Counter trading, what is your technique or pre-setup conditions?

Hello

I have developed a system to goes mainly counter trading. About 70% of the entry failed. Du to my trade and money management , the 30% remaining return return fabulous return for the last 12 month.

Now, look good on paper, but depending on the time of the year that i would had started a live system, I may had end-up to loose nearly 70% of the capital.

So I'm looking for a way to reduce my false entry.

My system is base on band trading. I look for different setup that occur around a band. Signal is nearly always counter trading.

I'm looking for a pre-setup, indicator or a technique that would reduce the failing entry.

Already, I'm using RSI and ADX as filter. Nice as it reduce by 50% my entry and increased dramatiquely the return. Moving average as not ben selected as it is not applicable to my system.

Nice return, but still, I'm not confident enough because of the period where system would nearly put me out of the game


Just to say that accout started with 25K and initial risk: 250$.
This is not a scalping system
Cost per transaction :20$
Slippage: 2.5 pip calculated

Any input appreciated

Problems:
1) trying to reduce with TA the bad entries is called curve-fitting
2) you have a 1600% return but 70% drawdown is bad?!!
3) why don't your reduce the risk by 50-80%?
4) only one year of testing is not enough
5) 70% are bad entries - why don't you go with the trend instead of fighting it?

I think Sauron made it clear, 1600% profit vs 70% drawdown, means that with a 10% DD you'll have more than 200% profit. Cut your risk..

Cutting the risk is part of the solution. I will look in my Risk caculation routine. Risk is increased by 10% after the account value as grow by 10%. Risk decreased after account value drop by 15%

I will top the max risk. Actually it goes up to fast.

I will try to test in other time period than 2010. IB, my data provider does not provide data for more than 1 year. Any idea where i could get 1 minutes historical data.

My main gain is obtain by the way that i follow my positions. Conditions to get out are strict. I alway know what I risk, but never know the return. No profit target, no partial profit. I'm using 4 differents setup all blend in the same system. This is not a scalping system,

Main gain came also by selecting time to trade in the day. It may look like curve fitting, but the best time for my system correspond to the big trading session time. No trade during slow session. Too much noise.

As mention, I'm not either fully confident in my system. These are only numbers for the moment. I would be more than glad to have a 100% return instead of 1600% if it never retaliated more than 15%.

Quest continu
Martin

I afraid that diversification is the only effective technique to reduce drawdown without sacrifice too much return.

Filtering or intense optimization is a big no-no.