I’m still performing some last minute testing on the new release of Heisenberg which I’m planning on deploying this weekend. However due to the amount of emails I have received I wanted to share some of the campaigns of this weeks as a little sneak peak of what to expect:
Here’s the EUR/AUD which triggered short yesterday. I got to 1.2R and then took 1/4 profits. The rest it held overnight and then reached 2R after which it unfortunately got stopped out this morning near the 1.2R mark.
Here’s the E-Mini on the 26th and 27th – the first one was a 3+R winner and the second one made it to 1.2R, took 1/4 profit and then got stopped out at about 0.5R. So roughly a 0.75R winner on the second one.
We didn’t run the spoos yesterday morning due to event risk – however I’m showing you what would have happened, which is a double stop out. Definitely not fun and as event risk should be kept to a minimum we always keep an eye on the Forex event calendar to make sure nothing big is looming.
Since then it grabbed a long when things quieted down a bit yesterday and it’s currently. Once again it got to 1.2R and took 1/4 profi- from there it got stopped out early today a bit above break/even. I haven’t done the math yet but it’s roughly 1.5R profit plus minus.
Currently we’re long again and have already taken 1/4 profit at 1.2R – let’s see if we can get this thing popping now. There were more campaigns but I’m running into some kind of charting problems on my dev box so I’ll have to tack them on here once I resolve the problem.
In case you missed it – you still can sign up for FREE to test Heisenberg at your heart’s content. However I recommend you wear googles plus protective clothing at all times and carefully study the info provided under the Heisenberg menu bar on top of this page.
No, unfortunately Walter White didn’t mysteriously return from the grave. But this is almost as good and I don’t think I’m exaggerating. Yes, you guessed right – it’s ba-aack! After weeks of fine tuning and internal improvements we have decided to once more unleash Heisenberg (our trading strategy) onto our intrepid steel rats – which is you guys.
It’s better – it’s bigger – and it’s got a bad attitude. So why did we pull it in the first place about two months ago? The answer is complicated but I’ll try to explain. The entry logic has not changed at all – what has is the pre-conditions that qualify the entry logic to kick in. And by that I mean certain proprietary methods (not unlike those used by Walter White) that allow us to carefully target our victims and get positioned for maximum impact.
Of course none of that makes any sense to you and that is the general idea as Heisenberg is proprietary and will always remain to be so. The basic entry rules are very similar to CrazyIvan but that is where the resemblance ends. Heisenberg is a lean mean trend trading machine whose sinister activites are fueled by the mental anguish of the hapless victims that find themselves on the other side of its trades.
Above I have pulled a screen grab of the current campaign on the E-Mini and this is not cherry picked – we have been testing it on the Forex side for weeks now with outstanding results. The average expectancy is a mind boggling 0.65R – yes, you read that right. And on the E-Mini it’s closer to 0.7R – which is outright insane.
How do we do it? You guessed right again – magnets – of course! And best of all – it’s still in beta and thus absolutely and deliciously FREE. Gratis para todas las ratas que hablan español. Meaning you can sign up right now to receive real-time email and Jabber alerts. I haven’t updated the Heisenberg tutorial yet but if you want to receive the latter than follow the instructions on the CrazyIvan page.
Equities have been holding steady over the weekend despite some very surprising results in the European elections. I guess it’s time for us Germans to start munching on cheese and baguettes as the French apparently are the right wing extremists now. Nah, I’m joking – given European socialist standards ‘far right’ means they’ve moved a bit closer toward what would make for moderate Democrats over int the U.S. What the article doesn’t really make clear is that the French nationals didn’t just make it into the European parliament – they completely swept the election!
Anyway, enough of the politics – we usually keep it to a minimum here at Evil Speculator. Why? Because we’re more concerned with banking coin as that allows us to buy us our own select group of politicians. If you want something done just buy yourself a mayor or perhaps a state senator and see it get done! Of course I’m kidding folks – we all know that money doesn’t play any part in American or European politics.
Speaking of banking coin – our E-Mini campaign is doing pretty well at this point. I’ve moved my stop a bit above the break/even point now (i.e. 1.2R). I’m playing this campaign Heisenberg style as we may have a runner here – which means giving this plenty of room to stage a reversal before it takes off. And probably with good reason:
Once again some storm clouds on the GBP/JPY correlation – be prepared for a little courtesy shake out post our Memorial Day weekend. FWIW – I was coding all the way through – no idle time for this lowly Mole.
Here’s the hourly panel and it shows us some support courtesy of the 25-hour SMA. But I wouldn’t play that one right now – better opportunities on its brethren – and then some – roll up your sleeves as we have work to do!
More charts and commentary below for anyone donning a secret decoder ring. If you are interested in becoming a Gold member then don't waste time and sign up here. And if you are a Zero subscriber you get free access to all Gold posts, which gives you double the bang for your buck!
Have fun but keep it frosty!
Now that I have your attention let me explain. A few weeks ago I finished implementation of an Equity Curve (EC) Filter for CrazyIvan – if you missed it then feel free to point your browser to my pertinent post which also covers the general theory behind it. In theory EC filtering works wonders avoiding draw down periods which are inherent among high dependency strategies. For a good example look no further then the CrazyIvan performance stats of the past five months:
This graph above shows us the stats of all six CrazyIvan symbols (Forex and futures) combined starting from January 1st to the last trade which closed today. Quite a few draw downs in there and to no big surprise as Ivan’s basic system is known to alternate between earning and shake-out periods. Over time it does come out ahead but still – it naturally does bode the question as to whether or not it would be possible to avoid especially some of those deep drawdown periods. If you read the previous post which introduces the concept of EC filtering it sounds almost trivial to implement. Obviously CrazyIvan is a high dependency system and thus makes for a great candidate.
The trick however was in running six separate symbols concurrently against one single equity curve. Let’s not forget that CrazyIvan trades on 480 minute charts, which means that campaigns can potentially be open for several days. And that complicates matters. What the original article doesn’t cover is the problem of inertia which is inherent in trading multiple symbols against a single equity curve. For instance let’s say I have three open campaigns right now and one of them closes. The one that closed gets logged to the spreadsheet and let’s say that it was a winner which pushed the equity curve back above its SMA. So we’re trading full position sizes again – great!
However a few hours later the other two campaigns close as well and they get logged as having traded full percentages. But wait a minute – both of them originated from before we pushed back above the SMA. So when analyzing your strategy you can’t go by the close out dates as they will be deceptive. This only works for strategies that trade single positions against an equity curve tied to one symbol only. You also can’t just sort your spreadsheet by the exit dates only as you now don’t know which strategy triggered the SMA rollover and thus how to build your equity curve.
If you manage to solve this problem there is an additional one as well. You could have five open trades – all winners during a drawdown period. Another campaign triggers – so do you still ignore it or only take a fraction of your risk percentage? Or do you consider open trades as well – and when? After much debate we decided to consider open trades in addition to the list of completed trades. Again trivial in theory but in reality it opened up a Pandora’s Box of engineering problems. It took me weeks to implement this properly but in the end all our efforts paid off handsomely as there are good news to report:
So here are the past ten weeks of CrazyIvan – once again we’re looking at the raw equity curve against its SMA(12). Now we were pretty lucky on the timing side as we turned it on right before a deep draw down that would have pushed us from near 48R all the way down to 36R. That’s a rough one and although the raw version of CrazyIvan (the blue line) dug its way out of it naturally (as expected) I’m sure many of our subs would have been less than thrilled.
If you peruse the original article you know that the author tested various EC filtering techniques – one that completely skips trades and two that adjust position sizing based on a fixed fractional position sizing. Which is fancy talk for taking 1% or more above the SMA and let’s say for example 0.3R or less below it. As we are suckers for punishment we decided to follow the second model for several reasons – 1) we believe it to be superior as it may get us out of draw downs quicker – and 2) technically speaking it would have been a royal pain in the butt to not trade at all during off periods. At any rate – implementing the idea was more difficult than anticipated but we got it done.
The latest stats are shown above – the raw version of CrazyIvan actually got pretty lucky there as it enjoyed several 3R winners last week. Nevertheless the EC adjusted version is already starting to pull ahead, and that’s only after two weeks of being active. But most importantly – look at the nasty drawdown right after we had turned it on. It completely avoided all of the pain – psychologically this would have been a rough time for even the most placid of my subscribers.
The graph above also shows us that our technique of considering open campaigns for our EC algo works rather well as I don’t see much inertia at all. It seems to be rather responsive and that’s good news on all fronts.
Some of you may remember that I was also working on an alternative messaging model for CrazyIvan (and soon Heisenberg). I reviewed various options (e.g. SMS, WhatsApp (popular in Asia and Europe), Snapchat, etc.) and in the end settled on XMPP a.k.a. Jabber. It’s not very popular compared to Snapchat or Whatsapp but it’s open source and it’s completely free. Most importantly there are a ton of mobile clients that support XMPP and since I’m running the service there won’t be any spam and no ugly surprises once (and not if) those companies change their business model.
Well, after testing it on my end for over a week I just deployed the latest version of CrazyIvan which now also sends Jabber alerts to your phone or your computer. If you are a sub and haven’t signed up for a Jabber account yet (and are interested) then please write me an email to admin@ with your current Evil Speculator username and the password you want. I have tested several Jabber clients, so here is a list of my favorites:
For Windows there are a ton, so check the whole list. On OS X the list is a bit shorter but I like Psi - works like a charm. Usually all you have to do is to enter email@example.com as your login and the password you sent me in order to connect. A few clients require only the username and the server name separately but I’m sure you can figure it out – if you run into trouble then let me know. Oh, and in case you’re wondering – of course we’ll keep email alerts as most seem to prefer them.
And that is it for now – see you later during the session.
It’s not too late – learn how to consistently bank coin without news, drama, and all the misinformation. If you are interested in becoming a subscriber then don’t waste time and sign up here. The Zero indicator service also offers access to all Gold posts, so you actually get double the bang for your buck.