Super Carry Trade Trading System
Greetings to all. I have posted a few trading systems here before, my reason for doing so is for others to critique and improve them. This is my latest, which I have been using on a live account, in a modified version since the first of 2008. This system has been producing for me between 8 and 10% profits per month, or approximately 100% per year or greater, depending on market conditions. I got the idea from Oanda “beginner” forum from “Knightrider” who has doubled his account yearly for the past 2 years.

I do “average in”, which some people do not like, but the actual trading aspect of this system helps to mitigate against any negative affects of “cost averaging” the entry. Please examine and critique/offer suggestions as able.

GPB/JPY
Long trades only (interest positive)
Use .05% of your Net Available Balance on each trade (Oanda does this automatically)

1. Enter at any time with a market order
2. Place limit orders (long) at 10 pips above initial entry
3. Place 10 pip profit targets on all limit orders, up to 200-400 pips above current market
4. If market drops (carry trade unwinds) by 200 pips enter a market order once per day, with no take profit, in an attempt to lower the average price of all orders to within 100-200 of current market. Each additional market order lowers the “average” of your orders.
5. Enter limit orders (long) at 10 pips above this market order, up to the orders already entered.
6. At any time you have more than 1 order open, and the market is above the average price, close all orders (Oanda makes this easy to do).
7. If market continues to drop, continue to place orders (as in numbers 4-6 above), attempting to keep the “average price” within 100-200 pips of current price.

Pros:

• Effective in all market conditions (ranging, trending).
• Provides profits from both trading and interest.
• Only monitor the markets once or twice per day, as desired.

Cons:

• Caution is needed during carry trade unwinds. If need be, during severe unwinds, limit further buying to only 400-500 pip drops.

Do you add smaller positions the more the market moves against you? Would this not make it harder to close all the positions that are averaged in on the retracement?

Good questions. Yes, with Oanda when you have selected the percentage you wish to trade with it does trade off of your net asset value, so that as the market moves against us the trades are smaller. However, the retracement trades keep the NAV close to the same if not add a bunch.

It is extremely easy to close all the positions with Oanda. One click closes them all at once. Very easy to work this system with Oanda.