How to develop a robust forex trading strategy?

I wanted to start a share and reapply disscussion on forex mechanical trading.

I dont want anyone to share their trading secrets, however, I want to ask has anyone of you succeeded in developing a robust forex trading strategy?

I am a newbie in the field but after testing some handfull of strategies, I have come to conclusion that many things they teach in books just dont work.

For me none of the suggested strategies have been robust enough to trade even after adding additional filters and indicators.

Even if they bring profit they all have huge drawdowns.

Maybe you could share what profit factors and drawdown levels would you be willing to trade live?

Maybe I am asking too much from my strategies?

For example, quite popular are stategies that use indicators.

Lets use the simple ones - MA and Bollinger.

What I have found multiple times is that sooner or later you get wispaws when your order gets opened based on indicators after what the trend goes opposite your strategy and kills it.

Even adding additional indicators does not work as at that particular moment they all show the same tendency that changes after two candles and goes against your strategy.

Of course, you can use stoploss for better results/money management but then again what stops to use?

As forex is quite volatile, stops have to be placed quite far so that they are not activated too early when the trade moves back again in your favour.

And now if indicators cannot be trusted and the result is random, mostly what you will get with wide stoploss is just loosing trades.

Therefore in my mind strategy cannot be robust using indicators.

Also as the market is volatile putting close SL and TP also does not work as breakouts are not long and even if you catch them you can earn max ~20pips-30 pips until it goes back again.

In this way profit is so small that does not dominate over loss trades that usually happen more than wins in real life.

So these are few of my observations.

Would be good to hear some of your thoughts on this. Maybe I am completely wrong and should just keep on trying more systems?

As you talk also about indicators let me share my experience with them. They are calculated using the historical price. Performing calculations brings no additional information that was not already existing within the price itself. Upon the historical price the future cannot be predicted. Judge by yourself how any indicator can help you.

Somebody famous (I forget who) said something like prediction is impossible and we should try to understand the market. Indicators can only help explain what is going on and not what will happen next.

yes well I am wondering why so many books talk about them and use them for opening and closing orders. I guess it very much depends if you do manual or mechanical trading. As mechanical has to be more robust due to fact that computer only does what is told and has no feelings.

yes this is what I feel as well.

Therefore they do not help much in mechanical trading.

Maybe they could help in process of developing a strategy but surely not during running it.

Would be cool to hear some more observations. Or everyone is busy programming their strategies? :slight_smile:

It’s a personal journey.

Nobody can do it for you.

So you might as well start programming your strategy :slight_smile: