STARC Bands Trading Systems

If like me you had not heard of STARC (Stoller Average Range Channels) Bands before, they are similar to the Bollinger bands. These bands will contract and expand depending on the fluctuations of the average true range (ATR). The difference between Bolliner and STARC is that STARC bands are used to determine the high probability trade rather than standard deviations of price action. Simply when price rises to the upper band a sell opportunity is indicated and when the price reaches the lower band a buy opportunity is indicated.

Basically STARC is created by two bands around a user defined SMA, The upper band is created by adding SMA to the average true range (ATR) and the lower band is created by subtracting the ATR from the SMA. For more detailed explanation of STARC please visit http://www.investopedia.com/articles...dsChannels.asp .

When a fellow trader introduced this indicator in Nanningbob`s thread, Bluemelle and I felt that there was a good potential for a simple trading strategy based on this one indicator alone, providing this was coupled with sound money management and the famous nanningbob`s multilevel recovery process. Surprisingly not much has been written regarding STARC despite its good potential. Therefore, I have started this thread to give STARC a home in FF and I hope to attract experienced traders who have an interest in this indicator and have ideas for its utilization and automation to publish their ideas and creations for further study, improvement, development and scrutiny.

Thus far Stevehopwood and Bluemele have created EAs (Expert advisors) for STARC systems. we will be discussing these in due course. I must emphasize strongly this is very much a R&D thread for the time being and it is not suitable for new traders and live trading. I strongly advise new traders to visit NanningBob`s and SteveHopwood`s threads for proven profitable systems and EAs.

Ok, have a look at the chart below. The strategy is very simple When the price touches the upper STARC Band a Sell order is placed and when price touches the lower STARC band a buy order is placed .The settings for STARC is 5,15,1.33 (or Bluemele`s more aggressive setting of 5,15,0.88). Almost all of the rules below were suggested by Bluemele.

TP can a be a fixed value based on the ATR or the middle band (although TP of middle band would mean you would lose out on the big runs).

SL= distance from outer band to middle band DIVIDED by 2 or a fixed value based on the ATR.

If loss is taken, suspend suspend new trades until midpoint is reached. This will ensure that you will not keep going into big trend. Usually, you will have 1 to 2 losses then it will retrace on a big move, and with this, it will then hit the midpoint in the near future. If it does it on the same bar, then it was just a news spike and it will most likely come back to the usual price. (a more conservative option is suspend till the opposite band is reached).

if trade loses, then reenter on same bar by 'x' (most likely % of ATR, a couple of pips) then reenter and take to midpoint for profit hopefully. Chances are that it won't do a loss twice.

Option of BE @ + x pips using STEVE HOPWOOD`s mptm plus trailing stop to start at x% (usually 50%) of distance between entry and midpoint that will trail by profit of x% (usually 20% to 50% of total move, so if it is up 10 pips, TS=2 or TS =5 respectively. You can turn Trailing Stop off, and it will do TP @ midpoint.

Please see my post of 10/11 October for STARC BOLLINGER CROSS...
11th October added couple of indicators for BB-STARC Cross

Great, I think there is some good options with this to scalp from the larger timeframes.

Thanks for starting this and see if we can get some interest. Maybe show some pics if/when you get some time. I will post my EA soon.

Thanks for starting this thread. It will be interesting.

Here is an EA I created for it, but it needs some tweaking. I would like to see your guys thoughts. I can help build an EA, but it won't be bug proof!

I can get this one working on forex.com no problem, but not on ECN, ATC.

This EA would work a lot better on a broker with smaller spreads though.

HI Blue

Thanks for posting this. I was demoing it on fxsolUK and suddenly EURJPY went berserk. They are GMT-4, most probably EST. Any idea what caused this?

Kind regards

Wow its alive!!!

Time shouldn't have any impact as I didn't add any time features.

Post the journal and let me see.

Strange.

Is that a backtest or forward demo test?

I never backtest Time is now 2:22 here in Las Palmas but it is Alpari server time that you see on the picture

I hope this is DEMO and not live. Please see my demo results attached to my previous post.
Kind Regards

Yes its Demo. I have been on demo 10 month now and start to get panic. I want this thing to work so I can go live.
The picture show Starc EA 15M with interference from Steves MultiManager and basket close. Started at same moment as the other Starc EA on H1. The first picture was from H1

27 orders on M15 and 7 on H1. I started them at the same time. But I close M15 as a basket.

Can we do something wit different risk levels. 0.88 0.01 lot ,1.33 0.02 lot, 1.6 0.03 lot
Make it optional

Hi Harry

I see your point (i.e. the less risk the higher the lot size) and it may be a good idea. However, the system is in its infancy and so many variables have yet to be tested and optimized. I was running some back tests and some pairs respond better to lower time frames, some pairs to high KATR settings. Hopefully by the end of this week we can start getting a coherent strategy together for comprehensive testing.

Kind Regards

Yes, can you guys spell out how you see a strategy?

i.e. - Piercing the line, then reentry, etc..

Show me your 'rules' and let me review them to my own.

I have a few.

1. If it pierces the line, enter, SL = distance from midpoint to outerline, takeprofit = midpoint

2. If it exits line and closes outside, take entry on close of bar to midpoint

3. if it exits line and comes back in on same bar, take to midpoint for TP (some aren't all that big...)

What are your guys thinking?

Sorry guys, so busy this week dealing with DD!

Keep the ideas coming. I would really like to find a better coder that doesn't take a day to figure it all out each time.

Today you could get money with a shovel. No idea how the configuration should be.

Hi

Our fellow trader E2U found some material on the STARC/BB cross which is very interesting. This idea has been around since 2005/2006 and was developed as "Trend Catcher" system. Basically when upper BB breaks above the upper STARC this signals the start of a down trend and when the opposite happens (i.e. Lower BB breaks through the lower STARC band signals the start of a UP trend). When Upper and Lower BB are inside the range of STARC bands the market is ranging. Have a look at the chart below and you see what is happening (the dotted lines are the BB). You can load the STARC and BB on any chart or TF and you can test it for yourself.

This can be used as a extra filter for our strategy. Although the implication would be fewer trades and losing out on perfectly good trades, but on the positive side it would keep us out of losing trades when we have a large number of bull or bear candles touching the outer STARC band. It can also be used for Nanningbob system (although BOB does not favour this indicator).

Below is the results of my test of STEVE`s STARC EA for Thursday and Friday, the TF is 4H and the setting is 5,15,1.33, I have also increased the TP multiplier to 6 and BE of 30 with BE profit of 20 pips. For some reason my mt4 has gone a bit haywire and does not save reports, that is the reason for posting the results in pdf format. There are 3 open trades with DD of -$10.50. This is very much in line with results of E2U.

I agree with Bluemele`s rules with minor differences in some points. Namely, I prefer a TP and SL based on the % of ATR and waiting for the candle to hit the opposite STARC band after a losing trade rather than the middle band. IMHO these rules coupled with the BB cross filter would improve our win loss ratio drastically whilst reducing the number of trades. However, this can be addressed by using a lower TF such as 1H or 30M.

Finally one more filter which was suggested in Trend Catcher system was RSI. The rule being take longs only if RSI>50 and shorts is RSI<50. This may result in yet less trades, however, I came across this suggestion by SCOOBY-DOO in the BEAST EA thread which IMHO we should use in all of our trades. I quote:

"Steve, You could look at using the RSI filter in a different manner so that you still get lots of trades with the original system.
i.e. Make sure you are not selling into oversold level and not buying into overbought level. So if NB or whatever says buy then make sure the daily rsi is not > 70 and if sell then make sure the daily rsi is not < 30 etc.
Scoobs."

Please forgive me if the above is not 100% clear, since I had promised to update the posts this weekend I am writing these despite having a few glasses of Chivas Regal at a party, however, since I am busy all of Sunday I thought I better honour my promise.

Kind Regards
P.S. Blue please post your rules and updated EA so others can benefit from your input and test the EA if they wish. The 1st my mt4 did not like the first version of Topgun for some reason and was going haywire. Maybe the next versions would work OK.

I loaded TOP GUN on a different demo a/c less than 8 hours ago and results are quite good as you can see. Early days yet, however, the signs are encouraging.

Kind Regards

I was unaware of STARC bands and had made my own indicator doing the exact same thing.

I however was looking at buying breaks as opposed to selling them. Will watch with interest and contribute when I can, am quite busy unfortunately. I very much like the theory of the indicator, should be able to show moves which are abnormal.