Forex Hans123 Breakout System

Simple Combined Breakout System for EUR/USD and GBP/USD

* Determine the 06.00 CET – 10.00 CET High Low on EUR/USD and GBP/USD
* Determine the 10.00 CET – 14.00 CET High Low on EUR/USD and GBP/USD
* Set BuyStop at High + 5 pips and SellStop at Low - 5 pips for both timeframes and both currencies
* Set Target Price at entry + 80 pips for EUR/USD and entry + 120 pips for GBP/USD
* Set StopLoss at entry - 50 pips for EUR/USD and entry - 70 pips for GBP/USD. If the other side of the breakout is within 50 pips for EUR/USD or within 70 pips for GBP/USD then the StopLoss will be that level (Longtrade: SL = Low range - 5 pips = SellStop; Shorttrade: SL = High range + 5 pips = BuyStop)
* Move the SL to breakeven after a gain of 30 pips for EUR/USD and a gain of 40 pips for GBP/USD
* If a certain position is taken and price turns agains you and it breaks the other side of the breakout channel then turn. If the breakout channel is broader then the stoploss first the stoploss will be hit. If the breakout channel is narrower then the stoploss then hitting the other side means that you have to turn your position. There is only one turn per time frame possible. This rule is a result of all previous rules. You can skip this rule if you want.
* At 24.00 CET all orders expiring and close all trades at market. On Friday we do the same at 23.00 CET.

This link displays the time in every major city in the world: www.qlock.com. I am using CET time (Amsterdam, Frankfurt).

Results October 2005:


10/03 : -22 pips
10/04: -61 pips
10/05: -103 pips
10/06: +168 pips
10/07: +156 pips
10/10: +135 pips
10/11: +61 pips
10/12: +108 pips
10/13: +97 pips
10/14: +274 pips
10/17: +178 pips


Total: +991 pips


The results this month are extreme. In general the system gives you an average return of 600 pips a month from March 2005.

On monthly basis the results are:

March 2005: +721 pips
April 2005: +940 pips
May 2005: +296 pips
June 2005: +857 pips
July 2005: +1,352 pips
August 2005: + 35 pips
September 2005: -20 pips
October 2005: +1,825 pips
November 2005: +554 pips
December 2005: +345 pips
January 2006: +73 pips
February 2006: -13 pips
March 2006: +633 pips
April 2006: +617 pips
May 2006: +1,319 pips
June 2006: +251 pips
August 2006: -322 pips

All calculations before October 2005 are done by hand, so it is possible that there is a small deviation. It is only to show the power of such a simple system.

This system has been invented by Hans Van Der Helm from Netherlands.

Source : http://www.forex-tsd.com

Forex Hedging System

Hedging is defined as holding two or more positions at the same time, where the purpose is to offset the losses in the first position by the gains received from the other position.

Usual hedging is to open a position for a currency A, then opening a reverse for this position on the same currency A. This type of hedging protects the trader from getting a margin call, as the second position will gain if the first loses, and vice versa.

However, traders developed more hedging techniques in order to try to benefit form hedging and make profits instead of just to offset losses.

In this page, we will discuss, some of the hedging techniques.

1. 100% Hedging.

This technique is the safest ever, and the most profitable of all hedging techniques while keeping minimal risks. This technique uses the arbitrage of interest rates (roll over rates) between brokers. In this type of hedging you will need to use two brokers. One broker which pays or charges interest at end of day, and the other should not charge or pay interest. However, in such cases the trader should try to maximize your profits, or in other words to benefit the utmost of this type of hedging.

The main idea about this type of hedging is to open a position of currency X at a broker which will pay you a high interest for every night the position is carried, and to open a reverse of that position for the same currency X with the broker that does not charge interest for carrying the trade. This way you will gain the interest or rollover that is credited to your account.

However there are many factors that you should take into consideration.

a. The currency to use. The best pair to use is the GBPJPY, because at the time of writing this article, the interest credited to your account will be 24 usd for every 1 regular long lot you have. However you should check with your broker because each broker credits a different amount. The range can be from $10 to $26.

b. The interest free broker. This is the hardest part. Before you open your account with such a broker, you should check the following: i. Does the broker allow opening the position for an unlimited time? ii. Does the broker charge commissions?

Some brokers charge $5 flat every night for each lot held, this is a good thing, although it seems not. Because, when the broker charges you money for keeping your position, the your broker will likely let you hold your position indefinitely.

c. Equity of your account. Hedging requires lots of money. For example, if you want to use the GBPJPY, you will need 20,000USD in each account. This is very necessary because the max monthly range for GBPJPY in the last few years was 2000 pips. You do not want one of your accounts to get a margin call. Do not forget that when you open your 2 positions at the 2 brokers, you will pay the spread, which is around 16 pips together. If you are using 1 regular lot, then this is around 145 usd. So you will enter the trades, losing 145 usd. So you will need the first 6 days just to cover the spread cost. Thus if you get a margin call again, you will need to close your other position, and then transfer money to your other account, and then re-open the positions. Every time this happens, you will lose 145 usd!

It is very important not to get a margin call. This can be maintained by a large equity, or a fast efficient way to transfer money between brokers.

d. Money management. One of the best ways to manage such an account is to monthly withdraw profits and balancing your positions. This can be done by withdrawing the excess from one account, take out the profits, and depositing the excess into the losing account to balance them. However, this can be costly. You should also check with your broker if he allows withdrawals while your position is still open. One efficient way of doing this is using the brokerage service withdrawals which is provided by third party companies.

Source : http://www.myfxreport.com/hedging.htm