14 Aug How Weird is This Year’s Market?
How Weird is This Year’s Market?
Aug. 14, 2023
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This week we’re talking about possible solutions to the rough price action we saw in July.
For trend following systems, it seemed a bit sketchy.
But guess what?
It’s always our fault.
It’s always our responsibility.
If price action seems predatory, then we need to solve the problem. We need to find something that works anyway.
And that’s what we’ve tried to do in the first two Newsletters this week.
First we used a shorter-term system, the Hornet, to lower the chances of getting whipsawed around. Then we introduced a new Hornet robot that uses Limit orders to enter instead of market orders.
Today, we’ll add one more thing.
We’ll look at the Heron.
As you may know, the Heron is also a short-term strategy. It uses a different indicator entry than Hornet, but it also goes for small, high-percentage wins. And even though it doesn’t have a timed exit like the Hornet, it still should be out of the market quickly on most trades.
So let’s take a look.
We’ll use new “universal” settings for the Heron. I’ve just given new sets of universal settings on Heron and Hornet to Elite Members at the start of the month.
Why use universal settings and not different settings for each pair?
Because the goal is to stay as far away from curve-fitting as possible. When we’re dealing with a sketchy, twisty market, anything that too optimized will get shredded.
So, like we did on the Hornet, we’ll use the same settings for each pair. We don’t have a Limit Order version of the Heron yet, so this is still using Market orders that can fall victim to wild spreads.
Nonetheless, here’s what we hypothetically would’ve have gotten if we traded 1 lot each time on EURJPY, NZDJPY, USDJPY, CADJPY, CHFJPY, GBPJPY, EURUSD, and AUDCAD in 2023:
Once again, on a hypothetical $10k account, this looks very good.
All we have to have is normal spreads, or not too many psychotic widenings.
On paper, using the Hornet and Heron could solve the Central Bank/Bad Market problem.
And using Limit orders might solve it even better.
We’ll see how it does in the live market. That will be the true test.
Talk to you soon.
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Disclaimer:
It should not be assumed that the methods, techniques, or indicators presented in these products will be profitable or that they will not result in losses. Past results are not necessarily indicative of future results. Examples presented on these sites are for educational purposes only. These set-ups are not solicitations of any order to buy or sell. The authors, the publisher, and all affiliates assume no responsibility for your trading results. There is a high degree of risk in trading.
HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN INHERENT LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT ACTUALLY BEEN EXECUTED, THE RESULTS MAY HAVE UNDER- OR OVER-COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN.