During the past few months I have been developing Asirikuy trading systems alongside different members with the hope of finding systems that can act as strong compliments to our current Asirikuy portfolios. We have focused mainly on the development of counter-trending strategies as currently Asirikuy has a very good supply of trending strategies based on breakouts and momentum. After a significant amount of effort in the development of these new solutions the first one which has come to light (already fully implemented within the F3.66 framework) is Amachay. This new trading system follows a very interesting trading technique based on Fibonacci retracements which allows is to retrieve profit from the markets while trading against the prevailing trend.
The idea for Amachay came to me from an Asirikuy member named Wilson who wished to improve the code for his system. The code he had had been made by someone “for hire” and the source wasn’t available for modification so we had to start from scratch with the logic he had first proposed, adding ATR adaptive mechanisms in the search to increase the ability of the system to adapt against market volatility. After spending a few weeks coding and improving the strategy we came up with the first reliable reproduction of the logic on the “new EA template” within Asirikuy and we then moved onto the migration of this logic onto the F3.66 framework.
Amachay isn’t a very simple expert and as a matter of fact it is above average Asirikuy system complexity in regards to the way in which it manages trades. The system works through the use of Fibonacci levels built upon a certain past number of periods on the 4H charts and then waits for price to be within two specific levels to trigger trades against the trend. These “chosen levels” remain valid for a fixed set of time after which they are recalculated over the past X periods again. When price moves into this range – and fits another small set of conditions – two trades are triggered, when a first Fib target is reached the first trade is closed and the second one is moved to break-even, waiting for a second target to be reached at the next Fibonacci level. This tactic seems to work to a good extent for this strategy – move-to-breakeven strategies rarely do in my experience – generating good results on several different pairs.
Although I still have to go a long way into the development of our Amachay portfolio before releasing it to the community (probably within a few weeks) up to now I have seen a very interesting behavior which matches what we would expect for such a system. Profitable parameters are easily found for pairs like the AUD/USD and the GBP/USD but are terribly difficult to find for pairs like the EUR/USD and the USD/CHF. It seems that the EA truly captures mean-reversion in the sense that it fails to profit significantly on pairs that are regarded as “strongly trending” but gives good results on pairs which do show a tendency to go through these pullbacks. Amachay also suffers from a reduced number of trades on some instruments due to the difficulty in fulfilling the entry logic – although within acceptable significance limits – but most results show that the entries are quite high-probability opportunities which do tend to materialize into winners.
As I have said before there are still lots of tests to be done over Amachay in order to improve its logic and release it to the community but overall the system is already showing to be a very interesting addition to Asirikuy which will greatly compliment some of our trend-following strategies. This system is also our first use of Fibonacci levels (or any similar level-based strategy) which introduces us to a different world of trading systems to explore. For those of you who are curious about the name Amachay – which means “protector” in Quechua – comes from the fact that the system was contributed by Wilson -> Son of William -> Whil + helm -> helm -> protector, so the name is related to the original member who shared the idea with me.
Currently there is another system on the works – whose logic was also contributed by a member – which will hold a name with a similar context. Right now I will continue to work on Amachay and this other system and hopefully will be able to release them along with their initial live account full portfolios within the next few weeks. Of course if you would like to learn more about my work in automated trading please consider joining Asirikuy.com, a website filled with educational videos, trading systems, development and a sound, honest and transparent approach towards automated trading in general . I hope you enjoyed this article ! :o)