FOREX REVIEWS

If you have been interested in system development and you have been following my achievements for a while you would have certainly noticed that I have never developed a system to target any JPY crosses. The reason why I haven't done so is not because I haven't tried but because the development of long term profitable systems for them has proved to be extremely hard. On today's post I want to share with you my experience with these instruments and why I have had a very hard time attempting to develop strategies that profit from these very volatile forex trading instruments. I will explain to you why price action based strategies simply do not seem to work for these pairs and what other alternative solutions I have put in practice to develop a long term profitable system that is able to diversify our trading with these JPY beasts. The JPY crosses are a series of instruments in the forex market that pair the Japanese Yen with a non-USD currency. These instruments are most comm...

When you first attempt to design your own mechanical trading systems you often start with big questions about the way in which this is supposed to be done. The building of the entry logic - which marks the potential of a trading strategy (not its profitability !) - is quite commonly the first obstacle new traders find when attempting to develop a strategy. Generally people who aren't familiar with system development will start to develop entry logic based on visual observations - without a true grasp of the underlying market- something which is bound to create significant problems and eventually lead the trading strategy to failure. On today's post I will be writing about how you should address entry development and how you should focus on the understanding of the currency pair and the building of causality chains so that you can truly build entry logic criteria that have a good potential for the development of a long term profitable trading strategy. When you sit down and star...

Perhaps one of the most important questions you can ask yourself when you start using automated trading systems is : how will I survive in the long term ? This is one of the most common inquiries made by traders new to the field since it seems to be evident that the market is an ever-changing beast that does not allow the mechanical exploitation of any inefficiency for too long. New traders often experience this when they first begin to use automated trading systems. Their systems do very well, then fail or they never do well at all. Besides the fact that many of these systems don't have adequate evaluation- leading with inadequate and unrealistic expectations to long term loses - traders almost never ask themselves : what doesn't change ? It is obvious that if you want to exploit a given characteristic of the market for long term profitability you have to look for characteristics of the market that remain constant as a function of time. But are there any ? On today's post ...

I have said several times that anyone interested in doing serious automated trading should think about getting a Virtual Private Server (VPS). It is absolutely true that a VPS is more reliable than a home server (several reasons are outlined in other articles) but it is also very true that a VPS is not infallible and failure to adequately care and configure one of these servers can bring you substantial problems. Generally people tend to have a very relaxed attitude towards VPS use and security and this in some cases turns out to be fatal as hackers take advantage of this and hack your VPS. I have to tell you that I have seen this happen and it is anything but fun to watch. On today's post I want to talk about VPS security, what happens when your VPS is hacked, how to detect hackers and how to configure your VPS so that it is a truly reliable and secure trading machine. Although following these guidelines will not make your server 100% hacker proof (no computer really is) you will ...

One of the most important reasons people have to believe that long term profitable trading using automated trading systems is impossible is that the simple appearence of a consistent and profitable system would most likely cause mass adaptation of the strategy, something which would render the inefficiency exploited by the system totally worthless. This is a very interesting issue and there are actually several explanations and examples to show you that long term automated trading is possible and that mass adaptation is actually not likely to happen in most cases and that when it is likely to happen, the system is indeed bound to become unprofitable. On today's post I will talk about this issue of "mass use", its consequences, the reasons why it happens and the reasons why it won't happen to most long term profitable systems. It is easy to imagine that if any system was able to produce massive riches in a consistent manner, in a short amount of time, everyone would ...

If you look at my last few weeks of posts I have been very excited about the new qualities of the Metatrader 5 trading platform and the benefits it brings to system development regarding faster execution, faster optimization and added flexibility. Using my prototype implementation of Watukushay FE I analyzed trading over several different instruments and I finally came up with the "starting point" of intra-currency trading for this well-known freely available trading machine. This week I decided to do a small experiment and compare my results of Watukushay FE for the AUD/USD on Metatrader 5 with those found out with Metatrader 4 and the results found were extremely surprising. On today's post I want to talk about my findings, the possible causes of the issues found and what I will be doing to investigate the nature of this problem and what solutions can be implemented to deal with it. During the first post comparing Metatrader 4 with 5 and the backtesting results of Watuk...

If you have read my posts during the past few months you will notice that I have become increasingly interested in the analysis of trading portfolios and the effect of trading several different systems together. After I was able to implement a solution that made the balance of Asirikuy experts independent it became possible to trade systems without their balance calculation becoming dependant on the other systems' trades, something which in turn opened the door towards the merging of backtesting results to accurately evaluate joint performance of the different trading systems. Up until now all this analysis had been made through the use of SQL scripts and VBA macros which were implemented by several Asirikuy members. Thanks to their effort we were able to do accurate calculations on the draw down and profit characteristics of portfolios. However it became evident that these solutions to portfolio analysis were not very comfortable needing backtesting statement manual reorganizatio...

I believe that the worst characteristic a person can have as a trader is unfounded optimism. When I started trading I possesed this very undesirable character trait and it took me a long time to get rid of this pest that would keep profits away from my account. It is very easy for traders -especially new ones - to get lured into believing simulations or past live testing results and jump into systems with high risks believing that a certain scenario will not happen. I cannot tell you how big a mistake it is to ignore every possibility and to act on faith and hope. Time after time I have seen traders do this and get burned in the process with their hopes in one hand and their empty accounts on the other. On today's post I want to talk to you about the great importance of the "What ifs" of trading and why it is important for you to answer every possible "what if" question you can ask until you are satisfied with every answer. One of the most vital things when you ...

I have to confess that I was pretty excited last week when I learned about the release of the full metatrader 5 strategy tester. Being a fan of simulations to accurately model past trading I was dreaming about all the great enhancements that were now available and how all current Asirikuy systems would benefit from these implementations. This week I have been playing extensively with this new platform, mainly getting to know the MQL5 new programming language and all the "new ways" of doing things we must now relearn. I started by analyzing and understanding the sample experts released with the platform and later coded a few very simple systems to get to know the way in which things are done, indicators called, etc within this new trading program. On today's post I want to talk to you about my first "real exercise" which involved the porting of a preliminary version of Watukushay FE to metatrader 5. I will describe the process I went through, what I achieved and ...

Finally on June the first we saw the first official release of the Metatrader 5 trading platform which has the mission to replace one of the most popular and widely used trading platforms in retail forex trading. Definitely the task for Metatrader 5 is not easy since its predecessor is very powerful and has become the "industry standard" when dealing with automated trading systems for the regular investor. On today's post I want to talk to you about Metatrader 5, some of its pros and cons as well as the journey that I will be taking to produce mql5 versions of all Asirikuy trading systems. Is there anything good about Metatrader 5 ? Is it bound to be a great improvement over metatrader 4 or are we talking about a windows vista Vs XP type change ? Keep reading to find out. I have to be honest with you and tell you my honest opinion about this new trading platform. I think that the people at metaquotes have done a good effort but I think they have neglected some key aspects...

Yesterday I received a very interesting email from an Asirikuy member pointing me to a database showing the past 20 years of performance of top forex traders and funds (the data was originally discussed in this article ). Although I had seen the indexed performance of several currency traders before this is the first time in which I had found this data in such an organized and reliable fashion, put together by Barclay Hedge. The Barclay Currency trader index,- in their own words- contains "An equal weighted composite of managed programs that trade currency futures and/or cash forwards in the inter bank market. In 2010 there are 119 currency programs included in the index". To sum it up, the Barclay Currency trader index gives you a snapshot at what the proffesionals in the field are achieving showing you exactly what profit expectations are more realistic and which ones are to be considered completely dilusional. On today's post I want to write a little bit about this dat...

Last week I wrote a post about the Bollinger Bands indicator and how I thought it could be exploited to achieve good profitability levels in forex trading. After doing a full analysis going through a visual 5-6 year backtest, a mathematical expectancy analysis and the final coding and testing of the strategy I can tell you that I have come up with a likely long term profitable system based exclusively on Bollinger Bands. Asirikuy members would definitely want to checkout last week's video in which I explain the whole development process in detail showing you all the steps necessary to go from an idea to an actual, coded expert with great possibilities of long term success. On today's post I want to give my regular readers a look into this strategy and the results it finally achieves. My first idea for coding this Bollinger Band system was taken from the thoughts I had a week ago regarding this strategy. I based the making of this strategy in the fact that when a bar closes abov...

Very often people will ask me what is needed to achieve some success in automated trading. I get asked if it is actually possible to live "making money while you sleep" and to exploit market inefficiencies as the market changes. Often people I explain my line of work to are extremely skeptical. For example a person I met a few weeks ago at my sister's wedding asked how this was possible and that if this was possible, why isn't everyone making a profit from the forex market. Oh well, it certainly is useful when you talk to people who have absolutely nothing to do with trading - as a matter of fact - I had not found myself in such a difficult position to explain something for quite a bit of time. In the end, I told her that - in analogy with getting to heaven and the ten commandments - people do not succeed with the use of automated trading systems because they do not follow some very simple principles. I explained to her that there are simple rules that need to be foll...

After talking to several people about the interaction with my website and getting my blog a little bit more online presense I decided to take a very important step forward and do an experiment using facebook. As you may all know, facebook is the most important social network out there and I trust that getting my blog into this environment will allow us to become a stronger community allowing me to better know you and allowing all of you to better know me. Of course, I think that hardly any other forex related individual is as open as me from a personal and business standpoint but I believe in transparency and I believe that only good things can come out when intentions are the best :o). On today's post I want to talk to you a little bit about this decision, the consequences I expect it to have and the decisions I have taken to prevent bad things from happening within the newly formed group. Truth be told, I have never been the biggest fan of facebook. For the first three years in w...

Today you will be witnessing one of the most important decisions I have taken within Asirikuy history. Several months ago I decided to create a fund called the micro-account stimulation project (MASP) which had as an objective the donation of 100 USD to a random Asirikuy member every month so that the selected member could create a challenge account and trade an Asirikuy system of my choice within it. The selected member would be given the 100 USD with the mere condition of running the EA on a VPS for two years and allowing me to monitor the account within Asirikuy. I was full of hope with this project and I hoped it will encourage people to open up mini accounts to try out Asirikuy systems and truly commit to their trading. However I was wrong about this. Today I will talk to you about the fate of this MASP fund and what will now be done with the money I have been putting aside for this project. So what happened with the MASP ? People simply were not interested in my offer. During the...

As many of you may already know - if you have been following my blog for a while - I have become a somewhat "regular" contributor to Currency Trader Magazine, one of the most well-known and respected magazines published in the area of forex trading. Besides featuring very famous and well-respected authors such as Barbara Rockefeller, the magazine tries to give people quality articles about both fundamental and technical aspects of currency trading. I have to say that Currency Trader Magazine had become a monthly "must-read" for me before I started writing in it, with its articles being very good to catch both a bird's eye view and a practical perspective over current market conditions but being an author now gives me the opportunity to humbly contribute to this great monthly magazine. On today's post I want to talk to you a little bit about my June article and how I think it provides very valuable information about market inefficiencies and the way in which ...