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After lot of unsuccessful attempts at keeping up stable habit for trading and guided by Atomic habits, I m trying my hand at creating this journal.
So here are some basics of system I am trying to follow.
MA based trend following
Stocks (mainly long only) all cash no margin.
Two screen system
Screen 1 Main trend weekly , 10 & 30 EMA
Screen 2 sub trend daily , 5 & 20 EMA
Candidate selection
10 w ema above 30
5 dema below 20dema
Trigger
Price closes above 5 ema/ 5 ema crosses 20 ema Divergence on MACD (31016) daily
Stochastic 21 daily fast crossover slow from oversold zone
Entry rules
SL pos - major daily swing low at price support
Risk & lot size
CMP and SL pos <= 0.5% capital
Exit rules
Trail SL using
PSAR (0.07,0.5) until SL hit
20 day ema line until SL hit
Caution - divergence Price ROC(2) daily
Other general rules
Do not take more than 1 or 2 trades simultaneously.
Try scale out of winning trade by breaking lots into half for each trail SL.
Assumed Capital - 500k
Would love to receive suggestions for any improvements.
Can you help answer these questions from other members on NexusFi?
Oh so ! , yes it is INR, I m actually focused on practicing rules of system and risk units based routine.
So I thought to practice a way of description which is neutral of these aspects.
Hi, I don't know if the system will work or not, but I think that if you go fully systematic you can try and back test it to see if it can give good results it looks easy to backtest.
From a strategic perspective (I am really biased because I am discretionary trader), I think that it's not a good idea to try to focus on completely systematic systems. Imagine that all the brilliant minds that come out of ivy league universities, phisics, engineers, mathematicians etc... they will have a lot of knowledge to make any kind of advance system. Why do you want to compete with them?
I would stay out of that route, it's like starting to playing tennis and playing against Nadal.
Consider that Artificial Intellligence systems will find inefficiencies in the market very easily, so if your system is too easy it means you assume that there are inefficiencies that are easy to spot.
Also try to backtest the system under different conditions, for instance a trending and a non trending market....and don't forget the risk of ruin as a parameter for backtest.
Thanks SB, I agree with most of your points.
And if you see there is lot of discretion built into it, and back testing is a pain point which I have to address, after blowing several small accounts, I keep my risk very limited manually.
Considering that I am not professional yet and is developing the skill apart from main day job, i’ld appreciate any guidance on how to approach back test without investing too much money.
Hi, I am not an expert of back testing because I am a fully discretionary trader. However I know that many systematic traders use Multicharts. I have never tried the platform but it is quite well known in the industry. I think that since the strategy is quite simple you can also test it in tradestation.
In order to save money ( I have also blown out several accounts :-( ), I suggest you this:
1) give a look at MICROS. The Sp500 futures (/ES-mini) offer a micro version, in which every point is worth 5 usd, instead of 50. It is a great product, it is very liquid , so the slippage is basically inexistent, it is also very precise, meaning that if you compare it with the /ES-mini it is exact to the tick.
There are several micro markets, not all of them are as goos as the /ES-micro, but these ones are also very good: Nasdaq (/NQ), DowJones (/YM), Gold (/QM). Be careful with gold, the micro is quite ok to trade but do not trade the mini since it's not liquid at all. Also you can trade 6E micro, which is the micro for Dollar-Euro future.
Trust me you will save a lot of money, you can earn a living trading micros if your system work.
2) to save money focus on Risk reward!! forget the winrate.... focus on trades that pay you 3 times what you risk at least. Those are good trades. I know everyone speaks about RiskReward so maybe I am saying nothing new, the first time I read about it I thought it was bullshit. Now I can tell you, after blowing up so many times, that this is the only parameter that count.
3) if you are systematic back test everything, and remember to stay away from the news.... there will be moments of high volatility that will destroy your system.
4) do not trade for at least 2 / 3 years, I know it sounds crazy but it takes time.
If you are interested in seeing the type of trades that I make, give a look at my journal:
Hi traders,
I am not the kind of person who would normally take the time to share personal stuff on social media or blogs, but this time I decided to give it a chance. After working on my trading style for such a long time, I feel now I am really close …
maybe you get some ideas. You will see that I risk 1 to make 3 or 4.
, yes it is INR, I m actually focused on practicing rules of system and risk units based routine. 
