All this while, I used to take any of its first signals which caught my attention, and for that I had mixed results. But I always believe in its potential.
Here is a brief overview of my system:
- It is neither a trend following nor a breakout system.
- It assesses only price action.
- It signals market 'turning' points (could be either a price reversal or continuation)
- It tends to enter trade near the high or low of the day
After some backtesting, I learn more about its ability, strength and weakness in greater detail. Here are some of its performances:
- It issues about the same number of long/short signals in a month
- It could be a winning month already with a 50% win-rate
- It performs better in a sideways, ranging month (e.g. Sept & Oct, see below)
- The system performs poorly in a strong trending month which leads to record high/low (e.g. July)
- The system can withstand wild price actions and market abnormalities (e.g August)
Below are the backtested results for the GBP/USD market in the months of July, August, September and this month so far.
Sideways of smaller day range ~100-200 pips (13 up days, 8 down day, 1 doji so far)
Sideways of greater day range ~ 'unusual' 200 - 300 pips (11 up days, 9 down)
Market 'panic' with sell-off & bottom fishing modes (10 up days, 12 down, 1 doji)
Strong trending month (13 up days, 8 down, 1 doji)
No comments:
Post a Comment