THT New Moon Trade - 1 Year TEST

[THT 102]

On the face of it this might seem totally CRAZY

but, wait..........

What happens if it works?

I've spoken at length about money management and risk in previous posts - this method will show you how important it is.

Trades with charts will be produced monthly for verification and the table below updated - PLEASE NOTE, I WILL ONLY BE PAPER TRADING THIS METHOD in this thread - the process is to show you how guessing works out and I'll be updating the charts and table when time permits me to do so - I don't have the time to do this real-time

 

THT New Moon Strategy

 AIM:  To show you the effects of a stupidly simple trading method/strategy where we exploit the R value in our favour and employ strict money management / risk methods, by knowing well in advance the trade direction we'll be taking as well as the risk and target levels

We only have to be right twice to break-even and once will result in a loss of only 6R

If 6R = 60% of your account then you could be in trouble for the next year - for the purposes of this exercise we'll assume 1R = 2% of your account

So we KNOW right from the off, that the most we can loose is 12R or 24% of our account in a trading year if we get every single trade wrong - this then allows you to trade the following year with 76% of our original trading capital (live another day!)

Wins are obviously a bonus

Trade direction is LONG only (The stock markets have a long directional bias) - I could have spiced this up a bit and used a toss of a coin 5 mins before market open but its another level of faff that I can't be bothered with documenting

 We'll use the SP500 Index for the exercise - DAILY Chart Time-Frame (charts will be updated) - this will be the one from my charting software not IG's - so there will be a slight variance in price if comparing with IG's charts

To break even we just have to be right TWICE out of every 12 attempts - which is handy as there are 12 months in the year 

We know in advance trade direction we're taking, the £ risk, £ profit target and the exact day we'll be trading - the only thing we do not know is if the market is going in out expected direction too!

1R below could be x% of your account

Let's trade this for 1 year and see where we end up..................

 

RULES:

 

1.      Entry is LONG @ the OPEN the day of the New Moon (If this date is a weekend or Bank  holiday then we'll open the trade when the market next re-opens)

2.      Stop 35 points (this might have to be revised slightly during high/low volatility periods) = 1R

3.      Target is 5 times risk = 175 points = 5R

4.      Once the position is UP 2 x risk or 70 points - stop gets moved to break even

5.      Once the position is UP 3 x risk or 105 points - the stop is moved to protect 40% of any open profits until stopped out or target hit

6.      Every trade will be taken regardless of whether others are still open

 

DATE	TRADE DIRECTION	ENTRY	STOP	RISK	TARGET	OUTCOME	**** R value
July 20th 2020	LONG			35 pts	175 pts
Aug 19th 2020	LONG			35 pts	175 pts
Sept 17th 2020	LONG			35 pts	175 pts
Oct 16th 2020	LONG			35 pts	175 pts
Nov 15th 2020	LONG			35 pts	175 pts
Dec 14th 2020	LONG			35 pts	175 pts
Jan 13th 2021	LONG			35 pts	175 pts
Feb 11th 2021	LONG			35 pts	175 pts
Mar 13th 2021	LONG			35 pts	175 pts
Apr 12th 2021	LONG			35 pts	175 pts
May 11th 2021	LONG			35 pts	175 pts
June 10th 2021	LONG			35 pts	175 pts

DISCLAIMER:

As we live in a world and time where you have to warn people who hold a piece of paper and a lit match close together that it could result in creating fire which burns and hurts one - The above is an example only - It is a random method designed to show you how it performs in the financial markets, it is NOT designed for you to trade, anyone trading it must accept losses as their own responsibility and if unsure, do not commit money or trade it - as one thing is for certain, the method will have losing trades and losses of some degree - this thread and post is for Illustrative purposes only

THT will not and cannot be held responsible for any losses whatsoever - trading this example is at your own risk and unless you fully understand the method and risks I would advise against committing money to it

 

[dmedin 869]

Who farted?

[jlz 163]

Hi I wrote a bit of code today to back-test this strategy with data from 2019. 

For the developers out there that are interested in running it themselves I added everything to a GitHub folder, so they can see everything in detail.

All datasets that I use are contained in the Data folder.

https://github.com/oneangrytrader/backtesting/tree/master/BackTester/Strategy

The results are attached as a picture for review.

All profits are calculated without commission, so it would be interesting to add proper commissions on CFD-SpreadBetting and Share Dealing accounts to see what it yields.

[THT 102]

Yep it rarely fails to make a profit or at worst just to break even in the time I've known about it

I'm not advocating trading it as there's far better methods out there, I'm just showing you how to shove the odds of success by controlling money management and R values into your favour and not the houses with a set entry direction on a known date in the future

 

 

[THT 102]

lol - There's one trader whose most likely just realised their ultra smart trading method is massively beaten and outsmarted by a simple stupid trading strategy

dumedin - post your trading strategy in advance of the trade and let's see how you compare - against it - we need to know rules in advance of time so that you can't doctor the results 

Are you man enough to take on a stupid system?

[THT 102]

It's officially LIVE

1st trade is off and running

Rules in post 1 above - target levels and stop shown on chart

Remember this is to SHOW you over the course of 12 trades and 1 year by ENTERING in a fixed direction, dictated by the NEW MOON, we will see how a virtually random method compares - to be honest the main aim is to show you how by skewing risk/reward and money management into your favour you can win or prevent massive losses

For the doubters out there - Yes I have in the past traded this method using ETF's of the FTSE250 Index (MIDD) in the 2000's inside my SIPP and ISA

As I'm doing this for fun, the chart will be updated once it's stopped out or target hit

Next Trade is in August and we'll be going LONG at the open on the 19th

(PS - The MOON has absolutely NOTHING to do with this trade - I just thought it fun to use the moon in the method to prove how you can actually make money trading the markets with a stupid example of a method, but with excellent risk/reward and excellent money management - we could have just gone long on the 1st or last trading day of the month) 

If you do not see the money management importance of this - then you will be doomed to failure as a trader and there is nothing anyone but you can do about that I'm afraid

TABLE:

DATE	TRADE DIRECTION	ENTRY	STOP	RISK	TARGET	OUTCOME	**** R value
July 20th 2020	LONG	3224.29	3189.29	35 pts	175 pts 3399.29
Aug 19th 2020	LONG			35 pts	175 pts
Sept 17th 2020	LONG			35 pts	175 pts
Oct 16th 2020	LONG			35 pts	175 pts
Nov 15th 2020	LONG			35 pts	175 pts
Dec 14th 2020	LONG			35 pts	175 pts
Jan 13th 2021	LONG			35 pts	175 pts
Feb 11th 2021	LONG			35 pts	175 pts
Mar 13th 2021	LONG			35 pts	175 pts
Apr 12th 2021	LONG			35 pts	175 pts
May 11th 2021	LONG			35 pts	175 pts
June 10th 2021	LONG			35 pts	175 pts

DISCLAIMER:

As we live in a world and time where you have to warn people who hold a piece of paper and a lit match close together that it could result in creating fire - The above is an example only - It is a random method designed to show you how it performs in the financial markets, it is NOT designed for you to trade, anyone trading it must accept losses as their own responsibility and if unsure, do not commit money - as one thing is for certain, the method will have losing trades and losses.

THT will not and cannot be held responsible for any losses whatsoever - trading this example is at your own risk

[THT 102]

UPDATE:

OK - so price hit 2 x risk, so according to the rules of this method the stop goes to break even (green line now) - 3224.29

Next New Moon trade takes place at the open on the 19th of August

 

[THT 102]

UPDATE:

3 x RISK target hit = STOP moved to protect 40% of open profits = Info on chart

[THT 102]

INFO - The 19th August trade details will not be produced until AFTER the date as I'm not going to be anywhere near my trading screen to produce the chart - will do upon my return

[THT 102]

Trade 1 = Target hit

 

DATE	TRADE DIRECTION	ENTRY	STOP	RISK	TARGET	OUTCOME	**** R value
July 20th 2020	LONG	3224.29	3189.29	35 pts	175 pts 3399.29	175pts	5R
Aug 19th 2020	LONG			35 pts	175 pts
Sept 17th 2020	LONG			35 pts	175 pts
Oct 16th 2020	LONG			35 pts	175 pts
Nov 15th 2020	LONG			35 pts	175 pts
Dec 14th 2020	LONG			35 pts	175 pts
Jan 13th 2021	LONG			35 pts	175 pts
Feb 11th 2021	LONG			35 pts	175 pts
Mar 13th 2021	LONG			35 pts	175 pts
Apr 12th 2021	LONG			35 pts	175 pts
May 11th 2021	LONG			35 pts	175 pts
June 10th 2021	LONG			35 pts	175 pts

DISCLAIMER:

As we live in a world and time where you have to warn people who hold a piece of paper and a lit match close together that it could result in creating fire - The above is an example only - It is a random method designed to show you how it performs in the financial markets, it is NOT designed for you to trade, anyone trading it must accept losses as their own responsibility and if unsure, do not commit money - as one thing is for certain, the method will have losing trades and losses.

THT will not and cannot be held responsible for any losses whatsoever - trading this example is at your own risk

[THT 102]

Here's Trade 2:

This one got stopped out 1 day after the trade date = -1R loss, so we wait for the September trade

 

DATE	TRADE DIRECTION	ENTRY	STOP	RISK	TARGET	OUTCOME	**** R value
July 20th 2020	LONG	3224.29	3189.29	35 pts	175 pts 3399.29	175pts	5R
Aug 19th 2020	LONG	3392.51	3357.51	35 pts	175 pts 3567.51	-35pts	4R
Sept 17th 2020	LONG			35 pts	175 pts
Oct 16th 2020	LONG			35 pts	175 pts
Nov 15th 2020	LONG			35 pts	175 pts
Dec 14th 2020	LONG			35 pts	175 pts
Jan 13th 2021	LONG			35 pts	175 pts
Feb 11th 2021	LONG			35 pts	175 pts
Mar 13th 2021	LONG			35 pts	175 pts
Apr 12th 2021	LONG			35 pts	175 pts
May 11th 2021	LONG			35 pts	175 pts
June 10th 2021	LONG			35 pts	175 pts

DISCLAIMER:

As we live in a world and time where you have to warn people who hold a piece of paper and a lit match close together that it could result in creating fire - The above is an example only - It is a random method designed to show you how it performs in the financial markets, it is NOT designed for you to trade, anyone trading it must accept losses as their own responsibility and if unsure, do not commit money - as one thing is for certain, the method will have losing trades and losses.

THT will not and cannot be held responsible for any losses whatsoever - trading this example is at your own risk

[THT 102]

Here's Septembers THT NEW MOON method test

Rules as in the original post

Aim is to prove to you that you do not need a fancy schmancy trading method to make money in the markets a random method with good risk:reward is all you need

 

  

DATE	TRADE DIRECTION	ENTRY	STOP	RISK	TARGET	OUTCOME	**** R value
July 20th 2020	LONG	3224.29	3189.29	35 pts	175 pts 3399.29	175pts	5R
Aug 19th 2020	LONG	3392.51	3357.51	35 pts	175 pts 3567.51	-35pts	4R
Sept 17th 2020	LONG	3346.86	3311.86	35 pts	175 pts 3521.86	LIVE
Oct 16th 2020	LONG			35 pts	175 pts
Nov 15th 2020	LONG			35 pts	175 pts
Dec 14th 2020	LONG			35 pts	175 pts
Jan 13th 2021	LONG			35 pts	175 pts
Feb 11th 2021	LONG			35 pts	175 pts
Mar 13th 2021	LONG			35 pts	175 pts
Apr 12th 2021	LONG			35 pts	175 pts
May 11th 2021	LONG			35 pts	175 pts
June 10th 2021	LONG			35 pts	175 pts

DISCLAIMER:

As we live in a world and time where you have to warn people who hold a piece of paper and a lit match close together that it could result in creating fire - The above is an example only - It is a random method designed to show you how it performs in the financial markets, it is NOT designed for you to trade, anyone trading it must accept losses as their own responsibility and if unsure, do not commit money - as one thing is for certain, the method will have losing trades and losses.

THT will not and cannot be held responsible for any losses whatsoever - trading this example is at your own risk

[THT 102]

Trade STOPPED out for a 1R Loss = Disciplined rule following

simply wait until the next trade next month

 

 

DATE	TRADE DIRECTION	ENTRY	STOP	RISK	TARGET	OUTCOME	**** R value
July 20th 2020	LONG	3224.29	3189.29	35 pts	175 pts 3399.29	175pts	5R
Aug 19th 2020	LONG	3392.51	3357.51	35 pts	175 pts 3567.51	-35pts	4R
Sept 17th 2020	LONG	3346.86	3311.86	35 pts	175 pts 3521.86	-35pts	3R
Oct 16th 2020	LONG			35 pts	175 pts
Nov 15th 2020	LONG			35 pts	175 pts
Dec 14th 2020	LONG			35 pts	175 pts
Jan 13th 2021	LONG			35 pts	175 pts
Feb 11th 2021	LONG			35 pts	175 pts
Mar 13th 2021	LONG			35 pts	175 pts
Apr 12th 2021	LONG			35 pts	175 pts
May 11th 2021	LONG			35 pts	175 pts
June 10th 2021	LONG			35 pts	175 pts

DISCLAIMER:

As we live in a world and time where you have to warn people who hold a piece of paper and a lit match close together that it could result in creating fire - The above is an example only - It is a random method designed to show you how it performs in the financial markets, it is NOT designed for you to trade, anyone trading it must accept losses as their own responsibility and if unsure, do not commit money - as one thing is for certain, the method will have losing trades and losses.

THT will not and cannot be held responsible for any losses whatsoever - trading this example is at your own risk

[THT 102]

Here's October 2020's THT NEW MOON method test

Rules as in the original post

Aim is to prove to you that you do not need a fancy schmancy trading method to make money in the markets a random method with good risk:reward is all you need

  

DATE	TRADE DIRECTION	ENTRY	STOP	RISK	TARGET	OUTCOME	**** R value
July 20th 2020	LONG	3224.29	3189.29	35 pts	175 pts 3399.29	175pts	5R
Aug 19th 2020	LONG	3392.51	3357.51	35 pts	175 pts 3567.51	-35pts	4R
Sept 17th 2020	LONG	3346.86	3311.86	35 pts	175 pts 3521.86	-35pts	3R
Oct 16th 2020	LONG	3493.50	3458.50	35 pts	175 pts 3668.50		R
Nov 15th 2020	LONG			35 pts	175 pts
Dec 14th 2020	LONG			35 pts	175 pts
Jan 13th 2021	LONG			35 pts	175 pts
Feb 11th 2021	LONG			35 pts	175 pts
Mar 13th 2021	LONG			35 pts	175 pts
Apr 12th 2021	LONG			35 pts	175 pts
May 11th 2021	LONG			35 pts	175 pts
June 10th 2021	LONG			35 pts	175 pts

DISCLAIMER:

As we live in a world and time where you have to warn people who hold a piece of paper and a lit match close together that it could result in creating fire - The above is an example only - It is a random method designed to show you how it performs in the financial markets, it is NOT designed for you to trade, anyone trading it must accept losses as their own responsibility and if unsure, do not commit money - as one thing is for certain, the method will have losing trades and losses.

THT will not and cannot be held responsible for any losses whatsoever - trading this example is at your own risk

[DSchenk 171]

Would it not make more sense and be much quicker if you backtest this, instead of forward testing?

Who wants to wait til June 2021 to see the outcome ha  

And with backtesting you could easily go back to the 1950s, not just do 1 year

I like what @jlz is doing there - what platform/tool you using for backtesting?

[jlz 163]

16 minutes ago, DSchenk said:

Would it not make more sense and be much quicker if you backtest this, instead of forward testing?

Who wants to wait til June 2021 to see the outcome ha  

And with backtesting you could easily go back to the 1950s, not just do 1 year

I like what @jlz is doing there - what platform/tool you using for backtesting?

It is a c# script, the Visual Studio project is at 

https://github.com/oneangrytrader/backtesting/tree/master/BackTester

The "New Moon" strategy tester is at 

https://github.com/oneangrytrader/backtesting/blob/master/BackTester/Strategy/NewMoonStrategy.cs

 

[THT 102]

20 hours ago, DSchenk said:

Would it not make more sense and be much quicker if you backtest this, instead of forward testing?

Who wants to wait til June 2021 to see the outcome ha  

And with backtesting you could easily go back to the 1950s, not just do 1 year

I like what @jlz is doing there - what platform/tool you using for backtesting?

Hi - That's not the point of the thread - anyone is free to back test it

All I'm doing is bringing it to the attention of the community and new members every month in the "hope" that it triggers deep thinking about risk:reward and how a ridiculous semi-random trading method can work in the markets

I might post a table of past years results, but it's last on my list of things to do for the time being - anyone wishing to do so feel free though 

[DSchenk 171]

On 18/10/2020 at 18:38, jlz said:

It is a c# script, the Visual Studio project is at 

 

I'm not so good with C#

Are you using the IG API datafeed or something else entirely?

I've built a few VBA applications using the IG API - didn't help me turning over a profit though  

[THT 102]

Stopped out again

DATE	TRADE DIRECTION	ENTRY	STOP	RISK	TARGET	OUTCOME	**** R value
July 20th 2020	LONG	3224.29	3189.29	35 pts	175 pts 3399.29	175pts	5R
Aug 19th 2020	LONG	3392.51	3357.51	35 pts	175 pts 3567.51	-35pts	4R
Sept 17th 2020	LONG	3346.86	3311.86	35 pts	175 pts 3521.86	-35pts	3R
Oct 16th 2020	LONG	3493.50	3458.50	35 pts	175 pts 3668.50	-35pts	2R
Nov 15th 2020	LONG			35 pts	175 pts
Dec 14th 2020	LONG			35 pts	175 pts
Jan 13th 2021	LONG			35 pts	175 pts
Feb 11th 2021	LONG			35 pts	175 pts
Mar 13th 2021	LONG			35 pts	175 pts
Apr 12th 2021	LONG			35 pts	175 pts
May 11th 2021	LONG			35 pts	175 pts
June 10th 2021	LONG			35 pts	175 pts

DISCLAIMER:

As we live in a world and time where you have to warn people who hold a piece of paper and a lit match close together that it could result in creating fire - The above is an example only - It is a random method designed to show you how it performs in the financial markets, it is NOT designed for you to trade, anyone trading it must accept losses as their own responsibility and if unsure, do not commit money - as one thing is for certain, the method will have losing trades and losses.

THT will not and cannot be held responsible for any losses whatsoever - trading this example is at your own risk

[THT 102]

November 2020 entry

[THT 102]

Stopped out - await the new new moon date

Closing in on Breakeven - this is what trading is about, we don't know the sequence of wins or losses

 

DATE	TRADE DIRECTION	ENTRY	STOP	RISK	TARGET	OUTCOME	**** R value
July 20th 2020	LONG	3224.29	3189.29	35 pts	175 pts 3399.29	175pts	5R
Aug 19th 2020	LONG	3392.51	3357.51	35 pts	175 pts 3567.51	-35pts	4R
Sept 17th 2020	LONG	3346.86	3311.86	35 pts	175 pts 3521.86	-35pts	3R
Oct 16th 2020	LONG	3493.50	3458.50	35 pts	175 pts 3668.50	-35pts	2R
Nov 15th 2020	LONG	3600.16	3565.16	35 pts	175 pts 3775.16	-35pts	1R
Dec 14th 2020	LONG			35 pts	175 pts
Jan 13th 2021	LONG			35 pts	175 pts
Feb 11th 2021	LONG			35 pts	175 pts
Mar 13th 2021	LONG			35 pts	175 pts
Apr 12th 2021	LONG			35 pts	175 pts
May 11th 2021	LONG			35 pts	175 pts
June 10th 2021	LONG			35 pts	175 pts

DISCLAIMER:

As we live in a world and time where you have to warn people who hold a piece of paper and a lit match close together that it could result in creating fire - The above is an example only - It is a random method designed to show you how it performs in the financial markets, it is NOT designed for you to trade, anyone trading it must accept losses as their own responsibility and if unsure, do not commit money - as one thing is for certain, the method will have losing trades and losses.

THT will not and cannot be held responsible for any losses whatsoever - trading this example is at your own risk