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0400-0700 GMT Breakout Strategy

  • #2,881
  • Apr 9, 2010 1:50am Apr 9, 2010 1:50am
For today I am BE on GRANT's Method!
Also CCI(20) today was in the right side and pointing to the right direction.

Looking forward for the next week!
  • #2,882
  • Edited 9:12am Apr 9, 2010 2:32am | Edited 9:12am
I`m going to change TP to 1.3400 for two reasons:

1. today`s low was 1.5267
2. seems to come out of consolidation

the daily ATR is at least 130 pips and on top of that coming out of consolidation I would be surpriced if price wont reach 1.3400 if price continues to go up.

I dont go to BE as Grant`s backtest showed its better to leave it at the SL spot.

to finish this trade:
price went up to 1.5391; just closed out 15 min ago @ 1.5358
  • #2,883
  • Apr 9, 2010 5:35am Apr 9, 2010 5:35am
Quoting yonnie
9 April Grant in @ 1.5290 SL 1.5275 TP 1.5365

WOW fantasic trade pls keep posting your entrys there really useful just trailing at the moment and this looks like good statergy.
  • #2,884
  • Apr 10, 2010 7:26am Apr 10, 2010 7:26am
Quoting yonnie

I dont go to BE as Grant`s backtest showed its better to leave it at the SL spot.
you really think its more worth to keep sl and not move it to BE.

The fridays case shows that it would go for TP if I wouldn't move to BE, however there is a lot of times where it would take SL if you wouldn't move to BE. Se are those TP>SL.
  • #2,885
  • Apr 10, 2010 9:55am Apr 10, 2010 9:55am
did you have a look at Grant`s back test from January to August last year?

according to that back test if you go to BE after being up +25 pips you would have a profit of 51% over January/August, but if you leave your stop at -15 pips the profit figure would have been 64% over that period.

if you chose the BE way, your profit curve will be smoother, `cos you dont have as many losses, but your profit will be less.

the choice is yours!
  • #2,886
  • Apr 10, 2010 10:10am Apr 10, 2010 10:10am
we know that when London wakes up the GBP/USD got to rise or fall 50, 100 or whatever amount of pips. we only dont know which way, up or down and how it gets there.

with Grant`s method (thank you Grant) we try it once and not even every day, but what happens if we keep trying every day once, twice, maybe three times to get those 50, 100 or whatever amount of pips with a 15 pip stop loss?

has that been tried before somewhere?

I just started with January 2010 and I`m curious where it will lead me.
  • #2,887
  • Apr 10, 2010 10:18am Apr 10, 2010 10:18am
Quoting yonnie
I`m going to change TP to 1.3400 for two reasons:

1. today`s low was 1.5267
2. seems to come out of consolidation

the daily ATR is at least 130 pips and on top of that coming out of consolidation I would be surpriced if price wont reach 1.3400 if price continues to go up.

I dont go to BE as Grant`s backtest showed its better to leave it at the SL spot.

to finish this trade:
price went up to 1.5391; just closed out 15 min ago @ 1.5358
Hi yonnie,

Do you mind show us in a chart that how you read the ATR?

I am confused reading ATR and analyze it.
Thanks
Mike
Failure, is a wonderful teacher!
  • #2,888
  • Apr 10, 2010 10:29am Apr 10, 2010 10:29am
Hi Mike1349

The ATR means average true range. It is an indicator commonly available with most trading platforms. It is the average high-low over a certain number of days ie ATR(20) is the average true range of the instrument over the last 20 trading days

uses: it helps with placing profit targets etc when trading. For example the atr of the eurousd daily is 130 so there is no point shooting for 200pips within the same timeframe. if you do it is likely that the market will retrace on you.

If you have an idea of the usual range of a market you can always use that in your trading anyway you wish ie set stops, set profit targets, fade trades etc

hope this helps
If you think you can or cannot do it you are correct
  • #2,889
  • Apr 10, 2010 10:37am Apr 10, 2010 10:37am
hi Mike,

you`re confused to read ATR, I`m confused to get a chart up

anyway just get a chart up in MT4, click Insert - click Indicators and click on Average True Range. In Parameters type in 20 in Period, click OK and a small window will come up under your chart. Have your chart on the daily.
Then on January 31st touch the coloured line in the ATR window and it will give you a reading 0.0135, which means that on average the daily range for 31 January and 19 trading days before that was 135 pips.

edit: sorry, somebody replied already......
  • #2,890
  • Apr 10, 2010 10:55am Apr 10, 2010 10:55am
Quoting yonnie
I`m going to change TP to 1.3400 for two reasons:

1. today`s low was 1.5267
2. seems to come out of consolidation

the daily ATR is at least 130 pips and on top of that coming out of consolidation I would be surpriced if price wont reach 1.3400 if price continues to go up.

I dont go to BE as Grant`s backtest showed its better to leave it at the SL spot.

to finish this trade:
price went up to 1.5391; just closed out 15 min ago @ 1.5358
Thank you guys.
I put up a chart.

As you said on Daily with 20 input when the ATR says 0.0136 means the average move for this currency in last 20 days been 136 pips(in average).

If I am wrong correct me ,please.

I guess if we go to 4 Hr TF it shows us average of last 20x4=80 Hours.

Thanks Mike
Attached Image (click to enlarge)
Click to Enlarge Name: ATR.jpg Size: 174 KB
Failure, is a wonderful teacher!
  • #2,891
  • Apr 10, 2010 10:58am Apr 10, 2010 10:58am
yep, you got it Mike
  • #2,892
  • Apr 10, 2010 11:23am Apr 10, 2010 11:23am
Quoting yonnie
we know that when London wakes up the GBP/USD got to rise or fall 50, 100 or whatever amount of pips. we only dont know which way, up or down and how it gets there.

with Grant`s method (thank you Grant) we try it once and not even every day, but what happens if we keep trying every day once, twice, maybe three times to get those 50, 100 or whatever amount of pips with a 15 pip stop loss?

has that been tried before somewhere?

I just started with January 2010 and I`m curious where it will lead me.
Yonnie,

i have never tried the multiple attempts, if you do keep us informed....

to add to the ADR comments, i have a weekly (5 days) of 140 and a monthly (30 days) of 163, and i am expecting these to drop a touch as the UK general election gets closer and markets go into consolidating mode until a winner is known. so 75 is still in the middle...

However i have been wrong on countless times before so this may be another one as well.

So i will trade the system mechanically each and every day along as it is valid and keep an eye on the ADRs just in case the 75 pip TP gets too high and adjust accordingly, posting any tweaks made here...

cheers

Grant
  • #2,893
  • Apr 11, 2010 3:28pm Apr 11, 2010 3:28pm
Quoting wltam
Out of town for a few week

modified the EA already

add the Tp2 Tp3 lot size
and ..the lot size control

my idea is
you can buy one extra unit for extra equity (say $400)

if ur equity has $1600, you can buy 4 unit lot

when you enter Lots is 0.1 Lot_TP2 0.2 ....
the lot enter will be 0.1*4 = 0.4 lot for Tp1 and 0.2*4 for TP2, same as TP3

if ur equity has $1325, you can only buy 3 unit lot.....
Hi wltam,

I try this ea but i have a problem. When I open unilot, order does not entered.

My settings;

Lots control = true
unilot = 400
Lots = 0.1
Lots_TP2 = 0.1
Lots_TP3 = 0.1

4 digit broker and equity = 10000

Regards.
  • #2,894
  • Apr 12, 2010 12:55pm Apr 12, 2010 12:55pm
Grant,

I checked how the 85EMA worked for January to go long or short, although I do realise that 1 month is not enough data, but I would like to hear your thoughts how it performed in the past.
I will check the other months of this year as well.

I looked at the EMA signal and where G/U would eventually go that day.

For January there were 14 signals for long/short and 3 days were undecided in price action, for 7 days price went the other way than the EMA suggested and 4 days were spot on.

Any comments Grant or anybody else?
  • #2,895
  • Apr 12, 2010 1:08pm Apr 12, 2010 1:08pm
I trade a similar setup...

11 pm to 1 AM EST... 2 position
SL 15 pips
TP1 - 15
TP2 - 30
Entry set right at 1:15 AM....

I use 85 EMA on 1 hour to determine direction of trade not on 15 min.


TommyCZ
  • #2,896
  • Apr 12, 2010 6:29pm Apr 12, 2010 6:29pm
Tommy, do you only place an order when the 85EMA on the hourly is not in the box?

can you give me a percentage of how reliable your EMA is in predicting where the currency will go for the day?

thanks

btw the direction for the day might not be so important for your system as for Grant`s seeing you only aim for 15-30 pips. even a good retrace from a trend could achieve that.
  • #2,897
  • Apr 12, 2010 9:37pm Apr 12, 2010 9:37pm
hello folks,

I did a manual backtest on January 2010 for Grant`s system and we trade every trading day.
If TP nor SL hit, we close out at the end of the day.
Stop loss is 15+2 for spread, long and short buffers 5, TP @ 75, no BE and maximum of 4 trades per day.

Jan4. +24, 5. +24, 6. +31, 7. -6, 8. +58, 11. +58, 12. +58, 13. +75, 14. -68, 15. +41, 18. -9, 19. +24, 20. -68, 21. +58, 22. +24, 25. +75, 26. +58, 27. +41, 28. +11, 29. -68

The total pip count for January is +441 pips.
  • #2,898
  • Apr 13, 2010 6:51am Apr 13, 2010 6:51am
I did backtesting for march!
Using classical grants method without buffers.
SL 15+2(spread) TP 75 move to BE when hit +25.
Results are
+249 pips
While using CCI (20) to confirm a trade was
+283
But I personally think that march was a way profitable month compared to others.
  • #2,899
  • Apr 13, 2010 9:45am Apr 13, 2010 9:45am
I see things like that :

Guess a position with 2 lot.
I setup a TP 30, when TP 30 is hit, I sell 1 lot of the 2.
At this time I set a trailing stop at breakeven for the remaining lot (it means, when the position will be at +60, trailing stop will be at +30).

Why using these rules ?
Main advantage provided by open market breakout is first an increase of volatility mostly in the same direction (when it's not a false breakout). After this acceleration it's sometime a pullback, sometime a trend continuation.

Well, here we have a TP30 (depends of the currencies) to take profit of the acceleration due to market opening. TP30 is a easy target with a good win rate.
A trailing stop to follow the trend tight is a good way to make money on trend following on the half remaining position.

So, you secure quickly a part of our profits on TP30 and let the rest ride (trend following).


About SL, by reading a part of the thread, I noticed some traders use SL 60 and TP 30. As you can see on graphics, most of the time you don't have to use a huge SL like 60 or 100 or equal to range size. In my opinion it's useless risks.

My proposition :

For instance :
SL = 1/3 of the Range size (90 pips for instance).
It makes my SL at 30 pips for a 90 pips range.

Last think, you noticed more a canal range is big, less the breakout is statically good. Well, the best to do is to adapt my position sizing according to that fact.

Suppose I use my system SL = 1/3 of range size, I choose a fix risk of 1% on each trade, it means if the range is small, SL will be small too and my pip value, big. In contrary, if I have a huge range (more than 100 pips) by the same effects my position size will be small with a poor pip value thanks to the 1/3 range size SL.

Need some backtests to fix some details but before I would like to hnow your opinion about these ideas before.

Forgive my English, I'm learning.
  • #2,900
  • Apr 13, 2010 5:31pm Apr 13, 2010 5:31pm
Quoting Walcott
I see things like that :

Guess a position with 2 lot.
I setup a TP 30, when TP 30 is hit, I sell 1 lot of the 2.
At this time I set a trailing stop at breakeven for the remaining lot (it means, when the position will be at +60, trailing stop will be at +30).

A trailing stop to follow the trend tight is a good way to make money on trend following on the half remaining position.

So, you secure quickly a part of our profits on TP30 and let the rest ride (trend following).


Need some backtests to fix some details but before I would like to...
Thanks Walcott;

I exactly trade the same way.

The only thing I noticed in a big range (which make a poor trade ) we usually get a retrace to 50 or 61.8 Fib retrace.So I usually put a pending order around that are and make a poor trade to a better trade.

I mean smaller Sl and bigger TP.

Regards
Mike
Failure, is a wonderful teacher!
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