Keeping up with the 2020 theme, this year’s HLHB Trend-Catcher System results are stranger than usual.
For one thing, the best-performing pair yielded BREAKEVEN results. What’s up with that?! Meanwhile, the relatively tame pair brought home the bacon for the system.
If you’ve just tuned in, know that the Huck Loves Her Bucks (HLHB) System aims to catch trends by using the 5 and 10 EMAs on the 1-hour charts of major dollar pairs like EUR/USD, GBP/USD, and USD/JPY.
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 as a parameter to weed out the fakeouts.
Check out a backtest that I did if you want to know more about the version that I’m using!
Take note that I only risk 0.50% of my account per trade.
Here’s a breakdown of how the system did for all of 2020:
The HLHB started the year strong on EUR/USD by gaining hundreds of pips with only nine trades.
Unfortunately, the system failed to catch some of the one-directional moves that we’ve seen in the second half of the year. In fact, the HLHB was more often faked out and was on the other side of a lot of strong moves.
But, hey, a win is a win! The 51 valid trades produced a total of 262 pips (+0.87%) even though the win rate plummeted in the second half of 2020. Phew!
If you’ve been watching HLHB updates in the last few years, then you’ll know that the system usually makes the bulk of it pips from Cable.
Not this year, though! Thanks to uncertainty for both the pound and the dollar, GBP/USD barely made strong one-directional moves.
This resulted in the HLHB gaining…..wait for it…. a net of ZERO pips! That’s about as many albums Rihanna has released since 2016!
Oh well. With all the drama surrounding Brexit and a new U.S. government, we might see more trending action on GBP/USD in the next few months.
Much like in EUR/USD, the HLHB got tons of pips from all the USD/JPY volatility in the first quarter when the world shut down their economies.
The HLHB didn’t gain a lot more after that, but it did add enough pips in Q2 and Q3 to sustain a small loss in Q4.
By the end of the year, the HLHB got a whopping 749 pips (+2.50%) from USD/JPY. Good thing the HLHB caught all those one-directional dollar moves!
That’s it for the numbers in this year!One thing I’ve noticed is that the HLHB really rakes in pips when we see strong trends. This is most obvious in the first quarter when sudden global economic changes prompted volatile trading conditions.
Consequently, slow and steady directional moves such as what we’ve seen in the second half of the year could yield tons of fakeouts and limit the HLHB’s ability to catch otherwise decent intraweek trends.
Let’s see if we get more trends in the coming months.
With the major central banks poised to keep their policies low and steady-ish, we’ll probably see price action similar to 2019 when trends change by the week.
I could be wrong though! How about you? Do you think we’ll see strong dollar trends next year? Or will the Greenback range against its major counterparts?
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