10 ticks on eurusd is just about ok since it meets my criteria of having an absolute minimum profit target of 10x cost (cost is the bid/offer spread plus round trip commission). So u might just get away with it. Still...it ain't gonna make you rich. You might think about looking onto binary options or the exchange traded equivalent which are option spreads, but i would be surprised if you could make money from such a small move in the underlying.
To achieve your 10 tick profit target 80% of the time what stop would you use? I don't think Visaria has quite enough information -- specifically the stop and how often can you trade it in an average session-- to determine if you can get rich with this. With a six tick stop and an average of three or four trades a day you can get very rich. The missing info is the stop and the frequency.
I suspect he needs a relatively wide stop to meet 80% win rate. Maybe 20 ticks stop loss? Personally, i think he will lose or at best break even rather than becoming rich lol.
I don't disagree. We will probably hear the stop is very large but I'm willing to hear what he has to say.
So would I. "And the rest", I suspect: an 80% win-rate trading the Euro with a 10-pip target and a 20-pip SL wouldn't see someone asking about resorting to options because they had such a SL problem? They'd (rightly) just be trading spot forex or forex futures all day long.
Hi, Thank you all for your comments. I can achieve 10 ticks 80% of the time. Each trade if open, is closed within the daily candle. Frequency is about 2 trades a week per currency pair. As stated at the start, my problem is that (as many other strategy), the stop loss kills the profitability of this strategy. If I consider 10 trades this would be the equivalent in the spread betting market (forgive me that's where I have been trading) 10 pips - spread 1.5 (and slippage) x 8 wins = 68 30 pips - spread 1.5 (and slippage) x 2 losses = 57 More or less I will need 30pips SL. The problem is that with a 30 pip stop loss I will not achieve 80% winning. I have an idea on how to adjust this in the spread betting (and results are not attractive) but I wondered if can apply a method that can achieve 80% success of securing 10 pips (ticks) in the underlying currency pair applied to the option trading (hence no worries of being stopped out) can be profitable. Binary options will not allowed to make money on such a small movement and the pay-out is less then the investment (so the SL>TP). I thought that perhaps by buying a ITM option knowing that the price will move 10tick within the next few hours (before the close of the daily candle for sure). But I am not an expert so I needed advices whether this sound possible considering the cost and commission of getting in and out of a trade + if such a movement in the underlying is too small to make a profitable impact in the price of the option. If I have applied and back tested (+10years) this breakout strategy and has always achieved between 80% win ratio on most of the currency pairs. I somehow though I came across something valuable as knowing that at some point during the day I can predict with good accuracy that the price will move for an extra 10 pips within the end of the day. I just do not know when exactly will get to the +10 level. Might move in the opposite direction for a while. Also after hitting the +10 price, it might move back. Hence the strategy is getting in and out at those two levels. That's all. Just wanted to figure out if there is an instrument that allow this strategy to make money! (I guess we all try to achieve this) Sorry for the long description but I felt I needed to provide a little more info and clarify few point, mainly that I try to have a strategy with no Stop Loss, hence my interest in Option Trading. Thank you for your time again and I will try to learn more about Options. Cris
Looks like you have nothing of value here as a futures trade but I'll let those with more options experience make the options call. That said, I'll be quite surprised if there is any value here no matter how you twist it and turn it.
That's what I was thinking. Anything much above that may make it not viable, in reality. I hear you. I'm back to my original question, in my original response: what makes you so sure it is an "advantage"? With apologies for sounding disillusioning, it sounds rather like a system which doesn't actually have an "advantage"/"edge", really? If so, I'm afraid that "looking for a different trading medium for it" is going to be an inappropriate solution to that problem, for all the obvious reasons. So will I.