Thursday, 10 March 2011

To Override and not to Override

I started today trading the ESTX50 (Dow Euro 50) future on Eurex. The ES had weakened considerably overnight, so when the ESTX50 opened at 7am London time I expected it to open down and weaken. Flo didn't give a signal (I didn't expect that she would) so I sold the close of the first candle as you can see from the pic below.

I scaled at the first green candle which rejected the low (@ 29050) but did not close all my position, as I wanted to give price a chance to hit my Fib target which I had diligently drawn before the market opened. I was nicely repaid for my homework and closed out the balance at 2895, banking 20 points/contract on the last half of my position. I was finished trading for the morning after 1 1/2 hours of work.

I started again half an hour before ES RTH. The market was down and I just wanted to grab some points and run. Flo did the rest quicker and better than I could have in such a fast market and no slippage. I was finished for the day in minutes.

The flexibility of HT is amazing and I am always thinking of new ways of using it. There is no need to trade all day. Switching Flo on when there is money to be made and stopping when I have achieved it is a better way to go. You can find me talking about trading less and earning more in the blog about 200 posts ago. Using Flo like this is a more recent idea. I can backtest for different times of day and have algos ready to go when I switch Flo on at that time of day.


  1. Thanks EL for all your effort in keeping this blog alive ;-)
    What do you do to see if the backtested period is really delivering good volatility to let FLO do it's job? I mean how do you decide if it's a good time to start FLO or not, other than basing your decision on backtested period?
    Because I'm not able to recognize when my backtested pariod is really good to trade or is better to stay aside. What do you suggest?

  2. Alex, it depends on a few things, some relating to the market and are obvious. When the cash opens, a market is out of balance and the market getting back into balance is when the best trades occur.