Tuesday, 21 June 2011

Only Trade That Perfect Setup???

Below are the stats for a particular configuration of the FloBot for a recent 21 trading days for just 1 contract. As you can see, it's a fantastic win rate and very profitable with low drawdown. It makes just over an average of 3.3 ES points per trading day. Trading 10 lots, the profit would have averaged a nice $1,650 + per day.

Here are the daily stats. 18 winning days out of 21.

What is interesting is that on many days there is only 1 trade. Miss that trade and the stats look different, either better or worse. But there was only 1 trade that day that met the TP definition of a trading picture.

I could not have sat there all day waiting for that trade and been ready when it showed up. I think that it's partly for this reason that manual traders take trades that are more marginal than their picture definition in their TP. Or perhaps their TP picture definition is more fuzzy, which causes them to take a variety of trades, all of which are really not in their own best self interest. These "off piste" trades are one of the biggest impediments to CP. Often, the newer trader has worked all day to be green and then one off piste trade is taken that loses that green plus 2 other days' profits. A great shame, as it can often be avoided.

One solution is back testing and then using an algo to capture the picture definition that gives the best result for entries, and then managing the trade to it's conclusion, manually. This approach fits the markets as they are evolving. The added noise from HFT requires seeing through that and seeing the real order flow. Using Flo to do that provides a clear backtested result with a predictable expectancy.


  1. Tom,

    Any plans to do another workshop here in the U.S.?



  2. Sean, there have been people asking. Not sure yet whether to do it online or face to face.