Another slow week for this mechanical trading system as it caught only one signal per pair this time. Did it score big gains, though?
In this revised version of the Short-Term Bollinger Reversion Strategy, I’m waiting for RSI to cross above or below oversold or overbought levels to indicate a bit more momentum in the direction of the trade. Make sure you review the tweaks here.
USD/CAD generated a short signal when it tested the top band, bouncing back to the middle to hit its first target. Price made it all the way down to the opposite band, but this wasn’t after it popped up to hit the adjusted stop at entry.
Here’s how the signal turned out:
CAD/CHF snagged a teensy win on the earlier update and caught another signal this time. Price bounced off the bottom band then dipped even lower but not enough to hit the stop loss. Phew!
The pair eventually found its way back to the middle band to hit the first target, but strangely enough this was right in line with the entry. Price dipped sharply again to hit the adjusted stop loss.
Ack, so much for those moves! CAD/CHF didn’t make any pips on the position, leaving the system with a meager 12-pip or 0.24% gain on the account assuming 1% risk per position.