In the month of August, the EURUSD pair seen swing of 500 points within 30 minutes not seen since the Lehman incident. This has been arguably the most volatile month for Euro since the 2008 crisis. We have managed to survive this while shorting the pair without incurring a substantial loss to our accounts.
Yes August has certainly been a turbulent time for a lot of pairs. EURUSD seen 500 point swings in half an hour which have not been seen since the Lehman incident. We were still shorting the market during 'Black Monday' and we have managed to get out with no substantial loss to our account in which some could argue was the most volatile month for the Euro since 2008.
FusionPRO posted: Yes August has certainly been a turbulent time for a lot of pairs. EURUSD seen 500 point swings in half an hour which have not been seen since the Lehman incident. We were still shorting the market during 'Black Monday' and we have managed to get out with no substantial loss to our account in which some could argue was the most volatile month for the Euro since 2008.
Thanks for your comment. Our stop losses are dynamic being based upon price action and news releases at the time. We have stop loss targets set for each individual trade so it differs with the trade itself some may be 50 pips SL some may be 200 pips SL and so on.
Our best trade is currently 90 pips and our worst trade is sitting at -9.7 pips.
theHand posted: And here's my mean return, between these two I can pinpoint the change closely, 21-22 Aug the market started trending.
It will recover in due course when the markets return to ranges. Then the trending one will flatline again. And so it goes. Just keep making sure you have systems running for both markets and that way you won't have to do threads like these.
Regardless of the loss here, I'm up 30% net in 2 weeks. Position building systems don't build positions in mean return markets, but they are frustrating as hell to watch. So this way I always have something that's working.
The idea is to hedge systems. Not trades or positions.
Interesting concept. Thank you for sharing. Wouldn't your net profits be minimal with hedged systems until means reversion on the range bound strategy happens? If the market continued to trend farther you'd have 1 winning account and a massively floating loss in the other account.
The trending system is by far out banking the losing mean return. My net there was 30%. These accounts are relatively new though, so they're still running without half the thing implemented.
What I really need is to kick out the mean return at what looks like -4%, maybe -5%, then have a cooling off period or at the very least wait for the return on the trend following system to diminish. Fairly easy to track. Just gain / time. Low figure means restart Mean Return.
But of course I won't know that unless I run it like this first. Have to guess the parameters first and then zone in on specifics once I have more data.
Point is really it's no mystery why some systems started failing and when they did. One of the main problems we face as developers as the we develop a system for the market conditions we see and/or optimise for those conditions and then they change.
It's nearly impossible to develop one system that works all the time. A better approach, in my opinion, is to acknowledge there are different market conditions, they do require different systems and find a way of identifying when to switch.
Nav is as good an indicator as any as to what is working and what not.
At the very least I can run those and live while my search for the answer to the question of the universe continues.
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