Topic: EURUSD 1 Day Breakout
I would like to post this, hoping we can discuss the mechanics of FSB a little.
This system was tested on data from a different broker, so the results may be different with the original FSB data - but I would like to discuss the rules, and how they are applied rather than the results.
Here is the strategy:
Forex Strategy Builder V 18.104.22.168
Strategy name: New
Exported on: 4/13/2007 14:24:43
Market: EURUSD 1 Day
Spread: 4 pips
Swap Number: 1 pip
Balance: 12194 pips
Minimum account: 45 pips
Maximum drawdown: 486 pips
Time in position: 86 %
The same direction signal - does Nothing
The opposite direction signal - does Nothing
[Opening point of the position]
Open long at the Up Band
Smoothing method - Simple
Base price - Close
MA period - 1
Deviation - 0.4
Use previous bar value - Yes
[Closing point of the position]
Stop - -25
Limit - 49
Now, to loosely translate the rules:
Buy @ Stop with a stop price somewhere above yesterday's close
Short @ Stop with a stop price somewhere below yesterday's close
Use fixed pip profit target and stop loss
Now, in real life, there could be a bar that touches all 6 prices: The long entry, short entry and the SL/PT of each.
I tried to understand from the chart what exactly happens each day, but I got a little confused by all the arrows and lines.
So I guess I would like to discuss (and ask):
a. What happens in such a scenario? For example, are both long and short position open? And what happens with the SL/PT? - since they were both hit on the same bar - is it considered a loss or a profit?
b.what are all the position-related markings on the chart? I could see down arrow, up arrow (which I assume mean "here we entered long/short" and I see some X's and some small horizontal lines (which may be SL and PT levels?)
For what its worth - the above strategy looks way too simple and was way too easy to create - as someone whos writing strategies for a while now, I must be skeptical and assume that something may be wrong either in the implmenetation that I present here, or in the backtesting engine (the data is no longer a factor, since I am using my own data, from my own broker)
Anybody with an opinion or with a better understanding of this, please feel free to jump in.