Set and Forget Breakout system by FXiGoR

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iGoR
1474
iGoR  

Hi Everyone,

Were I normally believe that trading is very hard work and one can only get good at if spending all your time in it ( as everyone who is very good in his field--from doctor to tennis player) I would like to go over a system with you that is a "set and forget" principle.

It is a breakout system that I would doubt if it is not been looked at before because of the simplicity of the rules.

But I would like to look at it in combination with a few indicators.

I don't know if the indicators will be usefull or not. For all the same it is maybe better to just take the breakout rules with S/L and T/P.

I hate the aproach of so called making a daily amount of pips profit. Trading is surviving in bad periods and taking full advantage in the good periods. That makes an overall profit at the end of the year.

I believe if one is looking for a monthly profit he or she should pick up an normall job.

But lets give it a try.

The rules as I said are very simple and should work on every pair.

If one wants to make an EA for it please be my guest.

I went over the gbp/usd over the worst periods this year between march and june and it worked like a charm. Needles to say that between july and now it works flawless.

But there is 1 problem that today I can't seem to solve.

So the entry rule is going long when the high of yesterday is broken or going short when the low of yesterday is broken. Nothing more nothing less.

I looked on the gbpjpy and there my T/P was 10 pips. It could be that back tests would show us that a bit bigger T/P is also working.

When there is a day that you were not able to make 10 pips profit then the next day you go for 20 pips. If again you were not able to make your 20 pips that day you go the next for 30 pips profit.

Over this years period the highest profit I had to go for was 40 pips and succeeded doing that ( shown on the picture).

Don't ask me what the rule should be if after 10 days we still did not succeed. That is something we can look at to solve.

So basicly speaking I managed with "compounding" to get my so called daily 10 pip profit target. But of course placed on the 6 majors a day can give 60 pips profit.

BUT..and there is a BIG BUT. At this moment I don't see it or feel it how to incorporate the stoploss. Because there were severall days were we entered on a breakout but did not manage to get our 10 pips and price went back completely in the High and Low channel.

I sujest to close all orders and positions the latest at 22.00gmt

So some of you will already understand that this system will give us very high hitrate but the no stoploss rule can spoil the party.

It could be that the days that we don't have a stoploss will eat out the profit of all the other profitable days.

So we need to find a logic stoploss rule or with the help of an indicator.

If we manage to find that and you place this system on 6-8 pairs it COULD be a nice money machine.

On some pairs we will need to take the T/P a little bit smaller and on some other pairs like the gbpjpy bigger.

I know it hasn't a lot to do with real trading but it could be in the interest for people who don't have the time to look to their charts at all or who were smart enough to keep their normall job.

Every bit of feedback is welcome. If you have any remarks or ideas I sujest that you take your time and go over your charts and look over severall months if your idea still stands. Needles to give ideas that would be based on the last couple of days.

The best test period is between february and june this year because of the very low volatility and small daily ranges. Needles to see if this works on very nice trending days.

In the template I have placed the high and low indicator and also some zizag indicators that will show you new lows or highs that are made.

So all the succes of this simple aproach will depend on the rule that we can come up for the stoploss.

Again I succeeded to have EVERY day of this year the avg. 10 pip profit (if not 10 pips the other day 20 or next 30 etc). But that was without any stoploss taken in account. I'm looking forworth to the solutions that we can come up with.

succes and to be continued..

regards..iGoR

iGoR
1474
iGoR  

picture of breakout channel with indicators ( picture of the template).

regards...

Files:
breakout.gif 71 kb
PRADIP RUPARELIA
6166
PRADIP RUPARELIA  

iGor

I suggest you use a optimised stop loss not to be hit frequently and a take profit taget which is not exected unless triggered by a proportional trailing stop loss

The proprtional trailing stop loss works on the following basis

And the new trailing stop loss is a proptional trailing stop.The trailing gap decreases as a trade gets nearer to the take profit target.

Example ...take profit is 50 on a trade.........as price gets nearer to profit target ,the trailing level decreases....eg start 50 ..........at 25 pip away from take profit ...the trailing level reduces by 25% to 37 ,at 10 pip away trailing level reduces to 50% 25

Regards

El cid

iGoR
1474
iGoR  
el cid:
iGor

I suggest you use a optimised stop loss not to be hit frequently and a take profit taget which is not exected unless triggered by a proportional trailing stop loss

The proprtional trailing stop loss works on the following basis

And the new trailing stop loss is a proptional trailing stop.The trailing gap decreases as a trade gets nearer to the take profit target.

Example ...take profit is 50 on a trade.........as price gets nearer to profit target ,the trailing level decreases....eg start 50 ..........at 25 pip away from take profit ...the trailing level reduces by 25% to 37 ,at 10 pip away trailing level reduces to 50% 25

Regards

El cid

Thanks for your contribution el cid.

But to be honest I don't understand what you are explaining.

So could you please explain a little bit more in detail or with a picture ( a picture speaks a 1000 words)

regards..iGoR

karmizi
23
karmizi  

simple trading

hi igor,

ur system is quite similar with what im using now. Yes, i also got problem on where to place my stoploss. Im using combine system by asian hi&lo by fxoperator and theonlypivot by stevenali.

I dont place any stoploss because most of my trade will close in 1 day. I always monitor it during news if the price reverse i will close in lose. Most of the time the accumulate profit is more than the losing trade. here a picture of my system.

Files:
simple.jpg 179 kb
PRADIP RUPARELIA
6166
PRADIP RUPARELIA  

iGoR

I find trailing stop strategies more profitable on trending days ,they simply let your profits run.Here is how a proportional TSL performs compared to normal take profit

PRADIP RUPARELIA
6166
PRADIP RUPARELIA  

Hi

A stop loss level of 35 to 50 is adequate for most low spread pairs excluding gbp/jpy

Regards

El cid

drayco
37
drayco  

Wasn't the SRDC method similar? Also, there is another variation called $TRILLION STRATEGY over at kolachitrader.net in the trading systems/methods area of the forum.

droesparky
756
droesparky  

YEp its is the SRDC method.

There was a argument from some to use the day befores open and close for entry of long or short, More pips.

There is always a problem with initial stop setting on these systems. You can eat up several days profit in a hurry when your only going for 10 pips.

Also often yesterdays high or low makes a nice double top or double bottom trade in the opposite diredtion.

Arctic4x
87
Arctic4x  

I never look very close into the SRDC method so i may be wrong but as far as i remember the only thing similar to that method is the breakout of the previous day high or low and that SRDC also use a small target.

I can not remember that the rest was the same or was it?

Arctic4x

PRADIP RUPARELIA
6166
PRADIP RUPARELIA  

iGoR

When you trade breakouts you gotta think like a casino owner and operate a gambling system based on probabilities.

The only way you will find out the probabiities to write an E A and backtest it ,and it will tell you your best t/p and s/l

Regards

El Cid

12
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