The God's Gift ATR... One year of testing and counting

Today I am very happy to announce the one year trading anniversary of the God's Gift ATR trading system. One year ago I started the live testing of this expert advisor and the trading system has done nothing but show its ability to preserve capital under unfavorable market conditions and take profitable trades under the right weather. This puts the God's Gift ATR up with only a very select group of trading systems which have been able to achieve this important one year live trading mark with satisfactory results.

The most important achievement of the God's Gift ATR -which is simply not available from any other trading system I know - is that I have done a backtest of the whole live testing period for all the currency pairs the EA is currently trading. The results tell us that the God's Gift ATR is back/live testing consistent. What does this mean ? It simply means that the expert advisor's simulations are an accurate representation of trading reality. Moreover, simulations also reflect that the God's Gift ATR performs even BETTER in live testing than in back testing.
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Why is back/live testing consistency so important ? When you have a LONG period of coherent back and live testing results then, and only then, you can say that the simulations you have for your EA are a realistic representation of the expert's performance for the past X years, making simulations much more valid and effectively making them a true beacon for the prediction of risk and profit targets. With the simulations of the God's Gift ATR validated, we can say that this EA would have made profit from 2000 to 2010 on several different currency pairs.

Results for last year were not extremely good for this trading system, as the EA was unable to profit through most of the year as the GBP/USD got caught in a range from June 2009 till January 2010, effectively making the EA enter a small draw down or breakeven period through most of the year (nonetheless, the year ended in profit). This is well within the predicted length of a draw down period for this EA and what is MOST important, this period of trades shows a very good match with backtesting results with an overall match of all the different smaller profit/ draw down cycles and the number of losing and profitable trades.

This EA will definitely continue to be used on Asirikuy and will definitely continue to be an important part of all my live trading portfolios. Without a doubt the God's Gift ATR has showed its potential for long term profitability and its ability to preserve capital under unfavorable market conditions. We have also learned a lot about this expert's broker dependency and the differences between the different curreny pairs and settings used.

From today (after the newsletter is sent), a back/live testing consistency section depicting all the back/live testing consistency analysis of all the God's Gift ATR instances will be included within asirikuy as well as the usual myfxbook private pages showing each instance's live updated performance. Of course, if you would like to learn more about the god's gift ATR, its trading logic and how you too can use it to trade with long term profitability in mind please consider buying my ebook on automated trading or joining Asirikuy to receive all ebook purchase benefits, weekly updates, check the live accounts I am running with several expert advisors and get in the road towards long term success in the forex market using automated trading systems. I hope you enjoyed the article !

The God's Gift ATR, Six Months of Live Testing

For today's post I wanted to write a little bit about the god's gift ATR expert advisor for which I haven't written a post in a while. This expert advisor, for the people who don't know it yet, was a modification I programmed from the original god's gift v 7c programmed by Matt Edmonds. After forward testing the initial EA for a period of one year I decided to add ATR adjustment modifications to make it more self adaptative against changing market conditons. That is, I wanted to make the EA more reliable. If you want to learn a little bit more about this modifications make sure you access the god's gift ATR label on the drop down list on the left side of the webpage.

The god's gift ATR EA has been trading on live accounts since March 01/2009. I have made weekly comments on its trades from its first week of trading for my weekly newsletter and by doing so I have got an excellent picture about its performance, its targets, what it can achieve and what it cannot. Certainly, the god's gift ATR has proven to be reliable and consistent with backtesting results. It has proven through live testing that it can work as I intended it to. The following image shows the god's gift trading from March 01 until it's 6th month trading anniversary on September the first.
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As you can see, the god's gift has had difficult periods of time as it is predicted by it's backtesting but it has always been able to come out of this periods through the use of trend following trades which make it make much more money than the amount it loses during these draw down periods. The god's gift ATR continues to have all the necessary requirements of a long term stable profitable trading system and up until now, the system has fulfilled all my expectations. I am very eager to see how this expert performs for the following few months when we will probably see a little bit more volatility on the forex market.

If you would like to learn more about the god's gift ATR, it's logic, it's trades and how you can trade it profitably in the forex market with realistic profit and draw down expectations please consider buying my ebook on automated trading or subscribing to my weekly newsletter to receive updates and check the live and demo accounts I am running with several expert advisors. I hope you enjoyed this article !

The God's Gift ATR, Turning a Good EA into a bad one !

I knew it was only a matter of time before the regular forex crowd took a hold of my god's gift ATR expert advisor. For the past few months I have seen an outdated version of my ea appear on several websites and forums and inevitably, they have started to test the system as they test all other forex expert advisors out there. I really think it's a pity. The reason why I keep the ea to myself and my customers is because I think that a certain degree of knowledge is required to trade this expert advisor and I like to serve as a guide to the people that buy my ebook or subscribe to my newsletter in order for them to use the system correctly. Below I point out the main differences between how I use the ea and how others have been testing it in order for you to know what the big differences in trading are :

How I use the system :

• I forward tested the gods gift 7c logic for 14 months before placing it on any live account
• I then programmed the gods gift ATR, backtested it on 15 different currency pairs
• I found out which ones the ea worked with and optimized them from Dec 1999 to Dec 2008.
  
• I made several risk projections to ensure that the ea would trade as safely as possible on live accounts.
  
• I then run these settings on four separate live accounts, two different sets of settings for the EUR/USD one for the GBP/USD and one for the USD/JPY.
• I tested the experts on a realiable vps with triple redundant internet connection and made the investor passwords available as well as an ftp with regularly updated results to my newsletter subscribers.
• I trade through draw down and profit and have confirmed several times the consistency I get between live and backtesting results.
  
• I wrote a manual to further help people understand what goes on under the hood
  
• I started the God's Gift ATR challenge to include controlled third party results into the expert's history.
  

How people are now testing it on forums :

• They don't do proper backtesting and optimization from 1999, the few that do use just the last year or last few months, this extremely curve fits the ea.
  
• Most of them don't have the slightest idea of how this system works
• They don't do any risk analysis and just trade it to "see what happens"
  
• Sometimes they trade it on more than 5 currency pairs on the same account (this by all means is a sure way to wipe the account)(I only trade one per account ! for very good reasons)
  
• They trade it on all pairs with the same settings, without any preoptimization. They also test the ea on some pairs for which I know for certain the ea is NOT long term profitable, sometimes not even short term at all.
• They run an outdated version of the ea which they adapted to use five digit brokers but in doing so they corrupted the ATR money management and market order size logics (again, they seem to lack of an understanding of how the system works)

As you can see, the great differences between how I test the ea and how it gets tested in forums is just too great. Inevitably, they will conlude that the ea is unprofitable eventually because they are trading it the wrong way. Why don't I start posting in forums and share all my results for free with everyone and help them succeed ? I am not interested in that. People that go to forums are sometimes arrogant and unwilling to change their mind sets about expert advisors and automated trading. They want you to explain everything to them and somehow, make them profitable in forex trading. I am not interested in fighting with people about how this should be tested or traded, etc. This is why I never asked the forum Administrator to remove the god's gift atr when this outdated version was posted on a forum a few months ago, because I know that even if the ea is out there for everyone, only one out of ten thousand will be able to find the settings and trade it the correct way and with enough discipline.

For this reason, as I outlined before, I just keep the god's gift ATR ea and testing to those people that are commited enough to read my posts, make a very small purchase and change the way in which they think about automated trading systems. Automated trading requires effort, requires knowledge and most of all, it requires commitment, something which I feel the crowd that is looking for everything on a silver plate fail to have. As you see, people at forums can turn perfectly good systems into terrible ones just by being totally irresponsible and incoherent with their testing. Why in the world would they test the ea on several currency pairs at the same time on the same account ? and all of them with the same settings ? I don't know. It is just a consequence of them not knowing what they are doing.

The worst thing about this is that they may get a month or two of profits and someone, somewhere will run that on a live account and lose money because of the irresponsability of the people that test these systems just for the sake of it. In order to test a trading system you must understand what it does and how it does it best, it is not about throwing the system into testing as you see fit.

If you are interested in learning more about the god's gift atr please consider buying my ebook on automated trading or subscribing to my weekly newsletter to receive updates and check the live and demo accounts I am running with several expert advisors. I hope you enjoyed the article!

The God's Gift ATR Challenge, Testing by Third Parties

One of the great challenges of any automated trading system out there is to be robust, reliable and profitable. Since I want the god's gift ATR expert advisor to become the most well documented expert advisor out there I have decided to take several steps to make this automated trading system's characteristics very well documented, examined and tested. For me, an expert advisor that is truly long term profitable should fulfill a small set of characteristics that demonstrate its capacities :

• Trading Platform Independence
• Broker Independence
• Extensive Live Testing (1 year at least)
• Third Party Live testing

Since up until now all tests on this ea have been done by me (one year of forward testing of the main strategy plus 4 months of live testing on 4 different live accounts) I have decided to ask some of my newsletter subscribers to participate in what I have called "the god's gift ATR challenge". What I seek with this challenge is to have third parties test the expert advisor on live accounts under agreed conditions that guarantee that the ea testing is well done and comparable to my personal tests. The use of different brokers, different vps providers and money amounts should provide us with a wide amount of information about this expert's profitability. The people participating on this challenge are aware that past performance does not guarantee future results and they do this testing under their own free will with no promise of profitability. They run the ea on personal live accounts to which I only have read-only passwords. However the people running the tests must fulfill some conditions :

• Expert advisor must be run 24/7 on a reliable vps provider
  
• Expert must be run alone on a live account with a minimum of 100 USD (10,000 contract) or 1000 USD (100,000 contract)
• A read-only investor password MUST be provided
• The ea must be run for at least 2 years, regardless of performance (people must agree to do this or their testing will not be taken into account)
• Settings, currency pairs and timeframe are to be provided by me and cannot in anyway be changed by the third party if results are to be comparable

If you are participating on the God's Gift ATR challenge please make sure you fulfill the above requirements and then send me an email. Please include your read-only password as well as the contract size of the account you are running, broker, account size and one of this three risk levels : Conservative, Moderate or Agressive. I will then send you settings as well as metatrader publisher instructions so that your results can be updated live to my ftp so that we can all share the test results.

Up until now more than 5 people have expressed a strong interest in doing this testing so if everything goes as planned, in a year from now we will have extensive reliable testing about this expert advisor and we will learn a lot about how it trades, how robust it is against market conditions changing and how we can improve it.

If you would like to learn more about this and other expert advisors I have tested and reviewed please consider buying my ebook on automated trading or subscribing to my weekly newsletter to receive updates and check the live and demo accounts I am running with several expert advisors. I hope you enjoyed the article

God's Gift ATR - Towards the Best Documented Expert Advisor

For the past year I have been developing and testing the god's gift ATR expert advisor, a modification I wrote of the original ea written by Matt Edmonds called god's gift 7c. Throughout all of my posts you may have seen how this expert advisor behaves on the market and how it performs under very varied market conditions. With each passing day I become more and more convinced of the large potential of this automated trading system on the real forex market.

Now, I don't want this ea to be the same as all the other expert advisors out there offered by the different commercial ea sellers. My compromise is with the retail traders out there who really want to be profitable using an automated trading system with real expectations and profits. For this reason what I intend to do is to slowly turn my forex automated trading ebook into a guide for profitable expert advisor trading using freely available systems. What I want to do, is to turn the god's gift expert advisor into the most documented and reliable expert advisor out there.

For this reason I wrote the god's gift manual a few days ago (included with my ebook or newsletter subscription) to start showing people exactly how the logic works and how the ea trades the market. I am also developing an extensive footage of simulated and live taken trades which show exactly how this ea both wins and loses in the forex market. I want people to know why this expert advisor trades and when and why it's logic can be really trusted.

For this same reason I have decided to trade this ea on 4 live accounts which can be seen with my newsletter subscription (along with the one year previously done forward test which accumulated more than 100% in profit). I want all the back and forward testing that has been done to be validates by the expert's trading in real, live accounts. Moreover, I will start to test this ea on several brokers once the testing of the current accounts reaches the first year of live testing in March 2010. Hopefully, god's gift will become the most documented, reliable and trusted expert advisor out there to make achievable amounts of profit in the foreign exchange market.

If you want to learn more about the god's gift ATR expert, including new versions, tests and the god's gift ATR manual please consider buying my ebook on automated trading or subscribing to my weekly newsletter to receive updates and check the live and demo accounts I am running with several expert advisors. I hope you enjoyed the article !

The God's Gift ATR Manual

As many of you may know, for the past several months I have been developing and testing a new version of the God's Gift ea I coded called the God's Gift ATR. This version of the God's Gift ea contains the original logic with position and market order size management adjusted as a function of the Average True Range indicator. These modifications ensure that the ea remains adjusted to current market conditions and effectively makes the expert's equity curve much more linear than with the traditional version of this expert advisor.

However, many traders are a little bit skeptical about the expert's logic because it seems rather complicated and obscure. They are right to be skeptical ! The god's gift ea logic is not very simple to understand and therefore it became very important for me to create a manual that could explain the inner workings of the god's gift expert advisor. My utmost concern is that traders can trust the trading system they trade and become profitable with real expectations in the world of forex automated trading.

Another very important problem that the manual addresses is the description of each one of the variables within the god's gift ea. Many people are confused by the many different settings that can be adjusted within the ea so the manual also explains what each one of these variables does. In the end I hope that the manual can provide a very good insight into the expert's entry and exit logic as well as the variables contained within the ea and how this can affect the way the expert advisor trades.

The manual is included within the new version of the ebook which is available from today and is also included in the newsletter subscription package for my expert advisors live and demo results. If you would like to learn more about the manual and this and other free and commercial expert advisors please consider buying my ebook on automated trading or subscribing to my weekly newsletter to receive updates and check the live and demo accounts I am running with several expert advisors. I hope you enjoyed the article !

Why I trust the God's Gift ATR Expert Advisor

I have always said that one of the main requirements to succeed with an automated trading system is to be able to trust the system and trade it through all market conditions with the assurance that the system will be able to recover from temporary loses. Trusting and knowing how a system works also enables you to know your system's strengths and weaknesses, something which makes trading with it much easier.

One of the systems I have been working on and testing for a while is the God's gift ATR expert advisor which I programmed based on the original God's Gift 7c programmmed by Matt Edmonds. Now, after being involved and watching this system trade live for more than 2 months I can start to say why I certainly trust this expert advisor. So why do I exactly trust the way the God's gift ATR expert advisor trades ? Well, because the expert's traiding fulfills some of the most important aspects any profitable trading system should (at least in my opinion).

Adjusts itself to the market : This ea uses the ATR indicator in order to adjust it's position sizing and market orders to match a certain percentage of market volatility. This somewhat guarantees that the expert will remain profitable under many market conditions since it is able to adjust itself to the different amplitudes of market movements.

The trend is your friend : The god's gift ATR expert advisor is able to follow trends when they develop by using a trailing stop which lets the expert take advantage of very long trending markets without getting stopped out.

Cut your loses short, let your profits run : The ea is able to cut loses by using an internal closing mechanism which follows many different indicators. This lets the ea exit the market before hitting the stop loss either when the price goes against the trade or when the stop loss is trailed after that price has moved in favor of the trader. This has the clear effect of increasing the ability to follow trends while minimizing the loses generated when the market is not with the trader.

Realistic Profit Expectations with Adequate Risk : The god's gift ea is able of producing 50-100% a year with a draw down not exceeding 20-50% (per back and forward testing results), this is a realistic profit expectation which reflects the conservative way in which the expert advisor trades. The equity curve generated by the ea is globally linear with a neat increase in equity under very varied market conditions.

I consider that the above reasons make the god's gift expert advisor a very unique and sound trading system. The ea has up until now proved to be robust and consistent, something which is a must have for a long term automated trading system. If you would like to learn more about this and other free and commercial expert advisors please consider buying my ebook on automated trading or subscribing to my weekly newsletter to receive updates and check the live and demo accounts I am running with several expert advisors. I hope you enjoyed the article !

Backtesting God's Gift, Consistent Profits Over Several Pairs

A few days ago I introduced my new version of the God's Gift expert advisor through a blog post (my newsletter subscribers received a detailed email explaining that release in detail as well as the 8and8 expert advisor). Now I want to talk a little bit about the optimization jobs I have been doing with this expert and how the God's Gift expert advisor proves to be profitable amongst several different forex pairs.

In order to know if the ea was profitable or not, I started by back testing it in the GBP/USD pair using the settings I had known to be profitable form last year's forward testing (12 months). According to the values of stop loss and trailing stop used, I realized that they would be the equivalent of about 30% of the ATR for the stop loss and 15% of the ATR for the trailing stop, however, I realized that the trailing stop was much more profitable if it was changed from 15% to 70% of the ATR, also decreasing the risk to reward ratio of the expert advisor. The back test graph I got was the one shown below.
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Now that I knew that the expert could trade the GBP/USD profitably, I wanted to know if this time I could get it to work with other forex pairs. My previous efforts to do this had failed dramatically as I could not find any other pair that was profitable since 2004 or before with God's Gift 7c besides the GBP/USD.

The first pair I started to test was the EUR/USD. The same settings failed to work straight from 2004 to 2009, but I did see that the settings used for worked perfectly when the pair was in high correlation with the GBP/USD. The solution was to optimize the stochastic parameters of the ea in order to find a better fit for the EUR/USD. In my mind, the stochastic parameters, which determine when to enter a trade, are what defines the "psychology" of the pair. After a lot of effort, I got the backtesting curve you see below (this one is from 2000 to 2009).
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Again, I decided to retest the expert advisor with another pair, the USD/JPY, trying to still refit the stochastic values against the pair's trading style. As if the expert advisor could magically adjust to every market condition, I found a set of parameters that worked the USD/JPY perfectly from 2000 to 2009. The image is shown below.
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As you can see, the new expert advisor does really good in backtest (and we know this correlates very good with forward and live testing according to last year's results) and does not have any of the "black holes", so common in today's commercial expert advisors. This expert has good linear equity growth, with loses, fixed stop loss values and trailing stop values you can see and set. The expert has a very good risk to reward ratio as all the backtests show that the average win is almost double the maximum loss.

If you would like to learn more about this new version of the God's Gift expert advisor I coded and the results we had with this and other expert advisors last year (as well as this one) please consider buying my ebook on automated trading or subscribing to my weekly newsletter to receive updates and check the live and demo accounts I am running with several expert advisors. I hope you enjoyed the article !

God's Gift, the Best Forex Expert Advisor Now Better !

During the past week, I had been implementing and testing a new version of God's Gift which has market orders adjusted to volatility as well as position sizing adjusted to volatility. I did this because I became aware that God's Gift profitability changed dramatically owing to changing market volatility and this was a consequence of it's rigid take profit, stop loss and trailing stop features.

After starting to use the ATR (average true range) indicator as a way to change the strategy according to volatility (this idea was inspired in some part by the turtle trading strategy) I realized that when doing this, the system became much more risky in higher volatility conditions because lot sizing did not change. So the SL, TL and TP would change to higher values when there was higher volatility but constant lot sizes would cause the system to risk more money (since an equal amount of lots was traded regardless of volatility).

Because of this, I decided to implement the same lot sizing strategy that is discussed in the Turtle book strategy in order to change position sizing according to volatility. The results ? The incredible looking back testing chart you see below (we already know that this expert advisor is highly consistent, because one year of forward testing was almost equal to the same year in backtesting. Backtest is from 2004 to 2009 using 90% modeling quality) . Of course, profits are small because lot sizing parameters are small but you can test with higher lot sizing parameters and get the same curve expanded. This way, you can finetune your risk against the profits you want to make, to say 100% a year against a 30% maximum draw down for example. You can see the green lines indicating the dynamic position sizing as volatility fluctuates.
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A live account will be started next week (investor access will obviously be available to newsletter subscribers) to test this new and improved version of God's Gift, which is just the same version coded by Matt Edmonds with several modification made by me for volatility managment using the ATR indicator. If you would like to learn more about the results I have got with God's Gift and other free and commercial expert advisors please consider buying my ebook on automated trading or subscribing to my weekly newsletter to receive updates and check the live and demo accounts I am running with several expert advisors. I hope you enjoyed the article !