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HLHBye, pips! Even though the major dollar pairs saw legit intraweek trends, consolidations early in the week kept this trend-catcher from making pips. Here are the deets!

Before we get to the numbers, read all about my HLHB Trend Catcher System if this is your first time hearing about it!

Basically, I’m catching trends whenever the 5 EMA crosses above or below the 10 EMA. A trade is only valid if RSI crosses above or below the 50.00 mark when the signal pops up. And in this version, I’m adding ADX>25 to weed out the fakeouts.

As for stops, I’ll continue to use a 150-pip trailing stop and a profit target of 400 pips. This might change in the future, but I’ll stick to this one for now.

Oh, and as mentioned recently, I’m switching back to applying the HLHB system to the 1-hour time frame. Using 4-hour in Q1 2017 and Q2 2017 wasn’t bad, but I think using this trend-catcher on the 1-hour could yield better results.

Without further ado, let’s take a look at the results from last week:

EUR/USD

EUR/USD 1-hour Forex Chart
EUR/USD 1-hour Forex Chart

GBP/USD

GBP/USD 1-hour Forex Chart
GBP/USD 1-hour Forex Chart

USD/JPY

USD/JPY 1-hour Forex Chart
USD/JPY 1-hour Forex Chart

Much like in last week’s update, the HLHB saw losses thanks to “valid” signals taken during tight consolidations. Even worse, the system is now invalidating legit trend-starter signals.

This week we saw two new signals. The one on EUR/USD closed an open position from last week at a loss, while USD/JPY’s signal popped up right before the pair blew up in the opposite direction.

I ended up with a net loss of 213 pips which, if we consider last week’s 100-pip loss, more than offset the previous week’s +308-pip win.

This has me thinking if my trend parameters are too loose. Given that current trends aren’t as extended as they were a few years back, should I adjust my rules to promote more valid signals and tighter stops? Something to think about for the year ahead.

Do you have any tips on how I can adjust my ADX and RSI parameters? Or how about using a new indicator? Don’t be shy to share your two cents! 🙂

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