ChattiFX, is your strategy entirely coded/captured in the EA? If so can't you backtest your different strategy configurations using MT4 backtesting functionality? You could use it to get a better idea of its performance over a much longer period?
Stop-Losses is indeed a very interesting topic... Most people swear by them although I've met a handful of very successful traders that simply don't believe in them. I have a fully automated neural network system that doesn't use stop-losses but this is only after the in-depth analysis I carried out proved out that in pretty much all cases (except for GBP/JPY) stop-losses degrade the performance quite significantly.
Stop-Losses is indeed a very interesting topic... Most people swear by them although I've met a handful of very successful traders that simply don't believe in them. I have a fully automated neural network system that doesn't use stop-losses but this is only after the in-depth analysis I carried out proved out that in pretty much all cases (except for GBP/JPY) stop-losses degrade the performance quite significantly.
ChattiFX
Member
- Messages
- 66
- Likes
- 4
I still exit manually at the moment and if I see obvious S/R then I occasionally move stops manually as well, so it makes it difficult to back test. I am working on an exit signal at the moment but I'm some way off getting it right for now.
The biggest thing that surprises me with Stops is when people say they use a set value i.e. 10, 20... etc pips. My stops have always been a multiple of an ATR value or based around S/R to take into account the different ranges of movement of the different pairs. For example a 10 pip stop for EUR/USD and GBY/JPY are two very different things... I hasten to add that I haven't done any analysis on this, it just seems logical to factor in the average range of a pair when setting a stop...
CFX
ChattiFX
Member
- Messages
- 66
- Likes
- 4
Ok quick update. I will continue to run the experiment for another few weeks and update the thread but to be honest the writing is already on the wall... This last week has given me everything I asked for in showing the weaknesses.
The shortest stop of 2.5xATR is too volatile, in a strongly trending market the rewards are very good but any sideways movement kills it. Literally drawdowns of over 50%...!!
There is less in it for the other two settings. I'm favouring the more conservative 7.5xATR going forward. Wins are obviously lower as the positions are smaller but in both trending and sideways markets it traps far less losses so gives a better return.
Obviously two weeks isn't enough to qualify anything but I will be switching my real money account to 7.5 and Demo to 5. The other demo will be running 7.5 and an idea I have for automated closing.
As a side note... I do intend to give more details on the actual strategy I follow and how I arrived at it but not until I am a bit more confident that it produces a decent return over an extended period, 6-12 months maybe.
Anyway I'll drop back and update at the end of the month probably, and of course answer any questions that get posted... Also thank you for the various people that have taken an interest and posted themselves, always interested in a different point of view!!
Cheers
CFX
The shortest stop of 2.5xATR is too volatile, in a strongly trending market the rewards are very good but any sideways movement kills it. Literally drawdowns of over 50%...!!
There is less in it for the other two settings. I'm favouring the more conservative 7.5xATR going forward. Wins are obviously lower as the positions are smaller but in both trending and sideways markets it traps far less losses so gives a better return.
Obviously two weeks isn't enough to qualify anything but I will be switching my real money account to 7.5 and Demo to 5. The other demo will be running 7.5 and an idea I have for automated closing.
As a side note... I do intend to give more details on the actual strategy I follow and how I arrived at it but not until I am a bit more confident that it produces a decent return over an extended period, 6-12 months maybe.
Anyway I'll drop back and update at the end of the month probably, and of course answer any questions that get posted... Also thank you for the various people that have taken an interest and posted themselves, always interested in a different point of view!!
Cheers
CFX
ChattiFX
Member
- Messages
- 66
- Likes
- 4
Oops sorry, below are results for this week to quantify it a bit. To be clear, figures represent the growth in account value since open of market on Sunday night this week, not since the experiment started last week...
Real - SL=5xATR - +19%
Demo 1 - SL = 7.5xATR - +25%
Demo 2 - SL = 2.5xATR - -17%
CFX
Real - SL=5xATR - +19%
Demo 1 - SL = 7.5xATR - +25%
Demo 2 - SL = 2.5xATR - -17%
CFX
ChattiFX
Member
- Messages
- 66
- Likes
- 4
Hmm, tough week... :-/
3rd week of my monthly experiment.
Real - SL=7.5xATR - -7.5%
Demo 1 - SL = 5xATR - -20%
Demo 2 - SL = 2.5xATR - No longer trading but if I had been I reckon it would have been at least -50%...
It was a real up and down week for both Real and Demo 1. In the past I probably would have got frustrated and started tinkering but I just left everything as it was and took my profitable trades as best I could. By lunch on Wednesday I was about 20% down then a bit of news and I was back to making a nice profit (about 15% up) for the week, Thursday was a bit of a nothing day and Friday afternoon I gave my profit back. and a bit more, to end the week down... :-( my first losing week in the last 2 months. Looking through the charts the JPY did most of the damage, but then it has given me a lot of profit recently so I can't complain really...:innocent:
Now I guess I shouldn't be too upset with that and I am just about to go back through my weeks trades to look for any synergies that I can use to my advantage. I have already worked on a nice exit signal which has been a weakness up to now and will probably form the basis of next months experiment. I've been on Garden Leave for the last few weeks but from 1st July I will be back to work so fully automating the system is a must really.
Anyway, I'll up date the thread next week and summarise what I have concluded.
Cheers.
CFX
3rd week of my monthly experiment.
Real - SL=7.5xATR - -7.5%
Demo 1 - SL = 5xATR - -20%
Demo 2 - SL = 2.5xATR - No longer trading but if I had been I reckon it would have been at least -50%...
It was a real up and down week for both Real and Demo 1. In the past I probably would have got frustrated and started tinkering but I just left everything as it was and took my profitable trades as best I could. By lunch on Wednesday I was about 20% down then a bit of news and I was back to making a nice profit (about 15% up) for the week, Thursday was a bit of a nothing day and Friday afternoon I gave my profit back. and a bit more, to end the week down... :-( my first losing week in the last 2 months. Looking through the charts the JPY did most of the damage, but then it has given me a lot of profit recently so I can't complain really...:innocent:
Now I guess I shouldn't be too upset with that and I am just about to go back through my weeks trades to look for any synergies that I can use to my advantage. I have already worked on a nice exit signal which has been a weakness up to now and will probably form the basis of next months experiment. I've been on Garden Leave for the last few weeks but from 1st July I will be back to work so fully automating the system is a must really.
Anyway, I'll up date the thread next week and summarise what I have concluded.
Cheers.
CFX
resistance
Member
- Messages
- 89
- Likes
- 1
I find stop loss very effective for new trader s .They can manage their accounts with it . They know before what will be their possible loss so they do trading in a planned way . Stop loss avoids unlimited loss in trading . It saves rest of the amount from risk ans automatically close positions.
ChattiFX
Member
- Messages
- 66
- Likes
- 4
Yes I agree, although I don't think a stop loss is exclusively for new traders...
Apologies I started a new job today and didn't have time to add an update for the end of the experiment last week. And what a rubbish week it was too, literally gave most of my profit for the month back. Although it has given me a few ideas which I will come to at the end of my post.
My second losing week in a row, although only my 2nd losing week out of 8 and my second profitable month in a row.
After the very good first week of the month the last three were pretty poor really and so my end results for the month are as follows:
2.5 x ATR - discontinued due to large drawdowns.
5 x ATR - +17% growth over the start of the month.
7.5 x ATR - + 24% growth over the start of the month.
So it doesn't take a rocket scientist to see the last couple of weeks had pretty bad drawdowns...
Firstly, as a result of this little test I am happy to stick with 7.5xATR for now. However having analysed the results for the month I think I have identified a weakness that will improve the system by keeping me out of trades going against trend. I will start a fresh thread on this change though. I need to do some more analysis on it before then so it probably won't be until The end of the week...
Anyway, thanks again for people's input and I hope my ramblings have been of a little interest... :-/
Cheers
CFX
Sent from my iPad using Tapatalk HD
Apologies I started a new job today and didn't have time to add an update for the end of the experiment last week. And what a rubbish week it was too, literally gave most of my profit for the month back. Although it has given me a few ideas which I will come to at the end of my post.
My second losing week in a row, although only my 2nd losing week out of 8 and my second profitable month in a row.
After the very good first week of the month the last three were pretty poor really and so my end results for the month are as follows:
2.5 x ATR - discontinued due to large drawdowns.
5 x ATR - +17% growth over the start of the month.
7.5 x ATR - + 24% growth over the start of the month.
So it doesn't take a rocket scientist to see the last couple of weeks had pretty bad drawdowns...
Firstly, as a result of this little test I am happy to stick with 7.5xATR for now. However having analysed the results for the month I think I have identified a weakness that will improve the system by keeping me out of trades going against trend. I will start a fresh thread on this change though. I need to do some more analysis on it before then so it probably won't be until The end of the week...
Anyway, thanks again for people's input and I hope my ramblings have been of a little interest... :-/
Cheers
CFX
Sent from my iPad using Tapatalk HD
