currency ring

Place your new trading idea here to see if someone can automate it.
tarrini65
Trader
Posts: 21
Joined: Thu Nov 17, 2011 8:30 am

currency ring

Post by tarrini65 »

this is a mix of currency ring and pitbull trader ...

open a ring of currency , eurusd usdchf eurchf ( buy buy sell or sell sell buy ) ,

this is a quite perfect hedge ,these trades will be our indicators .
from time to time a pair will go in profit , then trade that pair with a bigger or equal lot size .

- leave all the indicators trade opened -
close the extra trade when it gets in profit and you are happy with it -

- if the extra trade don't go in profit wait for the next pair to go in profit , one of the three will surely do , and trade that one , and so on .

you can try to close the basket if in positive , or get as many pips you can from the extra trade .

no indicators , controlled drawdown , not too much babysitting ....anyone able to code it ?

this is simpler , and always perfectly hedged , it's a circle, not a rubberband....
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gaheitman
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Joined: Tue Nov 15, 2011 10:55 pm
Location: Richmond, VA, US

Re: currency ring

Post by gaheitman »

I think you can get what you are looking for from the Hanover Recent Strength module. You can set it up to compare just three currencies, resetting at a certain time each day. Then you just go long the strongest against the weakest. OK, it's not that simple, but it should translate well to what you are suggesting. See this http://www.stevehopwoodforex.com/phpBB3 ... p?f=5&t=31 and this http://www.stevehopwoodforex.com/phpBB3 ... p?f=5&t=73 for more information.

BTW, I put together a quick indicator to test the "perfect hedge" portion of the ring. For whatever reason (I'm sticking with CB intervention and the Risk On/Risk Off Light Switch someone keeps flipping :) ) the hedge isn't perfect and big moves in one currency aren't muted by corresponding big moves the other direction by the other currencies. At this point, I believe monitoring what would have happened had you entered trades (or using Hanover above) would be safer.

George
tarrini65 wrote:this is a mix of currency ring and pitbull trader ...

open a ring of currency , eurusd usdchf eurchf ( buy buy sell or sell sell buy ) ,

this is a quite perfect hedge ,these trades will be our indicators .
from time to time a pair will go in profit , then trade that pair with a bigger or equal lot size .

- leave all the indicators trade opened -
close the extra trade when it gets in profit and you are happy with it -

- if the extra trade don't go in profit wait for the next pair to go in profit , one of the three will surely do , and trade that one , and so on .

you can try to close the basket if in positive , or get as many pips you can from the extra trade .

no indicators , controlled drawdown , not too much babysitting ....anyone able to code it ?

this is simpler , and always perfectly hedged , it's a circle, not a rubberband....
tarrini65
Trader
Posts: 21
Joined: Thu Nov 17, 2011 8:30 am

Re: currency ring

Post by tarrini65 »

yes , great idea , but i like to keep it simple . the strenght of a pair against another in a ring can be easily measured with a sort of "pip strenght " ....this ea should be used as a scalper , just run it for two or three hours ....and get 30-40 pips .

i am playing it manually and i have some good results so far ....
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tex
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Posts: 89
Joined: Wed Nov 16, 2011 7:27 am

Re: currency ring

Post by tex »

Hello Tarrini,

there was a thread about this over at FF. Three Pairs Hedging. And i ithink it was Lonestar who did the math behind this kind of hedge and stated that it isn't a perfect hedge. U still got exposure in one or two currencies, and there SURELY will be the time your basket will be in big drawdown and never come back to the green zone.

tex

Edit : found it here - http://www.forexfactory.com/showthread.php?t=279648
tarrini65
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Posts: 21
Joined: Thu Nov 17, 2011 8:30 am

Re: currency ring

Post by tarrini65 »

tex wrote:Hello Tarrini,

there was a thread about this over at FF. Three Pairs Hedging. And i ithink it was Lonestar who did the math behind this kind of hedge and stated that it isn't a perfect hedge. U still got exposure in one or two currencies, and there SURELY will be the time your basket will be in big drawdown and never come back to the green zone.

tex

Edit : found it here - http://www.forexfactory.com/showthread.php?t=279648
hi tex

if you read well my strategy you can find that it's different , the ring is an indicator only , from time to time a pair is the best performer , you trade that one in addition to the original ring , and you can take profit on that only or on all the ring if the positive profit is reached .

so you can have

eurusd -35pips
eurchf - 10pips
usdchf + 24pips

so you open an additional trade on usdchf and hope it gets in profit , if not, then wait for the next pair to come in profit in the ring and trade that one also .

this extra trade can be threated like a stand alone one with tp or sl .

the fact is that this ring really indicated a momentum , and we trade that one .

i believe that the chance of getting 30-40 pips a day is high .

sorry but i am italian , and english is my second language
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SteveHopwood
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Re: currency ring

Post by SteveHopwood »

tarrini65 wrote:sorry but i am italian , and english is my second language
Your 'second language' English is better than that of a lot of the kids here in the UK. :lol: For sure, it is better than my equivalent Italian, which is limited to musical terms that all musicians know. :lol:

This looks like fun and I shall try it on demo next week. I have already turned one of your ideas into an EA, and can already see how this one could be automated. All we need is a 'virtual basket' and I coded one of these a while ago.

More next week. Cheers.

:D
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MichaelM
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Posts: 117
Joined: Sun Dec 04, 2011 11:04 pm

Re: currency ring

Post by MichaelM »

gaheitman wrote:
BTW, I put together a quick indicator to test the "perfect hedge" portion of the ring. For whatever reason (I'm sticking with CB intervention and the Risk On/Risk Off Light Switch someone keeps flipping :) ) the hedge isn't perfect and big moves in one currency aren't muted by corresponding big moves the other direction by the other currencies. At this point, I believe monitoring what would have happened had you entered trades (or using Hanover above) would be safer.

George
Hey guys, it's me the-game from FF
gah has it right... I've wasted many hours on perfecting this also
Don't waste your time with the currency ring theory doesn't work and it does require lots of babysitting especially if one of the currencies makes a big move in the opposite direction it was initially opened.

Although, I noticed that the ring suggested uses CHF which is prone to SNB interventions of late.
Perhaps (just for kicks), let's see if the CBI can be used somehow as a trigger to open the ring and to take advantage of slow quotes on one or two of the pairs in the ring.
Might only work when the SNB intervenes, which is becoming the norm.

But please heed my warning on the theory in general.
blahn
Trader
Posts: 53
Joined: Wed Nov 30, 2011 2:39 am

Re: currency ring

Post by blahn »

I still do a little pitbull trading now and then, it is pretty fun not using charts and just going with the flow of your indicators. When it's ranging you just leave and come back in a few hours or the next day, and when it's trending hard you are closing and opening positions as fast as you possibly can. Not sure if a circle would be any better or worse than the rubber band effect of 8 to 12 pitbull indicators. I did try knocking my indicators down to 2 hedged pairs once, but it didn't seem as flexible even tho the concept is the same.
tarrini65
Trader
Posts: 21
Joined: Thu Nov 17, 2011 8:30 am

Re: currency ring

Post by tarrini65 »

i believe that only a forward test can help us ...i am using it live , i have good results since now....

it's slow , but profitable
ramack
Posts: 1
Joined: Fri Mar 15, 2013 10:48 pm

Re: currency ring

Post by ramack »

Hey Tar,
Are you still using this ring concept?
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