Normal
The expectancy (using the stats from skc) with a W% = 30% and AW/AL = 2.8 is only 0.14.IMO this is a poor edge extracted from the recent bullish market conditions. I would expect a value at least 0.3 to 0.7. Surprisingly the stats aren't very far from my minimum value of 0.3. If the W% was increased to 35% or the AW/AL was increased to 3.0 the expectancy's would be > 0.3. This would double the profit.I agree with skc in that the W% is too low rather than the AW/AL. The AW/AL might have been much better with the inclusion of only one good winner. Does your trade management allow for such an event or do you raise your TS higher than BE too quickly? We all realise that selecting the right TS is an art form (unless you have back-tested results). IMO TS's should be very tight or very loose. In-between doesn't work out well.The basic foundation of this approach is to have a go but limit the losses. I agree with this approach but question whether you are letting your winners get big enough to compensate for all your work.Great question craft. (I like it when you hang around.)After the entry, the second most worrying time for a break-out trader is when price retests the original BO level. This tests the break-out traders' resolve while other traders who prefer to buy on support think this is an excellent low risk entry. A BO trader must expect the retest to happen and not exit near BE when it does. A successful retest (price resumes in the BO direction) is a high probability indicator for a winning trade (and a pyramiding opportunity).
The expectancy (using the stats from skc) with a W% = 30% and AW/AL = 2.8 is only 0.14.
IMO this is a poor edge extracted from the recent bullish market conditions. I would expect a value at least 0.3 to 0.7. Surprisingly the stats aren't very far from my minimum value of 0.3. If the W% was increased to 35% or the AW/AL was increased to 3.0 the expectancy's would be > 0.3. This would double the profit.
I agree with skc in that the W% is too low rather than the AW/AL. The AW/AL might have been much better with the inclusion of only one good winner. Does your trade management allow for such an event or do you raise your TS higher than BE too quickly? We all realise that selecting the right TS is an art form (unless you have back-tested results). IMO TS's should be very tight or very loose. In-between doesn't work out well.
The basic foundation of this approach is to have a go but limit the losses. I agree with this approach but question whether you are letting your winners get big enough to compensate for all your work.
Great question craft. (I like it when you hang around.)
After the entry, the second most worrying time for a break-out trader is when price retests the original BO level. This tests the break-out traders' resolve while other traders who prefer to buy on support think this is an excellent low risk entry. A BO trader must expect the retest to happen and not exit near BE when it does. A successful retest (price resumes in the BO direction) is a high probability indicator for a winning trade (and a pyramiding opportunity).
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