EURUSD daily strategy

[JTrader]

Hi

I know of a 1 trade per day EOD spot EURUSD strategy discussed last year at tradestationworld that seems to have a success rate of around 70-80% when I have checked it previously, but with a 13 pip profit target and a 30 pip stop loss.
The trouble is, if the success rate drops much lower than 75%, the system struggles to break even in any given period of time. The rules are to go long when price hits yesterdays open/close, or go short when price hits yesterdays open or close (21:58 GMT) with a 13 pip PT, and a 30-pip SL.

The idea as discussed on TSW seemed to be to place your orders at around 0600 GMT, and see if and when either the long or short (One Cancels Other) order was executed.
This 0600 GMT start time was and is open to user customisation, as you could place your orders soon after 21:58 GMT(forex close time).

This strategy could be made to trade more than once per day - e.g. twice if both yesterdays open and close prices are hit.
There are many days when price crosses both below and above yesterdays open and close prices, with 13+ pips profit available on either side.

Of the 19 trading days so far this year, initial inspections of the daily/1440-min chart show that on 17 days (89%), the profit target appears to have been hit before any possible SL may have been hit.

However, daily charts can be fooling and one needs to look at a lower timeframe to be certain of how that particular day unfolded - i.e. which prices were hit first.
Price can cross yesterdays open and close several times per day, that's why the daily/1440 chart can be misleading sometimes.

This strategy idea may be a foundation for further improvement, if not solid and dependable enough in its own right.

 

[pssonice]

as long as u cant pick the bottom twice a day u cant be

successfull while trading i.e. EURUSD intraday

 

[JTrader]

1440/daily chart.
The indicator shows the number of pips above/below yesterdays open/close, price moved, goving an indication of which days would have resulted in a profit or loss.
When price crosses both yesterdays open and close, sometimes it is necessary to study a lower timeframe to see which event came first.

 

[JTrader]

I'm surprised, 80 views and no comments....................

 

[tradewinds]

A system like this that only targets 13 pips to me doesnt seem robust. It make work in the short term but for the long run I dont know

 

[pssonice]

Jtrader, poste your entries in time inside your journal

everything else isn't worth to look at

 

[a_gnome]

JTrader,
If you want to back-test this you really need to do it on a bar size that is small compared to your profit target and stop loss, say 5 minute bars. I knocked up something quickly in TradeStation and the basic strategy does seem to have some merit though it's nothing to write home about and I didn't account for spreads, slippage etc. FWIW the optimal parameters for the 3 year back-test seemed to be larger than the pip-sizes that you mentioned (40pip PT and 80 pip SL).

 

[JTrader]

JTrader,
If you want to back-test this you really need to do it on a bar size that is small compared to your profit target and stop loss, say 5 minute bars. I knocked up something quickly in TradeStation and the basic strategy does seem to have some merit though it's nothing to write home about and I didn't account for spreads, slippage etc. FWIW the optimal parameters for the 3 year back-test seemed to be larger than the pip-sizes that you mentioned (40pip PT and 80 pip SL).

Thanks AG for taking the time.

the origniinal idea was to trade once per day, and not having a trade carry over into several days - i.e. exit on the same day as entry by way of the profit target or stop-loss being hit (this should happen) or if neither the open or close of yesterday are hit, there would be no trade that day.

Did the 40 pip PT and 80 pip SL follow this condition?

The start time is also imporant (the time at which you place the orders with your broker, thus the time thereafter that a trade can be entered. This could be 1 hour or 10 hours after the 21:58 close.

Cheers.