Losing consistently in a trend is frustrating. It tends to make people feel either stupid or conspired against. The market always goes up ... until you buy. What's with that?submitted by whatthefx to Forex [link] [comments]
If you find yourself getting the run around in trending moves, this post should help.
We'll start with having a look at the areas common styles of trend following can generate losing signals '/ stop losses. The two main types of trend trading are breakouts and retracements. Here we can see the areas they are likely to generate losing trades in a typical trend formation.
On the left, we have breakout loses. On the right we have retracement losses.
The trades on the right are not too much of a problem. If you had a sold trend trading strategy using breakouts and maintained it with good money management, you'd be doing well. Having some strings of small losses would not matter relative to the trend moves you catch. It's this red bit. This is where things get sketchy. Here a lot of false signals will be generated. In a larger picture for retracement traders, but also on short term false breakouts.
Strategies that would have been very profitable ran through the blue area can become breakeven or losing strategies in the red area. This is actually (in my view) likely the reason most trend based EAs that can be designed easily or bought have limited long term profitability even if they produce great short term results. To make money in a blue market, the EA needs you to tell it how to do two things. Not get stopped out, and sell. There may be bumpy bits, but it will make money so long as that market condition continues.
This is all well and good, but the reality of having to deal with risk control in adverse market conditions will inevitably come along. When this happens, not adapting your trend strategy to filter out the losing streaks that most strategies will generate seriously hampers your net profitability and can even turn a good strategy bad.
In the early week gap and brief breakout on USDJPY, I thought it was likely we were switching from a blue market to a red market. So I activated the trend followers of different variations on my Shorting Noobs strategy, and waited to see if they'd pick up the worst signals (giving me ideal entries).
I explained what I thought the best trade pan for the sort of price action we'd see in the coming trading sessions would be.
My theory here is if you put a bunch of okay strategies (and these are not horrible traders. They have rules, and follow them. Do overall okay) into the very worst conditions, they'll do the worst thing. Which saves me the effort of being here doing what I think is the best thing. To look for big drops, and then it have a little false breakout. Buy this and take profits into spikes.
Here that is a bit closer.
Particularly where the red mark is, this has produce a perfect counter signal. Sharp drop, false breakout. Buy and take profit into spike up.
The interesting thing about this for me, is I do not find too much to be critical about with many of these positions if we are to look at the market from the perspective of a seller. Their stop losses seem to make sense from much of the stop loss rules commonly used (and ones working for them okay in other times of the strategy), but they're commonly being stopped out at the highs.
The main problem most strategies have is the recurrence of what can be increasingly strong looking sell signals. When using solid rules, this is a limited problem (can still be big), but without this and with there being emotional decisions made, this is a really hard time to trade. It's easy to lose all your money trying to follow the trend here, without really doing too much wrong other than starting to chase a loss or refuse to accept a loss. Then things happen so quickly, and that's it. Being a revenge seller selling into the bear engulfing bars right before the 50 pips 1 minute candles does not go well a few times in a row (tried and tested, would not recommend).
As I mentioned in the comments for the OP of this analysis, I stopped selling at 106.05. I stopped copying most of the strategies there because I didn't want them accumulating sells at a possible high. All through the consolidation period their have been sells accumulating and obviously the stops are above the highs, which is exactly the area I'd expect to spike out and reverse from in this pattern. It's what my manual trade plan inverts.
So at this point these strategies that have been doing well over the blue period (which has been a longer time) have lost most of gains. If the trend continues from here in the main they will breakeven on this red section (would be okay). If there are spike outs of the highs they will generate a lot more losing signals. By the end of this, strategies that have been profitable for 3 months will have leaked back a substantial amount of that in only 4 - 5 days.
Learning to remove these correction weeks from their trading patterns would very much benefit most trend following systems.
Here's the overall results from betting against either trend following or trend reversal mistakes like this.
Is it possible to program an EA based on a session breakout, basically here are the rules of my system;-take high and low and specific time-for long entry, draw fib retrace from high to low - set entry at high +2 pips, sl at 38.2% retrace with TP at 261.8% retrace and set B/E when price reaches 161.8%. -opposite for short-orders automatically set lot size for specific percentage risk. I know ... Session breakout ea - Looking for Session breakout ea? All about Session breakout ea, mt4 robot and Session breakout ea Problem i have meaning all other processes are. .. Breakout EA with the default settings Before proceeding to describe the robot configuration, we shall say a little about the logic of its work. At 8 pm GMT (before many European traders and banks enter the market) the EA puts two pending orders beyond the boundaries of the morning flat – buy stop and sell stop with the set parameters of stop-loss and take-profit. Forex London Session Breakout Expert Advisor. If you have been trading FX for any length of time, you will almost certainly have heard of the London open. London is the biggest FX market in the world and the objective of this EA is to take advantage of the momentum and volume which enters the market like clockwork from 8AM UK time every working day of the year. The London Session Breakout EA ... Hi Forex Wiki Friends, FXGen BreakOut MultiCurrency EA Description: Without volatility, trading the financial market is close to impossible. Profit is made ONLY when price is moving. The ERXGen OK so I opened a demo mt4 account at forex.com. opened EUR/USD chart M15 and loaded the indicator. Everything is default EXCEPT "Session.CloseOnHour" which is set to false. Attached Image (click to enlarge) Post # 22; Quote; Jun 27, 2012 4:42pm Jun 27, 2012 4:42pm stefan416 Joined Mar 2011 Status: Member 99 Posts. Well Im glad I have you helping me instead of an amateur (no offense to ... ERXGen BreakOut MultiCurrency Trader. Show Trade Info – if TRUE, this is a visual display on the top right corner of the chart with key trade information e.g. lot sizes, account balance, equity, drawdown, number of trades, profit, risk percent, etc.; ShowComment – if TRUE, this displays comments on the chart showing the status of the three rules, GMT time, breakout candles, etc The 20 Pips Asian Session Breakout Forex Trading Strategy is a trading system designed to capture the breakout of the asian trading range during the london forex trading session. Let’s be honest, many forex traders don’t like trading the asian forex trading session…why? For one simple reason only: price does not travel too much at all which simply means less trade volume compared to the ... ERXGen Breakout Multi-currency EA. Without volatility, trading the financial market is close to impossible. Profit is made ONLY when price is moving. Following the release of very popular indicator – ERXGen Filter, being used by hundreds of traders this is an automated trading system giving traders even more benefits for their trading. Price action during the Tokyo trading session is used to ... Forex breakout EA: A breakout method can supplement other trading patterns and offer diversification.Big breakouts are “occasion driven” in that they regularly show up around the release of critical facts. Minor breakouts, candle breakout ea which can be more frequent, often have a “technical pull” behind them.
[index]          
Academy: http://bit.ly/2wSQkyx Tokyo Session Forex Trade Example - How To Apply The Market Phase Concept I strongly anyone trying to learn Forex trading must... EA-Link: https://www.mindfulfx.de/open-range-breakout-ea Without volatility, trading the financial market is close to impossible. Profit is made ONLY when price is moving. The ERXGen (Early Riser Next Generation) Breakout System is a short-term trading ... Forex Breakout Expert Advisor ... I made 184% in 8 days trading using this EA. I used aggressive settings. The DD was 28.9%, Profit factor is 4.56 The EA is ... Learn more at http://www.SlickTrade.net Like, Share, Comment Subscribe :) #forextrading #nadextrading #forexstrategies #nadexstrategies #onlinetrading #workf... Watch this lesson to discover an effective scalping trading strategy that could help you become more successful when trading the Forex market. In this video ... #forex #forexlifestyle #forextrader Get the tool here: https://a1trading.com/software/the-breakout-super-scanner/ Want to join the A1 Trading Team? See trade... 3 simple steps to make profit by Tokyo Box Breakout Strategy. I am showing the break out strategy with LIVE trading on CHFJPY on 26 of June, 2019, and explai... Found this in http://www.forex-tsd.com/metatrader-4/24353-free-breakout-ea.html Back test and found it is not bad. May need some trailing stop but at lest st... In this video I reveal my hidden London Session Breakout Trading Strategy. If you are a 9-5 person with full time job, this is a perfect trading strategy for you. I compare the regular Candlestick ...