GBP JPY Candle Counter System

[lbranjord]

Hey all. Sharing a system with you. It looks great, I have not traded it and I made it in one day. So trade at your own risk, test first, yada yada yada

Pair: GBP/JPY only (test others if you like, i didn't bother.)
Time: Daily Charts
Indicators: 60 sma

Entry: open of daily candle (must be midnight cst or est)

Stop: 110 pips
Profit: 200 pips

Exit: at close of the candle if target/stop were not hit

How to: Are you above the 60 sma? Then consider the trend up. Are you below the 60 sma? Then consider the trend down.

Count the last few candles and follow these rules:

FOR UPWARD TRENDING---------------------
One green candle - Don't trade
Two consecutive green candles - Buy
Three consecutive green candles - Buy

One red candle - Buy
Two consecutive red candles - Sell
Three consecutive red candles - Sell

FOR DOWNWARD TRENDING------------------
One red candle - Don't trade
Two consecutive red candles - Sell
Three consecutive red candles - Sell

One green candle - Sell
Two consecutive green candles - Buy
Three consecutive green candles - Buy


---------------------------------------------------
Finishing touches: Don't count dojis, pretend they're invisible and look to the candle before them to follow the rules. Don't count any candle that's body is across the sma.


Please, as always, try to break it. This is a candle counting system based on historical odds of this pair in particular. If you want to see the odds I have them and can post. Good luck all! Nice easy system for you.

 

[Sang Froid]

Hey all. Sharing a system with you. It looks great, I have not traded it and I made it in one day. So trade at your own risk, test first, yada yada yada

Pair: GBP/JPY only (test others if you like, i didn't bother.)
Time: Daily Charts
Indicators: 60 sma

Entry: open of daily candle (must be midnight cst or est)

Stop: 110 pips
Profit: 200 pips

Exit: at close of the candle if target/stop were not hit

How to: Are you above the 60 sma? Then consider the trend up. Are you below the 60 sma? Then consider the trend down.

Count the last few candles and follow these rules:

FOR UPWARD TRENDING---------------------
One green candle - Don't trade
Two consecutive green candles - Buy
Three consecutive green candles - Buy

One red candle - Buy
Two consecutive red candles - Sell
Three consecutive red candles - Sell

FOR DOWNWARD TRENDING------------------
One red candle - Don't trade
Two consecutive red candles - Sell
Three consecutive red candles - Sell

One green candle - Sell
Two consecutive green candles - Buy
Three consecutive green candles - Buy


---------------------------------------------------
Finishing touches: Don't count dojis, pretend they're invisible and look to the candle before them to follow the rules. Don't count any candle that's body is across the sma.


Please, as always, try to break it. This is a candle counting system based on historical odds of this pair in particular. If you want to see the odds I have them and can post. Good luck all! Nice easy system for you.

Well it sounds interesting but why the need for the 60sma? If I've read this right, if there are two or three consecutive up (green) candles you buy regardless of whether the price is above or below the 60sma. If there are two or three consecutive down (red) candles you sell, again regardless of whether the price is above or below the 60sma? So why have the 60sma in the first place?

It sounds a bit like roulette to me, wait for a sequence of x amount of red/black then whack your stake on accordingly. Having said that, the trend is your friend and all that.....

What about S/R? If the price is pushing resistance say, do you still buy after two green candles? also 200 pips is a hell of a long way to go in one day, how do you manage the trade? Trailing stops or just set and forget?

I'll give this a test next week on a demo and let you know how I got on.

 

[lbranjord]

Well it sounds interesting but why the need for the 60sma? If I've read this right, if there are two or three consecutive up (green) candles you buy regardless of whether the price is above or below the 60sma. If there are two or three consecutive down (red) candles you sell, again regardless of whether the price is above or below the 60sma? So why have the 60sma in the first place?

It sounds a bit like roulette to me, wait for a sequence of x amount of red/black then whack your stake on accordingly. Having said that, the trend is your friend and all that.....

What about S/R? If the price is pushing resistance say, do you still buy after two green candles? also 200 pips is a hell of a long way to go in one day, how do you manage the trade? Trailing stops or just set and forget?

I'll give this a test next week on a demo and let you know how I got on.

First off why the 60SMA? - very valid point there. I didn't realize by the time i'd finished the system I'd rendered it useless in MOST cases. But, did you notice the 'do nothing' scenario? That is important. The inverse is to open up a trade. This has to be in accordance with the 60sma or it will ruin the percentages.

Second, S/R - Another valid point. When I traded this, after forty trades I was up a thousand pips. I completely disregarded the S/R, fib levels, everything. I want it to be simple and odds based, similar to card counting. Feel free to optimize the system or tweak it, but that goes against the basis for creating it in my opinion.

Third, why the huge target profit?! why the huge stop loss? - They are there just to protect from catastrophe and to capitalize on home runs. I'd rather the exit be based on the close of the candle, so these are only a necessary evil and I'm trying to avoid using them.

Here's the stats I have from testing. The first row is the result of the trade, the second row is cumulative pips. Notice the first 20 or so trades are during a range and it manages to break even (an accomplishment compared to other systems). Notice after surviving crap conditions, a trend starts and the system shines with 1000 pips (reasonable for a two to three month trading period.)

Thanks for the comment! Good points

-35 / -35
32 / -3
-57 / -60
-110 / -170
71 / -99
94 / -5
78 / 73
-110 / -37
7 / -30
71 / 41
112 / 153
-45 / 108
-110 / -2
-59 / -61
42 / -19
-72 / -91
16 / -75
-16 / -91
53 / -38
-74 / -112
200 / 88
11 / 99
42 / 141
200 / 341
31 / 372
200 / 572
19 / 591
-110 / 481
122 / 603
59 / 662
142 / 804
-15 / 789
-13 / 776
74 / 850
108 / 958
-32 / 926
75 / 1001

 

[lbranjord]

More results (excerpt from 2009)
18/ 18
200/ 218
200/ 418
-110/ 308
200/ 508
-110/ 398
-110/ 288
-110/ 178
-10/ 168
-110/ 58
186/ 244
-110/ 134
200/ 334
-56/ 278
-110/ 168
-59/ 109
108/ 217
200/ 417
23/ 440
200/ 640
81/ 721
194/ 915
200/ 1115
200/ 1315

 

[kraven]

Hey all. Sharing a system with you. It looks great, I have not traded it and I made it in one day. So trade at your own risk, test first, yada yada yada

Pair: GBP/JPY only (test others if you like, i didn't bother.)
Time: Daily Charts
Indicators: 60 sma

Entry: open of daily candle (must be midnight cst or est)

Stop: 110 pips
Profit: 200 pips

Exit: at close of the candle if target/stop were not hit

How to: Are you above the 60 sma? Then consider the trend up. Are you below the 60 sma? Then consider the trend down.

Count the last few candles and follow these rules:

FOR UPWARD TRENDING---------------------
One green candle - Don't trade
Two consecutive green candles - Buy
Three consecutive green candles - Buy

One red candle - Buy
Two consecutive red candles - Sell
Three consecutive red candles - Sell

FOR DOWNWARD TRENDING------------------
One red candle - Don't trade
Two consecutive red candles - Sell
Three consecutive red candles - Sell

One green candle - Sell
Two consecutive green candles - Buy
Three consecutive green candles - Buy


---------------------------------------------------
Finishing touches: Don't count dojis, pretend they're invisible and look to the candle before them to follow the rules. Don't count any candle that's body is across the sma.


Please, as always, try to break it. This is a candle counting system based on historical odds of this pair in particular. If you want to see the odds I have them and can post. Good luck all! Nice easy system for you.

Sounds like another simple interesting idea you have there lbranjord.
Problem i see is waiting for bar closure and the size of 1 day movement. For example, trend is down, you wait for your second down bar to close, you sell. the next day you get a green bar of 130pips (easy in one day). SL hit.
This could continue for a while.

 

[kraven]

I've just done a small run. There will be lots of in and out (not that bad really on 1 day chart). And because SL on a daily bases may be too low?? I've upped it to 200. Target is none existant as this system will rely on it's long winning runs to work (see chart). Chart shows 4 losses (- 144, -78, -69,-181 = -457) with 4 winners (+18,+764,+95,+667 = +1544) for a total of +1087

 

[lbranjord]

I've just done a small run. There will be lots of in and out (not that bad really on 1 day chart). And because SL on a daily bases may be too low?? I've upped it to 200. Target is none existant as this system will rely on it's long winning runs to work (see chart). Chart shows 4 losses (- 144, -78, -69,-181 = -457) with 4 winners (+18,+764,+95,+667 = +1544) for a total of +1087

Ha sweet. I guess you're no craven after all huh?

I thought it was dead because I tested other years and could not pull profits. Always break even. You've added a new dynamic with no target. Thanks for the help. Perhaps it is worth it's weight after all.

Make sure you test other spots. I gathered this data from early 2009, so if you try and backtest that region, you will do extremely well because the buys and sells are tailored to that section. Does that make sense? Try 2008 for instance. My goal was a 55% strike or better...

 

[kraven]

I plan on forward testing it with a demo account with multi currencies for a few weeks. It shouldn't be much hassel. The broker daily candle finished at 11p.m, so it's just a matter of checking them all out together. For example i don't need to check tonight as I've looked and none of them I've charted will leave a bet.
As I said, this will rely on letting them run. They'll be lots of negative results but if i've got this right the one or two big movements will hopefully leave profit. We'll see.
I'll also try and adjust the SL, this may vary between currency pairs.

 

[lbranjord]

Nice. Yeah I chose GBP JPY for the big movements. I'm going to reread your post and go do some backtesting using your additions to the system. I'm sticking to GBP/JPY to make it simpler on me.