Pointbreak Expert Advisor Final Review, Week 5, C’est Finit

After five weeks of trading the Pointbreak expert advisor and looking closely at the way it closes and opens trades I have just one opinion, for me, c’est finit, it is finished.
Last week I wrote a post which was fairly optimistic about the trading of the Pointbreak expert advisor. I said that I was convinced about the trading strategy, it’s closing and opening mechanisms, etc. But well, to err is human. The expert advisor itself has shown me this week how all I believed it was supposed to do was incorrect.

I had the following notions about Pointbreak (maybe you have them too) . I though that the expert :

– should make profits when there is a strong trend
– was supposed to keep draw down at a low level (below 7% at least)

– is supposed to give a 10% annual return
– controls draw down effectively

This week, Pointbreak showed me how all of them (except the 10% annual return which I did not prove or disprove) are – in my opinion – not entirely correct. The expert advisor managed to obtain a massive open draw down (for the conservative setting) which was above 9%. This puts the annual risk reward ratio in the 1:1 area, something that is way too risky for the amount of profit I am waiting to obtain.

The EUR/USD also clearly trended upwards from the beginning of this week (see chart below). Pointbreak didn’t show this on it’s results, only increasing it’s open draw down as it accumulated sell orders (something I wouldn’t have expected it to do).


This puts a question on my mind. How much does it have to accumulate to realize a loss ? It is clear on my mind that if it didn’t close trades with a 9% open draw down then this may happen with a larger loss, this for me, to win only a 10% yearly profit (as they say this is what they guarantee) , is clearly unacceptable.

This of course, has made me decide to stop trading the Pointbreak expert advisor. My final opinion on this expert advisor is then pretty clear. I consider it – through careful examination of forward testing results – to be extremely risky for the amount of profit obtained. I consider the risk of a massive draw down due to sudden market movements a reality and I also consider the margin requirement of Pointbreak to be excessive for it’s risk reward ratio.

The expert has clearly showed me that it does not catch trends as accurately as I would have liked, it also showed me that it does not close positions even on a 9% open draw down and it also showed me that profit accumulation is excessively slow and accompanied with an almost hidden open draw down risk. You have seen my comments (both positive and negative) on the forward testing results. You can see the trading statement here. Judge for yourselves.

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One Response to “Pointbreak Expert Advisor Final Review, Week 5, C’est Finit”

  1. Yohanes R. Gagahlin says:

    Hi Daniel,

    I have contacted by one of my subscriber that read your post about PointBreak here and he doesn’t agree and need me to check, since last 2 months I really busy with my forex seminars and never take a look at your blog…. sorry…

    I found that you already stop PointBreak when EUR at very choppy market (January 2008). It’s pity, because that’s how PointBreak EA works.

    It will make drawdown on choppy or sideways market and waiting until EUR breaking the resistance.

    Your current drawdown was solved on Feb 25, when EUR breaking 1.5000 after that EUR market come back to trending market which PointBreak EA continue to make continuous profit.

    I have account that started on Dec 2007 and I share the account and password to everyone, so everyone can take a look and compare it.

    You can login to our account to check:

    Account#:1745192.
    Password:lucky7
    Platform:InterbankFX Demo Account

    The account started on $25,000 on Dec 2007 and the current Equity (March 25, 2008) is: $30,200
    It increase the equity more than 20% now in just 4 months (and it’s using Risk Setting=1 Very Conservative)

    You can follow week by week reports on this link:
    http://www.forexhope.com/trading_report.htm

    Our Very Aggressive Account has profit 135% (It’s 47,187.67 now – the account start at $20,000 ~ Oct 01, 2007):
    http://www.forexhope.com/performance.htm

    And yes, PointBreak EA is using Pyramiding is an aggresive trading style. One’s need to willing to sustain the drawdown.

    I know that you do not like a drawdown, but that’s how PointBreak make profit. It needs around 30% drawdown.

    If you read the manuals, I explain that it needs around 30% drawdown, although I found for Conservative, PB never exceed 20% drawdown;
    but I read you stop PB to work at 9% drawdown.

    I have new release for PointBreak EA (Build 803 – March 2008)
    available to download and valid through July 2008.

    Click here to download the new release:
    http://fxhope.com/2008/03/20/pointbreak-ea-new-demo-relese-build-mar-15-2008/

    If you want to try again, please try it until it solve the drawdown with maximum is 30% before you stop it.

    PointBreak is long term strategy, it needs to be run several months for someone that can appreciate the performance.

    Best Regards,

    Gagahlin

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