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The alternative method (50 pip candles)

  • #21
  • Dec 8, 2009 8:03am Dec 8, 2009 8:03am
Quoting Dan S
Quite interesting approach.

But you are assuming that you are at the screen always, no?
What are you doing when you are not sitting at the screen and one of your 50 pip candles closed?
I place the next order in advance.
Now i'm short with 2 lots. I've placed a buy order at 1.6250 (that means i will win my actual trade) with 1 lot. And i've placed a buy order at 1.6350 (that means i will loss my actual trade) with 4 lots.

But you can play the game when you want.
  • #22
  • Dec 8, 2009 8:09am Dec 8, 2009 8:09am
Quoting Chris_B
Mmmm now i'm starting to understand better the system...it surely has his logic....have you backtested also before august 2009? And only with GBPUSD?
No i didn't backtest before. Yes only GBP/USD.
It's a brand new system !

Thank you to all of you who want to help and backtest 1 month of one pair. It is lots of work and time, it will be better if we can share the job !
  • #23
  • Dec 8, 2009 8:10am Dec 8, 2009 8:10am
Ah yes, that makes sense.
  • #24
  • Dec 8, 2009 8:10am Dec 8, 2009 8:10am
Quoting zebulon
No i didn't backtest before. Yes only GBP/USD.
It's a brand new system !

Thank you to all of you who want to help and backtest 1 month of one pair. It is lots of work and time, it will be better if we can share the job !
Or create an EA to backtest it !!
  • #25
  • Dec 8, 2009 8:13am Dec 8, 2009 8:13am
So if I get this correctly, in the event that you loose you double up, and if you loose again you double up again but only to 4 lots. It is a shortened martingale if I am on your wavelength and by doing so you just make winning a harder target. By that I mean you may loose 3 or 4 trades in a row which cumulatively you would have lost 1 lot, then 2 then 4 and then back to 1 which equals 8 lots, then you win and you get 1 lot back. In the end you may have more pips but your stacking of lots on losses can render your account negative, a valid argument to the pip wars.

Eg, with the above scenario would require you to then win 9 trades at 1 lot to come out in front. The 9 trades would equal 450 pips while the 4 losses would equal 200. On paper the 200 pips looks great however you are marginally in front over the course of 13 trades at an ave of just 15 pips per trade with very little account growth. That may be acceptable to some but the system is at best 50/50 based on your alternate trade setup.

If I am completely off the mark here then feel free to correct me, I am just basing this post on what I have read. In all honestly you would be better to build up on the winners and in the event that you get 4 trades in your favour you stack up on the other side, your reward is greater than your risk and it would stand up on a 50/50 system.

Razor
  • #26
  • Dec 8, 2009 8:37am Dec 8, 2009 8:37am
Quoting Razor_trader
So if I get this correctly, in the event that you loose you double up, and if you loose again you double up again but only to 4 lots. It is a shortened martingale if I am on your wavelength and by doing so you just make winning a harder target. By that I mean you may loose 3 or 4 trades in a row which cumulatively you would have lost 1 lot, then 2 then 4 and then back to 1 which equals 8 lots, then you win and you get 1 lot back. In the end you may have more pips but your stacking of lots on losses can render your account negative, a valid argument...
Interesting, but the system is based on the fact that 3 or 4 consecutive losses are rare and compensated by the other winning trades.
The market is trending or ranging

+++++++ trend
--------- trend
+-+-+-+- range
+-+-+-+- orders

I've tested a system with more lots after 3 trades in my favor, the results were not so good.

More backtests will tell us the truth...
  • #27
  • Dec 8, 2009 8:41am Dec 8, 2009 8:41am
Zebulon...do you use any indy to plot the 50pips candles on the chart?
Market is like a puzzle, YOU have to fit the pieces!!
  • #28
  • Dec 8, 2009 8:48am Dec 8, 2009 8:48am
Quoting zebulon
Interesting, but the system is based on the fact that 3 or 4 consecutive losses are rare and compensated by the other winning trades.
The market is trending or ranging

+++++++ trend
--------- trend
+-+-+-+- range
+-+-+-+- orders

I've tested a system with more lots after 3 trades in my favor, the results were not so good.

More backtests will tell us the truth...
But if the system is 50/50 then the rarity of losses is equal to the rarity of winners. Your doubling up would therefore be better on the winning side.

Razor
  • #29
  • Dec 8, 2009 8:59am Dec 8, 2009 8:59am
Quoting Razor_trader
But if the system is 50/50 then the rarity of losses is equal to the rarity of winners. Your doubling up would therefore be better on the winning side.

Razor
Not sure of this...

When you win you are supposed to lose the next trade on a 50/50 basis..

for example:

trade 1: i win +50
trade 2: i double and i win +100 (total +150)
trade 3: i double and i lose -200 (total -50)
trade 4: i start again and i win +50 (total 0)
trade 5: i double and i lose -100 (total -100)

as you can see it won't work...

instead doubling on the lose and supposing the same sequence:

trade 1: i win +50
trade 2: i i win +50 (total +100)
trade 3: i lose -50 (total +50)
trade 4: i double and i win +100 (total +150)
trade 5: i lose -50 (total +100)

doubling on the losing side is better...
Market is like a puzzle, YOU have to fit the pieces!!
  • #30
  • Dec 8, 2009 10:58am Dec 8, 2009 10:58am
Zebulon,
Vous avez abandonez lautre (50-pip candle?).

I like your systems anyway. But when do you start to trade
a series. Say for example you wake up in the morning and the
market is going +_+_+_+_, if you trade _+_+_+_+ you loose right?
This wil give you more than 4 losses in a row.

Your Martingal series only goes 4 rounds. I have a nice modified Martingale series that can go 14 rounds, if you are interested.
  • #31
  • Dec 8, 2009 11:54am Dec 8, 2009 11:54am
Zebulon,

If your series for December was

+ - - - - + - - - + + + - - + + - + + + - + + + - - + +, then you trade

+ - + - + - + - + - + - + - + - + - + - + - + - + - + -
~~ ~ ~ ~ ~~ ~ ~ ~~

This will give you 10wins. That is $500 for December.

Is that correct? you still will not loose more than 3 in a row. That is not bad!
  • #32
  • Dec 8, 2009 11:55am Dec 8, 2009 11:55am
hi maxwell,

one thing I do like about this system... it is easy to know where or when you are in a ranging market... i.e +_+_ though the losses... I am sure this can be handled - you don't have to always be in the market, whats the point of being in the market when it is ranging, if it is ranging, then why not buy when you see a _ and sell when you see a +.

We should be able to back test this to see when we are in a ranging market, i.e if we have got an X amount of bars that card doing +_+_ (based on some historical data) we should be in a ranging market, any other time we should be a trending market - this will reduce out losses.

The more and more I am thinking about trading, I am not looking at a chart telling me where to enter, but looking at numbers and these numbers telling me what the market is doing and only care about these numbers.

Regards,
Vip

Quoting maxwell-eqtn
Zebulon,
Vous avez abandonez lautre (50-pip candle?).

I like your systems anyway. But when do you start to trade
a series. Say for example you wake up in the morning and the
market is going +_+_+_+_, if you trade _+_+_+_+ you loose right?
This wil give you more than 4 losses in a row.

Your Martingal series only goes 4 rounds. I have a nice modified Martingale series that can go 14 rounds, if you are interested.
  • #33
  • Dec 8, 2009 2:01pm Dec 8, 2009 2:01pm
Quoting Chris_B
Zebulon...do you use any indy to plot the 50pips candles on the chart?
Personnally i don't, but you can try this :

http://www.forexfactory.com/showpost...&postcount=207
  • #34
  • Dec 8, 2009 2:07pm Dec 8, 2009 2:07pm
Quoting maxwell-eqtn
Zebulon,
Vous avez abandonez lautre (50-pip candle?).

I like your systems anyway. But when do you start to trade
a series. Say for example you wake up in the morning and the
market is going +_+_+_+_, if you trade _+_+_+_+ you loose right?
This wil give you more than 4 losses in a row.

Your Martingal series only goes 4 rounds. I have a nice modified Martingale series that can go 14 rounds, if you are interested.
Hi ,
non je n'abandonne pas l'autre ! mais je n'ai pas beaucoup de temps ...

I start at the beginning of the month and determine the first order (+ or -). But of course i can't trade all night, so when i wake up i draw the night's candle and start the strategy.

if the market is going
+-+-+-+-
and the orders are
-+- the next orders will be ------
  • #35
  • Dec 8, 2009 2:33pm Dec 8, 2009 2:33pm
Quoting maxwell-eqtn
Zebulon,

If your series for December was

+ - - - - + - - - + + + - - + + - + + + - + + + - - + +, then you trade

+ - + - + - + - + - + - + - + - + - + - + - + - + - + -
~~ ~ ~ ~ ~~ ~ ~ ~~

This will give you 10wins. That is $500 for December.

Is that correct? you still will not loose more than 3 in a row. That is not bad!
No, that is not correct,

that is 50+50-50+100-50-100-200+50-50-100+200-50-100+200+50-50-100-200+50-50-100+200+50-50= -250 pips

But according to the rules, the trade should be

+ - - - - + - - - + + + - - + + - + + + - + + + - - + +,
+ - + - + -+ + - + - + - + - + - + + - + - - + - + - +

result = 50+50-50+100-50-100-200-50+100+50-50+100+50-50-100+200+50+50+50-50-100-200-50+100+50-50-100+200= 0 PIPS
  • #36
  • Dec 8, 2009 2:39pm Dec 8, 2009 2:39pm
Quoting guess121
whats the point of being in the market when it is ranging, if it is ranging, then why not buy when you see a _ and sell when you see a +.

I've tried this, not so good
  • #37
  • Dec 8, 2009 2:57pm Dec 8, 2009 2:57pm
Zebulon

Perhaps you try following system:
When you win you decrease your lot size (if it is minimum then keep it). But when you lose increase it by 1.

Let see example:

Bet 1 lot - Win +1
Bet 1 lot - Lose -1
Bet 2 lot - Lose -2
Bet 3 lot - Lose -3
Bet 4 lot - Win +4 (now we only -1)
Bet 3 lot - win +3

another one (the best scenario)

Bet 1 lot - Lose -1
Bet 2 lot - Win +2
Bet 1 lot - Lose -1
Bet 2 lot - Win +2

I tested out it on yours 50 Candle System. It gave me +1500 in November.

If somebody can make EA to back test for longer ...
  • #38
  • Dec 8, 2009 3:11pm Dec 8, 2009 3:11pm
Ok... then if we are in a ranging market, then we do not trade or we trade we a lower SL and TP, or you lower the brick size to 25 pips to see what the market is doing.

I do not think this is difficult to over come.

Quoting zebulon
I've tried this, not so good
  • #39
  • Dec 8, 2009 5:36pm Dec 8, 2009 5:36pm
Not a programmer but should be simple EA. Pick start price and go from there
  • #40
  • Edited 7:20pm Dec 8, 2009 7:06pm | Edited 7:20pm
My first trade with this system gave me a win...from 1.63000 to 1.62500 (+50)

now I'm long...according to the rules...from 1.62500...

I don't know if I would like to let an EA to trade my money...but we really need an EA for this type of trading...at least for backtesting...time to sleep here...I will try to put some limit order to trade the different scenarios during the night...but an EA would do it better..
Market is like a puzzle, YOU have to fit the pieces!!
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