the next 10 min xx.00 will print.
What happens there is when the mkt was at 20/22 everybody who saw a green candle at 25 went, "..hmmm, green candle. I'll buy some here.."
Now, if there was no fundamental news to move the market, volume was light, mkt was thin and nothing really different was afoot,
the brokers on the other side took that volume and are now effectively short at xx.25 or xx.28.
Next thing you see is price breaking xx.20, ppl bailing out, getting scared, more shorts pile on and the price tests the figure @xx.00
Then the green candle buyers go," ooops, that's my stop, the line under the last 25. I'm out.." and they sell. The brokers buy.
They cover the shorts from 28 at the figure or below and have picked up a quick 25-30 pips in just a few minutes.
Don't get caught up with that old trick.

In the other case where the price is broken, 25 begets 30, then 35 then 40, then 43 and so on, same conditions but no fade,
unless there's news to propel the price up, up and away you'll see these shops taking all the volume, same way
laying off some of it to get just the spread, averaging some of it at the higher price and then a retrace of say
10 pips brings the entire position collectively into profit for 3 or 4 pips and they push it off to the bank, usually several millions notional value.
They still make money.

Meanwhile, the xx.25 buyers are taking the few pips profit selling into the 30's and 40's and who are the buyers this time ?
Same as last time. Now that the price is waking up and breaking out to the upside, the shops take that volume too.
Price breaks 50 - 60 and so on, they've been accumulating since 30's and so no problem. More money. Yea !

Anyway, point is: Don't let using this kind of strategy become a profit center for the market makers. It's your money they're taking.
If you trade retail, it's one of the things to watch out for. Little games like this.
On an ECN, you're still playing the game, but instead your playing against real market volume, experienced scalpers who know this stuff already,
and the unforseen things that pop in and out when least expected.

Can't trade this way on a EA. The stops are sitting ducks. Manual entries and exits improve the odds of not getting popped,
but the risk is that a sudden move will blow waaay past where you intended to exit if the trade went sour.
If you use a "get-me-the-hell-out" stop far enough away, then you've entered the territory of negative expectancy
due to the fact that average win(s) won't over come those bigger losses. SO that's no good either.

The person who takes the time to code all this stuff into an EA and then either sees, "wow! I'm getting blown.......away, that is"
or "...too much risk, not enough reward.." may have missed the gist of the underlying premise of the method itself:
Trends, even 1 hour trends, tend to persist, especially when in concert with the larger Time Frame (4HR, Daily, Weekly).
Even when it's counter-trend to the daily, the 1HR trend is still real and valid and can be exploited.

The method being discussed provides and serves as a useful tool to do so. It's potency lies in the hands of the operator.

The way I look at it:
it has nothing to do with round numbers.
it's about distance between horizontal lines in combination with cycles.
Not sure about that, but it's the way I look at it.

so if I am right: that means the distance between the lines should be chosen carefully. The more volatile the bigger the distance.

just a chart

this one shows loss and profittable trades

Last wednesday. 42 trades. 16 losses.
thanks fugly
have a nice weekend all of you!

this is like one of the TheRumpled One's system Never lose again in other forum..(or maybe it is)..

Where does he hang out, now?
He's been banned from the forums I know about

just sent you a message..
it is funny though..how he get banned from those forums..he has shared many great systems.

It appears your test took trades in both direction, the instruction on thread 1 says only take trade in the direction opposite the direction of the prior hour candle.

I don't think so.
I did it this way:

If a bar is red, go long if the next bar is goes from under to above the round number line

for long vice versa

Hi Fugly,

Thanks for sharing this system. I studied your chart of nov.26, but I could find only 56 pips on the chart. I also backtested some weeks in oct. and nov with Trading Simulator. What I found is that the system is probably profitable, but not as much as 100 pips per day. The reason is the spread.

The system gave 40-80 net pips per day, but it required 10-12 trades per day. Considering that one winnig trade costs 3 pips (1 pip+spread) and one losing trade costs 5 pips (3 pips on entry and 2 on stoploss), it is cca 40 pips cost per day. So the realistic net profit is somewhere between 0 and 40 pips per day.

It can still be good, if it is consistent, after all it is not the pips that matter but the value in the pips. Perhaps I try to write a porgram that can extnsively backtest this system on large amount of data.

What seems sure: the system generates significantly more winnings than losings. Pitty the magic numbers are so close to each other, a larger distance could help keep most of the profit and not giving it to the broker.

Ok guys, I wrote the program and backtested this system for the past year (I had no more data). I used the 5M data, because there are not many 5M bars longer than 50 pips.

The result: if there were no spread, the system would produce a break even during one year. With spread, of course, the overal result is a loss.

Test period: 225 days
Winner: 1277 trades
Loser: 1247 trades
Uncertain: 44 trades (because the 5M bar is longer than 50 pips, so hits both TP and SL)

With spread, the average loss is 30 pips per day.

The number of winners and losers are almost the same, so the signals of the system are not better than random guessing. In fact, I am beginning to think that there isn't any system that can perform better than random guessing on forex on long term.

Let's all hand it Arilou for actually writing/running the code to get the "official" canned results.
I guess it had to be done by someone just so the curiousity could be satisfied. Thanks Arilou.
I hadn't run any numbers and I was curious myself what the actual stats would come out looking like.
Of course, not a big surprise. I believe this goes further to the point that the method, in and of itself, is not a system.
For reasons I tried to detail earlier, there is a way that this rationale can be put to an advantage to make pips.
It's just that scientifically placing the conditions into an EA and running them on auto pilot is not the solution.
Although that's disheartening for some to hear, it's actually a positive step toward uncovering and discovering
what it is about the method that can be procured into some level of profitability.

Please allow me to be frank, short and sweet: This is not an automated strategy.
It requires some degree of discretion that eludes a preprogramed execution script.
I don't want to discourage anyone from thinking outside the box. To the contrary, I hope others will find something
that myself and others have missed along the way and be wiling to share.

The 40-80 average daily pip count actually sounds about right. The catch is: you'll be taking it 5 pips at a time, 10 to 15 times a day.

I hope that's food for thought.