Blog Item

MellyForex July Update

MellyForex July Update I had hoped to be able to report around this time that I'd put another robot or two into forward test but, unfortunately, that isn't the case. The truth is that I haven't seen anything new over the last few weeks which has captured my interest sufficiently to put into test and write a review.

C'est la vie!

All is not lost, however, as it has given me the opportunity to provide a general update on progress and to cover several minor points which wouldn't otherwise be worthy of an article of their own.

Recent movement on my Robot Leaderboard has been less dramatic and it's becoming increasingly obvious which are the good quality robots and which are the ones that will never make the grade.

PipRider has regularly occupied one of the top spots since first going into test and, despite struggling a little with market conditions over the last few weeks, it is clearly developing a reputation for being one of the safest robots around.

Wall Street Forex Robot has been going from strength to strength and it is now safely holding on to first place on the leaderboard. One of the reasons for this is the fact that it is able to trade four different currency symbols, so those extra trades mean that it is always going to win more pips than, say, PipRider which only trades one symbol. Coupled with this, the effect of using an EA with multiple symbols can have a smoothing effect on the balance curve and serve to lower drawdowns.

Interestingly, the Morpheus OddBot has quickly risen up the leaderboard, and is currently sitting in second place after a relatively short space of time. Given the similarity of some of OddBot's trade entries with those of the Wall Street Forex Robot, this probably isn't too surprising, although I maintain my previous stance that the two robots act independently of each other and that it should be quite safe to run both robots together on the same account, and it should also be noted that OddBot's current average return of pips per month far exceeds that of Wall Street.

Before leaving the subject of OddBot completely, it appears that the earlier 10% discount available on OddBot is no longer available. I have therefore edited my original article accordingly to remove any mention of the offer.

Forex WindFall has been profitable, but not to the same degree as either Wall Street or OddBot but, as I alluded within my recent article which directly compared the three robots, I'm sure this will change in the future and you will then witness either Wall Street or OddBot as under-performer out of the three for a while.

Another robot which has disappointed slightly in forward test has been the Forex Real Profit EA which is still underwater after a couple of months of test, although its ranking has been improving recently. One of my initial concerns when reviewing this EA was that, because of the times of day it trades, it might not be able to replicate the good backtest performance going forwards. That said, I believe that the EA's current drawdown has nothing to do with the ability to get trades away and is simply down to some unfortunate trade timing, and I do believe that it will recover the current drawdown and progress to greater things in the not too distant future.

What does concern me about the Real Profit EA, however, is that an updated version has recently been released which contains what I believe is an untested news filter. Filters such as this are all very well, but I believe they should be backtested properly in advance of being released to determine the benefits. If they aren't tested in this way, there is absolutely no evidence whatsoever to suggest that the inclusion of a news filter will actually be of any benefit whatsoever. For that reason, and seeing as I don't have either the time or inclination to rig up a news history file to test the modification for myself, I will be leaving the news filter switched OFF in my ongoing forward test.

Despite offering a healthy monthly return, Forex Growth Bot has slipped down my leaderboard slightly because of its relatively high drawdown level. This is most likely due to the fact that my version supplied by the vendor for forward test is a basic version which uses fixed lot sizes. Had I been using one of the advanced versions which employs variable lot sizes, then it's my guess that the drawdowns would be easier to regulate.

I previously mentioned that I wasn't planning to carry out a full review of FxPowerCube because of its poor backtest results as seen in the following erratic equity curve.


FxPowerCube Strategy Test

The developer did contact me after that to suggest that there was some kind of bug within my copy of his EA and he subsequently provided an updated version which he asked me to retest and report upon, but I'm sorry to say that I am still unable to produce any noticeable improvement on my earlier tests. It's certainly not for want of trying, as I've retested FxPowerCube using a multitude of settings and experimented with different brokers using different spreads in an attempt to produce some worthwhile backtest results, but it's all been to no avail.

The FxPowerCube developer has produced his own 11 year profitable backtest which, as a last resort and because I want to be fair to the developer, I analysed in some detail. Unfortunately, however, a risk simulation of those results didn't fill me with any great confidence as it suggests that users of the EA will almost certainly end up disappointed.


FxPowerCube Risk Simulation

To explain the risk simulation results, the EA looks to be susceptible to high drawdowns, it requires a relatively high account deposit to run, and less than 1 in 5 users will probably never see their account balance drop below their initial deposit. Although FxPowerCube is currently profitable in my forward test (which I intend to leave running), this is an EA which I would never contemplate running live, as it is not only too risky, but I feel it could go into serious unexpected decline at any stage.

My most pleasant surprise comes from the Primeval EA which is really only in forward test as a benchmark. It's an older EA which I've already stated that I don't plan to review thoroughly, but it's managing to hold its own with a top 4 spot on my leaderboard against its newer rivals. Maybe there's something to be learned from that?

At the bottom of my leaderboard, I can't claim to be shocked by Forex Shocker's poor performance, nor am I surprised that Forex Crescendo has fizzled to a whimper, or that Forex Hippo has gulped over half its account balance.

Another EA which has managed successfully to live up to its name is Forex Cash Protector which has managed to protect capital by trading so infrequently that Alpari deleted my demo account following an extended period of inactivity by the EA.

Before concluding this article, I would like to repeat myself once more and stress the importance of using a good broker with the tightest spreads. So many people seem to think that the best ECN brokers are those which offer the lowest commission but, frequently, this isn't the case. Many ECN brokers will "pad" the spread by 0.3 or 0.4 pip each side of the trade which enables them to offer a low commission and give an illusion of being competitively priced, but retail clients often don't realise what's actually going on. A true ECN broker will offer spreads as low as 0.1 pip, whereas other brokers claiming to operate via ECN will mysteriously never offer spreads that tight. In addition, a true ECN broker will not present any restrictions on trading style (such as scalping), they won't force any requotes on their clients and they certainly won't take the other side of your trade because they really do want you to win.

To make things perfectly clear, I'm going to shout - IF YOUR ECN BROKER ISN'T OFFERING SPREADS AS TIGHT AS 0.1 PIP, IT'S BECAUSE HE'S PADDING THE SPREAD AND ISN'T A TRUE ECN BROKER!

At this point, I'm going to unashamedly mention FX Central Clearing once again, as they are a true ECN broker who are totally transparent and fulfill all of those criteria I've just mentioned. The only thing that you need to watch out for with any broker who charges commission is that, when using an EA such as OddBot which locks in a small profit of, say, 1.0 pip, you must increase the amount of locked-in profit by the amount of commission being charged, otherwise your locked-in profit will be wiped away by the commission.

Finally, I'd like to ask a favour of anybody who enjoys MellyForex, that they help promote the site and assist it to grow. By that, I don't necessarily mean that you've got to click on any of my affiliate links to buy the products I brazenly promote (although it is nice when you do, so please don't let me stop you from clicking those links ).

What I mean is that you can help in other ways which don't even involve parting with any money. I simply want people to start posting on the forum, telling their Forex friends about MellyForex, and to generally help develop a nice, caring and considerate community of users who talk to and help each other through sharing their personal experiences.

To explain in a little more detail, it's alway been my aim to fund the site through paid advertisers (I promise that I'll never litter the site with countless ads, and no more than are already here at the moment). Development of MellyForex is progressing to plan and I'm happy to continue posting my reviews, but I really do need you guys to get talking on the forum to develop the community and provide the levels of web traffic that the advertisers are looking for.

Please keep that at the back of your mind and, if I can find some worthwhile products to test and review, there'll be some new Forex articles coming soon.

Discussion (0 comments)

Be the first to leave a comment!

Add a Comment

;-) :-) :-D :-( :-o :-O B-) :oops: :-[] :-P

To prevent automated Bots form spamming, please enter the text you see in the image below in the appropriate input box. Your comment will only be submitted if the strings match. Please ensure that your browser supports and accepts cookies, or your comment cannot be verified correctly.
»