Forex trading strategy #23 (Trading with Average Daily Range)
Submitted by User on July 7, 2009 - 09:20.
Submitted by Ipun
1- Close out any open position
2- Cancel any unexecuted orders
3- Set an Entry Buy order 1 pip above previous high
4- Set an Entry Sell order 1 pip below previous low
5- Set stops and limits using the following guidelines:
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I have developed an EA for this strategy that also includes partial closes, 3 exit options that are triggered at x PiPs past open, and incorporates a compounding money management system. I straddle the market when it is in consolidation (for example EUR/USD around 21:30 GMT). This strategy has a 50/50 win ratio at best. Here is the problem. The market goes one direction hits your pending buy or sell and then reverses to your stop loss. This could be a VERY profitable strategy/EA if someone can figure out how to reduce the false entries. It works great if the market takes off out of consolidation and trends one direction. It loses money in a sideways market. I will add and test any good ideas to solve this problem and share the EA with anyone who can solve the problem. I can be contacted at FXPiP.Rider@gmail.com
I forgot to add this. Here is a screen shot of the EA in action. The settings at the bottom show some of the options that can be set in the EA. The Yellow line is the pending sell trigger line that was not hit. The gray box in the background is the current daily range. 14 and 50 EMAs. You can clearly see how one or two PiPs on the low side would have triggered a sell and the sell would have been a loss. Link to screen shot http://screencast.com/t/cM3HNLlvD I've tried narrow straddles and wide straddles, same results in back testing. Any Ideas?
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