Diversified Trend Trading Approach

The Weeks Trading Recap continued......

DJI (Primary Trade) (R Multiple = -0.40)


USDSGD (Primary Trade) (R Multiple = 0.47)



EURJPY (Primary Trade) (R Multiple = 4.12). Don't cry for me EURJPY, the truth is I never left you. All through my wild days, my mad existence, you kept your promise, don't keep your distance.


GBPSGD (Primary Trade) (R Multiple = -0.02)


EURUSD (Primary Trade) (R Multiple = 0.26)


EURAUD (Primary Trade) (R Multiple = 0.78)


....more to come.

C

The Weeks Trading Recap continued.....


AUDCAD (Secondary Trade) (R Multiple = 1.17)


NZDCAD (Secondary Trade) (R Multiple = -0.25)


XAUUSD (Primary Trade) (R Multiple = 0.50)


USDCAD (Secondary Trade) (R Multiple = 1.11) Parting is such sweet sorrow!!!


CADJPY (Primary Trade) (R Multiple = 0.16)


XAGUSD (Secondary Trade) (R Multiple = -0.20)


Well that's it for closed trades.

Next few posts will detail current open trades since resurrecting positions on the portfolio.

C

The Week's Trading Recap continued.....

Current Open Trades

USDCAD (Primary Trade)


DAX (Primary Trade)


EURUSD (Primary Trade)


AUDJPY (Secondary Trade)


USDSGD (Primary Trade)


ASX (Secondary Trade)



...more to come.

C

The Week's Trading Recap continued.....

EURJPY (Primary Trade)


NZDJPY (Secondary Trade)


AUDUSD (Primary Trade)


NZDUSD (Primary Trade)


That's it so far for the week. Hopefully I will be able to add to the portfolio next week to bolster the potential results for January 2015.

I will be posting the Weekly Outlook later this weekend.

Regards

C

Weekly Outlook

It looks like the CHF and ECB announcements have cooked up the markets giving great volatility. Trend riders should be getting excited as we are probably in for a good two months or so of opportunities.

It's time to celebrate before we get cracking.

Inserted Video

....and now for the outlook ahead.

AUDJPY

Attached Image (click to enlarge)

AUDUSD

Attached Image (click to enlarge)

CADJPY

Attached Image (click to enlarge)

GBPUSD

Attached Image (click to enlarge)

ASX

Attached Image (click to enlarge)

DJI

Attached Image (click to enlarge)

....more to come.

C

Weekly Outlook Continued...

EURAUD

Attached Image (click to enlarge)

EURJPY

Attached Image (click to enlarge)

EURUSD

Attached Image (click to enlarge)

EURCAD

Attached Image (click to enlarge)

Nikkei

Attached Image (click to enlarge)

FTSE

Attached Image (click to enlarge)

....more to come.

Weekly Outlook Continued.....

USDCAD

Attached Image (click to enlarge)

USDCHF

Attached Image (click to enlarge)

USDJPY

Attached Image (click to enlarge)

AUDCAD

Attached Image (click to enlarge)

DAX

Attached Image (click to enlarge)

XAUUSD (Spot Gold)

Attached Image (click to enlarge)

.....more to come.

Weekly Outlook Continued....

USDSGD

Attached Image (click to enlarge)

NZDUSD

Attached Image (click to enlarge)

XAGUSD (Spot Silver)

Attached Image (click to enlarge)

NZDJPY

Attached Image (click to enlarge)

NZDCAD

Attached Image (click to enlarge)

GBPSGD

Attached Image (click to enlarge)

That's all for the week ahead. Looking forward to a good one.....but don't get too cocky as with volatility comes risk.

This should help to reduce our ego and bring us all down to size.




Regards

C

Following on from Post 251, I will shortly be introducing trading opportunities on the D1 and W1 timeframes to take advantage of the longer term secular trend. Having recently commenced the EDTT approach to supercharge the strategy, to trade on the M30 timeframe prior to undertaking trades on the longer term timeframes runs counter to the general philosophy of trend trading using this approach in that it is the longer timeframe trends that exhibit non-random drift in their nature. We will still be undertaking trades however on the M30 timeframe associated with the H1 trend to keep us occupied but it is folly to not take better advantage of the longer term timeframes when the opportunity arises.

Why??
Think of going to the casino and being lucky in finding a roulette table with a very small bias in it's spin. When these situations arise, do you simply put all your hard earned cash on the table for a single punt on say red or black, or do you break your kitty up into small chunks and sit at the table for an extended period to take advantage of the bias?

The answer of course is that a positive bias is expressed in terms of trade expectancy which is time dependant. As with all probability games the outcome of a single event has a high random component attached but with time, the small bias in probability shifts in your favour giving rise to a greater chance of positive expectancy over the longer term. That is the reason that casino's ultimately come away with your cash as this bias in expectancy is their positive cashflow.

The same effect is found with trends and why we should bias our trading decisions towards the longer term timeframes to at least benefit from a small positive bias, if it exists, even though we may not be able to discern it. Of course trends on the very long term timeframes such as MN and W1 are likely to possess a fundamental bias in their nature due to an economy's monetary policy, attractiveness to investors etc., and while it might not be sexy and full of action exploiting these long term trends, given the significant random component of price movement on the shorter timeframes, these juggernauts, while moving slowly serve to assist in giving you an edge with positive expectancy and should not be ignored.

Through trading on multiple timeframes through this approach we will find that naturally the approach will progressively build it's position into trends of substance without compromising risk management objectives that ensure you stay in the game a long time.

So please refer back to Post 251 for details about what is shortly about to commence in the next week or so with this approach.

The trade entries and trade management will adopt the same formula as that applied with the DTT and EDTT discussed to-date and the SDC will be used as our trade management mechanism. We treat each trade as independent to other trades and ensure that our trade management decisions are restricted to the correct associated timeframe. For example, while we may close a position on the M30 timeframe when the SDC is touched, we do not let this affect trade decisions running on other timeframes.

Regards

C

PS Note that a positive bias in the context of trend following means either a long or short bias as opposed to simple random outcomes.

Weekly Update

Given the recent changes made to the approach in an attempt to supercharge the strategy, trade frequency has now significantly increased particularly on the M30 and H1 timeframes. Previously in the weekly update, I would showcase all trade exits and open trades for the past week, but given the significant increase in trades, I will be altering the method of presentation to interested members to reduce the time it takes to present this material to you.

I hope you enjoy this new format method as it really cuts down my hours in presentation.

Trade Update for the Week
Below is a summarise account of portfolio performance which outlines the result of all closed trades that have been entered during the month and also includes the status of all current open trades.



Current projections suggest that January will be a profitable month with a return of approximately 4.3% but this result may materially vary dependent on the performance of open trades. The maximum drawdown for the month has been minimal.

Below is a statistical presentation of the components of the strategy taken over the entire trading period applied to this approach.



Over time these statistics will capture valuable information to allow us to modify elements of he strategy to enhance returns. The DIV/O results over time will disappear as results are entered into these cells.

The statistics will over time be able to validate some important assumptions made over the course of this thread. Namely, that better performance is achieved using longer timeframes. Currently we can see than M30 trades have a far lower Pwin and Expectancy result than H1 trades and I would expect this trend to continue if this approach favours the longer term timeframe.

Once we receive sufficient data, we will be able to make valid decisions as to whether we only trade certain timeframes and/or whether we only trade in the direction of the longer term MN trend or also accept countertrend trades. Time will tell. I will therefore continue to include this statistical summary in weekly updates.

My next post will provide the outlook for the week ahead, again, in a different new look format.

Regards

C

Weekly Outlook

Given that we are now trading on multiple timeframes, the method of presenting the weekly outlook has also changed. If you have any queries about what it all means, let me know but it should be fairly self-explanatory.

AUDJPY


AUDUSD


CADJPY


GBPUSD


ASX


DJI



....more to come.

C

Weekly Outlook continued....


EURAUD



EURJPY



EURUSD



EURCAD



Nikkei



FTSE




.....more to come.

C

Weekly Outlook continued......

USDCAD

Attached Image (click to enlarge)

USDCHF

Attached Image (click to enlarge)

USDJPY

Attached Image (click to enlarge)

AUDCAD

Attached Image (click to enlarge)

DAX

Attached Image (click to enlarge)

XAUUSD (Spot Gold)

Attached Image (click to enlarge)

.......more to come.

C

Weekly Outlook continued.....

USDSGD

Attached Image (click to enlarge)

NZDUSD

Attached Image (click to enlarge)

XAGUSD (Spot Silver)

Attached Image (click to enlarge)

NZDJPY

Attached Image (click to enlarge)

NZDCAD

Attached Image (click to enlarge)

GBPSGD

Attached Image (click to enlarge)

.....That's it for the week ahead.

All the best.

Regards

C

Spreadsheet Update

Give the significant increase in trade frequency and the longer timeframes now being traded, it is possible that some trades might stay active for many months. Previously, the recording of results by the attached spreadsheet was based on the date of trade entry given I was interested in identifying when trends commenced as opposed to when they ended. The problem with this approach was that it would take some time to close off a particular month as some trades extended for a number of months after the trade entry month.

I have therefore adjusted the spreadsheet to take account of the closing date of trades undertaken so that at the end of each month all trades closed during a partiocular month will be assigned to that month and we will be able to quickly assess performance results at the conclusion of each month.

It has taken a bit of work, but the attached spreadsheet now records performance over the entire testing period in accordance with this new methodology. This has altered monthly results from prior versions detailed in previous posts but the entire quantum amounts are the same. In addition the Van Tharpe SQN number has now been verified following an audit undertaken of these results by an independent 3rd party, and this will assist in determining the power of each approach.

Just to note that we are now trading this approach on the following timeframes (MN, W1, D1, H4, H1 and M30). The H4 timeframe was chosen as recommended by Bassramy given the need to bias the EDTT approach towards the longer term timeframes.

As this amendment including all timeframes detailed above was made commencing 2 Feb 2015 it will take some time for stats to build to sufficient sample numbers to be able to objectively assess performance acroiss each timeframe, but over the next 12 months or so, the results should be able to substantiate further amendments to this approach to significantly enhance future performance.

Regards

C

http://www.oocities.org/hollywood/1096/hatsoff.gif

Hats off to you and your work Sir.

Thanks Bass. I like that image :-)

Weekly Update

In general a very tough trading week for trend followers with numerous false breakouts that quickly ran out of puff. The weekly outlook will highlight the significant number of instruments that are currently consolidating with no clear direction.

Trade Update

Below is a summarised account of portfolio performance and results for February reflect trading according to the new EDTT approach. The table also highlights current open trades in the portfolio and their respective timeframes.



The month of February has been tough so far with a current loss if ($2,643.17). We do have a current valuation of $772.29 of open trades which are still to be taken to account, but so far it has been a slow start for February. Interestingly at the beginning of the week we had a very positive result of approximately 9R on all open trades but over the course of the week, almost every favourable position turned sour. Such is life for a trend trader.

Despite the poor start to February, total drawdowns are still minimal at 2.28% but I am hoping for a better week next week.

Trading on the M30, H1 and H4 timeframes are keeping me very active at the trading screen but the results so far are not encouraging....... however these are still very early days in the testing and you cannot make confident decisions at this stage with such a small sample. Over about 6 months or so, we will be able to confidently amend the approach to eliminate those timeframes that are not performing. Furthermore, information being captured regarding whether the trade was in the direction of the primary trend or a retracement entry will be very useful for honing the strategy. For example we may find that positive performance is acgieved when we only trade the H4, D1 and M30 timeframes in the direction of the primary trend...or not at all. The results will over the course of time speak for themselves. We know the power of this approach for the longer timeframes so I am not anticipating any change to trading the D1, W1 or MN timeframes as these are likely to remain valid for this approach.

....anyway, it is time to brush aside the poor performance last week and focus on the week ahead.

Regards

C

Weekly Outlook

But before we get started, some great music from Nick Drake for a bit of reflection while you review the outlook




ASX

Attached Image (click to enlarge)

AUDCAD

Attached Image (click to enlarge)

AUDJPY

Attached Image (click to enlarge)

AUDUSD

Attached Image (click to enlarge)

CADJPY




....more to come.

C

Weekly Outlook continued.....


DAX

Attached Image (click to enlarge)

DJI

Attached Image (click to enlarge)

EURAUD

Attached Image (click to enlarge)

EURCAD

Attached Image (click to enlarge)

EURJPY


EURUSD


....more to come.

C