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I appreciate your questions and suggestions, so feel free to ask. I can use any help here.
Last year I started the system and went pretty ok, trading it live (with money). Then in Dec21/Jan+Feb22 there were several losses that took most of the profits, and Ukraine war started.
I also accepted an assignment, so didn’t had much time anymore, and took a break from the system. I'm still on that assigment (part-time).
I wanted to review the system as well, which I did in July/August22. And then started to paper trade it, which is not going well enough.
So, a fresh look at it might help. Like trying other tickers, but I think that is not enough.
To answer your question, each day is a different setup, because it is depending on IB OC, PrD OC & 2PrD OC (so 2 days ago). Then also gap + closed (or not) and the position of the price at 9:30 play a roll.
Not any day has the same ‘filters’/settings. That makes it hard to compare or improve specific setups.
After applying all those filters, I end up with let’s say 10-25 historical trades that give a good result (> trade) or not.
I believe less filters but more specific situations (like gaps + IB OC and PrD OC) give a higher probability of success.
Yesterday, based on some of these filters, it gave a 88% win% based on 17 trades.
This means there have been 17 days that had these same filters in the past ~12 years.
And when taken a short trade from 11:30-13:30 with a SL of 18% of ATR on these 17 days, 88% were winners. If I would add the new data (1st Nov) to the tool, that percentage would be about 82% (1 more loser).
There are endless things to try, but need time for that.
I think the tool is great, but how to use it well is not yet clear
The following is not a personal criticism of what you are doing. I formulate here simply times in word and writing the one point, which I from quite clear experience simply know from my training, then lived and practiced. I'll start with this:
What I do not understand in this kind of trade, as you practice it, is the following and how often have I seen a decision made in this thread and then wondered if the man does not take this into account.
Well what do I mean?
The first point is this absolutely correct statement, which is so often pointed out and which I also perceive and experience myself in my own life, whether in the trade at that time or in general life: Good performance in the past is no guarantee that the same performance will be achieved in the future.
Since this should be clear, why do I not compare, and here is what I have always wondered and asked myself since it is of the utmost urgency, the chart with what the statistics tell me? If the statistics show a "short", but the chart clearly indicates an upward trend, then why should I trust the statistics and not my own clear analytical mind ?
Of course, I have to trust myself with the approach that I can afford an independent judgment, no matter what the statistics say. I think that here your trading system can be significantly improved. This is just my own opinion and especially my own experience.
As I said: No personal criticism and maybe it really brings something in your case, because the said has hands and feet, as they say here so with us.
What I'm doing here is indeed very straigth forward, just looking at the statistics. I agree, no guarantees on historical stuff.
I also agree on having a bias in the morning, that would help. This independent judgement is very difficult. I have been trying that a few years ago without success, and searched for something that I don't need to take descissions, but just follow rules.
So I came up with this statistical trading system, and focussed fully on this.
I'm not there yet, and probably never will be unless I change things.
Let me think on how to get a bias for the day, ideally chart based. If you have suggestions, please let me know.
Thank you for your explanatory answer in which you also confirm how you personally understand and want to implement your trading approach. Also important that you mention that you have really tried the difficult, independent approach with the chart reading. So I guess you really know what you have in mind and it is not on my side to prove you any thing. Telling this:
The chart reading is only one tool of many and often contradicts with what the fundamental analysis so says. The more tools I have and understand, the broader I can base a trading decision on different information. The more tools I use, the more complicated it can be. But I do not have to explain that here, because every day with every new trading decision must also be taken on the current situation in the market.
To come now purely on the question of you, in which you ask for a possible guideline which works on daily basis, I can only say: Also here the range of knowledge purely on the area of the chart analysis is very broadly scattered. Note @GFIs1
I make the suggestion that I may post in the coming days, if you want this, simply times absolutely simple charts with my analysis of the current DAX market, if I think that your statistics could possibly be not ideal. Nothing complicated to keep it economically simple. This then also gives you the opportunity to compare how you assess the situation at the moment on the chart, even I say: This is long when looking at the whole picture.
But I have to say that my active Pro Tools like OptionVue, MetaStock, Omnitrader and the direct trading platforms are not active at the moment, because I don't have to work anymore. Maybe I will activate some in the private again in the future to have my fun trading.
Final question: What about your stomach feeling? Would you trust them to make a decision?
Lots of tools indeed, and the more, the more complicated. I'm aware of that. One tool will say short, and the other one long. Complicated...
Yes, looking forward for your inputs. To make it part of a system I would like it to fit within the rules. But for now, it can give a indication, and can learn something from it.
Also, ideally I would add to my data set a long or short bias, but that would be hard to get for 12 years of data, unless it can be programmed.
If something works while testing it well, than I would be able to rely on it. Did many trades following @GFIs1, mostly before Covid, but still sometimes I do.
Considering the FED interest increase, I would guess it will be a red day
FDAX
Gap: down gap
Gap closed during IB: no
Position price at 9:30: below prior day HL
IB direction: short
Looking at PrD OC, IB OC and down gap not closed, the tool gives a nice trade.
DAX short (paper) trade
Entry 11:30
Exit 13:30
SL 61 pts (large SL due to high ATR)
Result 64 pts
Historical results with this setup:
SumR 301 (16 trades/win% 75%)
So, SumR translates to a relative (to current FDAX price) result of X points per trade (SumR/No of trades/10000*9am open price).
