Leaving Home (an opposite Going Home interpretation)

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Leaving Home (an opposite Going Home interpretation)

Postby Davex » Fri Apr 25, 2014 12:45 pm

Hi guys, this is my first seriuos post about some trading ideas. I've been trading live the Going Home system for different months implementing it simply putting the stoch-difference indicator under the chart instead of trading a basket, (directly EURGBP instead of EURUSD + GBPUSD) knowing that in the forex market most of the pairs are mathematically derived from the originary ones. So i know that this is basically a counter-trend system, even if with very good signals.
So, with the additional help of technical analysis I had great results ( the original account had been decuplicated in 7 months) until a black-swan trend on NZDCAD almost wiped out my account in January. :cry:

So I began to look for a solid way to filter out this kind of killer trades and after a lot of tries i decided to try out crossing negative correlated pairs an see what happened.

What I found out, visually backtesting it, amazed me: the signal provided by negatively correlated pairs, unlike the positive ones, goes with the trend . Simply, instead of signaling a possible reversal it signals a possible end of the retracement, exactly the same principle of reverse divergence compared with the classical divergence.

I know it could seem a little bit counterintuitive and I am the first one who thinks that seems too good to be true, but I strongly suggest to Steve or whoever wants to do it to add this feature to the EA and do some backtest to see what happens.

Greetings from Sardinia :clap:

P.S. Today i took the first two trades this way and worked perfectly.
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Leaving Home (an opposite Going Home interpretation)

Postby SpiderX » Fri Apr 25, 2014 12:54 pm

Hi,

posting a few pictures from your visual backtest and live trading plus forecast on pending trades...would be helpful.

Cheers
"Love is patient, love is kind. It does not envy, it does not boast, it is not proud. It does not dishonor others, it is not self-seeking, it is not easily angered, it keeps no record of wrongs.Love does not delight in evil but rejoices with the truth. It always protects, always trusts, always hopes, always perseveres."
-Corinthians 13:4-8
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Leaving Home (an opposite Going Home interpretation)

Postby Davex » Fri Apr 25, 2014 1:54 pm

Ok, you're right. This screenshot represents exactly what I mean. Obviously it won't always go this way, sometimes there will be stronger signals, sometimes some whipsaws.
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Leaving Home (an opposite Going Home interpretation)

Postby Davex » Fri Apr 25, 2014 2:14 pm

This is one of the trades I took this morning, closed with +17. You can see a little divergence beetween price and indicator, this is where I entered.
Fortunately I didn't follow the first signal because I wasn't in front of the PC, I took it lately, for a brief time the level has been over 80. Anyway it would have been profitable even entering at the first one. ;)

I just close another short right now with +1 on EURJPY (you can see it in the same image, on the right), it wasn't convincing me no more because of the bullish pinbar on the H1 chart.



EDIT: Just open another one short on the cable right now, it seems to be good, let's see what happens.

RE-EDIT: Out with +1, volatility seems to be over for this week.

RE-EDIT: S**T! It would have been a decent 6 pips, but I'm happy anyway ;)
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Leaving Home (an opposite Going Home interpretation)

Postby milanese » Fri Apr 25, 2014 3:01 pm

@Davex please upload your images with your posts as attachment, if you do not know how look here:
http://www.stevehopwoodforex.com/phpBB3/kb.php?a=2

Cheers :)

Tommaso
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Leaving Home (an opposite Going Home interpretation)

Postby Davex » Fri Apr 25, 2014 3:19 pm

milanese » Fri Apr 25, 2014 4:01 pm wrote:@Davex please upload your images with your posts as attachment, if you do not know how look here:
http://www.stevehopwoodforex.com/phpBB3/kb.php?a=2

Cheers :)

Tommaso


Ok, I just did it. Grazie ;)
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Leaving Home (an opposite Going Home interpretation)

Postby milanese » Fri Apr 25, 2014 3:21 pm

Davex » Fri Apr 25, 2014 3:19 pm wrote:
milanese » Fri Apr 25, 2014 4:01 pm wrote:@Davex please upload your images with your posts as attachment, if you do not know how look here:
http://www.stevehopwoodforex.com/phpBB3/kb.php?a=2

Cheers :)

Tommaso


Ok, I just did it. Grazie ;)

perfetto, grazie :good:
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Leaving Home (an opposite Going Home interpretation)

Postby Davex » Fri Apr 25, 2014 10:18 pm

Just took the last trade of the week in the wrong side. I confused the real direction of the trend :arrrg: , using the chart of the synthetical pair with negative correlation can be really confusing, so I won't do it anymore. Anyway, good news are that the trade would have worked perfectly opening two positions, buying one and selling the another one that originated the cross (see the images below).
Next week I'll post as many trades as I can in real time.
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