Hi all

I have spent some time recently looking at applying this strategy across multiple pairs and was wondering if anyone else here was looking at this. I back-tested with 19 pairs using Vahids strategy, T1=50% of pips risked, T2 = 100% and moving stop to breakeven at T1. All trades run to completion (T2 or SL) or where closed Friday evening.
Each trade carried a 2% risk regardless of the number of pips risked and this was recalculated daily; ie it was always 2% of the previous days balance. Its impossible to make completely objective decisions when back testing because you can see what happened next but I had a set of rules about which patterns in the Asian session would exclude trades and which would always be taken.
Over the 6 weeks 19th April to 28th May this would have yielded a gain of about 140%. The last week of these 6 ended at breakeven and the previous week was -12%. The best week was 52%.

This is of course too short a time span to be representative for back testing and I am slowly working my way back in time. It does however show that with some work on filtering out less strong trades there may be a valid system here. The appeal to me is that all analysis and trade placement is done by 8am and then everything takes care of itself.

Is there anyone else here looking at this sort of thing? I'm wary of posting too much in the public area regarding the Vahids breakout strategy because it really should be for members only but I'd also be keen to share experiences if anyone else is interested.

All the best

Michael

Hello Michael,
testing 19 pairs? That must have taken some time
How many trades did you place in the week that you showed a 52% increase?

I did some extensive backtesting and real time testing of a similar strategy last year, but based on the Asian session being 10PM to 6AM UK time and just taking breaks of highs or lows with no discretion. It didn't work very well! I actually found the range between 10PM and 4AM UK time worked better.

I believe that you are right that you need to be able to recognise what is a better set-up. It is the skill and discretion of the individual trader that will make a mediocre strategy a winner.
Well done, looking like you can spot the better chart patterns

Good luck


Keith

Hi Michael,

Thanks for this post. These kinds of posts make me so happy and interested. It makes members think and work and it helps everybody to find new ways and approaches. This is the real meaning of forum and discussion board.

The range breakout system is not as easy as what we may think. Sometimes, specially since one month ago, we have to mix it with technical analysis. I mean it is not just a simple sideways range breakout. It is much more than that. I trade only EURUSD and GBPUSD with this system. This week, we only had one range formed after the daily candle close and during the Asian session on GBPUSD. It is on 23th. On the other days, we had to use technical analysis and having pending buy/sell orders was almost impossible.

Also some currency pairs are too noisy for this system. GBPUSD was used to be the best but now EURUSD works better.

Thanks again

Hi Keith

Yes, it took quite some time. I have done some coding to make it easier but there is still a lot of work to be done.

That week was 47 trades, with 7 hitting stop loss and 10 closing at breakeven - not a typical week I'm sure

I have also looked at taking the trades without filtering and it definitely doesn't work! I have been using the range between 10pm to 8am UK time. There are some setups which are definitely worse performers such as when it trends for the whole time. Perversely, when these ones do work they tend to reach higher multiples. I also think that when the previous day has been ranging there is much more chance of the trade triggering by a little then reversing and getting stopped out.
My strategy is to aim for 1:1 trades with stop moved to breakeven at 50%

I'm just getting back into this now as my youngest son has been quite ill but is now out of hospital and on medication. I'm trying to analyse each pair in turn to see if there is an optimal channel width, which patterns work best and also whether 1:1 is the best target. Shouldn't take more that a few thousand hours!

All the best

Michael

This week was the start of proper forward testing on a demo account.

With no trades taken on Monday (problem with one of my scripts) or Friday (caution about trading on Fridays) my net results were:
All trades 2% risk, 2% target T2
17 Trades opened.
3 hit Stop Loss
6 closed at Breakeven
5 closed at T2 (same number of pips as SL)
1 trade was closed late on Friday for about 1% profit as I don't leave these running over the weekend)
1 was closed early a little before it hit its stop loss 1.85% loss
1 was closed a little in profit for 0.3% but I mistakenly didn't cancel the second part of the order which subsequently triggered and resulted in a 1% loss, so overall 0.7% loss.

Final result for the week was 2.64% profit (£264.85 on a £10k demo account)

All trades are placed as limit orders, 2 buy and 2 sell. The first order of each pair opens at the trigger price and has full stop loss but TP at 50% of the target. The second order opens at the 50% level and has Stop Loss at the original entry price and Take Profit at 100% target. Once an order is opened the two orders in the opposite direction are cancelled by a script.

This means that left alone each triggered trade can either lose 2%, break even or gain 2%. I'm keeping this strategy for now but may change as backtesting strongly indicates the single trades with SL and TP equal (1:1) would be more profitable.

All the best

Michael

Hi, where can I find the information of Intraday Range Breakouts strategy? Thanks.

Hi Ethan

Vahid covers it in several of the videos in the member area. You need to have subscribed to his service to get them.

Michael

Hi Michael,

It has been quite quiet lately around here. Things have shaken up a bit. That is good. Those of us who have been around for awhile should by now be making progress if not already arrived at independence.

I commend you on your work. You are finding your own stride, giving birth to a methodology which will give you the confidence you need to take it to the big leagues. By developing your own style, you will be familiar with all of the nuances, all of the mechanics, which make it tick. When it performs, you will know why. When it does not perform, you will know why (unless it was just the randomness of the market). You are not blindly following a "signal". A signal should only be a crutch for the crippled, or a type of training wheels for the beginner.

You have taken off the training wheels, and are beginning to ride the bicycle under your own balance.

Stay strong Michael. At this rate, you will surely get there, and one morning you will wake and say "Aha!!! this is how I trade!!!"

Vincent

Hi Vincent

Thanks for the kind words and encouragement. Personal progress is what its all about isn't it.
I'm not sure I agree that the 'shakeup' has been good though, there are only a few people posting as it is. I value Keiths posts both for what he is doing and his comments on others posts. I hope he starts posting again soon.

I'm glad that Vahid has stopped focussing on sniping and short term trades. I never understood how that fitted in with his philosophy that scalping was a waste of time.

All the best

Michael

Good in the sense, it takes away the diversion. Sometimes a lot of talking can just be a diversion from the fact that one does not really know what one is talking about, and I mean know experientially, not academically. I speak of no one in specific, just generally.

We all are scalpers if we are trading forex. We just choose different time frames to accomplish the task.

Exactly Bill!! What an Aha experience when we realize that.

Here is a blast from the past:

"I have expressed this early on. I have also stated that in my opinion it is all relative. All lower time frames are scalps of their higher time frames. a 15M is scalping maybe the 1 Hour or 4 Hour. There are 4 15M periods in the 1 Hour or 16 15M in a 4 Hour. There are 6 4 Hour periods in a day 30 4 Hour periods in a 5 day period.

As I see it, one who trades the 4 hour is scalping the daily or weekly. The danger for most in low time frame scalping is the speed and skill required, as well as the danger of loss due to the spread.

Price moves, period. All of these delineations are just arbitrary. "

http://www.forexoma.com/forums/at-the-risk-of-being-critical-477.html

Vincent

Hi Michael,

That was unfortunate about Keith - I was quite taken aback by that post.
Anyway - regarding your trading, which currency pairs did you trade?

Looking at last weeks m30 charts and the choppy price action I cannot figure out which pairs you traded or at least how. The JPY pairs for example are just too wild.
If you trade the JPY pairs then you would have missed the clean move down on Friday with the CHFJPY.

Regards,
aquiagora

this result was just for week. but i made backtest for a year. there was other result.

Hi, I have started testing the London session breakout range system that Mr Vahid has metioned in his training videos. At the end of each month I will try to post the results from my demo account.
The rules are simple:
1. Trading GBP/USD pair only
2. 20 pips filter
3. 3 pips stop-loss from resitance or support
4. 1:0.75 stop-loss to target ratio
5. Maximum range 80 pips