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Mechanical Trading - Is it possible?

  • #21
  • Feb 27, 2013 1:36am Feb 27, 2013 1:36am
Update

EUR/GBP hit it's SL of 50 pips (1R)

Hindsight is a great thing but this really wasn't a good trade, even when it comes to mechanical trading it takes some common sense.

It might well be better to keep trading with the trend.
Attached Image (click to enlarge)
Click to Enlarge Name: 27th Feb 13 EUR:GBP 4h Chart.png Size: 140 KB
  • #22
  • Feb 27, 2013 5:53am Feb 27, 2013 5:53am
Hi Stevepatt:

Viewing the chart I think there is a problem, maybe adjusting the MACD or SuperTrend.

Testing the indicators still have problems.

I will keep trying, bye.

Quoting stevepatt
Update

EUR/GBP hit it's SL of 50 pips (1R)

Hindsight is a great thing but this really wasn't a good trade, even when it comes to mechanical trading it takes some common sense.

It might well be better to keep trading with the trend.
  • #23
  • Feb 27, 2013 8:10am Feb 27, 2013 8:10am
Quoting jnkarlos
Hi Stevepatt:

Viewing the chart I think there is a problem, maybe adjusting the MACD or SuperTrend.

Testing the indicators still have problems.

I will keep trying, bye.
Hi jnkarlos,

The BB MACD Inputs are (Fast Len 133) (Slow Len 244) (Length 21) (St Dv 1.1)

The SuperTrend Inputs are (CCIPeriod 50) (Old Calculation false) (MAPeriod 50) (MAMethod 2) (MAPrice 0) (ShowMA false)

The AllAverages v2.1 Inputs are (TimeFrame 0) (Price 0) (MA Period 50) (MA Shift 0) (MA Method 2)

Please remember this is a work in progress and is not yet fully tested if you are interested in this method please do so on a demo account.
  • #24
  • Feb 27, 2013 8:16am Feb 27, 2013 8:16am
Yes of course it is possible. All the best
  • #25
  • Feb 27, 2013 11:20am Feb 27, 2013 11:20am
Update

USD/CAD trade has broken a weekly trend line that goes back to Sep 2011 I'm expecting it to test this line before hopefully continuing going north. There is still plenty of room to the the upside.

AUD/USD trade has broken through a Demand level and still has plenty of potential to the downside.
Attached Image(s) (click to enlarge)
Click to Enlarge Name: 27th Feb 13 USD:CAD W Chart.png Size: 118 KB
Click to Enlarge Name: 27th Feb 13 USD:CAD 4h Chart.png Size: 143 KB
Click to Enlarge Name: 27th feb 13 AUD:USD D Chart.png Size: 141 KB
Click to Enlarge Name: 27th Feb AUD:USD 4h Chart.png Size: 141 KB
  • #26
  • Mar 1, 2013 4:00am Mar 1, 2013 4:00am
Haven't had time to post, but took another short trade on EUR/GBP, yesterday 28th Feb, the setup was looking much better with a LL being made at 0.86780.

Things where looking good until GBP Manufacturing PMI came out at 9.30am GMT and we have had a spike up to take this trade out for (-1R). It's the chance I take trading 4h charts I don't check for RED news. Over time I'm sure it will be a case of swings and roundabouts as some trades go against me, like this one, and some go with me.

The whole idea of making something "mechanical" is so you don't have to use any discretion to enter a trade, I only start to use any discretion once I have my last 25% running then I will look to coax as much as I can from the trade.

How many of you keep records of how your trades would have worked out if you hadn't moved your SL or moved your TP?
Attached Image (click to enlarge)
Click to Enlarge Name: 1st Mar 13 EUR:GBP 4h Chart.png Size: 147 KB
  • #27
  • Mar 1, 2013 4:25am Mar 1, 2013 4:25am
Quoting stevepatt
Update

USD/CAD trade has broken a weekly trend line that goes back to Sep 2011 I'm expecting it to test this line before hopefully continuing going north. There is still plenty of room to the the upside.

AUD/USD trade has broken through a Demand level and still has plenty of potential to the downside.

Update

USD/CAD trade is working to plan market came back to test weekly trend line and then continued north. I've set a target of 350 pips (1.75R) on the remaining 25% still in this trade. The 1.75R is in addition to the 1.5R I have already taken on this trade.

AUD/USD trade is a good case for leaving a trade to run it's course, the large Gold candle was Red news that came out in Australia yesterday 28th Feb. You often find after big news events, that spike the market one way or the other, that it will find it's way back to where it started from and carry on it's merry way.

I will update progress so far sometime over the weekend.
Attached Image(s) (click to enlarge)
Click to Enlarge Name: 1st Mar 13 USD:CAD 4h Chart.png Size: 141 KB
Click to Enlarge Name: 1st Mar 13 AUD:USD 4h Chart .png Size: 167 KB
  • #28
  • Mar 2, 2013 8:51am Mar 2, 2013 8:51am
Update Close of Markets for Friday 1st March 2013


Entered two EUR/GBP trades this week and both got stopped out for (-2R)

USD/CAD Trade is still running with 25% in tact and at +241 pips

AUD/USD Trade is still running with 25% in tact and at +100 pips


Since opening this journal I have entered eight trades.

11/02/13 USD/JPY Result +0.87R averaging 54.4 pips

11/02/13 GBP/USD Result +2.97R averaging 148.5 pips

12/02/13 EUR/JPY Result (-1R) losing (-50) pips

13/02/13 NZD/USD Result +0.75R averaging 50 pips

15/02/13 USD/CAD Result +1.5R averaging 100 pips with 25% still running 1.21R +241 pips

22/02/13 AUD/USD Result +1.07R averaging 71 pips with 25% still running 0.5R +100 pips

26/02/13 EUR/GBP Result (-1R) losing (-50) pips

01/03/13 EUR/GBP Result (-1R) losing (-50) pips


So after three weeks of trading if all trades where liquidated at this point I would be +4.09R for the 8 trades I have taken. I have been testing this since 23/01/13 and have taken 27 trades altogether with a success rate 0f 36% and a return of +12.30R

No where near enough information but certainly going the right way.
  • #29
  • Mar 2, 2013 9:01am Mar 2, 2013 9:01am
Something for the weekend
http://reddirt.co.uk/wp/?page_id=119
  • #30
  • Mar 2, 2013 12:39pm Mar 2, 2013 12:39pm
I'm posting a EUR/USD 4h Chart, from the 20th July until the 31st August 2011, to try to show the potential in using this method of trading. It was, as you can see, a period of choppiness in the market. If you had taken every long signal and short signal, as they came along, you would have come through it +1R in profit.

Remember all I'm looking for is that the indicators are all coloured RED for short and GOLD for long

Take a look back through the charts and see what you can find.
Attached Image (click to enlarge)
Click to Enlarge Name: 2nd Mar 13 EUR:USD 4h Chart.png Size: 182 KB
  • #31
  • Mar 2, 2013 1:20pm Mar 2, 2013 1:20pm
Quoting Supertrader9
Yes of course it is possible. All the best
I disagree. My personal view is that mechanical trading is a waste of time. If you can't trade manually with any success, what makes you think you can extract money from the markets mechanically without falling victim to the law of averages? Simplistic mechanical systems always fail at some point and will give all of their profits back and probably then some as well. I've never even heard of a long term profitable EA.

I'm sure that there are robots that can identify good trading opportunities but the writers of these understand the market at the most fundamental levels and know what a good trading opportunity looks like to their eyes. And it doesn't involve a moving average or bollinger bands. To code this type of intelligence into a robot is complex and far beyond what you'll see drifting around the EA community.
  • #32
  • Edited Mar 3, 2013 5:37am Mar 2, 2013 2:01pm | Edited Mar 3, 2013 5:37am
Quoting Kanzler
I disagree. My personal view is that mechanical trading is a waste of time. If you can't trade manually with any success, what makes you think you can extract money from the markets mechanically without falling victim to the law of averages? Simplistic mechanical systems always fail at some point and will give all of their profits back and probably then some as well. I've never even heard of a long term profitable EA.

I'm sure that there are robots that can identify good trading opportunities but the writers of these understand the market...
Hi Kanzler,

Thanks for your point of view, but this EA is simply for managing a trade, all trades are entered manually.

I am doing this as an exercise to see it's effectiveness going forward I have done some back testing and it looks promising.

A mechanical approach eliminates the discretion needed when trading many systems, it can become very frustrating taking losing trades and then missing the winners because you start to doubt what you are doing, it also helps to eliminate revenge trading.

Using a 50ma on a 4h chart for trend and then looking to trade inside and outside candles after LL LH for going short or HH HL when going long also makes for a good trading method but variety is the spice of life.

Good luck with your trading.
  • #33
  • Mar 2, 2013 5:47pm Mar 2, 2013 5:47pm
Really Nice work Steve, Trust me when I say your on the right track, if your weakness is exits ( which it is for most traders who are knocking on the door of annual + % success ) automate it, keep it simple and if you have realistic annual % return views you will carry on building your account..

Ive Just found your journal and haven't read all of it...( I will do ) so please except my apologies if I'm off base, but I think your on the Path to fulfilling
your unconscious belief.

Thanks

Ja.
Memories caught in time but never forgotten
  • #34
  • Mar 3, 2013 5:04am Mar 3, 2013 5:04am
Quoting j4d
Really Nice work Steve, Trust me when I say your on the right track, if your weakness is exits ( which it is for most traders who are knocking on the door of annual + % success ) automate it, keep it simple and if you have realistic annual % return views you will carry on building your account..

Ive Just found your journal and haven't read all of it...( I will do ) so please except my apologies if I'm off base, but I think your on the Path to fulfilling
your unconscious belief.

Thanks

Ja.
Hi Ja,

Thanks for popping by, looking forward to your feed back once you've read everything.
  • #35
  • Mar 3, 2013 5:35am Mar 3, 2013 5:35am
I have been looking for areas of choppiness in the market to see how things would work out. As long as I am patient and stick with what I'm doing sooner or later I will catch the prevailing trend.

It's when I catch a good trend that I must get the most from it.
Attached Image(s) (click to enlarge)
Click to Enlarge Name: 3rd Mar 13 AUS:USD 4h Chart.png Size: 137 KB
Click to Enlarge Name: 3rd Mar 13 GBP:USD 4h Chart.png Size: 139 KB
Click to Enlarge Name: 3rd Mar 13 GBP:USD 4h Chart 2.png Size: 130 KB
  • #36
  • Mar 3, 2013 1:15pm Mar 3, 2013 1:15pm
Following this thread with interest. Currently trading three such systems, and aside from one bad year in backtest data they look pretty good. Would be helpful if anyone who had been successful could advise that they had actually managed it. New to this forum, not sure if they support polls or if they are frowned upon.
  • #37
  • Mar 3, 2013 3:28pm Mar 3, 2013 3:28pm
Quoting stevepatt
Hi Ja,

Thanks for popping by, looking forward to your feed back once you've read everything.
Hey Steve, I think your journal is going well , keep it up and keep up the good work even in those times of DD..
I trade in a similar fashion in the sense that I'm a swing trader, though I dont use a lot of indicators.. I take my entries off the 4hr Ch. but I get my bias from the weekly chart and confirmation of bias from the daily chart...It works for me.

This looks like it works for you...

Keep up the good work Steve ...

Ja.
Memories caught in time but never forgotten
  • #38
  • Mar 4, 2013 12:53am Mar 4, 2013 12:53am
Trade No. 9 on AUD/JPY short. I missed a trade setup here last week I was asleep in the bath when it triggered same thing on EUR/JPY you can't get them all I guess.
Attached Image (click to enlarge)
Click to Enlarge Name: 4th mar 13 AUD:JPY 4h Chart.png Size: 155 KB
  • #39
  • Mar 4, 2013 1:27am Mar 4, 2013 1:27am
Quoting ftw
Following this thread with interest. Currently trading three such systems, and aside from one bad year in backtest data they look pretty good. Would be helpful if anyone who had been successful could advise that they had actually managed it. New to this forum, not sure if they support polls or if they are frowned upon.

Hi Ftw,

I have been trading PA, primarily on 15m charts, and was getting very frustrated with my lack of consistency. It was an Email I received that sparked my interest in mechanical trading and I started a search on FF for any information, I have credited in my first post where i gained most of this information from, and put it together to make this method.

I have only been trading this way since the 23rd Jan 13, on a demo account, but so far so good.

I'd be interested to know your methods of trading "mechanically".
  • #40
  • Mar 4, 2013 1:32am Mar 4, 2013 1:32am
Quoting j4d
Hey Steve, I think your journal is going well , keep it up and keep up the good work even in those times of DD..
I trade in a similar fashion in the sense that I'm a swing trader, though I dont use a lot of indicators.. I take my entries off the 4hr Ch. but I get my bias from the weekly chart and confirmation of bias from the daily chart...It works for me.

This looks like it works for you...

Keep up the good work Steve ...

Ja.
Hi Ja,

I see, from your profile, your from the UK, I can also see from your posts that you have positive approach to life. Good luck with your trading pop by any time.
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