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7am-9am Big Dog USD Breakout Strategy

  • #2,461
  • Mar 23, 2010 12:29am Mar 23, 2010 12:29am
Quoting boophaty
Nice trade today for +49
Good trade. I opened with .2 lots, closed .1 for +27 on the eur/usd, left the other .1 at little better than BE. We'll see what happens.

Monday
+27
Week
+27
Month
+445
  • #2,462
  • Mar 23, 2010 12:42am Mar 23, 2010 12:42am
Quoting tavaresneto
hey thanks for that. I am not actually switching systems, i'll try to use both i think. this strategy seems pretty solid and i see a lot of potential. which pair do you think it works best with?
im only doing cable at the moment, i thought i'd focus on one pair and try to trade it really well. so, do you trade only one pair or trade quite a few? also, have you been trading this system alone?
i've done forex before but unsuccessfully, have been doing alright in equities but wanted to try again with forex. My target is 50 pips/day but im trying to...
I'm not sure what other pairs work. I have only been trading the eur/usd. I havn't skipped around because I want to learn how PA on this one pair behaves. I'm sure the cable would work quite well, probably better as it is a little more volatile. I have thought about gbp/jpy but, hey, I've been doing okay with the euro.

This is the only system I use for my trades. 50 pips/day might be a little aggressive for the TF you are using. At least it is for the eur/usd pair. I find that with this system, you do need to babysit your trades for BEST results. I have also found that PA usually retraces before 50 pips are hit, but again, that goes with the pair I trade.

Keep us all informed on your results if so inclined to do so.

Good luck
  • #2,463
  • Mar 23, 2010 6:11am Mar 23, 2010 6:11am
Hi everyone. I'm quite new to forex but have spent a lot of time looking into differant treding systems. The one I've been looking at is trading the UK opening time 8AM and trading the brake out from this point. I've back tested this for about 6 months. I intend on trading the break of the earlier bar and make a round 20 pips. in the back test I've not had many lossing days. Out of 97 days I've seen about 4 lossing days, if I've back tested correctly. I would be graetful for any input from people who understand forex better or trade this way.

Good Trading

Gary A
  • #2,464
  • Mar 23, 2010 7:27am Mar 23, 2010 7:27am
Hi,

What do you guys do regarding news releases? Do you trade if you know there is an immenent release due? Backtesting with this strategy is profitable even though news releases are totally ignored, but is it smart to stay on the sidelines during news? I know from experience a contingency plan for news is a must, and usually I'll just downsize positions during news. Any help from experienced traders will be apreciated.
Thank you j16!
  • #2,465
  • Mar 23, 2010 12:39pm Mar 23, 2010 12:39pm
Quoting anderou
Hi,

What do you guys do regarding news releases? Do you trade if you know there is an immenent release due? Backtesting with this strategy is profitable even though news releases are totally ignored, but is it smart to stay on the sidelines during news? I know from experience a contingency plan for news is a must, and usually I'll just downsize positions during news. Any help from experienced traders will be apreciated.
I trade this system regardless of news. The way I see it, price is either going to go up, or its going to go down. Why not be ready for it either way?

With that said, money management is very important. You need to have stops in place, and not risking more than you are comfortable losing. For me, this is the standard 1-2% of my equity at any one time. If price does go against you, as it could in any breakout, then you have not lost too much because you were protected.

Most of the time, for this time period, the news has already been released anyway. I figure if it is volatile news and PA skyrockets in any one direction (against the overall trend) . . . this just means there is a chance to capture something from the retrace.

Hope my two cents worth helps
  • #2,466
  • Mar 23, 2010 1:30pm Mar 23, 2010 1:30pm
Quoting Gary A
Hi everyone. I'm quite new to forex but have spent a lot of time looking into differant treding systems. The one I've been looking at is trading the UK opening time 8AM and trading the brake out from this point. I've back tested this for about 6 months. I intend on trading the break of the earlier bar and make a round 20 pips. in the back test I've not had many lossing days. Out of 97 days I've seen about 4 lossing days, if I've back tested correctly. I would be graetful for any input from people who understand forex better or trade this way.

Good...
If its not broke, don't fix it. It looks like to have close to a 97% winning streak on your backtest. I don't know how you could do better, unless you discover a way to see the future! 20 pips a day would be great in anyones's book. I try for the same, but will definitely settle for less if I think the market is going to turn on me. Any profit is good profit.

Try forward testing it and let us know how you are doing.
  • #2,467
  • Mar 23, 2010 1:54pm Mar 23, 2010 1:54pm
Hi Gary A,

Could you please explain more about this statement "trading the UK opening time 8AM and trading the brake out from this point"?

Which pair and time frame do you use? the period of time you used to back test?

Thank you,
Regards,
Keith
  • #2,468
  • Mar 23, 2010 3:39pm Mar 23, 2010 3:39pm
Hey Everyone,

Just wanted to say Thanks to everyone for some really good posts. Definately learning a lot from everything on here! I've actually only just started using MetaTrader and my programming is rubbish so most of my back testing is manual.

I've been paper trading this method since the begining of the month with a simple TP of 15 and SL of 15. I wait for the box to form completely and enter on either the break of the high or the low. According to my results there have been 14 winning trades and 3 losses. That's a win rate of 82%. Is anyone doing anything similar to this and getting roughly the same results? Or am I doing something completely random and getting inaccurate results?

Also what do you think about the last bar? I know SLC said in an earlier post he sometimes enters positions befire the box has fully formed? I pretty much had to do this today because unfortunately had limited access to my account, I have no problems with this and it always nice to grab those extra few pips. Do most people count the 9th bar in the box (on a 15 min time frame) or just use the first 8?

Again thank you to everyone who's contributed!

Geoff
  • #2,469
  • Mar 23, 2010 4:39pm Mar 23, 2010 4:39pm
Hi Everyone

Thanks for your replies. Keith what I've been doing is trading 8AM UK time and taking the brake at the high or low of the 7-8AM bar on the GBPUSD on the 1 hour time frame. I've been following the market for about 2-3 hours and you do loss in one of the hours but get back in the other hours of trading. I've been forward testing this for about 1 month and the results are just as good. If you look at the charts this week with I think is 3 AM NY time the trades have given good results. If at the 8AM bar does not make new high or low you then use the 8-9AM bar as your new high low brake. Hope this help.

Gary A
  • #2,470
  • Mar 23, 2010 5:06pm Mar 23, 2010 5:06pm
Well, since i'm recuperating and the dodgy tickers decided to keep going for a while, i thought i'd try and make myself useful,and revisit the thread.
Scott, wheres spike? Has he dissapeared, counting up his pips?
Anyway, this week i've used Slc settings, 8-10.
So far: monday +27
tues +10 ( it broke to the upside, but i didn't fancy it)
I do like the breakout, but can it be harnessed?
Slc has some stellar results, lets see if we can't iron out any problems, but to be up over 400 pips, deserves a round of applause!!

Cheers

P.s. I'm here to be used and abused, any questions or backtests you need doing, direct at me for the next week or so.
  • #2,471
  • Mar 23, 2010 7:38pm Mar 23, 2010 7:38pm
Today's trades: sell gbp/usd @ 1.5035.. got stopped out @ b/e... BUY gbp/usd @ 1.5039.. closed for +25. Total for the week is +74.. The first trade was the start of the UK session 12-2am breakout... wish you all many pips!
  • #2,472
  • Mar 23, 2010 8:54pm Mar 23, 2010 8:54pm
Quoting slc12312
Just go online, or if you have an ipod or smart phone with a world clock, Look up what time it is in New York in relation to where you are. It is as easy as that. Trade 7am-9am EST......
Yah but I mean which time is the correct one! Do you use 14-16 by London or you use 7-9am by new york!
This interval cannot be true because in any case there will be 5 h difference, and it doesn't depend which one you use edt, gmt or other...

So is everyone using 14-16 by london?
Or 7-9 am by new york? (Because than it is 12-14 in london)???

Im really curious about these time zone thing!!!
  • #2,473
  • Mar 23, 2010 9:13pm Mar 23, 2010 9:13pm
Quoting Phant0m
Yah but I mean which time is the correct one! Do you use 14-16 by London or you use 7-9am by new york!
This interval cannot be true because in any case there will be 5 h difference, and it doesn't depend which one you use edt, gmt or other...

So is everyone using 14-16 by london?
Or 7-9 am by new york? (Because than it is 12-14 in london)???

Im really curious about these time zone thing!!!


The correct time to trade is 7-9am New York time... I personally like to also trade the London 12-2am.. for a quick 20-50 pips... find what works for you and make it your own also knowing PA helps with this strategy
  • #2,474
  • Mar 23, 2010 10:19pm Mar 23, 2010 10:19pm
Quoting Phant0m
Yah but I mean which time is the correct one! Do you use 14-16 by London or you use 7-9am by new york!
This interval cannot be true because in any case there will be 5 h difference, and it doesn't depend which one you use edt, gmt or other...

So is everyone using 14-16 by london?
Or 7-9 am by new york? (Because than it is 12-14 in london)???

Im really curious about these time zone thing!!!
This time zone stuff is enough to drive a guy crazy. I had a hard time with it when I first started this system for the same reasons, then it dawned on me to quit obsessing over it and to just do as the thread says. Just trade 7-9am EST and don't worry about it. Once I got over that, I could finally concentrate on trading.
I do believe most use 7-9 TF, or one to their liking. I use 8-10 am EST because it fits my scedule, no other reason.

Best in luck in regard to figuring it out. We have already had daylight saving time. Don't know how that factors into the equation.

Good luck!!
  • #2,475
  • Edited Mar 24, 2010 10:47am Mar 23, 2010 10:38pm | Edited Mar 24, 2010 10:47am
Quoting pianosax12
Well, since i'm recuperating and the dodgy tickers decided to keep going for a while, i thought i'd try and make myself useful,and revisit the thread.
Scott, wheres spike? Has he dissapeared, counting up his pips?
Anyway, this week i've used Slc settings, 8-10.
So far: monday...
Pianosax, welcome back my friend! I havnt heard from SirSpike in a while, I think you are right . . . He is busy counting!

Good luck with the 8-10 TF, it has worked for me. But the I think almost any TF would work, depending on the pair. You are right, today (still Tuesday for me) was a sketchy day. I was up about 40 pips (entered early), couldn't monitor the trade. The last time I looked, I was at -32, 8 pips shy of being stopped. That's why I feel you have to or should try to monitor the trade once entered. You were wise as usual to take some profit once you had some doubt, any profit is good profit. I'd rather have 10 pips than no pips or negative pips!

Good luck Wednesday
  • #2,476
  • Mar 24, 2010 1:21am Mar 24, 2010 1:21am
Quoting IceyGeoff
Hey Everyone,

I've actually only just started using MetaTrader and my programming is rubbish so most of my back testing is manual.

I've been paper trading this method since the begining of the month with a simple TP of 15 and SL of 15. I wait for the box to form completely and enter on either the break of the high or the low. According to my results there have been 14 winning trades and 3 losses. That's a win rate of 82%. Is anyone doing anything similar to this and getting roughly the same results? Or am I doing something completely random...
Hey Geoff
There is another trader by the name of forex_fan who is trading the same way as you. That is a 15 pip profit target with a 15 pip stop loss. He as doing quite well with it. The last I heard, he was up around 225 pips for March. He was also trading multiple pairs with some winners and some losers as it goes. I have been tempted to try that for simplicity sake, but have yet to do it.

I havn't heard to much on the thread about whether or not to trade on the 8th candle or wait for the full box to form. The way I do it is to do a quick multi timeframe analysis (about 15 minutes before the box completely forms) to try and determine the trend strength, or if there is a trend at all. Then I look at the box. If PA is somewhere in the middle, I enter a buy and sell stop on both ends, figuring if PA is in the middle . . . the box is pretty much formed. If I see the PA trending in a particular direction, then I'll enter right away, and still put a pending order on the other side in case I get stopped. Once orders are in, I leave for work. Once at work, I check the charts (this is about an hour later) and start to monitor any positions that are open, looking for the ususal retrace, with my finger on the close trade button. Sometimes I close half and let the other half run, sometimes not. it all depends on my "gut" feeling of the trend and time of day.

So using today for an example. I entered long early, before the box was completely formed with .1 lot and a 55 pip S/L (2% of my account). Unfortunately, I had a meeting and didn't get back in time to check the open position. It went to +40 then reversed and ultimately got stopped out. This is why I say to monitor your trades!! Since I put a sell on the other end, it ended up being triggered and right now it is +63. If I close, I'll be up only 13 pips for the day.
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  • #2,477
  • Mar 24, 2010 2:04am Mar 24, 2010 2:04am
I've just realised why my win rate percentage is so high. I've not been taking into account a 15 SL when doing my backtesting and instead using the whole height of the box! Even though the figures do show a high win rate the risk/reward is a bit higher than i'd feel comfortable with! Will go over my results hopefully tonight and post the change that they make!
  • #2,478
  • Edited 10:54am Mar 24, 2010 10:34am | Edited 10:54am
Quoting IceyGeoff
I've just realised why my win rate percentage is so high. I've not been taking into account a 15 SL when doing my backtesting and instead using the whole height of the box! Even though the figures do show a high win rate the risk/reward is a bit higher than i'd feel comfortable with! Will go over my results hopefully tonight and post the change that they make!
Geoff,
Well, the correct method is that your SL should be at the whole box height. If you were to use that, I wouldn't use a 15 TP . . . because as you say the R/R is not that good. My experience with this system is that it WILL trigger an order (obviously price will either go up, or it will go down), and that the key will be your ability to determine trend as accurately as you can . . . and to be able to monitor your trade once entered with some sort of money management in place (1-3% per session). Even with the 15 pip TP and whole box SL that you have been using seems to have worked for you.

Good luck to you!

Monday +27
Tuesday +91.8 (closed after overnight run)
Wednesday -18 (short) at time of writing, still open

Week +118
March +563
  • #2,479
  • Mar 24, 2010 11:27am Mar 24, 2010 11:27am
Hi guys, for some of you cheking this system out here is and example of how it can go, either for you or against you. Would have gone bad on the long and potentially the short too! If one were to get stopped both ways it would represent about an -80 pip loss for the day. This is why I suggest doing your best while trying to determine trend and not neccessarily blindly placing buy and sell orders. You can be selctive.

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  • #2,480
  • Mar 24, 2010 12:28pm Mar 24, 2010 12:28pm
Yes SCL saw that today. On the Euro/USD pair this method would have lost you a bunch of pips as it triggered an open position and hit the SL of both the pending buy and the sell. So how do we void days like this? This is a big loss for those that are using 15 pips take profit or even 10 pips thats like over a weeks worth of profit gone in one trade.
Former Trader Of the Year of the 95% losing club! Retired
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