What can be done to make a very highly unprofitable EA Profitable? - page 2
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Inverse SELL into BUY and BUY into SELL and make plenty backtesting and forward testing in demo accounts. You may see that the reversal of strategy is usefull and it might give you new ideas. Even if you don't get a profit equivalent to the previous losses (because you won't!), it might be helpfull to test the "contrary" strategy of what you've been using.
Its simply by reversing the whole trade strategy itself.
This topic is very helpful. Thanks lot
This statement is extremely far from truth. By the way, if it was so simple (just by reverting a failing strategy), why aren't everyone in the world using such method?
This statement is extremely far from truth. By the way, if it was so simple (just by reverting a failing strategy), why aren't everyone in the world using such method?
Hi forexgoshen,
The situation with reversal is more complicated.
1. There is spread
2. Market is not going to uptrend and downtrend only. Uptrend and downtrend are just ... may be ... 15 or 20% of the market movement. Others - flat or ranging.
3. Every asystem is trading system based on some indicators or price action or support/resistance and so on.
If we reverse any system - we will receive completely different system. It will not be "same but reversed" system.
Example - download any BrainTrading or Asctrend or Silvertrend indicator from Codebase, change color of the dots (red to bue, and blue to red), and trade in reversal. And you will see that it can not help.
Just the other example - RSI (Relative Strength Index).
This is default indicator in Metatrader 5.
If we will use RSI in "normal way" so it is top-bottom (or overnough/oversold):
But if we will reverse?
We will receive completely different system - it is RSI using on breakout way:
4. There is some other situation. Some people say that any trading system (in case of lower timeframe than H4 for example, and if it is not martingale) can be profitable for 3 months as a maximum. After that - the system should be improved, or trader should take a break from trading for some time. Just imagine - we will reverse? And what we will receive? Same 3 months ...
But I agree with you: it may be good to have additional parameter in any EA/system such as Reverse = fase or true for example.
''What can be done to make a very highly unprofitable EA Profitable'':See Parrando's paradox it might be helpful > https://en.wikipedia.org/wiki/Parrondo's_paradox
Parrondo's paradox?
There exist pairs of games, each with a higher probability of losing than winning, for which it is possible to construct a winning strategy by playing the games alternately.
There are 3 problems with this Parrondo's paradox concerbning forex:
1. Market is changed all the time so it can not be just one unchanged rule for "this game"
2. Any combination of A and B can be separated system
3. Price is not randomly moved on the chart.
It may work with winning systems. For example - I change manual systems all the time... it is not good habit to jump from one system to the other but I am doing it sometimes ...
I agree with this opinion.
I don't remember, who and when said, that unprofitable EA could stay profitable using simple reverse, if average loss more then two spread.
I agree with this opinion.
>>> Simple reversing of trade direction will make it profitable
This option will not work