ExpertAdvisorTrading.com

PointBreak relies heavily on hedging trades. With the new Compliance Rule 2-43 announced by the National Futures Association (NFA) recently, PointBreak can no longer be used as the Expert Advisor for fx trading. This came at a bad time. My demo account was down sharply to less than USD 8,000 due to indecisiveness of EURUSD. Of course, if the EA was left to run it might have recovered the lost ground once again. But, admittedly a drawdown of that magnitude can hardly be justified. 

The developer has come up with a new Vision EA which continues the hedging scheme but now using EURUSD and USDCHF to avoid the new NFA rule. I’ll give it a try on my demo account but frankly I don’t have much faith. From a risk-reward point of view, the scheme is far from attractive. That’s my conclusion at this point. Will keep you posted.

PointBreak once again resolved the very serious situation, closing over 450 open positions on my live account with a small profit. At one point the account equity was 60% down and the margin went below 100%, a very dangerous situation.

Of course, my demo account also successfully closed all positions with a profit. The balance is now $37,523.

Although this is marvelous, the key contributing factor was the market movement. PointBreak is a trend follower. If the market ranges, it will accumulate losses. In the middle of the latest episode of the eurusd ranging, the author of the ea emailed users explaining how users might manually intervene to resolve the situation, but that would involve predicting market’s next thrust. Luckily I left PointBreak alone and the market move in my favor.

PointBreak is a great trading system but you have to be very conservative. I will try to apply some manual intervention technique next time around to prevent getting into another sharp drawdown.

I feel the need to write this update on PointBreak partly because there seems to be some readers anxiosly waiting for it and partly because there is a performance issue of the ea. The thing is my demo account continues to display steady performance with the balance now stands at $36,776 and a neglegible floating loss but my live account is in a big trouble. PointBreak accumulated longs when EURUSD made its last push upward during September 19 – 22, 2008 only to be caught in the strong trend reversal since September 22. My demo account somehow got off unharmed but my live account couldn’t. It squared off the positions with a huge floating loss of over 50% of the balance and then start accumulating net shorts. Altogether 375 trades have been entered into at 128:247 buy:sell ratio. There is a chance of recovery if the the downward push reaches the target around 1.31, about 400 pips away. On the other hand if the trend ends or if there is a correction, the trouble may be deepened.

I guess I need to monitor my live account closely and may have to manually intervene at a point. The ea’s author seems well aware of this problem and hints a manual maneuvering may be necessary from time to time. The later versions of the ea provide tools for such intervention but left it to the users on how it should be used.

I should have posted this update earlier. Well, the long awaited turnaround by PointBreak occurred finally. Only a few days after my last update, PointBreak closed most of the opened trades and recovered all the floating loss. With EURUSD entering a bearish phase decisively, PointBreak did what it was expected of doing, i.e. closing trades with profit. 

The profit at that point was small but it’s such a relief to have come out of the long dark tunnel. Now things look much better with PointBreak closing trades more frequently and accumulating profit. My demo account balance now stands at $33,775. My live account mirrors the performance quite nicely.

Well, I’m happy with the ea and will inject more fund into my live account. My demo on PipBoxer on the otherhand didn’t show sign of improvement, so, I decided to stop the test.

It’s a while since my last update on PointBreak EA forward test. Well, things didn’t seem to turn out as positive as I thought. The demo account I use for the test stands at $30,874 at the time of writing, a respectable $5,874 profit over the initial balance of $25,000 in about 6 months – a 47% p.a. roi. However, the equity level is a notch lower at $29,996. What bothers me is my live account is still in a negative zone in terms of equity after 3 months. Of course, the account balance based on closed position is positive but the floating losses have dragged on for too long time. 

Looks like my search for the ultimate ea needs to continue. I will run the forward tests on PointBreak for a while more. Actually, I’ve resumed my tests on PipBoxer again. Will keep you posted.

During week 5 PointBreak closed just 73 trades generating $95.30 profit inclusive of swap. However there is a large open loss of over $3000. In week 6 the situation improved a little with 75 more trades closed and $69.27 profit added to my account which stood at $26,145 and the floating loss was down to $2,739.96.

PointBreak definitely closes trades with profit but in the process may accumulate floating losses when the market is ranging. The point here is how the system withstands the ups and downs of the market and doesn’t collapse before the new trending market resumes. I guess I’ll have to observe the results and behavior further before I can be more confident in trading the ea live.

This week PointBreak closed just 94 trades generating $153.84 profit inclusive of swap. My account balance now stands at $25,980.50. However there is a large open loss of over $1500 out of 40 open positions.

EURUSD looked trapped in a wide ranging market condition. At first the positions tilted or “skewed” to the long side. But since the market kept moving south, PointBreak started adding shorts and eventually skewed to the short side. Now EURUSD is moving back up again.

I’m forced to delay my plan to switch on my live trade with PointBreak for the time being. In the mean time, Forex Hope has released a new update of the bot. According to the author’s email, the new release fix lot-size problem on M cycle and add 3 new parameters for M cycle engine. I’ve updated my live chart accordingly.

This week PointBreak closed 213 trades generating $427 profit inclusive of swap. My account balance now stands at $25,826.66. The open loss for this week is $581.10 out of 10 open positions.

PointBreak did what it’s expected of doing, i.e. closing trades with profit. This was by no means a straightforward affair. At one point there were about 95 open trades and over $1,200 floating loss.

After the profitable closes I noticed PointBreak started new positions at bigger lot sizes supposedly a work of its money management engine.

From observing its behavior over the past few weeks, I’m much more confident with the bot and will go live next week.

This week PointBreak closed 44 trades generating $125.7 profit. My account balance now stands at $25,354.46. It was rather a smooth week. There remains 78 unclosed positions with a floating loss of $1,229.59 and are tilted to the long side. During the week, EURUSD ranged rather widely from 1.4510 to 1.4779 but with moderate slopes. Given the nature of PointBreak ea, I’m not concerned about this. The key here is you need a good equity base to maintain the positions until they are eventually closed at a profit. Account free margin is $23,539.87 translated into a margin level of 4,123.91% which is still quite ample.

If things proceed as expected, I may start a live trade with PointBreak soon.

I was contacted by the developer of PointBreak expert advisor to give his ea a try. So, I down loaded the demo version and launched it on a new IBFX standard demo account exactly a week ago. The initial equity was set at $25,000.

The ea ended week 1 with $228.76 profit after closing a total of 207 trades. You can see the Detailed Statement here. As you may notice, this is a completely different type of ea which trades much more often. The thing is the ea doesn’t even predict the direction of the market. The ea uses pyramiding and hedging strategies. The system will keep adding trades in the direction of the trend above or below a starting point. The pyramiding technique work best on a trending market. Once all the trades that are open reaches a profit total target, all the trades will be closed out thus realizing the profits and ends a cycle.

There is one problem to this strategy: on very choppy market, the floating loss will increase and may trigger a stop-out by the broker. In fact, during the past one week, the floating loss on my demo account reached over $1,300. The market just resumed a trend yesterday and PointBreak magically closed all positions at a profit.

The key here is to set the system up to trade very conservatively. There is also a built in money management which will automatically calculate the correct position size according to the risk level selected. This has the effects of containing the risk and compounding the profits.

I’ll want to continue the demo and see how the ea flares over the coming weeks before considering a live trading.