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Attachments: Simple 5 / 8 moving average crossover
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Simple 5 / 8 moving average crossover

  • #821
  • Jun 25, 2009 5:07pm Jun 25, 2009 5:07pm
Quoting chamane
I was curious to see how this strategy is profitable on the 4 hr TF in the long run. I manually backtested AUDJPY, AUDUSD, CADJPY, CHFJPY, EURCHF, EURGBP, EURJPY, EURUSD, GBPJPY, GBPUSD, NZDJPY, NZDUSD, USDCHF, USDCAD and USDJPY. Overall, I came up with over 15000 pips since January following the rules in my previous post. The win/loss ratio is around 78%. The pairs with JPY gave the best results and EURCHF (62%) - NZDUSD (67%) the least profitable results. Of course I couldn't have taken them all otherwise I would have gone over 2% of my investement...
Wow, that's a lot of work!
The 78% success rate is quite appealing. Whcih are the highest currencies, I may ask?
Also, Although I am not a programmer, this seems like a very easy strategy to program into an EA, as my only problem with the method would be getting sleep!
Anyone know of an EA that could implemnet this?
Michael
  • #822
  • Jun 25, 2009 6:08pm Jun 25, 2009 6:08pm
Quoting alllivemind
Wow, that's a lot of work!
The 78% success rate is quite appealing. Whcih are the highest currencies, I may ask?
Also, Although I am not a programmer, this seems like a very easy strategy to program into an EA, as my only problem with the method would be getting sleep!
Anyone know of an EA that could implemnet this?
Michael
You can have a look at my results in the attached file. I would add that when price was 1/2 TP level, I brought SL to Breakeven + 10 pips. When price reached 3/4 TP level, I brought SL to Breakeven + 1/2 TP. I didn't consider the trades stopped out at BE + 10 pips in my results. There could be some other way to manage money. This is just a start for me to evaluate the system.

Chamane
Attached File(s)
File Type: pdf Backtest.pdf   38 KB | 1,362 downloads
  • #823
  • Jun 25, 2009 8:47pm Jun 25, 2009 8:47pm
have you tried with 5_Ema_Close and 8_SMA_Open??

i'm trying with SMA and using the narrowing of the 2 mas instead of the cross as enter signal.

It seems to work well. I will attach later the indicator I'm using to notice the narrowing
  • #824
  • Jun 26, 2009 5:43am Jun 26, 2009 5:43am
Quoting Corre
have you tried with 5_Ema_Close and 8_SMA_Open??

i'm trying with SMA and using the narrowing of the 2 mas instead of the cross as enter signal.

It seems to work well. I will attach later the indicator I'm using to notice the narrowing
For now, I am only using the cross of ema's but I could use the dark color of histograms (see pic) wich represents the narrowing of the lines as you mention. Those histograms use only close ema's and I am looking for one where you can change the settings for open. When I get a signal from the histograms, I check the ema lines to make sure it's a close/open signal.

I also backtested the daily/weekly charts combo from January and here are the results:

AUDJPY: 3 wins 0 loss +900 pips (SL/TP=300 pips)
AUDUSD: 3 wins 1 loss +450 pips (SL/TP=300 pips
CADJPY: 4 wins 0 loss +1200 pips (SL/TP=300 pips)
CHFJPY: 5 wins 1 loss +1050 pips (SL/TP=300 pips)
EURCHF: 2 wins 0 loss +450 pips (SL/TP=300 pips)
EURGBP: 4 wins 1 loss +450 pips (SL/TP=150 pips)
EURJPY: 4 wins 0 loss +1200 pips (SL/TP=300 pips)
EURUSD: 4 wins 0 loss +1050 pips (SL/TP=300 pips)
GBPJPY: 4 wins 0 loss +1750 pips (SL/TP=500 pips)
GBPUSD: 3 wins 2 losses +200 pips (SL/TP=400pips)
NZDJPY: 3 wins 1 loss +600 pips (SL/TP=300 pips)
NZDUSD: 4 wins 0 loss +800 pips (SL/TP=200 pips)
USDCHF: 1 win 1 loss 0 pips (SL/TP=300 pips)
USDCAD: 3 wins 2 losses +250 pips (SL/TP=250 pips)
USDJPY: 2 wins 2 losses 0 pips (SL/TP=200 pips)
Total: +10350 pips

Slightly less profitable than the 4hr/daily charts combo, but more practical for those who like to sleep...

chamane

http://i41.tinypic.com/vhxhk9.gif
  • #825
  • Jun 26, 2009 3:36pm Jun 26, 2009 3:36pm
This week's results. I took six trades on 4hr charts:

EURUSD: +100 +50
GBPUSD: +100 +30 (still running)
USDCHF: +50
NZDUSD: -6 (still running)

Chamane
  • #826
  • Jun 27, 2009 1:37am Jun 27, 2009 1:37am
i modifie macd to have the slow line open i hope its what you want i dont have the macd with color change like your if you send i can modifie
i work since long time now on this cross and its one of the best you can find on 4h see my thread on WPS http://www.forexfactory.com/images/icons/icon10.gif
Attached File(s)
File Type: mq4 MACD_colormodified5CX8O.mq4   3 KB | 1,051 downloads
  • #827
  • Jun 27, 2009 7:37am Jun 27, 2009 7:37am
Quoting free84
i modifie macd to have the slow line open i hope its what you want i dont have the macd with color change like your if you send i can modifie
i work since long time now on this cross and its one of the best you can find on 4h see my thread on WPS http://www.forexfactory.com/images/icons/icon10.gif
Thanks a lot! Your indicator seems to be working fine. It signals the ema cross one candle ahead of mine as it should. I enclosed two MACD indicators you can work on for the colors. I personally use the first one that doesn't need the signal line. I am actually looking at shorter timeframes for the strategy. It could be more appropriate for smaller equities.

BTW, what is WPS?

Chamane
Attached File(s)
File Type: mq4 MACD_4CZ_mtf.mq4   5 KB | 802 downloads
File Type: ex4 MACD_4CZ_mtf.ex4   5 KB | 676 downloads
File Type: ex4 MACD_OsMA_4ColorH_2LVar_mtf.ex4   8 KB | 749 downloads
File Type: mq4 MACD_OsMA_4ColorH_2LVar_mtf.mq4   7 KB | 830 downloads
  • #828
  • Jun 27, 2009 8:14am Jun 27, 2009 8:14am
here the modified macd i try in little time frame the best for me seems 2H
Attached File(s)
File Type: mq4 MACD_4CZ_modified mtf.mq4   5 KB | 891 downloads
  • #829
  • Jun 27, 2009 8:35am Jun 27, 2009 8:35am
Quoting free84
here the modified macd i try in little time frame the best for me seems 2H
Merci mille fois! It looks quite sensible to changes in the narrowing of the cross. I found your thread. Very interesting. Thanks again.

Chamane

http://i40.tinypic.com/23syq79.gif
  • #830
  • Jun 27, 2009 4:34pm Jun 27, 2009 4:34pm
Hi,

maybe this helps to see the rsi<>45/55 more clearly.
Attached File(s)
File Type: mq4 Pj-over RSI.mq4   3 KB | 912 downloads
File Type: ex4 Pj-over RSI.ex4   4 KB | 748 downloads
  • #831
  • Jun 27, 2009 4:51pm Jun 27, 2009 4:51pm
Quoting MCFly
Hi,

maybe this helps to see the rsi<>45/55 more clearly.
Yes, sometimes you can't tell if RSI is over/under the line or not. That will surely help.
Thanks!

Chamane
  • #832
  • Jun 29, 2009 8:41am Jun 29, 2009 8:41am
From last week's trades, I had NZDUSD and GBPUSD srill running. They both reached 50% of TP this morning (Monday) so I brought the SL to BE + 10 pips. Now they are over 30 pips and I'm sure it's going to be all winners for last week.

I just took another trade on EURUSD 4hr (see pic). What I find the most reliable is to wait first for the 5/8 emas to cross on the higher timeframe (second histogram). Only then look at the 5/8 emas cross in the same direction on the current timeframe (first histogram). Take the trade if RSI(13) is over55/under45 (last two indicators). I plotted a 10 sma (shifted 2 - HLCC/4) wich shows the same effect as a 5/8 emas cross (see WPS thread).

For the exits, I am still looking for the best solution. For now, I stick to:
SL = 2 X ATR
TP = 2 X ATR
When price reaches 50% TP, bring SL to breakeven + 10 pips.

The win to reward ratio doesn't look that good, but from what I observed, the win/loss ratio is interesting. One solution I like is to trade two 0.5 lots. Once TP reached, close one lot and bring SL of the other one to 50% TP. Then trail stop the price with the three bars technique, i.e. bringing the SL at the lowest/highest of the last three bars in order to catch the big move.

Any idea welcome.

Chamane

http://i43.tinypic.com/2nq8p3n.gif
  • #833
  • Jun 30, 2009 8:27am Jun 30, 2009 8:27am
Here are my frist two trades for the week. For EURUSD, I decided to secure my pips this morning and got stopped out at 50% TP, but it appeared to be the right decision.

Vertical lines show all conditions fullfilled for a long entry (first MACD (25close,40open,1)>0, then MACD (5close,8open,1)>0 and RSI(14)>55 for long). Horizontal lines show entry, SL and TP levels. So starting off this week with +150 pips.

http://i41.tinypic.com/28qyoax.gif
  • #834
  • Jun 30, 2009 8:43am Jun 30, 2009 8:43am
Quoting chamane
From last week's trades, I had NZDUSD and GBPUSD srill running. They both reached 50% of TP this morning (Monday) so I brought the SL to BE + 10 pips. Now they are over 30 pips and I'm sure it's going to be all winners for last week.

I just took another trade on EURUSD 4hr (see pic). What I find the most reliable is to wait first for the 5/8 emas to cross on the higher timeframe (second histogram). Only then look at the 5/8 emas cross in the same direction on the current timeframe (first histogram). Take the trade if RSI(13) is over55/under45 (last...
Hi,

nice to see that someone optimize his exit strategy. How did your tests on shorter timeframes ended?
  • #835
  • Jun 30, 2009 9:00am Jun 30, 2009 9:00am
Quoting MCFly
Hi,

nice to see that someone optimize his exit strategy. How did your tests on shorter timeframes ended?
I backtested 30min and 1hr charts for June and got unsteady results. Some pairs showed even negative results overall. But I used the narrowing of the EMA cross (changes of color of MACD (25,40,1)) instead of the cross itself (MACD above/below 0) because I wanted to know if it would give more interesting trading opportunities. Now I'm convinced that it doesn't. Visually, I'm quite sure that shorter TF's like 30min are still interesting if using only the cross of the EMA's and forget the narrowing. I am demoing it right now. 4 hr charts seems to give steady winning results so far.

Chamane
  • #836
  • Jul 5, 2009 4:19pm Jul 5, 2009 4:19pm
I've been working on a set of rules that would allow me to trade a set and forget type of system. I chose the daily charts because it only needs les than an hour of work per day. Here are the rules:

Indicators:
- 3 EMA close
- 5 EMA open
- 30 EMA close
- 50 EMA open
- RSI(3)
- Starc Bands for stop loss (ATR=13; MA=1; KATR=1; Shift=0)
- Starc Bands for take profit (ATR=13; MA=1; KATR=1.5; Shift=0)

Entry long:
- 3 EMA crosses 5EMA upwards (closed candle)
- At the time of the cross RSI(3) is greater than 55. If not wait for next cross
- 30 EMA has to be higher than 50 EMA

Entry short:
- 3 EMA crosses 5EMA downwards (closed candle)
- At the time of the cross RSI(3) is less than 45. If not wait for next cross
- 30 EMA has to be lower than 50 EMA

Stop loss - take profit:
- Stop loss is given by the first Starc Band (1.0 X ATR(13)) and take profit by the second (1.5 X ATR(13)).

I started with the 5/8 EMA cross, but tried 3/5 and found it more sensitive and it gave good results on daily charts (see backtest results). Actually, this is simply a 3/5 EMA cross signal validated on a higher timeframe and with the RSI indicator. Money management is simple and gives a 1.5:1 return. The backtest doesn't take the spread into account, there were around 140 signals for all the pairs evaluated. June was a bad month for the system, I wonder if this was noted for another trading system.

Comments welcome.

Regards.

Chamane

http://i43.tinypic.com/t80l6r.gif
http://i43.tinypic.com/oksps6.gif
  • #837
  • Jul 6, 2009 7:07am Jul 6, 2009 7:07am
Quoting chamane
I've been working on a set of rules that would allow me to trade a set and forget type of system. I chose the daily charts because it only needs les than an hour of work per day. Here are the rules:

Indicators:
- 3 EMA close
- 5 EMA open
- 30 EMA close
- 50 EMA open
- RSI(3)
- Starc Bands for stop loss (ATR=13; MA=1; KATR=1; Shift=0)
- Starc Bands for take profit (ATR=13; MA=1; KATR=1.5; Shift=0)

Entry long:
- 3 EMA crosses 5EMA upwards (closed candle)
- At the time of the cross RSI(3) is greater than 55. If not wait for next cross
- 30 EMA has...
Hi,

Looks good and I think I will test it beside my main thv system. maybe I'll choose the 15 min tf.

An alarm for the cross would be a nice idea.
  • #838
  • Jul 6, 2009 10:34pm Jul 6, 2009 10:34pm
Quoting MCFly
Hi,

Looks good and I think I will test it beside my main thv system. maybe I'll choose the 15 min tf.

An alarm for the cross would be a nice idea.
I am curious to see the results of your tests. I would guess that you would have to change the settings somewhat because of the whipsaws of shorter timeframes. Maybe getting back to 5/8 ema? I don't know. Anyway, I enclosed my template and indicators so you can use what fits your needs. There is already an alarm (arrows and sound) for the ema cross.

Chamane
Attached File(s)
File Type: zip 3-5 ema crossing.zip   33 KB | 1,706 downloads
  • #839
  • Jul 16, 2009 11:44am Jul 16, 2009 11:44am
I have been successfully trading using a system involving a 5/8 EMA cross for nearly a year now.
I manually look for divergence on a higher time frame MACD and/or STOCH and use the 5/8 cross as my trigger.

Out of curiosity I downloaded the alert from post #203 and it is actually giving me good signals.

if you check it out you will find it gives you a large number of alerts but only a few arrows indicating a proper setup.

The audible alerts are nice but there are far more audible than the visual arrows.
The arrows are what i am finding to be more accurate.

I know absolutely nothing about programming so I am not sure what all is written into the script but many of the signals are coinciding with my own manual signals.......hmmmmmm..

Any Ideas.

Is this a similar technique to what you all are using???

i've read thoroughly through the previous posts and i'm not really following the technique so well.
SANTHOSHAM
  • #840
  • Aug 18, 2009 7:06pm Aug 18, 2009 7:06pm
Wow.. Looks like alot of people have been doing real good with this system. I have been out of it for awhile now. I am going to get back into this system again I might be alittle rusty..lol...
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