The times, they are a changin’…
Much has happened since we last communicated, and, as is usually the case in life, not all of it has been productive. For much of last year I was hindered by a series of medical issues, which were, individually, not serious, but which collectively sidetracked my efforts to keep routine and workload under control. If you’d like to read the gory (just kidding) details, you can do so here. I’ve written them up as a way of explaining why it’s taken me so long to move the program forward, and I thank you for your patience. For those who aren’t interested in my recent medical history (I don’t blame you), you can head to the meat of the article below which gives a brief insight into the changes I intend making to both the ACTP course in general and the ROBOS strategy in particular, to accomodate changing market conditions, and methods of trading them successfully. Let’s start with ROBOS…
Along with the Escalator, ROBOS has been a staple strategy of mine for a long time, delivering a steady stream of pips to my basket, largely due to the high Reward:Risk I employ, and, in the case of ROBOS, the AUDJPY’s tendency to trend once it develops some momentum. Unfortunately, that ability to trend for sustained periods appears to be at an end. I could lay the blame at any one of several factors – Trump, climate change, the failure of numerous global and regional trade deals, and geopolitical conflicts to name a few – but whatever the cause, the system is currently, at best, only marking time. Two steps forward, two steps back. A profit gained, followed by the market swallowing it straight back. I knew what needed to be done – additional filtration needed to be applied, to entries in particular, but also exits, however with medical issues distracting me, I couldn’t find the time to test and optimize these to a professional degree. So, I dramatically reduced the number of trades taken, and in fairness to my signal subscribers, stopped transmitting the signals and refunded their fees (on a pro rata basis). It also meant that I would have to rewrite the strategy and produce a new video detailing my discretionary filtration technique. This is already underway and I hope to have something out very soon, the gods willing.
While re-evaluating ROBOS, I started investigating alternative trading methods, looking specifically at ways to take advantage of confused but volatile markets. This lead me to systems that I had previously discarded as being too risky. One of these systems is called Grid Trading, and if you do some research on the perceived viability of the strategy, you’re sure to find division amongst traders that would rival the Grand Canyon. It is generally agreed though that grid trading is particularly suited to ranging markets, but falls down heavily in strong trenders. This would appear to be fine, because as we know, Forex markets are usually in a consolidation pattern (approximately 90% of the time, it’s been estimated). The problem is, grid trading relies on a ‘multiplier’ effect, similar to a Martingale system, whereby losses are doubled-down in order to ‘average’ the total position. If the trend continues indefinitely, your account is headed for oblivion.
However, new techniques have been introduced, with great success I might add, since the last time I played with such a system, and anyone who has been following my @forexistential Twitter feed recently has been able to witness, first-hand, the consistent stream of winning trades this strategy is able to garner. Having said that, it’s important to note that I am still a fair way off from mitigating the risk to an acceptable level. Although the results are extremely promising, I’m currently only entering with microlots (0.01 multiplied to 0.02, 0.03, etc.). which, although making account balance progress, still leaves equity lagging in real-time due to the number of open trades in negative territory. Only I am able to see these open positions, which means that anyone following the results on Twitter isn’t seeing the whole picture. I’m confident that I’ll ultimately find a satisfactory way of closing these trades out at profit (or at least a smaller loss), but in the meantime, please bear this anomaly in mind.
My plan is to eventually release an EA that will take advantage of these volatility swings, while simultaneously protecting the trader from undue risk. That is not an simple task, but I remain hopeful it’s possible, even if it means taking an unconventional, ‘outside the square’ approach. This new strategy alone will require a significant rewrite of the ACTP course, including new videos. This will take time – lots of it – but few worthwhile things in life come quick and easy, and, as the saying goes, patience is a Vertue 😉
I thank you for yours,