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4H Box Breakout

  • #761
  • Edited 3:08pm Jul 3, 2009 2:53pm | Edited 3:08pm
Quoting fewhills
Closed GBPJPY Sell with a -22 pip loss.
This week a total loss of -129 pips (Buy: stop loss 107 and Sell: close loss 22).
Will continue next week with new Ace's entry setup.
Thanks for posting your results. I'll try to do the same every week just so traders have some idea how the system is actually working.

I ended the week at +146 pips. I'm basically following the system to the letter with these "tweaks":

I open 2 positions with EUR/JPY, with a TP of 2.0 on one position and 3.0 on the other.

I also open two positions with GBP/JPY, with a TP of 2.5 on the first position and 4.0 on the second.

The results for the week are attached. (I closed the final position on EUR/JPY early today since it was a trading holiday in the U.S.).
Attached Image (click to enlarge)
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Greetings from Guanajuato, Mexico
  • #762
  • Jul 3, 2009 4:08pm Jul 3, 2009 4:08pm
Hey Randy, long time no see! Glad to see you back here at FF

How is the burro?

I've just started looking into this strategy myself--see you around


Quoting yen44x
Thanks for posting your results. I'll try to do the same every week just so traders have some idea how the system is actually working.

I ended the week at +146 pips. I'm basically following the system to the letter with these "tweaks":

I open 2 positions with EUR/JPY, with a TP of 2.0 on one position and 3.0 on the other.

I also open two positions with GBP/JPY, with a TP of 2.5 on the first position and 4.0 on the second.

The results for the week are attached. (I closed the final position on EUR/JPY early today since it was a trading holiday...
  • #763
  • Jul 3, 2009 4:45pm Jul 3, 2009 4:45pm
Quoting enewbold
I have a live account with ATC (who uses FXCM as their backend), and I had a long talk today with Dave Malinka, the owner. He told me all ATC accounts are already defacto FXCM UK accounts, but that since we go through the ATC MT4 front end, nothing has changed for us. In other words, I can still place S/L and Limit orders with no problems via my MT4 platform. No need to move accounts, switch brokers, etc. Ed in Columbus, OH.
enewbold,

Thanks for your input, but...

If I understand correctly, ATC requirements include:

1) $5,000 minimum account balance
2) minimum lot size = 10,000

Sorry...too rich for my blood. Still looking for a viable alternative...any other ideas for a non-USA broker?
  • #764
  • Jul 3, 2009 5:07pm Jul 3, 2009 5:07pm
Quoting wolfeman
Hey Randy, long time no see! Glad to see you back here at FF

How is the burro?

I've just started looking into this strategy myself--see you around
Good to hear from you, my friend. You're right . . . I took a LOOOONG break from posting.

The burro says to say "hello". Actually, it was "hola", but you get the idea.
Greetings from Guanajuato, Mexico
  • #765
  • Jul 3, 2009 5:50pm Jul 3, 2009 5:50pm
Thanks Ace....
I love this trading system , good RR (Risk-Rewards) ratio and WL (Win-Lose) ratio... the problems only false signal. How do we take this clear? Is there another way to detect false signal ( pairs GJ/EJ ) ?
  • #766
  • Jul 3, 2009 8:43pm Jul 3, 2009 8:43pm
Quoting Ace284

Now, here's something important to realize. You will lose more trades than you will win. The winning success of this system for GBP/JPY is 40%-45%. For me its been 42.5%. I hope thats clear to everyone. That means you lose, 55% - 60% of the time. This is also from the start of this year.
Quoting Ace284
If you have tested the BE approach and the normal approach and find that moving stops to BE is more profitable then its a good idea to use this method.

To the ones using it, is it more profitable? When is it best to place these orders?
Hey Ace-

I wanted to comment on how you said this strategy does not win as much as it loses. My back testing shows otherwise, perhaps because of the BE stops that I have. Anyway, thought I'd share some results based on my parameters below:
--------------------------------------------------------------------

I've back tested this strategy from 2007 up until current (or end of May and forward tested till current) using the Gbp/Jpy and these are the parameters I used:

1- Move stop to BE after price has traveled farther than 100 pips
2-Any bar over 300 pips was ignored (this happened a few times in 07' and 08'.
3- Any trade in profit by larger than 500 pips was trailed. I'm an advocate of letting the trade run but in this case where price was moved generously in your favor, I preferred to trail my stop @ half the distance traveled, so 250 in this case.
4- Add a buffer on both buy and sell orders. This has been talked about more than enough on here; really a personal choice, I use about 20 pips or so.

Here are the results, based on 2.5% risk per trade and entering no more than twice per week (this is if you get stopped out. I don't re-enter again if I'm not stopped). So max loss per week is 5%. Almost ALL trades were left to run on their own until the end of the week. Some were trailed (see # 3 above).

Year 2007 Results (total lost and won are in terms of %):

# of Losing Weeks18
# of Break Even Weeks13
# of Winning Weeks21

Total Lost67.5
Total Won402
Net Total335%

Year 2008 Results

# of Losing Weeks14
# of Break Even Weeks11
# of Winning Weeks26

Total Lost60
Total Won354
Net Total294.00%


Year 2009 Results (through end of last week)

# of Losing Weeks5
# of Break Even Weeks2
# of Winning Weeks17

Total Lost27.5
Total Won148
Net Total120.50%


In 07' and 08', there were over 10 weeks in each year where the trade closed at BE. This might frustrate some, but the results speak for themselves. Perhaps this is why Ace's numbers came up with more losers than winners.

One thing to note and this is quite important: I didn't officially back test 2005 but just by eyeballing the charts week after week, this system probably would have lost you money. The market was range bound for much of the year. Clearly this system thrives on trends, like many others do. So if someone knows of a way to filter out bad trades due to ranging prices, that would be nice to know

Good luck next week, everyone. I'm still waiting for these yen pairs to make a big move (personal bias of course). When it does, this strategy will position us nicely. Thanks again for sharing, Ace!
  • #767
  • Jul 3, 2009 9:45pm Jul 3, 2009 9:45pm
Quoting G550
Hey Ace-

I wanted to comment on how you said this strategy does not win as much as it loses. My back testing shows otherwise, perhaps because of the BE stops that I have. Anyway, thought I'd share some results based on my parameters below:
--------------------------------------------------------------------

I've back tested this strategy from 2007 up until current (or end of May and forward tested till current) using the Gbp/Jpy and these are the parameters I used:

1- Move stop to BE after price has traveled farther than 100 pips
2-Any bar...
This system is highly similiar to a few opening week breakouts (first strike plus springs to mind). Although the entry parameters are different I would say the trade execution price would be similiar. FSP has been used by Joel Rensink along with a few other Volitile Breakouts methods over his past 25 years of trading, that in itself shows the power of getting in early.

In a video he did (it was actually based on a VBO which is traded daily) his results where very similiar to Aces in that the win % was around 42% but the Profit factor was very good (around 1.43 consider that the casinos roulette table has a profit factor of only 1.05 and it generates big money).

It is great to see so many enjoying success with simple methods like this. They are basic to interpret, simple to execute and require very little management if you trade them for the longer term.

Great stuff

Razor
  • #768
  • Jul 3, 2009 11:59pm Jul 3, 2009 11:59pm
You know Yen, I never thought I'd see you around. I figured that burro business of yours was taking off =P
  • #769
  • Jul 4, 2009 1:06am Jul 4, 2009 1:06am
Quoting yen44x
Good to hear from you, my friend. You're right . . . I took a LOOOONG break from posting.

The burro says to say "hello". Actually, it was "hola", but you get the idea.

Well I never

How r Things man?

Still go down to the watering hole?
  • #770
  • Jul 4, 2009 2:35am Jul 4, 2009 2:35am
Quoting G550
. Anyway, thought I'd share some results based on my parameters below:
--------------------------------------------------------------------
Thank-you for posting this, G550.

Wishing all the Americans a great July 4th !
  • #771
  • Edited 9:26am Jul 4, 2009 9:07am | Edited 9:26am
Quoting Ronald Raygun
You know Yen, I never thought I'd see you around. I figured that burro business of yours was taking off =P
Hey RR, congrats on the job! Do I have to call you Mr. RR now?

Yeah, the burro business was going so well I thought I could retire as a trader, but then the recession hit in the U.S. I thought the biz was recession-proof, but here I am trading again.

The burros miss you terribly, but they were still glad to hear about your new job. I attached a photo showing their reaction when I explained that you hit the big-time.

Of course, they insisted on going out and celebrating your success. As you can see, they had a great time at the burro bar. I thought you would want a photo of RR Jr. toasting you. BTW, Bonita keeps asking about you . . . she keeps muttering something about "paternity suit".
Attached Image (click to enlarge)
Click to Enlarge Name: RR Got a Job!!!.jpg Size: 187 KB
Attached Image
Greetings from Guanajuato, Mexico
  • #772
  • Jul 4, 2009 9:19am Jul 4, 2009 9:19am
Quoting Siam
Well I never

How r Things man?

Still go down to the watering hole?
Siam,

How in the world are you? Wow, with you and RR checking in, it's like being in the land of "Oz" again.

Yes, I'm still a regular at the watering hole. But, with a weekly system like this, I have a lot of time on my hands. I was thinking of looking for a new watering hole there in Thailand. Any suggestions?

And, of course, I'd need a place to stay. Any chance me and the 17 burros could bunk with you for a week or two?
Greetings from Guanajuato, Mexico
  • #773
  • Jul 5, 2009 2:24pm Jul 5, 2009 2:24pm
G550,

thank you for all that time you put into the backtesting for us here.

now I must say that it is not important that your winning percentage is higher than Ace`s way, because you move your SL to BE.
It might well be that the price moves back in the box and reverses towards the original direction: while you`re out at BE, Ace makes a profit.

What counts at the end of the day is the amount of pips each system makes............

Instead of a percentage, could you tell me how many pips you made with your system as most people come up with pips after backtesting?

Appreciate your time and I will look into it as well later this week.

thanks
  • #774
  • Jul 5, 2009 6:54pm Jul 5, 2009 6:54pm
I think it doesn't matter if moving to BE is better, or 3x is better than 2x. The most important thing is that you digest the method, and backtest with enough setting so as to find the (hopefully) optimal value you feel comfortable and happy trading with.

I backtested manually on GJ pair with 4hr bar data from 2003 Jan, with different setting such as closing half position at TP1 and leaving another half's SL intact (like that in DIBS), or just plan simple leaving SL intact for the whole position; backtested closing position at TP1.5, 2, 3; backtested buffer with 10 pips, 20pips, etc. With all data in hand, you can find a combination of setting which gives a good profit (your happiness) with reasonable drawdown (your comfort).

It took me a bloody 2 weeks of tedious work scrolling through the chart again and again. But hey, it's my life time business. I think it's fair enough to spend just a couple of weeks to find my own setting which may benefit me for years.
  • #775
  • Jul 5, 2009 7:14pm Jul 5, 2009 7:14pm
Luks like the range is too small to trade for now.

Has anyone read the latest NFA rules on placing of orders and the FIFO rules ?

Wont be long before all MT4 US brokers will have to close.
  • #776
  • Jul 5, 2009 7:18pm Jul 5, 2009 7:18pm
Quoting dannywmk
I think it doesn't matter if moving to BE is better, or 3x is better than 2x. The most important thing is that you digest the method, and backtest with enough setting so as to find the (hopefully) optimal value you feel comfortable and happy trading with.

I backtested manually on GJ pair with 4hr bar data from 2003 Jan, with different setting such as closing half position at TP1 and leaving another half's SL intact (like that in DIBS), or just plan simple leaving SL intact for the whole position; backtested closing position at TP1.5, 2, 3; backtested...
As mentioned, there are different ways to trade it, there are combinations that work out better with different setups. The Profit Factor for any method will change with these combinations and provided the profit factor is greater than 1.00 then the system over time will yield positive results.

The longer a method is tested the stronger the profit factor becomes, even if the value is less than a short term one simply because it has stood the test of time. Therefore looking back on this thread there was a test of the EUR/JPY which showed a Profit factor range based on setups that ranged with a peak of 1.6 (fantastic). This wasnt tested over 25 years so there could be bias to say that the past 6 odd years was a strong trend, but it still wasnt effected by the massive drop, if anything it would have been helped because the entry at the start of the week would have held in most weeks for tremendous gains, plus you could have held a piece from 1 week to the next and yield super gains when the market crashed.

Breakout methods over time have proven to be solid. The are simple, in most cases can work ok when the range consilidates (dependant on opening risk and you ability to at least secure a BE trade at weeks end).

Razor
  • #777
  • Jul 5, 2009 7:20pm Jul 5, 2009 7:20pm
Quoting Tranell
Luks like the range is too small to trade for now.

Has anyone read the latest NFA rules on placing of orders and the FIFO rules ?

Wont be long before all MT4 US brokers will have to close.
Oh life is beautiful here in Australia. The grass is green, the skies are blue and we can still use the same setups as before, but the NFA looks to screw you (USA). My opening rhyme for the week
  • #778
  • Jul 5, 2009 7:29pm Jul 5, 2009 7:29pm
Quoting yonnie
G550,

thank you for all that time you put into the backtesting for us here.

now I must say that it is not important that your winning percentage is higher than Ace`s way, because you move your SL to BE.
It might well be that the price moves back in the box and reverses towards the original direction: while you`re out at BE, Ace makes a profit.

What counts at the end of the day is the amount of pips each system makes............

Instead of a percentage, could you tell me how many pips you made with your system as most people come up with...
If you account grows over time then the system is profitable. Pips mean nothing more than a measure to take profit or losses on. In the end you could have negative pips and still be profitable because your risk was greater on your winning trades then on your loosing trades, this would involve some silly money management but it is still possible. R/R is just a measure of taking profit at X reward comparable to X risk.

% of win/losers means little if your system has a PF factor of relavant size. A high win/loss system usually has a bad PF, usually less than 1.00 because the system requires lower R/R and in cases higher Risk compared to lower Reward. If at the end of the week your account has grown by more than .1% then that week was successful in terms of profitable trading. It is the only factor the ultimatly matters IMO.

Take care

Razor
  • #779
  • Jul 5, 2009 8:16pm Jul 5, 2009 8:16pm
Just wanted to say thanks to a lot of people for the great feedback. I see some great conversations going on about this system. As well as people sharing their long term testing.

The week is underway, and the candle finished about 15 mins ago. Here's what im looking at right now.
Attached Image (click to enlarge)
Click to Enlarge Name: setup.gif Size: 49 KB
  • #780
  • Jul 6, 2009 12:33am Jul 6, 2009 12:33am
Pair: GBPJPY
Broker for determining price etc: demo account IBFX
Time Frame to determine price: H1. Bars: 4 x H1
Time range between 23:00 GMT Sunday Bar Open and 02:00 GMT Monday Bar Close.
Highest Price: 156.430
Lowest Price: 154.868
Buffer: 21 pips
Break Out High: 156.43 + 21 + 9 spread = 156.73
Break Out Low: 154.87 - 21 = 154.66
Diff without spread: 198 pips
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