cfudge replies to: Simple Daily Trend Reversal Trading System


In light of the last 2 weeks, and how we’ve had a string of losses, I’ve been analyzing the risk settings for the EA a bit more intensely again. When you winning you dont pay attention to the risk parameters, only when you start losing lol.

I do know that we can’t expect to have only wins, and no losses, and having a loss here and there is expected and acceptable, but having the wrong risk parameters in place, those few losses can wipe out the previous gains, and as I’ve been watching the last 2 weeks this is what has been happening.

The current SL setting for the EA is a fixed hidden SL at 70 pips, and SL at ZZ set to true, so if the SL at ZZ is more than 70 pips then the fixed hidden SL will be used.

Now I’m also using the TS settings, so lets say we have 3 orders that close in profit after hitting TS 1 or 2 which is 30-40 pips, that totals 90-120 pips, and if we have 1-2 losses that is 70-140 pips we have wiped out almost all of the profits of 3 trades from 1 loser. This has been happening a lot in the last 2 weeks so most previous gains have been lost from only a few losers.

I’m thinking that perhaps using a smaller SL might help to minimize the losses on those losing trades. I looked at the losers, and if the SL was 50 or 60 pips they would have still lost, but saving us 10-20 pips per loss. I hardly saw any trade that went to 50-60 pips into DD, and turned around to hit TP, so my thinking is that reducing the hidden SL will help to reduce the losses on losing trades.

When I was trading this strategy manually in the beginning I would set a +-50 pip SL, but also take into account the previous high or low, and make a decision based on what I saw on the charts, but with an EA it doesn’t have human spontaneous decision making capabilities to make decisions like that.

So whats your input guys? What do you think is a suitable SL for trading on H4?

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