Moving Average System

[cr6196]

I was wondering if anyone had been trading a moving average based system recently. I have had success in the past week or so applying this with 100% profit. However, I was wondering if anyone had been trading this on a longer scale and what kind of returns did they see?

cheers

 

[jiggly]

so you have made 100% return on your account balance over a week you say?

 

[RedGreenBen]

I was wondering if anyone had been trading a moving average based system recently. I have had success in the past week or so applying this with 100% profit. However, I was wondering if anyone had been trading this on a longer scale and what kind of returns did they see?

cheers

When markets trend then MA-based approaches work nicely. You need a much longer test period though. A system rule that said 'buy dollars no matter what' would have done pretty well in the past week or so.

 

[cr6196]

yes that is right...the actual account has grown by 110%, the current trades are seeing 150% increase tho but had a big drawdown just previous to entering the largest trades...is hard to stick to a mechanical trading system ...i've learned my lesson tho

AND

yes that point is realised and this why i asked if anyone had used moving averages over the long term. I also realise that it is by lucky timing that I have entered the market at times in which the market is trending heavily, so again i would ask how traders using a moving average system recently over the long term have fared?

cheers

 

[cr6196]

...edging towards 200%.....lol

 

[shadowninja]

It depends how you trade the MA, though... entry is important.

And if you're risking more than 2% of your account, which I suspect has resulted in a doubling of your account, expect to lose in the long run.

The danger of trading the MA occurs in sideways markets, I've found. You need to recognise when this occurs.

Try backtesting your method, then forward test for 6 months.

 

[trendie]

I was wondering if anyone had been trading a moving average based system recently. I have had success in the past week or so applying this with 100% profit. However, I was wondering if anyone had been trading this on a longer scale and what kind of returns did they see?

cheers

I started off as a MA-X-over player. Lots of good times. And some bad times.

Using MAs is a starting point, not and end-point.

Learn to ignore cross-over signals when the price has moved violently away from the MAs.
Learn to understand that when the price is mostly above or mostly below, and within a bars height, you get good signals.
When the MAs are in the middle of price, market is choppy.

If you get two or three consecutive losses, you may find that the market is rangebound, and therefore learn to draw lines that price needs to break out of (above or below) before trusting the MAs again.
If automating, learn that there are times of the day that are more proftiable than others.
depending on your time-frame, be wary of news spikes.

ultimately, you may decide (as I have) to define trend (whether you use MAs or not), but use smaller time-frames to jump aboard during pullbacks, where your risk is much reduced.

MAs are indicators, and some intelligence is needed to decide whether a signal is a valid one, and if the risk of being wrong is great, pass on the trade. (I use previous swing high/low to decide if risk is too much)

good luck if you use MAs. if you are still here after six months, you will be surprised at how much you have changed your views on MAs and their usefulness!

Dont forget money management and risk assessment.

 

[VingTsunKuen]

Amen,Trendy.:cheesy:

I think that peeps before me have told you some good things.
So i just would like to make my 2Pips on your profits.As said before,it looks like it is result of poor risk management.I guess that your account is madly leveraged,and you probably risk more than you should.So be ware,specially if you trade real $,that profits are lost more easily than they are made.If you are serious about trading you would like to run marathon rather than 100m sprint-race.
Regards,
VTK