Partner Center Find a Broker

Greetings, forex earthlings! I thought I’d pick up where I left off with the SMA Crossover Pullback system signals from last year. If this is the first time you’re hearing about this mechanical system, better take a look at the trading rules and risk management adjustments first.

Here’s what went on in the past few weeks while I was vacationing in a galaxy far, far away…

To start off, let’s review the open forex positions from my previous system update. EUR/USD had a long position at 1.0880 and the trailing stop was activated once price moved 150 pips in the trade’s favor. This stop was eventually hit just before a new crossover materialized, which then led to another losing trade. Yipes!

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

EUR/JPY also had a long position open, which got closed on a new crossover. A stochastic pullback signal soon followed, generating a short position which also hit its trailing stop before the downtrend gained momentum.

EUR/JPY 1-hour Forex Chart
EUR/JPY 1-hour Forex Chart

Unfortunately for Cable, its long position eventually hit the full stop loss before a new crossover could even generate an early exit signal. It looks like the pair might have a strong comeback with the next short position, though.

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

AUD/USD managed to lock in a few pips when the trailing stop was hit before a short signal popped up.

AUD/USD 1-hour Forex Chart
AUD/USD 1-hour Forex Chart

Here’s a summary of the positions that were closed and left open as of January 1:

SMA Crossover Pullback Positions as of Jan. 1, 2016
Pair Position Entry SL PT Status P/L  (pips) P/L  (%)
EUR/USD Long 1.0880 1.0730 1.1180 Closed +30 0.20%
EUR/JPY Long 133.50 132.00 136.50 Closed -20 -0.13%
GBP/USD Long 1.5140 1.4990 1.5440 Closed -150 -1.00%
AUD/USD Short .7290 .7440 .6990 Closed +40 +0.27%
EUR/USD Short 1.0820 1.0970 1.0520 Closed -150 -1.00%
EUR/JPY Short 133.40 134.90 130.40 Closed +90 +0.60%
GBP/USD Short 1.4920 1.5070 1.4620 Open
EUR/USD Long 1.0915 1.0765 1.1215 Open
AUD/USD Long .7265 .7135 .7565 Open

Not really the strong finish I had been hoping for with the SMA Crossover Pullback system in 2015, but you gotta remember that this strategy still managed to lock a little over 10% during the latter half of the year. Even with this 160-pip loss or 1.06% dent on the account, it’s still a pretty solid gain!

Do you think this mechanical system would be able to take advantage of the strong forex trends we’ve been seeing these days? Looking forward to seeing your comments on this strategy!