If a trading method didn’t generate setups for a long enough period?
Hi all,
after spending a lot of time analyzing the charts I had been able to build my method based on the price action. This method was performing well from February to July of this year(2012). It didn’t give me a lot of signals. I was making only 5-7 trades a month on the 3 minutes chart. But the percentage of winning trades was like 80%.
In August I stopped trading for two weeks because I went on Holidays, but after turning back from the Holidays, my method wasn’t generating any setups. Since August till now I’ve had only 3 setups. (we’are talking about the 3 minutes chart)
As I didn’t have a setup for more than a month, I’ve lost my confidence in my method. Did this happen to you? How did you managed it? Do you think it’s better to forget it and search for other methods or it’s OK to take the setups if they will present themselves? Or maybe I should wait for the system to generate signals again, then I should test it again, before starting trading it?I trade systems that give maybe 5 to 7 trades a year! It's all down to your temprement, if you get bored easily and need a lot of action then trading is not a good career for you anyway but just by creating and following the system so far already you have proven that you have enough patience to be a trader.
I run multiple systems so that when one is not doing much the others usually are. This keeps me in a steady supply of trades. Also all of my systems are fully automated and run on end of day charts so I only need to turn the pc on once a day to let them update and then forget about them.
I would say that if, as it is 3 min charts, you need to spend 8 hours a day watching for signals that never come then I would get pretty fed up with that pretty quickly and you may be better off finding something else. If you have got some or all of it automated and/or can create alerts or in some other way can narrow down the time you spend watching for signals and it doesn't take up too much of your time then stick with it because your strike rate suggests it is worth it.
Of course a lot also depends on the amount of money you are making by trading the system. If it's giving you a full time yearly income, it's just a bit slow at the moment, then again I would stick with it because it's all you need to do. If it's pocket money then maybe again it's not worth the time and effort.
Thank you for the answer.
No, I don’t get bored easily, I don’t have problems doing something else. Fortunately I’ve learned that I don’t have to trade every day. Indeed, I trade on the 3 minutes chart, but I trade only for 30 minutes.
Unfortunately it doesn’t give me the amount of money to live on, for the moment. I’m a full time programmer.
I was also thinking that it would be nice to have more strategies, so that when one doesn’t give signals the other one will. So I just have to test other strategies and keep trading this one if the signals will present themselves.
I think that's the best plan.
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Hi all,
after spending a lot of time analyzing the charts I had been able to build my method based on the price action. This method was performing well from February to July of this year(2012). It didn’t give me a lot of signals. I was making only 5-7 trades a month on the 3 minutes chart. But the percentage of winning trades was like 80%.
In August I stopped trading for two weeks because I went on Holidays, but after turning back from the Holidays, my method wasn’t generating any setups. Since August till now I’ve had only 3 setups. (we’are talking about the 3 minutes chart)
As I didn’t have a setup for more than a month, I’ve lost my confidence in my method. Did this happen to you? How did you managed it? Do you think it’s better to forget it and search for other methods or it’s OK to take the setups if they will present themselves? Or maybe I should wait for the system to generate signals again, then I should test it again, before starting trading it?