Trading both Long and Short +-40 strategy XBT to always win
My plan is to trade this volatility regardless of direction and is simply involves setting both a buy and sell order $40 above and below daily open market price, each with a stop loss at the daily open price, then at the end of the day close the positions and set up for the next candle.
The logic being that on any given day no-one really knows which way XBT will go, typically if the price moves more than $40 in either direction there is a reasonable chance for the day that the price will continue on further in that direction and will close in your favour.
Of course some days the trade will trigger and price will return to open price at a loss of $(40) and some days with high volume sideways movement both trades will trigger resulting in a loss of $(80), some days one trade will lose $(40) and the other will make small or massive gains offsetting it, and some days neither trade will trigger. But as you will see from the chart, on many days there will be a massive move in one direction where only one trade will trigger and you will capture the vast majority of this move which is ideally what i'm trying to capture with this.
I have manually back tested this for January and it seems it would have generated a gain of around $600 at 1:1 but which if you were trading on leverage could be huge.
Any thoughts? I am not a coder so don't have the ability to backtest this long term but if someone else does then feel free.
The number of $40 wasn't plucked out of thin air either, I have looked at the average size of the wicks down for days that were green and wicks up for red day candles for last 2 months which come out at around $37 average
The logic being that on any given day no-one really knows which way XBT will go, typically if the price moves more than $40 in either direction there is a reasonable chance for the day that the price will continue on further in that direction and will close in your favour.
Of course some days the trade will trigger and price will return to open price at a loss of $(40) and some days with high volume sideways movement both trades will trigger resulting in a loss of $(80), some days one trade will lose $(40) and the other will make small or massive gains offsetting it, and some days neither trade will trigger. But as you will see from the chart, on many days there will be a massive move in one direction where only one trade will trigger and you will capture the vast majority of this move which is ideally what i'm trying to capture with this.
I have manually back tested this for January and it seems it would have generated a gain of around $600 at 1:1 but which if you were trading on leverage could be huge.
Any thoughts? I am not a coder so don't have the ability to backtest this long term but if someone else does then feel free.
The number of $40 wasn't plucked out of thin air either, I have looked at the average size of the wicks down for days that were green and wicks up for red day candles for last 2 months which come out at around $37 average