mnGapAutoTrader redeems Itself Trading The Opening Gap With SP500 (ES) Futures

admin | July 8th, 2010 - 4:09 pm

Market activity has not been too kind to the opening gap trade over the last few days, however the mnGapAutotrader, which fades the opening gap on index futures, performed very well today – making $775 profit and putting it firmly in the green this month.

This performance puts the July P&L back into profit, which goes some way to verifying the statement that your winning trades should be much larger than your losers – a good risk reward ratio is critical to the long term success of any trader, automated or otherwise.

The performance with Nasdaq (NQ) and Dow (YM) futures was not so good, however this is because the system generated stop was too tight. See the image below.

We are addressing this problem in the latest version of the mnGapAutotrader which is currently being beta tested for us. The latest version of the autotrader will allow you to enter your own stoploss according to your own risk tolerance and would almost certainly have created excellent winning trades for both YM and NQ today.

We also have some other ideas about improving the stoploss behaviour of the system, but we’ll keep that hush hush for now.