ForexMorningTrade System

Deatil said:
I understand what you are saying. But my point is, and for some reason up until now it was falling on deaf ears when I tried to explain it earlier in this thread.

There remains one major NEW issue that has become very important in this new global market.

That we have up to until today fail to mention or take notice of. But we now have a “new player” in this global game a player that can turn the markets and shift market moods all by itself, and that ‘player” is China.
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That's an enlightening technical analysis of why the game might be changing.

The point I would make is that by the laws of probability, you'd expect 50% of random trades to be right. Therefore we are looking for a strategy which improves on that, and if it doesn't (assuming reasonable TP expectations), then it's badly flawed.

I wonder if our correspondent can put timeframes on when China did become more of a force in the Asian session, and meanwhile perhaps I can share the results here of some more analysis I have done (E&OE) into FMT going back about 4 full years

2007. @40TP/40SL 1240 pips net gain. Winning 59%
2008. 840 pips, winning 57%, this was the worst year in the last 4
2009. 1200 pips, winning 59%
2010 1760 pips, winning 62%

The highest number of pips in a year are a function of the % of winning trades and the highest number of trades. Surprising how you can get months eg May 2010 (UK election turmoil) when there were few days with FMT signals.

Best success is surely going to come from eliminating bad trades before they start, and having reasonable exit stops with acceptable risk/reward ratios.
I'd be worried if 2011 performed like or worse than 2008
We have nevertheless got to be prepared for the occasional losing month. I would say about 25% of the last 50 months would have been losers. More so in 2008 (there were 4) - and this board would have been full of lively debate if we were already trading in those conditions. And probably quite a few members would have switched off FMT prior to it having a great run for the next 2 years. Those who give up on it now could well miss out on the prize.
 
phn73 said:
I just spent an awful lot of time analysing previous trades over the last 6 months and comparing different SL/TP combinations! Speciifcally I was looking for a system that would be profitible during December, but I found it was also profitible every month I tested, and thats what got me interested.

HOWEVER to be clear: A more usual strategy like 40/28 would still have netted MORE pips over the period, due to the excellent results it got prior to December, offsetting the recent losing streak. Depends what you want really, but as for me I like to see consistent (if smaller) profits...
Click to expand...

I also prefer a high win rate. I will be researching this possibility. I've only just started testing this system and it looks terrible so far. Only people's comments about previous results keeping me in. At this rate I'll be asking for my money back!
 
Tenapenny said:
Same here. +43 today and as I didn't trade till 10th of month I'm +107 pips so far using SLM.
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Nice to know it. Are you using similar parameters than me? My sets are SL65 TP43 BE20.
Since January 10th, it was 4 wins 1 loss, 108,3 pips exactly.

What do you mean with SLM?

Regards and good trades.
 
if there are four or five losing months will you give up?

long-term profitable systems often have such losing streaks - they even have losing years. (check out the turtle system)

most people give up on a long-term profitable system much too soon - they are emotional rather than statistical traders. they then lose their money on a system that has three or four months of good profits.

furthermore, just as a losing year is meaningless, so also are one or two or three winning years.

look at the barclayhedge data; the top currency hedge funds return 7%/year on average, with 15% drawdown. if you expect better results than this long-term, you are dreaming. they have much better access to liquidity and have more money, brains, and experience than all of us put together.

a short-term win/loss rate (less than five years) like 95%, is a good start but is meaningless because market conditions change - particularly on the smaller (less than 1-hour) timeframes. they can change anytime. it is certainly possible that china has changed the asian session.

essentially all long-term profitable systems have adaptive stops, take profits, and lot sizing. they adapt to changing market conditions by using the ATR as a proxy for changing market volatility.

these are what FMT needs. you could say that FMT has an "adaptive" entry (with the indicators) but much more is needed.
 
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buddhi said:
if there are four or five losing months will you give up?

long-term profitable systems often have such losing streaks - they even have losing years. (check out the turtle system)
.
Click to expand...

Yea i agree with you...but if you trade only currency and obtain 2-3 year losses in a row, it doesn't mean your system is temporarily making losses..the system is simply no good....a year is the longest/best estimation of trading system profitability, because the next year will be the same fundamentals coming out (yes there are exceptions..)
If you're trading many markets and you are having a losing streak in currency but a winning streak in other markets, then you're in a much better position
 
The way the market is going, I find I can smooth this roller coaster ride for the last two months without quitting. Is to use FMT with money management on.This way with my limited funds , I can weather this storm of losses until the market improves. I know it won't be like this always.
 
wiseambitions said:
That's an enlightening technical analysis of why the game might be changing.

The point I would make is that by the laws of probability, you'd expect 50% of random trades to be right. Therefore we are looking for a strategy which improves on that, and if it doesn't (assuming reasonable TP expectations), then it's badly flawed.

I wonder if our correspondent can put timeframes on when China did become more of a force in the Asian session, and meanwhile perhaps I can share the results here of some more analysis I have done (E&OE) into FMT going back about 4 full years

2007. @40TP/40SL 1240 pips net gain. Winning 59%
2008. 840 pips, winning 57%, this was the worst year in the last 4
2009. 1200 pips, winning 59%
2010 1760 pips, winning 62%

The highest number of pips in a year are a function of the % of winning trades and the highest number of trades. Surprising how you can get months eg May 2010 (UK election turmoil) when there were few days with FMT signals.

Best success is surely going to come from eliminating bad trades before they start, and having reasonable exit stops with acceptable risk/reward ratios.
I'd be worried if 2011 performed like or worse than 2008
We have nevertheless got to be prepared for the occasional losing month. I would say about 25% of the last 50 months would have been losers. More so in 2008 (there were 4) - and this board would have been full of lively debate if we were already trading in those conditions. And probably quite a few members would have switched off FMT prior to it having a great run for the next 2 years. Those who give up on it now could well miss out on the prize.
Click to expand...

I will try and answer you by giving you some simple facts (very limited and simple) to get everyone’s brain thinking about the new global era and the effects during the Asian session.

Why would China swap investment in their own higher return economy for lower return US debt?

The answer is very simple, they are buying US Dollar assets in order to weaken their currency and thus support export demand for their industries through exports. This in turn would cause china to have a higher GDP and also higher CPI reading along with a faster growing inflation rate, and risk appetite would be expected to INCREASE and the USD would lose

China has entered a period of strategic opportunity. Also China’s rise will not only transform China in a profound manner but may also reshape the world.

China has already increased bank reserve requirements several times in an attempt to try to slowdown lending. China’s demand is really the only thing keeping the global economy afloat at this time. Should China take appreciable measures to slow down its economy, then risk aversion would be expected to INCREASE and the USD would gain. Why? because we would see a sharp fall in their GDP/CPI and inflation would be under control due to lower exports and lower internal demand .

Investor love high inflation, why? Simple it means just one thing growth, jobs!

Just these very simple facts listed above which would not even begin to touch the real surface of the impact of China’s News has during the Asian session would have on traders looking at not only the impact of the News but the trading ranges during this time zone.Which is released at around 9PM NYT and even over the weekends sometimes.


But as I have already mentioned this topic is way, way beyond this thread.
 
FMT not working for me. Anyone else got similar results? I'm using 35tp 40sl on a small account for time being unless results improve. :(
 

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Deatil said:
I understand what you are saying. But my point is, and for some reason up until now it was falling on deaf ears when I tried to explain it earlier in this thread.

When anyone has done a back test or even mention stop values that have been changed along with changed take profit targets. There remains one major NEW issue that has become very important in this new global market.

That we have up to until today fail to mention or take notice of. This one important element that has gone either unspoken or un-noticed that really just started to take shape at that start of 2009 till now.

The Asian sessions in the past were used to consolidate price action which occurred over the London and US session.

But we now have a “new player” in this global game a player that can turn the markets and shift market moods all by itself, and that ‘player” is China.

We now are having major News being released out of China at around 9:00 PM NYT, which can shift the markets moods and cause trend changes, But even worse is the early news release out of China which did not really exist or have any major impact before 2009 has caused what was once a quite Asian session to become more volatile and make the trading ranges far exceed that 40 or even a 50 pip stop used by FMT.

I once tried to explain that good news out of China more than likely would cause the GBP/USD to really as risk appetite would pick up and investors even on a short term basis would seek higher yielding currency and investments and use the dollar as a carried trade ,even it it meant just base on over night moves.

But if news out of China was bad for their economy investors would run to the USD as a safe haven and the flows would cause a shift change, again it may just be a short term change , but enough to kill any FMT trade, and remember that during the days when China news is scheduled for release that more then likely the trading ranges will be wilder then normal.

This topic is beyond this thread, but anyone who keeps over looking this major point will have trouble going forward.

Same can be said for any major moves caused by the prior day, why would anyone take a counter-trend trade today, when we had such a BAD GDP number out of the UK last night, and also given the fact again as we can see the Asian session had a 61 pip range? With the bottom of the range at 1.5774 with over night rejection at 1.5808, even before the FMT Long trade issue.

We need to think a little and not just follow blindly after any of the above events have happen the day before and we are about to take a counter trend trade. Will this always work NO.

But it will improve our risk reward if we use some common sense, maybe like tonite Long trade signal, we could think about buying into a pullback and decrease the range size and thereby improving our risk reward.
Click to expand...

Insightful!
 
phn73 said:
A bit of info about my variation on the FMT strategy - please feel free to shoot holes in it if required!

I use the standard FMT system, but with SL=20 and TP= 7.

This has given me 7/7 wins over the last few days, and I am currently in profit for January. An interesting point, but this strategy often works REGARDLESS of whether the FMT indicator is correct or not, as the general 'noise' in the market often triggers TP. Today is a good example of such a case.

Of course this is certainly not a "get rich quick" strategy. but according to my backtest (6 months) it hasn't had a losing month yet...

Please let me know if any comments or suggestions!

Cheers!

Philip.
Click to expand...


If you have a $5,000, at 2% risk, that's $100 risk per trade. Divide that by 20 pips, you can do 5 lots per trade.
On a mini account, that's 5 lots x 7 pips = $35 profit per trade. That could add up quick!
Anything profitable looks good right now. I would back test your settings, but I messed it up trying to improve it.
 
Stats for 01-25-2011



'Live' Accounts:

FMT 4.2, FXSolutions, dealing desk, No Trade, 0.0 pips
My stats since 11-08-2010: 12 No Trades, 15 Break Evens, 17 Losses, 13 Profits, Total: -246.0 pips
Pips include slippage, using EA standard settings: 40 SL, 20 BE, 35 TP

FMT 4.2, IBFX, non-dealing desk, No Trade, 0.0 pips
My stats since 01-04-2010: 5 No Trades, 5 Break Evens, 4 Loss, 2 Profits, Total: -100.6 pips



Demo Accounts:

FMT 4.2, 5:No Trade at non-dealing desk brokers:
PFG Best, 0.0
FOREX.com, 0.0
FXCM, 0.0
Alpari(US), 0.0
FXDD, 0.0



Testing new tweaked settings, based on back testing. For more details, see Post #5659, page 708:
FMT 4.2 EA, GU M15 Chart, UK time zone.
Using PFG Best Demo Account, Settings: SL=40, TP=30, BE=20, BE+5 pips,

6:15 start, buy trade, 1.59962, 1.59560, hit SL= -40.2 pips ... :-(
My stats since 01-20-2011: Total: +25.5 pips


Oh no, this is not good . . .
 
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Stats for 01-26-2011



'Live' Accounts:

FMT 4.2, FXSolutions, dealing desk, Missed Trade, 0.0 pips
My stats since 11-08-2010: 12 No Trades, 15 Break Evens, 17 Losses, 13 Profits, Total: -246.0 pips
Pips include slippage, using EA standard settings: 40 SL, 20 BE, 35 TP

FMT 4.2, IBFX, non-dealing desk, Buy/Loss, 1.58250, 1.57836, -41.4 pips
My stats since 01-04-2010: 5 No Trades, 5 Break Evens, 5 Loss, 2 Profits, Total: -142.0 pips



Welcome to real trading:
Missed traking the trade for FXSolutions. Don't know what happen? Maybe I turned it off by mistake.
I would have had a loss, like everyone else. First time human error has kicked in since I started Nov 8.

Mark missed a profiable trade on 12-31-2010 by choice thinking it would go wrong.
I missed a lossing trade on 01-26-2011 by mistake not knowing how it happened.
Is it possible that the MT4 platform can crash and shutdown itself?



Demo Accounts:

FMT 4.2, non-dealing desk brokers, 4:No Trade, 1:?
PFG Best, 1.58252, 1.57843, -40.9
FOREX.com, 1.58262, 1.57860, -40.2
FXCM, 1.58251, 1.57801, -45.0
Alpari(US), 1.58244, 1.57805, -43.0
FXDD, (no sure, may have been turned off too, but has no trade)



Testing new tweaked settings, based on back testing. For more details, see Post #5659, page 708:
FMT 4.2 EA, GU M15 Chart, UK time zone.
Using PFG Best Demo Account, Settings: SL=40, TP=30, BE=20, BE+5 pips,

6:15 start, buy trade, 1.58242, 1.57814, hit TP= -42.8 pips ... :-(
My stats since 01-20-2011: Total: -17.3 pips


Two losses in a row!
 
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So let me get this right Deatil...the Chinese are affecting the Asian session with news announcements which is knocking off FMT...but only since the second week in December 2010...........??
 
back at the beginning of Jan, someone said they were going to wait until there had been a couple of good trades..that hasn't happened convincingly for me. I think it is best to sit and watch and see when it looks better, which i am trusting it will. The only difference i have now is that i get up even earlier to see whether anything significant is happening at 6.15. Things can kick off at 6.25 as well (just like the surge that often happens at 6.50). I haven't done well and am being very conservative until this 'couple of good trades - probably consecutive days has happened. Reduce TP
J
 
Isn't it funny how all ea's fail within a couple weeks to months from which they are launched? I give FMT credit because it lasted longer than most. However, now we approach a period where we are forced to acknowledge that 2007 to end of 2010 results are questionable. At what point can we say that an ea has been curve fit? Is it too far a stretch to say that fmt was curve fit for 2007 to Sept 2010 just prior to launch? Why does FMT not backtest well prior to 2007? If 2011 is really a new market, then is the 2007 to 2010 run over, and are we returning to market conditions that are unpredictable? We all know curve fit data eventually fails. Now we must wonder are we really just analyzing a curve fit EA?
 
I took 28TP as was my target, and am thankful to partially recover the month's losses.

Re post 5838 I have thought the same thing.

The bad facts are that the running average of the last 50 trades (I maintain lots of these statistics!) are their worst for 4 years, and that is the meter which gives me concern, however I can't think we write off a strategy until there are 2 bad months in a row.

I have wondered whether the FMT signal system would offer profit if we traded upon crossovers 24 hours a day? Or would QQE on a 1 hr chart be better? I'm impressed with how prescient that one is.

7 wins now around 28tp, 6 losses of 40. Down 42 pips this month

Good luck to all
 
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