Trading Systems Forex - Simpler the better-

[Zenda]

OK Guys,

Lets some some back tested results...

Somehow I don't think MA crossovers will be bringing home the bacon over a few weeks, never mind months.

JonnYT

Go away JohnnyT you know backtesting is a load of of rubbish costing much wasted time - It doesn't prove anything - Complicated claptrap as any Real Trader will tell you - you cant change history - Proves absolutely nothing - waste of time and effort -

If you have your head stuck in technicalites & backtesting theories and want it proved - then it's very very sad - go back to the threads which excite those types - This one is for active traders not theorist selling complex trading systems -

You wanna backtest - carry on let us know the results - and what it proves!

 

[Roberto]

... backtesting is a load of of rubbish costing much wasted time - ...
... Proves absolutely nothing - waste of time and effort -

Depends how you look at it, no? Backtesting showing steady profits without huge drawdowns is certainly no guarantee of future success, but would you want to trade a system that showed the opposite on back-testing?

 

[robber]

Zenda, whats Ricky Tomlinson doing on the home page at www.learntrading.co.uk?

 

[Zenda]

Zenda, whats Ricky Tomlinson doing on the home page at www.learntrading.co.uk?

Nice one luv it -

 

[Zenda]

Depends how you look at it, no? Backtesting showing steady profits without huge drawdowns is certainly no guarantee of future success, but would you want to trade a system that showed the opposite on back-testing?

Dan Zanger turned $11,000 into $43M in 24 months using patterns and volume - No backtesting. - Backtesting is for technocrats wanting to prove something - usually chart fitting to sell expensive systems and software! or proving to others that they are clever programmers - show me any system that has been backtested to success? please and I'll buy it!

 

[Roberto]

Backtesting is for technocrats wanting to prove something - usually chart fitting to sell expensive systems and software! or proving to others that they are clever programmers ...

You didn't answer my question, though, Zenda: backtesting showing steady profits without huge drawdowns is certainly no guarantee of future success, but would you want to trade a system that showed the opposite on back-testing?

 

[noises49]

Trading Systems

ok I wasn't going to bite for fear of drawing attention to this thread but come on.

The simple MA cross over may well work with "magic values" 21 & 34 but several things are liable to cause burnt fingers by anyone daft enough to think your serious. Hey it may even workout in the longterm but displaying several great charts at convienent timeframes doesn't inspire me with confidence.

There may well be a place for MA crossovers but periodicity that works one day may not work the next. If you are a trendfollower fine but comments like "Cables not the place to be" tells me that your either on a windup or not seriously trading as anyone who follows it daily knows there are several great opertunaties a day for those not using 21 & 34 crossovers, some days even using 21 & 34

I may not be an old pro at this malarky but maybe you should optimize the 2 moving averages 4 times a day on all the timeframes you've displayed to determine the best to use, I may have a lot to learn but I'll be sitting on the other end of your trades just as your MA's begin to oscillate between buy and sell assuming you foolishly try it on cable

geez can't believe I bit

Sven,

Appreciate your comments; they are valid. We were not trying to imply this was the Holy Grail; just that "simple" probably is better. One day's worth of trading does not a system make, but it should be cause for curiosity, don't you think. Let's check it out tomorrow and the day after. Also, if you've got a better idea we'd be delighted to hear it.

Re Cable - With all due respect to my buddy Buk (and he knows I am a long term devotee of this pair), it is now a DOG WITH FLEAS. Started Sept at 1.79 - ended Sept at 1.79. Check the daily charts - up, down and around. A veritable pin ball machine.. If you want to trade Cable, be my guest!

 

[Buk]

Check the daily charts - up, down and around. A veritable pin ball machine..

yep, you're absolutely correct, it doesn't make a good case at all for the swinger/trend follower. There are far better behaved pairs out there. And I guess what one fella looks on as a major pain in the a** to trade, is merely 'another day at the desk' for another!! I will also agree there is no consistant, "one thing fits all markets" method of trading either these or any other instrument.....each have their merits & their pitfalls, and they'll also attract their corresponding camp followers.....at the end of the day it all boils down to earning your crust & tipping your hat to the market at the end of every day with a degree of mutual respect.....however & whatever you utilise to get YOU thru each session is what matters I think

 

[Libertine]

Dan Zanger turned $11,000 into $43M in 24 months using patterns and volume - No backtesting. :

So what you're saying is that before he started trading he had no idea whether his price/volume patterns produced profit or not? In that case he got pretty lucky don't you think?

Backtesting is for technocrats wanting to prove something - usually chart fitting to sell expensive systems and software! or proving to others that they are clever programmers

What you've described is backtesting done incorrectly.

 

[Buk]

styles & strats....for each occasion! - I'm not saying an intraday strat is clever or more profitable than scanning the currency arena for more 'trendy' set ups - in fact it's probably a far less intelligent method of collecting regular wages.....and some might argue, you make life difficult for yourself.....but one can still clip regular pips from these rangey animals whilst hanging in there for the bigger 1 - 4 cent pops up & down the ladder

makes for an interesting day at the screens anyway skinning the cat with different knives I think they call it.

 

[Dave1971]

Re Cable - With all due respect to my buddy Buk (and he knows I am a long term devotee of this pair), it is now a DOG WITH FLEAS. Started Sept at 1.79 - ended Sept at 1.79. Check the daily charts - up, down and around. A veritable pin ball machine.. If you want to trade Cable, be my guest!

I would have to disagree with you on this one, cable has made some very clear intraday moves in the last month, most of which have been breakouts from easliy recognisable chart patterns. Not much good for a trend follower, but plenty of pickings for the simple breakout strategy I use.

Horses for courses I guess.

Dave

 

[JonnyT]

Go away JohnnyT you know backtesting is a load of of rubbish costing much wasted time - It doesn't prove anything - Complicated claptrap as any Real Trader will tell you - you cant change history - Proves absolutely nothing - waste of time and effort -

If you have your head stuck in technicalites & backtesting theories and want it proved - then it's very very sad - go back to the threads which excite those types - This one is for active traders not theorist selling complex trading systems -

You wanna backtest - carry on let us know the results - and what it proves!

Complex!!!

Certainly clearer than two MAs with no trading plan.

I doubt you will make money trading MA crossovers.

This thread is pure garbage, even more so now I've posted.

JonnyT

 

[Zenda]

Complex!!!

Certainly clearer than two MAs with no trading plan.

I doubt you will make money trading MA crossovers.

This thread is pure garbage, even more so now I've posted.

JonnyT

meeeeeeow! This is a "tongue in cheek" thread but you wouldn't see that would you? still promoting your website I see in every post - Did I read it right - you said above ' that now you have posted its Garbage!'

Actually I am a Trend Follower! especially looking for distinct patterns ! in Fx simple Crossover MA can be a great indicator in looking for a change of direction (especially in longer time frames) I don't use systems to trade - I use "My eyes" and experience - If trading US shares Patterns Price and Volume are my parameters! :| I have been known to show my Live trades on this BB (for Free ).But you will never get me paying for any "System" in the long run none of them work consistantly! (if just one did, the potential is to collapse the world economy! )

Without strict financial control and discipline ( that's the 95% problem area) all trading is doomed to failure! -

 

[trendie]

Complex!!!

Certainly clearer than two MAs with no trading plan.

I doubt you will make money trading MA crossovers.

This thread is pure garbage, even more so now I've posted.

JonnyT

I thought that "Technical Analysis of Financial Markets" by JJ Murphy, had a section which compared severla systems over several years.

MA crossovers and breakouts were the most profitable, and beat the more complex methods.
You could argue the markets have changed, or any manner of things, and the study is outdated.

 

[Zenda]

I thought that "Technical Analysis of Financial Markets" by JJ Murphy, had a section which compared severla systems over several years.

MA crossovers and breakouts were the most profitable, and beat the more complex methods.
You could argue the markets have changed, or any manner of things, and the study is outdated.

Well said Trendie!

Great Book - A must read!! Trend Following by Michael Covel 2004

 

[trendie]

Zenda,

All ready got it !!
Am on chapter 9 -Holy Grails
No real trading strategies, more of a good general read.
Love the one-liners and gems of advice.

Worth it just for Ed Seykotas views.

 

[TheBramble]

This is all very interesting. You often hear how MAs are lagging indicators and therefore can only tell you what's already happened. The implication being they're no good for determination of future direction, strength, duration etc.

Yet the same people will be desperately trying to find a way to establish the current 'trend'...

Over an appropriate timeframe and with something other than MAs to get you out of a trade, I believe MAs offer an extremely useful indication of current trend and a workable system.

As for Fibs and Magic Numbers - great - whatever works in your chosen timeframe.

Zenda - full marks for freely sharing your criteria.

 

[TheBramble]

This thread is pure garbage, even more so now I've posted.

Not true on either count JT, and you know it.

Your brusque and curt manner we all know is a cover for your teddy-bear softness and sensitivity.

 

[The General]

Who the hell is Dan Zanger ? and where is the proof of his efforts ?

 

[sidinuk]

It does work in other time frames - I just found out that the Magic "Secret" numbers to use are 21 & 34 - (these numbers are my world copyright )

Out of curiosity how did you discover that 21 and 34 MA's work best?