Hedge Hog - Daily Strategy

Hedge Hog Strategy

STRATEGY OVERVIEW:

Each day Monday-Friday at 00:00 GMT since market is closed), you enter a BUY and SELL for the EUR/USD pair (some systems require you to HEDGE in order for the opposite order not to be closed) with a LIMIT (TAKE PROFIT) of 14 pips. Most days this will give you 28 pips profit.

Other pairs besides the EUR/USD have been looked at but not studied in depth to determine if they are suitable.

HISTORICAL BASIS FOR STRATEGY:

After reviewing historical data from GMT (nothing done on Saturday/Sunday at 6/23/89 to 2/13/06 (over 15 years) I have observed the following:

With a LIMIT (TAKE PROFIT) of 9 pips:

BUY orders were successful 89.1% of the time (3855 out of 4326 closed in profit)

SELL orders were successful 91.1% of the time (3944 out of 4326 closed in profit)

In both BUY and SELL orders there was less than 1% risk of neither being closed on a given day.

With a LIMIT (TAKE PROFIT) of 14 pips:

BUY orders were successful 83.5% of the time (3613 out of 4326 closed in profit)

SELL orders were successful 85.7% of the time (3707 out of 4326 closed in profit)

In both BUY and SELL orders there was less than 1.5% risk of neither being closed on a given day.

With a LIMIT (TAKE PROFIT) of 19 pips:

BUY orders were successful 77.4% of the time (3350 out of 4326 closed in profit)

SELL orders were successful 79.3% of the time (3430 out of 4326 closed in profit)

In both BUY and SELL orders there was less than 2.5% risk of neither being closed on a given day.

Orders NOT Closed

About 80% of the orders placed will be closed in PROFIT each day but there are days when either the BUY or SELL (and rarely both) are not closed. What do you do?

95% of the orders not closed will be closed within 1-3 days (usually the next day). If an order is not closed within 48hrs of being opened, MANUALLY CLOSE the order and DOUBLE the number of lots for the new orders the day just beginning (for which ever direction was not successful (BUY or SELL). NOTE: Orders that were not successful for 3 days in a row only occurred 15 times in the time period studied (less then 3/10 of a percent).

SUMMARY

Each day at 00:00 GMT (Monday-Friday) place a BUY and SELL order (or HEDGE) for the desired pair (EUR/USD) with a LIMIT of 14 pips.

If after 48hrs an order has NOT CLOSED then manually close and place your order for the new day for double the lots (BUY or SELL). Only double the order that was not successful (i.e. if it was a BUY that you manually closed then double the lots but place your SELL for the new day as you normally would).