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Originally Posted by permanentjaun
Having a little trouble understanding how this system profits. It has been noted that this method requires large equity because it experiences huge drawdowns. What is the scenerio in which it wins? I've only read it briefly, but don't understand the difference between the turtles method and simple pyramiding.
Which turtle method are you testing btw? System 1 or 2? What exit strategies are you using, 2 N or whipsaw 1/2? Do you think there is a way to trade this idea that will not produce the profits a true turtle system would produce, but perhaps bring in more consistent profits with less drawdown? Matt
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Hello im using system 2, but i will develop system 1 after this EA is already working perfectly. the reason i chose sytem to to program first because it has much simpler condition to program.
As for exit strategy im using 2N as dafault for stoploss. You can change the values if you wish by changing Stoploss Multiple. Multiple is by how much to multiply the N with. Take Profit is exactly as in the book, after making a 20 bar low or high dafault(you can also change Exit bar lookback if you want to costumize this). So what I did is the exit acts like a trailing stop with the stoploss being adjusted to the low or high.
As for drawdown it is true that the system could lose much when the market is ranging but this is normal with the system because when you capture a trend it is able to make huge profits.
I hope this helps, and enjoy the forward test
regards,
Mikhail