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This system uses martingale.

The system is based on martingale and the logic is the following since March, 02th 2009 :

1. I accept to increase the negative pyramid up to 4 level and for me it's around 2% of negative floating.
2. I use the same strategy but shared in 4 sub-strategies (same entrance signal but differents level of target/pyramid). I assume in this case that the maximum risk for 1 currency is 8%. I assume that each sub-strategy will be close in different time regarding the target/pyramid: the hypothetic result is the combined final risk for 1 currency should be below the maximal risk as 8%. The bad new for me is if the market change as range to trend quickly I loss 8% per currency and if all my sub-strategies/currencies are open in the wrong way I lost 48%. So in demo account 48% with no pressure !
3. I trade with 6 currencies EURUSD, GBPUSD, AUDUSD, USDCHF, USDJPY, USDCAD and in this case my account could be goes down up to 48%... if I'm an unlucky guy !
4. I run Monte Carlo simulation and the best way seems to cut the loss when I reach my risk per sequence.
5. So I assume the probability like ratio win/loss is 1:1 so I expect to have each month a gain between -48% and +48%.
6. The Monte Carlo analysis give me 5% of chance to have a DDmax of 2% with 95% of chance to reach 27% each month.
7. I made a <custom extrapolation> and I have 5% of chance to loss 12% each month. So if I loss 12%, I will try to stop my trading up the end of the month or when the market will return in trading range (visual confirmation).
8. It's only statistical presomption because it's not possible to include the lucky or unlucky parameters :-)
9. The statistic gives me a possible way of my account but the true is the market is unpredictable.

Happy trading ...

yes ! i think it's a good way to make money man. ... a controlled pyramid !
of course, luck is necessary, but statistically, you can win
will look at your system

and good luck

Trading Status March,24th 15:00 US time.

1. The floating (771$) of the GBPUSD for the sub-system 4 is above my initial risk defined at 710$. In the same time, I saw a positive divergence with the EURUSD and the correlation with the GBPUSD is around 0.84. The decision today is to take the chance with the visual strategy divergence/correlation but I will cut the loss if the floating will touch 1095$ which represent a loss when the level 5 will be touch (loss around 3%). So we shall see ...

Happy trading !

Trading Status March,24th 15:24

Whatever it will happen with the GBPUSD it's a good trade for me because I fixed a (acceptable for me) stop loss and the future is 50/50.

hi eravo,
open trades are private, so we can't understand what you've done !
it's wanted ?

Sorry, It was just a mistake ... Correction done !

Trading status March,30th 11:00 US time

11:00 30.03 – Today is a really wrong forecast for the consensus. It’s means for the crowd. The ADP Non-Farm Employment Change forecast is 40K; the actual value is -23K and the previous was -24K. The predictive absolute error is 63K! 157.5% … In the same day the Chicago PMI forecast is 61.5; the actual value is 58.5 and the previous was 62.6. The predictive absolute error is 2.7! 4.39%. The both error create a strong bullish rally for the EURUSD and a strong bearish rally for the USDCHF (correlation or hedge strategy). In my case, it’s time to use the manual mode regarding the EURUSD and USDCHF because I’m in-the-negative-floating. It’s time for me to manage the loss!

still good results Eravo !!
can you explain more about your system or is it private ?

I tell you about my trading system

There is no secret. It’s the secret… I developed a tone of EA with great back testing but almost of them failed in a real account! Why? By doing a back testing we are looking the best setup for a certain period with a certain currency. In fact tomorrow will be not yesterday (acronym rule as TWBNY) and specifically in trading field.

An EA is typically used for an automatic position after a “trader feeling” confirmation. I do not believe a trading robot can run 24h/24h without human intervention. It’s a no issue in long term. So you should stop to ask “which currency, timeframe, period data, etc” all the time. In this case you receive a really good back testing from the vendor or the author with amazing result but you should not forget TWBNY. And you know what? When it’s time to win money in a real account, your own account blows up. Amazing! In fact, your mindset is to manage the pain and not the loss as simple of that. That’s why at the end the level confidence of you is low and you are looking almost of the time the best EA in the world.

I’m always impressed by the manual trader. I believe it’s one of the best ways to trade but you should be stronger regarding the psychological effects exposure. In other hand, I prefer the semi EA because I fell comfortable. Each method have his specific rules but all the method need to have a properly money management regarding the goal.

So, I see each day a marvelous performance as today 180% with 4 trades. It’s only a lucky trade. And if it was wrong it was a really bad trade as “manage the pain and not the loss”. The live account is off the track in long term return.

So if you would like to know more about my EA, then I have a mindset for trying to manage the loss and the expected return in long term. I tried to define my own goal as return per month, loss per month, risk/reward ratio, etc. I accept to loss and pass the way for a new positive shot (I hope!). I accept sometime to do nothing. It’s always a personal choice. I believe almost of the EA are good but almost of the trader failed because they are so optimistic and not looking all the aspect of the trading. I know what the pain is!

As a trader you should know the table as loss/recovery (%) and try to loss an acceptable loss regarding your goal as 10/11, 20/25, 30/43, 40/67, 50/100, 60/150, 70/233, 80/400, 90/900, 100/game over. So if you loss 50% with a kind of martingale you should agree that you should do 100% for going back at the initial capital account. You spend more gasoline to climb the loss and almost in the case you make an over boosting position for the next shot. It’s look like a vicious scheme and a perfect way for the hell. And all is depending of your mindset, because it’s your choice.

In my own case, I try to reach 48% per month with a maximal floating of 24% (ratio 2:1). I’m not specifically looking the formula one race but a 24 hours Mans race. I use a sizing position in correlation with my account as maximum 2% per set and I run 24 set (6 currencies x 4 sets and same signal for the entrance and different SL, TP, BE and pyramid level). And finally it’s a demo account. The challenge is to have a positive return at the end of the year and not to be off the track after 3 months. It’s good for the pocket to reach 400% per year but I believe it’s hard for the brain to face sometime at 60% of negative floating. Few traders have an amazing track record with a small DDmax and it’s an exception. Remember too “1% of the winner trader keep the money of the 99% loser trader”.

Trading is not so easy than the marketer people seems to tell you. It’s a mixed between probability, emotional, other consideration and finally the result is win or loss money with the TWBNY rule and a properly money management. It’s your own scalable result if you’re good (the lucky period help sometime!).

 It’s only my opinion between thousand opinions, so happy trading!

Since today, I added a new stop loss strategy when the system is not following the price action! We shall see...

The new stop loss strategy worked well during the last Thursday and Friday regarding the CHF and EUR rally coming from the Greek debt report but the floating was too high. I change the money management (from percent/capital to lot/fixed portion) to reach around 3% per week. We shall see.

Happy trading!

Weekly Reports April 26, 2010.

The system is designed for an account of 25K$ starting with 0.01 lots with 100:1 (not NFA compliance).

1. The last week was a good week because the system gained 3246$ and it represents a growing of 12.99% (The system expects to win around 4688$ per week).
2. Since the inception the system gained 20682$ and it represents 84.25% (starting February 10, 2010).
3. The monthly projection is 33.42% with a drawdown of 20.22%.
4. The VaR system expects a maximal floating around 46% in worst case (100% of 24 templates/trading sequence are in the same time at the reverse price action market).

Since now we have changed the risk profile as following.

1. The system expects to win around 1700$ and it’s a growing of 6.8% per week.
2. The VaR system expects a maximal floating around 15% in worst case (100% of 24 templates/trading sequence are in the same time at the reverse price action market).

Happy trading!

very impressive eravo
the risk is under control as we can see

but you don't tell much about the signals, but the signals are quite good ok !
without good signals, even if the risk is under control, you can't have such a good result

bravo

Hi Stef,

Thank so lot for the compliment! Its good for the brain… Sure, I don’t tell more about my signal. I worked on it since 5 years and I developed a custom indicator (it’s my personal add-value) which matches with the money management. So, I hope in your side your trading going well too. I specifically take care on the DDmax because if I would like to run in long time I must be focused on it. I’m not looking 100% in one month because 100% per cent per month should tell for me the reverse as -100% per month too. My strategy is to realize around 3-5% per week and it’s enough if you are using the composed interest. My goal is to have a DDmax around 4-8% as soon as I will find the good protective setup by using the my custom VaR analysis.

Happy trading!

The system is designed for an account of 25K$ starting with a sizing lot in correlation with the growing size account by using a part of 100:1 leverage (not NFA compliance).

1. The last week was a good week because the system gained 3421$ and it represents a growing of 13.7% (The system expects to win around 1045$ per week) with a drawdown of 0.68%.
2. Since the inception the system gained 24511$ and it represents 98.5% since February 2010.
3. The monthly projection is 35.63% with a drawdown of 20.22%.
4. The VaR system expects a maximal probability floating around 7.85% in worst case.
5. VaR Monte Carlo Weekly rolling gives a worst drawdown at 244$ and it represents 0.91%.
6. VaR Monte Carlo Inception gives a worst drawdown at 12034$ and its represent 34.05%.

Resume: Actually the system has a good reaction regarding the market condition because the drawdown 20.22% is inside the Monte Carlo drawdown expectation and is below the worst drawdown (7.85%) for an acceptable weekly return (13.7%). The goal for this strategy is to keep a minimum risk by returning a consistent composed return in long term as looking as a residual income. The weekly income is above the expected weekly income because we adjust correctly the sizing lot regarding the capital.

Happy trading!

hi Eravo,
so what's on ?
on holiday ? or maybe improving your ea ?
give us news, your approach is very interesting !