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Boomerang indicator system at

  #147 (permalink)

Dallas, TX
Trading Experience: Intermediate
Platform: NinjaTrader, IB
Favorite Futures: GC, CL, ZS
Posts: 14 since May 2013
Thanks: 5 given, 41 received

New Update on Boomerang & AutoTrade

Hello all - I wanted to update you all on Mohan's Trading Room and AutoTrade Account. In a phrase - STAY FAR FAR AWAY from the room and the AutoTrade account. The Boomerang system itself is great, if you follow the indicators. Learn to trade it yourself.

But he is clueless and arrogant. He doesn't follow his own system, just takes pot shots at the market. The Boomerang AutoTrade account was only in profit 1 day, then in 9 trading days, lost over 18% of the trading account. Then today he supposedly retooled his approach, going to have the autotrade account now take all his trades (Boomerang, scalps, what he calls ricochet trades - basically top and bottom picking) and have smaller stops. Instead, today, the 1st day of that approach, he's had stopouts of 5 points, 7 points and another 7-8 points, always stopping out right near the top or bottom of the move, just as he's been doing for the past 2 weeks. He will repeatedly hold a trade to a 7 point stopout, then reenter right at the point of the stopout, and then sit through another, smaller drawdown, before perhaps getting something out of it.

He's usually talking a bunch of junk first thing in the morning for 20-30 minutes, so usually misses the move off the open or pre-open. Then he's trading into the midday slop, after the big trends are gone, trying to make a big trade out of chop. Then he gives up at 2:30 eastern or so, doing his wrapup, missing good moves that often happen in the last 60-90 minutes. Doesn't trade days with rollovers, option expirations, FOMC reports, various other things. So often doesn't trade 25% of trading days in a month, because of all these "market conditions".

Today in the room and the account, there are 4 losers out of 7 trades, total loss of 15 points or so. The last trade he missed his 5 or 6 point target by 1 tick, now let it go all the back to the entry and scratched it, so 5 out of 7 losing trades today, for 15 points loss at least. No trade management, criminal to get 5 points, a tick or two away from your arbitrary target, and then let it go back right to break even. He scratched the trade right at the point you actually should be shorting again, and right at the top of the little rally to his Dynamic Trend Band, as soon as he scratched the trade, at literally the high tick, just like any newbie. Now it's dropped 5 points already, starting a new downtrend. That's 80% accuracy? That's a great trader, or a great trading room? Trade management?

Here are the trades called out today, 3/20/2014 -
1 short at 3681, I think - 5 point loser
1 short at 3686.50: 3689.50 high, low at 3678 - 6.5 point winner, taken off at 3680.
1 long at 3680.50: 3682.75 high, low at 3763.75 - 4.25 point loser, taken off at 3676.25
1 long at 3681: 3685.50 high, low at 3678.50 - 3 point winner, taken off at 3684
1 short at 3682.75: 3693.25 high, low at 3682.75 - 7 point or more loser. Taken off at around 3690
1 short at 3689.75 to 3691 area - 3697.75 high, 3689.50 low, 6-8 point loser. Stopped out at high 3597.
1 short at 3695 - high at 3696, low at 3688.75 - Had 6 points, scratched at top of move, 3695, then started new downmove.

Total trades - 7
Losers / Scratches - 5: 71%
Total winners - 9.5 points
Total losers - 24 points
Total loss - 15.5 points

When a Boomerang stops out for 3 points, it's "just a small loss". When it makes 3 points, it's a big deal. His ricochet trade targets (basically top / bottom picking, looking for momentum changes) look for 5 to 10 points. When he gets 5 points, wow, you'd think he'd hit the lottery. Then a 7 point stopout, well, no big deal, "ninja warriors". If you were getting 80% accuracy, perhaps. But at 30%, you're doomed, as the track record below shows.

At the runup to the opening of the AutoTrade account and trading room, he touted 60-80% accuracy on his Boomerang trades, saying that $8000-9000 per month return was available on a 4 lot, $12,000 account trade. These are actual quotes from his emails and website:

Jan. 9, 2014 - Welcome to 2014 Boomerang Day Trader precision trading setups. 11 winning trades in a row on Boomerang for Tuesday and Wednesday..Jan.7th-8th.
11 winning trades in a losses...on Tues_Wed. Jan 7_8th - DayTradersAction's library

Dec. 12, 2013 In our simulated trading from 11/1-12/11 using the exact Core Boomerang Day Trader setup method/rules the gain was +$9434 on 4 NQ contracts . This was after all expenses mentioned above. These results must be considered hypothetical because they were done on a simulator as we began beta testing the program. Using Bills recommended $3000 margin per contract this would represent an excellent return of 80% after expenses for that first 23 session period. I expect we will be able to duplicate these or similar type of returns in real time as both of us are very long time experienced in trading but of course as you know we cannot make any guarantees or assurances.

Oct. 1, 2013 - Up to +80% winning trade setups in September using our very simple Core Trading method showing up to potential $18,465 after commission using just a $5K account? This was one of the choppiest trading months in years. Keep in mind that last months Boomerang Core Trading method showed up to +$24,845 in gains (hypethetical results based on using exact core method...see webinar and disclaimer below)

Here's the actual track record of the Boomerang trades, actual trades from my autotrade account for that period (winners are supposed to be 3 points, losers also 3, scratches usually for a tick or 2, but counted as a loss, due to commission, slippage, etc.):

3/3 - 5 short trades: 4 losers / 1 winner
3/4 - 3 short trades: 3 losers
3/5 - 1 long trade: - 1 winner
3/6 - No Trade
3/7 - 3 short trades: 2 loser / 1 winner
3/11 - 3 short trades: 1 loser / 2 winners (but for 1.75 to 2 points)
1 long trade: 1 winner
3/12 - 5 short trades: 3 losers / 1 winner / 1 scratch
3/13 - No Trade (he didn't trade because of rollover, there was a 80 POINT DOWNMOVE!)
3/14 - 1 short trade: 1 scratch
2 long trades: 1 winner/ 2 scratches (146 points of total market movement that day)
3/17 - 2 short trades: 1 loser / 1 winner (1.75-2 points)
1 long trade: 1 winner
3/18 - 4 short trades: 4 losers (against a 45 point trending upmove)

Trading days trading - 9

Total trades - 32
Total Winning trades - 10: 31.25% (some less than target)
Total Losing trades - 18: 56.25%
Total Scratches - 4: 12.5%

Total Short trades - 27: 84.38%
Total Winning short trades - 6: 22.22%
Total Losing / scratch short trades - 21: 77.78%

Total Long trades - 5: 15.62%
Total Winning long trades - 4: 80%
Total Losing long trades - 20%

Total loss on 4 lots - $2200, about 18% of equity

I was trading 4 lots, pulled back to 2 lots, and today it looks like it will be another $700 loss, or 7% loss on equity, after losing 8% in equity on 4 lots 2 days ago. If I had stayed at 4 lots today, it would have been a 14% loss in 1 day. It took him 9 days to lose 18%, now he lost 14% in 1 day. See a trend here - accelerating to the downside.

You can see from the track record (he refuses to provide a track record himself, "too busy") that an overwhelming majority of the trades are short trades, and that the overwhelming majority of them are losers. Right there, that inherent short bias, in a market that has lots of upside momentum, is crippling.

If you call him on his lack of ability to trade his own system (touted as having 80% accuracy on his website, it's now under 30%), he belittles anyone who disagrees with him or points out that his trading is bad, misses trades because he talks to much (and he repeats the same crap over and over again), takes 7 point stopouts on trades that he's only looking to make 3-5 points on, can't hold winning trades for larger amounts. Always fighting the larger trend, picking tops and bottoms WAY too early.

The frustrating thing is, the Boomerang system really does work. If you trade only in the directions of the Dynamic Trend Bands, buy when they cross over, or when price is above them on pullbacks, and stay in that long trade as long as they're going up and price stays above them and the red line, you can catch 10, 15, 20 point or larger moves. Once a move starts exhausting and prices drop below the DTBs, then you can short against them with low risk. Once they turn down, then just keep shorting against them and follow the downtrend. It really does work, but he's always front-running, sitting through big drawdowns, stopping out RIGHT where the move exhausts, and then reentering the trade again right where he got stopped out. For someone who has 20 years of experience trading, and has developed this good system, he is completely unable or unwilling to trade it himself. He trades like a neophyte, really. And every day, when he's losing trade after trade, well, today the market is "tricky", or "cowboys are rigging the market", excuse after excuse after excuse.

After a big stopout, it's "oops, sorry gang, guess I should have gotten out of it earlier". And when he's in a trade, he sets arbitrary targets that he "hopes" and "wishes" we'll get to, instead of either taking them off at obvious support / reaction points, and letting a trend trade run until a reverse signal is given (he says nobody can do that - BS, I know that it can be done, have seen someone do it, using Boomerang, QQEs, etc.). Often misses his target by 1 tick, then hangs on as Boomerang clearly shows a momentum shift back the other way, and will ride it back to break even, or even back into a loss.

A week ago, the NQ had a 19 point downmove, a 18 point upmove, a 29 point downmove, a 29 point upmove, and another 29 point downmove, with a late 11 point rally and another 10 point downmove into the close. That's 146 points on the major moves alone. He netted a total of 3 points on trades, most if not all of that eaten up with commissions & slippage. Is that really good trading, for someone who's supposedly been trading for 20 years and has this 80% accurate system?

Same thing on Wednesday - a 45 point upmove, yet he had 4 short Boomerang trades that were all losers, 12 points plus slippage & commisions. He fought the uptrend most of the day, because he was locked into his daily forecast prediction. All his indicators kept pointing up. but he ignored them. All you had to do was buy the market on the open when the Boomerang indicated going long, or on every pullback to his Dyanmic Trend Band line, and you would have made gobs of money. But he was too busy talking for the first 20 minutes, by which time the market was already up 20-30 points, then starts shorting. But of course, the market going up was just "cowboy riggers", not retail trade. Who cares? If the market is going up for whatever reason, don't fight, go with it. And that's what the Boomerang indicators showed. But no, let's fight the trend all day.

He complains that the market's different in 2014, and that the Boomerang trades are "more difficult" now. Personally, I think they are what they've always been. There's NO difference in the chart patterns between 2013 and 2014, or 2011 and 2012 to 2014, for that matter. I've watched them hundreds of hours, and see the same patterns over and over.

I think the real problem is that he's been always doing his tutorials on the Boomerang trades on his website, AFTER the trades are done. Hypothetical trading. Having watched the system myself for some time, it's easy to take a signal too soon, because it looks like it shows a trend change, then in the next bar, that indication disappears as prices move. That's basically the problem with almost every indicator, they're all based on past price movement, and to some extent or another, will repaint as price changes and change indications. I think in real time, he's obviously finding it a LOT more difficult to pick those trades out than it is when all price movement is over and done with.

Anyone can go back to a historical chart with indicators, whether they're stochastics, MACD, Boomerang, you name it, and say, here's where you'd get long and here's where you get short. That's why in the tutorials and testimonials, he boasts of 80% accuracy, or 10 winning trades in a row, because he sees which signals work and which don't, after they've happened and the bars are complete, with no repaints. And as soon as those indicators start to change, Mohan wants to rush in and take the trade, afraid that it will move without him.

But waiting until his DTB lines change color and then taking pullbacks to them gives you PLENTY of time to get in on the trend change, sometimes at a new high or new low. By then, he's gotten in too early, maybe gets 3-5 points out of it, and then is looking to reverse into a new trend that drops 10, 15, 20 or more points, and getting eaten alive.

I do believe the Boomerang system is a very good one, especially combined with other indicators, such as the QQE, D3 Divergence Spotter, perhaps an MACD-type indicator (I have 2 variations of them, called Bullseye and Wavetrend), and the usual stuff like Bollinger bands, ADXVMA, etc.

Maybe he'll turn it around. But after making a big deal about retooling the trading, today is as bad or worse than ever, with big net loss, big stopouts, and the usual excuses. After getting some points in the first week or two, he's just been flailing about, breaking even at best, and now losing larger and larger. Save the $250 a month he charges for this travesty, put it towards the program itself and learn it yourself, because it can be a good trading tool, if you really trade with it. He for some reason chooses not to, and the results show it. The emperor in his trading room and AutoTrade account is wearing no clothes.

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