Is this one Spot on?
Another system for you to ponder.
This one has been tested using Spot data from 18th Sept 2003 using hourly bars for the EUR/USD Spot Market. Its rather simple:
1) Trade in the direction of the first breakout of the hours 02:00 to 04:00 US time (i.e. the first breakout from 07:00 to 10:00 UK time)
2) Close the trade at 16:00 (21:00 UK time). There are no stops.
Since 18th September (the start of my spot data) this has returned about 26 pips per day and has a remarkable percentage win rate.
66 winning trades, 29 losing trades, only two occurances of two losing trades in a row!!!
It seems too good to be true.
I haven't 100% confirmed these results as this was a quick and simple test of principle. It looks like these results need to be verified
http://static2.trade2win.com/boards/...icon_smile.gifI think you may be falling for the classic trap of over
fitting your system to past data...
Er I don't think so.
I've done no optimisation whatsover. I've not looked for better approaches, not carried out mathematical analysis or anything.
It's apparent from viewing charts that by 10:00am UK the trend for the day normally sets in. This system just trys to catch the trend move.
If I tried to make the system fit then there are lots of things I could do like stops, profit targets etc.
This system is pure price action and follows the KISS principle so I think its safe from the 'data fitting' argument
A friend of mine use to base his system on lunch time and the fact that trends either re-establish themselves after lunch or reverse. He looked for breakouts based on this. It actually worked pretty well for a while. He had stops and he use to take the price about 15-30mins from closing.
I have heard of people trading the 1 hr bar breakout finnishing at 9am UK............. they had a 60 point target with a 60 stop........
U mention 02.00 to 04.00 am ESt time which means the 7.00am - 9.00 am UK time breakout.............
Also, are there any stops ?? or are we just supposed to close the trade at 9 pm UK, regardless of what happens during the day !??
At least thanks for your efforts.................