The interesting trade however is the one that got away...
As you may have spotted over this past month, the system provides me with buy and sell levels in 11 markets, which together form a hedged strategy. Depending on the profile of the trigger responsible for the signal, the market sometimes has to fall to fill a buy order (filing the order at the most advantageous level) or go up to fill a buy order (seeking further confirmation of the momentum)
If you look back on the order levels set, and compare them with the key trading levels the next day, you will see that the system has done a pretty good job at anticipating those key levels.
As you will see from this mornings post on this blog (below) one of the system's orders placed at 7.40 am was to buy the EURCHF at 1.13980.
I closed all my positions at 9 pm this evening. The EURCHF buy order was the only one not to be filled. Looking at the chart below, you can see that the low of the day was 1.13945. This is below the buy level of 1.13980, and at first glance you might expect the order to have been filled. However, the spread betting firm I use fills orders at their quote (not at the market as some others do) The EURCHF has a 4 pip spread, consequently, their bid price needed to touch 1.13940 to have filled this order today. As you will see from the chart below, the bid price touched 1.13945. The order was not filled because it missed the order level by half a pip (the smallest of margins, so small that it is not a tradeable unit)
Below you can see that the market went below my order but failed to trigger it:
This is interesting as those trading this system via direct access, spread betting "at market", or making an adjustment for the spread if trading "on quote" were all filled,as the market had touched the fill order level. As you can see from the second graph below, the EURCHF then went onto rally by 304 points. You will also see that my order was for £2 per point (to bring the RR roughly in line with the other orders)
Instead of seeing a profitable trade adding £608 onto my account at the close of play, I saw an order not filled. Two weeks ago a similar thing happened, missing out on a significant DOW trade.
To ensure the system is executed properly, if using a spread bet, an allowance needs to be made for the spread cost to ensure the trades are filled at the system's levels.
It is also true that it can go the other way. One days missed profit is another "stop not hit" or a dodged bullet with a loser not being filled. However, missing a trade is always going to disadvantage the results in the long run as this system does have a positive expectation.
