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Random entries discussion...

  • #1
  • First Post: Aug 5, 2010 6:59am Aug 5, 2010 6:59am
I'm meddling a little more in backtesting and I've just found out that random entries and fixed exits often produces better results than entries based on classic indicators (mov averages, cci, stoch, rsi, boll, etc). That's quite startling. And meanwhile I am pretty sure that most of us spent most of our time looking for the best entry points.
  • #2
  • Aug 5, 2010 7:28am Aug 5, 2010 7:28am
  •  Ideasmiths
  • | Joined Mar 2009 | Status: 一将功成万骨骷 Forex war! Win pips or die! | 30 Posts
Quoting Intensity
I'm meddling a little more in backtesting and I've just found out that random entries and fixed exits often produces better results than entries based on classic indicators (mov averages, cci, stoch, rsi, boll, etc). That's quite startling. And meanwhile I am pretty sure that most of us spent most of our time looking for the best entry points.
Good results, which pair did you backtest on?

Did you put stop loss and how wide when you do the test? Is it in a single direction or you just randomly choose to long or short? And the most important question is, what profit target did you set per entry? or did you take profit randomly as well.

Thanks
  • #3
  • Aug 5, 2010 7:33am Aug 5, 2010 7:33am
AUD-CHF forms continuation pattern "H&S".
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  • #4
  • Aug 5, 2010 7:36am Aug 5, 2010 7:36am
Quoting Intensity
I'm meddling a little more in backtesting and I've just found out that random entries and fixed exits often produces better results than entries based on classic indicators (mov averages, cci, stoch, rsi, boll, etc). That's quite startling. And meanwhile I am pretty sure that most of us spent most of our time looking for the best entry points.
Hi Intensity,

You can try,i think on other forum one guy work that every day and post results every day...He work 50 SL 100 TP and i think he is positive per month,not much pips but positive...

But dont work that becouse knowloage is most important thing on Forex.Forex is like a school,to be a good student you must learn and learn.I earn every month about 1200-2500 pips with strict Money Menagement 1-(max 2 %) from balance or 5 % from all trades...
Bad thing about traders is when they have micro balance 300,500,1000 $ they dont have patinace to work with MM becouse they want to be reach for 7 days...

Just learn and practice and practice,also for every Job you need 2,3 years to undestand materia and that is normal.


Cheers


Petar
"Buy on fear, sell on greed !!!
  • #5
  • Aug 5, 2010 7:41am Aug 5, 2010 7:41am
Check out ronald Raygun's coin toss challenge
  • #6
  • Aug 5, 2010 7:47am Aug 5, 2010 7:47am
Sorry for the lengthy post. Couldn't resist - I was reading this old favorite of mine, and I think there's plenty wisdom in it. From Joe Ross.

My own many
years of trading experience indicate to me that the various elements
of a trade are made up of the following categories and approximate
percentages:
Signal Identification 10%
Trade Management 20%
Risk Management 10%
Money Management 10%
Personal Management 50%

I wish to admit here and now that there is nothing scientific in the way
that I have assessed and allocated these activities and percentages.
Others may have equally good guesses or have performed a more
precise study of how much time a successful trader should spend
with each of the listed activities. My own trading history tells me the
above are at least close to being correct.
What puzzles me most, is how few traders actually recognize that
trading involves the activities I have listed. In light of the percentages
given above, my question is, “Why do traders spend ninety percent or
more of their time with entry signals?” Why do they continue to chase
a phantom, the so called “holy grail” of trading? My contention is, that
the holy grail of trading, if it were found, would be nothing more than
entry signal recognition or an entry identification technique. How do I
know that? Because of the many thousands of traders with whom I
have come in contact, I have never encountered one who was
looking for a holy grail of management. I have never met a trader
who was exclusively seeking the perfect way to manage self with the
object of becoming a winning trader.
I have never encountered a trader who stated, “I am looking for a
wondrous way to handle trade management so I can be a winning
trader.” Nor have I encountered one who, in order to succeed,
sought to be a prodigious manager of risk or miraculous manager
of money. What I have encountered are hundreds of traders, who
through countless hours of backtesting and simulation, seek only to
find perfect trading conditions, entry signals, or identification methods
that guarantee that every trade, or even most trades will turn out to
be winners. What I have also encountered are dozens of books, and
seminars that enforce the search for a guaranteed perfect way to gain
market entry. In addition, through the media of literature and
presentation, those who produce them feed upon the quest for the
perfect entry technique.
The quest is invariably that of ‘entry.’ What is the magic way to enter
a trade? What is the perfect entry signal and how do I recognize it?
What combination of events will render a guaranteed profit and how
do I distinguish them from all others.
If I am correct in my assessment of the amount of time a trader
should devote to the various elements of trading, and if it is true that
most traders spend ninety percent of their time performing ten
percent of the job of trading, is it any wonder that the number of
losing traders approaches, and by some estimates exceeds ninety
percent?


Quoting Intensity
I'm meddling a little more in backtesting and I've just found out that random entries and fixed exits often produces better results than entries based on classic indicators (mov averages, cci, stoch, rsi, boll, etc). That's quite startling. And meanwhile I am pretty sure that most of us spent most of our time looking for the best entry points.
forget about tomorrow, just steal away into the night
  • #7
  • Aug 5, 2010 8:02am Aug 5, 2010 8:02am
Quoting Intensity
I'm meddling a little more in backtesting and I've just found out that random entries and fixed exits often produces better results than entries based on classic indicators (mov averages, cci, stoch, rsi, boll, etc). That's quite startling. And meanwhile I am pretty sure that most of us spent most of our time looking for the best entry points.
Possible errors that you've made:
- you backtested during a trending period
- you didn't consider the spread
- the program has a bug

Quoting fugly
Check out ronald Raygun's coin toss challenge
oh dear....
  • #8
  • Last Post: Aug 11, 2010 12:59pm Aug 11, 2010 12:59pm
Quoting spekitox
Sorry for the lengthy post. Couldn't resist - I was reading this old favorite of mine, and I think there's plenty wisdom in it. From Joe Ross.

[size=1]My own many
years of trading experience indicate to me that the various elements
of a trade are made up of the following categories and approximate
percentages:
Signal Identification 10%
Trade Management 20%
Risk Management 10%
Money Management 10%
Personal Management 50%

I wish to admit here and now that there is nothing scientific in the way
that I have assessed and allocated these activities...
I completely agree with this text, specially with this point:

Personal Management 50%

Trading is more about psicology than about technical analysis, MM, entry systems, etc.
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