I know what you are thinking! What about a system that buys at the line and TP at the next line. I thought about it too! I have worked a lot on this, and never found something that works. You know why? Because it is too hard to predict the direction with enough repeatability to cover losses. Also, this is a system that adapts to what we see on the chart. Friendly reminder, when you trade, you don’t see the future bars yet. Also, you can’t predict the direction of the market. I talk about it in my conclusion.
I have worked a lot on ranging trading and I have built some pretty nice bots, I also learned a lot from a few people who are doing the same thing. Based on my experience, there are a lot of nice profits to be made and I know the one guy who taught me the stuff is profitable over the long haul, but me I was never able to tweak my bot to make it.
This being said, I am not the type of person who gives up and I do plan on going back at it because if he’s doing it, then I should be able to do it too. Remember the risk courses? We can’t just settle down and wait to see if the current bots/algos will perform in the future. Because, we can NOT predict the future. What we can do though is work on what we can control: new systems, news algos, more live trading and new learning.
So now, is it possible to have a system that makes consistent profits whether the market is ranging, going up or going down? Like a Holy Grail?
Well, most people will tell you that this is impossible. The other people will tell you it’s possible because they are good salespeople and they are selling theirs, which in the end doesn’t work because of slippage, fees, order execution or just because they back tested only during a very strong trend and now this strong trend is gone.
Me, I do think that it is possible to have something like a Holy Grail system, something that is quite flexible but most importantly something that is sizing positions properly, so that during high volatility, OR during very low volatility, the system is still reliable. I believe I’ve got something like that (though of course I can’t tell you for sure because again I can’t predict the future). My system doesn’t care what the market is doing, I just use all the principles/ideas I have been writing about in these courses, and so far it has worked for me.
I also think that if you have a macro indicator or a tool that tells you when this is ranging and when it is not, you could have a TV algo that trades differently, like 3 TV scripts into 1. Each of them would cover a market type.