Saki's Forex Reversal Journal
- Thread starter sakimonohito
- Start date
hi,
I did a backtest for last year on stops for the system and it worked well but that was because last year most currencies had 1000-2000 pip trends which lasted 5-6 months. if I didn't use stops last year, this system would have blown up rather quickly.
This year the rhythm of the forex markets seems to be more reversal orientated, wouldn't you agree? Alot of tops and backfills. The best kind of market for reversal systems.
I did a backtest for last year on stops for the system and it worked well but that was because last year most currencies had 1000-2000 pip trends which lasted 5-6 months. if I didn't use stops last year, this system would have blown up rather quickly.
This year the rhythm of the forex markets seems to be more reversal orientated, wouldn't you agree? Alot of tops and backfills. The best kind of market for reversal systems.
experimental stops are failing. they don't seem to fit into the volatility of my system. This system works because it has a high rate of success and the drawdowns have been large, but the consistency of winners has been much higher. So for now I have removed the stops.
So much for honoring thy stop
So much for honoring thy stop
I relized the absurdity of saying that the stops are failing. Stops don't fail, they save you from a bad system so I will continue to trade this way using 14 trading day time stops. Let's see what happens now!
sakimonohito, I am not enough of a FX expert to say whether this year fits more mean reversal or trend systems. However, I am currently working on a FX system which is low risk/reward like you, and I have problems with stops too. It looks more attractive without stops, at least for the time being.
Still holding previously opened trades
EURUSD S 1.2310 Limit 1.2168
USDCHF B 1.2351 Limit 1.25
EURJPY S 133.73 Limit 130.82
and adding:
GBPUSD S 1.8539 Limit 1.8370
EURUSD S 1.2310 Limit 1.2168
USDCHF B 1.2351 Limit 1.25
EURJPY S 133.73 Limit 130.82
and adding:
GBPUSD S 1.8539 Limit 1.8370
some charts would be cool 
ok attached below is the reversal signal on GBPUSD
I have also attached a new calculator I ran across which is gives more information about the levels. Hope this is helpful.
I'm also considering if the EURJPY trade was even lower percentage than the others since the reversal signal came just above the 4/8th level. Perhaps reversals should only be taken when the levels are oversold or overbought on a MM frame in addition to the Daimyo indicator.
I have also attached a new calculator I ran across which is gives more information about the levels. Hope this is helpful.
I'm also considering if the EURJPY trade was even lower percentage than the others since the reversal signal came just above the 4/8th level. Perhaps reversals should only be taken when the levels are oversold or overbought on a MM frame in addition to the Daimyo indicator.
here is the new MM calculator I found in the Murrey math user group. Hope it is helpful.
Sell GBP/USD 1.8750 Limit 1.8380
(1.8750 is the 8/8 of the mml AND the Daimyo was overbought, very high percentage trade, already up 200 pips)
Sell EUR/CHF 1.5325 Limit 1.5160
(1.5351 is +1/8th level plus Daimyo is a touch overbought)
Still faithfully holding the following, looking for reversal signals or limit orders to be filled:
EURUSD S 1.2310 Limit 1.2168
USDCHF B 1.2351 Limit 1.25
EURJPY S 133.73 Limit 130.82
GBPUSD S 1.8539 Limit 1.8370
I should note that I have added another indicator which has helped with my entries. Bollinger bands using fibonacci lines. When the 3rd standard deviation is pierced, the Daimyo indicator seems to be stretched to its extreme and this seems to coincide rather consistently with the MMl 8/8 and 0/8 levels. Yet another filter to improve my entries. The last 2 weeks have been nothing but sluggish upward trends which started off of uncovincing topping action, the upper bollinger wasn't pierced on most of my entries I made 2 weeks ago and this could have saved me two weeks of unrealized drawdowns not to mention lost interest (the succubus of the forex world!)
(1.8750 is the 8/8 of the mml AND the Daimyo was overbought, very high percentage trade, already up 200 pips)
Sell EUR/CHF 1.5325 Limit 1.5160
(1.5351 is +1/8th level plus Daimyo is a touch overbought)
Still faithfully holding the following, looking for reversal signals or limit orders to be filled:
EURUSD S 1.2310 Limit 1.2168
USDCHF B 1.2351 Limit 1.25
EURJPY S 133.73 Limit 130.82
GBPUSD S 1.8539 Limit 1.8370
I should note that I have added another indicator which has helped with my entries. Bollinger bands using fibonacci lines. When the 3rd standard deviation is pierced, the Daimyo indicator seems to be stretched to its extreme and this seems to coincide rather consistently with the MMl 8/8 and 0/8 levels. Yet another filter to improve my entries. The last 2 weeks have been nothing but sluggish upward trends which started off of uncovincing topping action, the upper bollinger wasn't pierced on most of my entries I made 2 weeks ago and this could have saved me two weeks of unrealized drawdowns not to mention lost interest (the succubus of the forex world!)