After all the action that we’ve seen last week, you would think that a trend-catcher would see tons of valid signals. So why did the HLHB lose 61 pips?
Before we get to the details, 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 before, 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.
EUR/USD was on a slow and steady downtrend for most of the week. Unfortunately, the moves were slow enough that it didn’t meet the HLHB’s parameters for a trend change.
But wait, there’s more! Recall that the system also had an open long trade from the previous week. Since the pair did a 180 as soon as the week started, price hit last week’s adjusted stop loss. Boo!
Cable was on Chopsville for most of the week, which is likely why the HLHB didn’t validate any of the crossovers from the pair.
GBP/USD only saw decent action near the end of the week when NFP players came to play. I hope next week’s price action will make more sense for my trend catcher!
USD/JPY did not have one-directional price action like in EUR/USD but it also wasn’t confined in a tight range as GBP/USD was.
Despite that, ALL of this week’s crossovers still failed the HLHB’s trend parameters. What’s up with that?!
Here’s a summary of this week’s results:
Looks like the HLHB is starting the week with a clean slate! Do you think we’ll see strong one-directional trends from the major dollar pairs in the next few days?