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Daily Break Strategy

  • #61
  • Edited 10:36am May 17, 2012 9:07am | Edited 10:36am
say:
A:60% to win and winpips:losspips=1:1 and 1lots for 1 pair.
B:60% to win and winpips:losspips=1:1 and 0.5lots fo 2 pairs each(say both are major).
1 trade/pair 1 day.
For A,he has a 60% chance to win and a 40% chance to loss.
For B,he has a 36% chance to win and a 48% to BE and a 16% chance to loss.
IF C trade 3 pairs at same time than he has a 21.6% chance to win as much as the win of A,has a 6.4% to lose as much as a lose of A,has a 43.2% chance to win 1/3 as much of a win of A,and has a 28.8% chance to lose 1/3 as much of a lose of A.

AS they share the same mathematical expectation(arrage)，I want to be B who trades more pairs with small lots.why?
The 1st reason is that the DD is smaller so my boss will give me more money to trade.
The 2st reason is that the chance to lose all the money is much less if you trade 3 pairs.(It's not a easy maths problem.But it can be proved using tool of maths)
The 3st reason is that for you have a smaller DD you can use bigger lots to trade which means more profits in your blance.

It seems good i know.But all of this is based on that you have a 60% or higher chance to win in every pairs you trade.Is that ture?I want to someone to help to backtest to see if this system works in other pairs.
thanks.
  • #62
  • May 17, 2012 9:21am May 17, 2012 9:21am
Hi,
What would happen if the BE point is used if the price gets to be 50% of the TP1 value?
Ron
  • #63
  • May 17, 2012 10:41am May 17, 2012 10:41am
Quoting packgreen49
Mahanxiong,
Thanks for the help.
Ron
  • #64
  • May 17, 2012 12:21pm May 17, 2012 12:21pm
Quoting packgreen49
Hi,
What would happen if the BE point is used if the price gets to be 50% of the TP1 value?
Ron
Then you close one trade and move the SL of the other trade to BE point.At least i think so.
  • #65
  • May 17, 2012 1:06pm May 17, 2012 1:06pm
Hi,

i am just saying this to modify. If it gets to the 50% of the movement to the tp1, then move the stops to BE.

  • #66
  • May 17, 2012 3:40pm May 17, 2012 3:40pm
Quoting mahanxiong
Two updates.
1:Now there are two indis,one works on XXXjpy pairs and work on all the other pairs.
2:If your broker has a sunday chart(6 days one week),then set weekends to ture.If your broker has no sunday(5 days one week),then set weekends to false.
I'm coding the EA and there is still some bugs.I will post it later.
I coded a indi for this strategy to make it easier to backtest and trade.
http://www.forexfactory.com/attachme...1&d=1337256274
There are...
Nice job Mahan

Is there a way to overlap another indicator to draw the TP1 line for second entry ?

Looking forward to test the EA. Let the levels be variables so that we could test other levels for other pairs too.

Regards,
Basber
Trading methods are designed to put the odds in our favor, not predicting.
  • #67
  • May 17, 2012 3:43pm May 17, 2012 3:43pm
Quoting etrade360
i know MQL very well, tell me clearly how your trade then i will write EA as u want
It's on the first post E,

Regards,
Basber
Trading methods are designed to put the odds in our favor, not predicting.
  • #68
  • May 17, 2012 3:51pm May 17, 2012 3:51pm
Quoting mahanxiong
say:
A:60% to win and winpips:losspips=1:1 and 1lots for 1 pair.
B:60% to win and winpips:losspips=1:1 and 0.5lots fo 2 pairs each(say both are major).
1 trade/pair 1 day.
For A,he has a 60% chance to win and a 40% chance to loss.
For B,he has a 36% chance to win and a 48% to BE and a 16% chance to loss.
IF C trade 3 pairs at same time than he has a 21.6% chance to win as much as the win of A,has a 6.4% to lose as much as a lose of A,has a 43.2% chance to win 1/3 as much of a win of A,and has a 28.8% chance to lose 1/3 as much of a lose of A.

AS...
The theory is right, but it's not how it is. I've tested it on AU, results was positive, but not as attractive as EU. And tested on UJ and results was not good because the small daily ranges makes spread play an important factor to change the positive results into negative.

Maybe we can change the levels and have a good results.

More importantly, your calculations was right if you have 3 methods with all 60% win rate (In first paragraph I discussed why it's not the same on all pairs. EU is the most technical one) and the other important thing is they should have independent results with one another to create what you came to. But the thing is they are depended to one each other, it's because usually when a break occur for EU, AU or GU or UCHF or etc. can have the same break, but because EU has the best outcome, trading on different pairs will bring down the win chance.

In conclusion, your theory can't work because it will bring down the winrate, because all of them don't have the same winrate and they are not as high as EU.

Regards,
Basber
Trading methods are designed to put the odds in our favor, not predicting.
  • #69
  • May 17, 2012 3:59pm May 17, 2012 3:59pm
Quoting packgreen49
Hi,
What would happen if the BE point is used if the price gets to be 50% of the TP1 value?
Ron
It's very small, so it will not give the trade to breathe. then we will have a lot of BEs and we may miss the move very often and it will decrease the profit. The level I put (1.25) was a good place because it's not that far so the price may easily reach it, and it's not that close so the trade will not break even most of the time.

There is something else which I think it's important if you guys know. If you don't bring your SL to BE at 1.25, your results will be better. But high profit is not the only case. When I want to design a strategy, I have in mind three things instead of two. 1) Winrate , 2) Sharpe Ratio, 3) Losing Streak. If you take partial profit at TP1 and bring SL to BE, the worst case that could happen to you will decrease alot. So you can risk more and from this way, you can increase your income, and you will feel much more comfortable if the system produce more income, even if it's smaller. But as I said you can raise your income by increasing the risk for every trade. Risks higher that 2% is not recommended.

Regards,
Basber
Trading methods are designed to put the odds in our favor, not predicting.
  • #70
  • May 17, 2012 11:57pm May 17, 2012 11:57pm
First sell order executed, now it's time to place buy for "Second Entry". Let the market decide the rest.

P.S. : Ignore the volume indicator and vertical lines. Just the fibo for now.

Regards,
Basber
Attached Image (click to enlarge)
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Trading methods are designed to put the odds in our favor, not predicting.
  • #71
  • May 18, 2012 12:04am May 18, 2012 12:04am
Quoting Basber
It's on the first post E,

Regards,
Basber
i always take short-cut to the last post. That why...
BullShit BearShit
  • #72
  • May 18, 2012 12:31am May 18, 2012 12:31am
Quoting etrade360
i always take short-cut to the last post. That why...
No problem E.

Let me know if you need something else.

Regards,
Basber
Trading methods are designed to put the odds in our favor, not predicting.
  • #73
  • May 18, 2012 12:57am May 18, 2012 12:57am
Quoting Basber
The theory is right, but it's not how it is. I've tested it on AU, results was positive, but not as attractive as EU. And tested on UJ and results was not good because the small daily ranges makes spread play an important factor to change the positive results into negative.

Maybe we can change the levels and have a good results.

More importantly, your calculations was right if you have 3 methods with all 60% win rate (In first paragraph I discussed why it's not the same on all pairs. EU is the most technical one) and the other important...
Yeah,I backtest it a little and find the same thing.
The stuff of the dependence is not a problem.You can go to http://www.forexticket.co.uk/en/tools/01-01-correlation to choice 2-3 pairs that are not in high correlation.
But the win rate is really is problem.Basicly,the majors are all in a high rate of correlation for they are all xxxVSusd,so i try EU and a high liquility cross as GJ,the reasult is fine but not very good.
But still i like to trade 2 or 3 pairs together.I will study more about this.
HF
mahanxiong
  • #74
  • May 18, 2012 1:00am May 18, 2012 1:00am
Quoting Basber
Nice job Mahan

Is there a way to overlap another indicator to draw the TP1 line for second entry ?

Looking forward to test the EA. Let the levels be variables so that we could test other levels for other pairs too.

Regards,
Basber
Later i finished my class i will post indi for this.Hours later.
  • #75
  • May 18, 2012 1:02am May 18, 2012 1:02am
Quoting etrade360
i know MQL very well, tell me clearly how your trade then i will write EA as u want
hi etrade,will you be so kind to code the EA?
For i'm busying with my coming exam,if you are going to code it then I will be able to have time to goover my class.thanks a lot.
  • #76
  • May 18, 2012 1:04am May 18, 2012 1:04am
Quoting mahanxiong
Yeah,I backtest it a little and find the same thing.
The stuff of the dependence is not a problem.You can go to http://www.forexticket.co.uk/en/tools/01-01-correlation to choice 2-3 pairs that are not in high correlation.
But the win rate is really is problem.Basicly,the majors are all in a high rate of correlation for they are all xxxVSusd,so i try EU and a high liquility cross as GJ,the reasult is fine but not very good.
But still i like to trade 2 or 3 pairs together.I will study more about this.
HF
mahanxiong
Mahan, I recommend you wait for an EA to be created with variable fibo levels. Then we can easily check other levels too. Different pairs have different move patterns. SL is optimized for many pairs, but we should work on TPs for different pairs that is much more easier with an EA. Gold and oil also can be candidates too. But it should be tested well. With same levels, EU is the best. You must change levels and optimize it and without an EA, it takes a lot of time. Maybe even more than 100 hours.

Regards,
Basber
Trading methods are designed to put the odds in our favor, not predicting.
  • #77
  • May 18, 2012 1:34am May 18, 2012 1:34am
Quoting mahanxiong
Later i finished my class i will post indi for this.Hours later.
Take your time Mahan,

Regards,
Basber
Trading methods are designed to put the odds in our favor, not predicting.
  • #78
  • May 18, 2012 1:46am May 18, 2012 1:46am
Quoting Basber
First sell order executed, now it's time to place buy for "Second Entry". Let the market decide the rest.

P.S. : Ignore the volume indicator and vertical lines. Just the fibo for now.

Regards,
Basber
TP1 hit. Bring SL to BE.

Regards,
Basber
Attached Image (click to enlarge)
Click to Enlarge Name: db16.jpg Size: 94 KB
Trading methods are designed to put the odds in our favor, not predicting.
  • #79
  • May 18, 2012 2:08am May 18, 2012 2:08am
This is a great simple strategy thank you.

I hope there will be an Ea soon.

Zendebad Iran!

Khoda hafez
  • #80
  • May 18, 2012 2:54am May 18, 2012 2:54am
Quoting Omidak
This is a great simple strategy thank you.

I hope there will be an Ea soon.

Zendebad Iran!

Khoda hafez
Wecome to the thread Omid.

Yes, with an EA, it will be much more easier to place the orders.

It's nice to see you here. You live abroad ?

Regards,
Basber
Trading methods are designed to put the odds in our favor, not predicting.
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