08
Feb 2020

EPIC v3 Crude Oil Code Updates: Drawdown Protocols vs Expected Return (follow-up to Feb 2 note) #machinetrading #oiltradealerts

Machine Trading , , , , , , Curt Melonopoly

EPIC v3 Crude Oil Trading Software Updates, A Follow-Up to Last Week’s Note on February 2nd.

RE: Software Drawdown Protocols vs Expected Returns and Oil Trade Alerts.

Good day traders,

Last weeks note (if you have not read it) can be found here;

EPIC v3 Crude Oil Code Updates: Drawdown & Short Selling Protocols $CL_F $USO #machinetrading

Since the Feb 2 note I have had some questions from our clients that I suspect others have also, so I a summarizing responses from those questions below.

Our Primary Objective

The goal in our development is now limiting draw-downs, we know the software works and that is not at issue, at issue is the size of potential draw-down.

Our primary objective is to find the range of “throttle” in the software that provides a consistent return with the least volatility in ROI.

Draw-down Protocol “Events”

The software is designed to trade on historical structures, trade set-ups, order flow and more – find details in the most recent white paper update can be found here.

Specifically to draw-down protocols, in my last note I described the change in code to be throttled 50% (limiting potential downside to 50% of what is described in the white paper). I also explained that if required we would throttle it again another 50% of its most recent setting.

Last week crude oil seemed to be basing from a technical perspective and the software (considering the chop) did well, however, we were not comfortable with the potential draw-down risk in the “event” driven chop.

At issue specifically are market “events”, such as with the recent virus event out of China. Event periods will potentially cause draw-downs, our objective is to avoid this volatility.

As of today we have done that – throttled the draw-down protocol again.

The reason is simple, our objective now is to limit unnecessary draw-down percentages to the point that we can allow the software to run without concern to draw-downs even if that limits potential returns. For now this is the case and as explained previously if we open the throttle at all we will advise our clients well in advance. 

In practical terms this means that the software size held is limited intra-day when in draw-down and the range is limited. The range is not changed from previous, being one full “quad” and/or “channel” range on the EPIC Algorithm Model but the size held is limited to near 1/10 size. The size can very from approximately 1/10 to 3/10 size but the software will “flash” in and out any adds with near zero range stops executing at each key support in a draw-down.

Oil Trade Alerts

This will at times cause the oil trade alerts feed to be very active but yet at times will be very silent as the software will only execute the highest probability trades also.

This represents the tightest throttle possible in our code.

Expected Returns vs. Draw-Down Risk

Through development we have had plateaus of code structure ranging from 20% – 150% ROI expectation and we even looked toward 300% being possible.

However, there is a volatility to potential draw-down that comes with higher expectation of ROI. This has to be balanced with account size and risk tolerance.

Our objective is to code software that has limited draw-down with highest ROI on specifically 10 contract size accounts. As explained previously, 30 contract and higher accounts this is much different. 

At the current throttle setting our estimation of returns is somewhere between 40 – 80% per year (likely closer to 40%) with very littler risk to the down-side as we have run the software in this throttle range prior for some time and this is the ROI expectation. The variance in ROI expectation (40%- 80%) is in consideration of market conditions and not how we expect the software to run.

After the software has run for a considerable time at this level of “throttle” we will look at releasing the “throttle”, but this will be only considered after some time and again I emphasize that our clients will be notified well in advance.

Being as transparent as I can, the reason for this is motivated by the fact that we have been in development for near 4 years and there is a point where returns need to be the norm and not volatility in development. We need to run a low risk environment for some time now as development has been costly. When we have recouped development costs and put some profit back in to the project we can then look at further development and associated risk. 

Our next white paper update will reflect the content of these updates notes.

Any questions please send me a note via email [email protected].

Thank you.

Curt

Further Learning:

If you would like to learn more, click here and visit our Crude Oil Trading Academy page for complimentary oil trading knowledge – posts from our top crude oil traders that includes learning systems, blog posts and videos.

Welcome to NYMEX WTI Light Sweet Crude Oil Futures.

Subscribe to Oil Trading Platform:

Standalone Oil Algorithm Newsletter (Member Charting Reports sent out weekly at times in report form or updated on email regularly).

Real-Time Oil Trading Alerts (Private Twitter feed and Discord Private Server Chat Room).

Oil Trading Room Bundle (includes Weekly Newsletter, Trading Room, Charting and real-time Trading Alerts on Twitter and private Discord Chat Room Server).

Commercial / Institutional Multi User License (for professional trading groups).

One-on-One Trade Coaching (Via Skype or in person).

 

Article topics; crude, oil, trading, machine trading, algorithm

02
Feb 2020

EPIC v3 Crude Oil Code Updates: Drawdown & Short Selling Protocols $CL_F $USO #machinetrading

Machine Trading , , , , , , Curt Melonopoly

RE: EPIC v3 Crude Oil Trading Software Updates

Good afternoon traders,

It is Sunday Feb 2, 2020 and futures markets will be opening soon.

In advance of a new week I am communicating our most recent EPIC v3 code updates to keep everyone abreast of changes. I have had a number of email and DM discussions and will encapsulate the question and answer of those discussions below.

Through-out the previous trading week I did communicate much of this content below in summary form via email, in private oil trade member server on Discord and even Twitter. If you prefer the reader’s digest version see this link: https://twitter.com/curtmelonopoly/status/1223755725572378624

The EPIC v3 version software is consistently on the win side to near 100% win-rate, easily above 90% consistently. This goal was the primary challenge for us in development, without this accomplishment everything else is moot – it simply would not matter. Coding the draw-down protocol to a level of comfort is much much less work.

In short, we have coded with success an extremely high win percentage rate and that took extensive work and includes over 8700 instructions of code. This is our concrete footing.

At issue however, is when the software does lose a trade – specifically the drawdown amount.

Also at issue, and not as problematic is the win rate on the short selling side. Per previous communications we may or may not ever find success in this code and it doesn’t really affect the ROI expectations because our code protocol for drawdown on short side trades is extremely throttled so there is near zero potential loss in short trade sequences.

Specific to the drawdown percentage during a loss, the most recent white paper outlines the protocol for percentage of loss allowable here: 

White Paper Updated Dec 29, 2019: How EPIC v3 Crude Oil Machine Trading Outperforms Conventional Trading

So then the question becomes, if we know we can win easily more than 90% then why risk significant drawdown amounts when a trade does not work?

The answer or the balance of thinking is in the potential annual returns, we do not know the answer to the question – if we throttle the software to lower risk how that will affect annual returns.

We know that we can run returns 80% – 150% per year leaving the drawdown protocol as it is, but the problem is that the drawdowns are not just very uncomfortable, with smaller accounts they are more significant in terms of percentage and put at risk the account itself.

So this update is specifically motivated by and to accounts in the 10 contract size category or less, although updates to the code are in effect for all size of accounts.

So as I communicated to our clients last week we have initially throttled the software drawdown protocol to 50% of the previous protocol as outlined in the most recent white paper update (link above).

If this code update (50% of previous) is not performing as we expect we will again throttle to another 50%. I do not think this will be necessary and I am sure the current update is more than acceptable.

What does this mean in real world practical applications?

The expectations of returns are likely to be less than previously expected but this is not known until we see how the near term trade sequences perform. There is the far off chance the annual returns will actually be better than prior.

The code is throttled which manifests as only the highest probability of trade set ups to trigger a sequence, however, when a sequence starts the frequency of trade may be considerably more because the downside / stops are significantly tighter than the previous code.

In practical terms, this means that the software will not likely hold more than a 3/10 size trade for any amount of time at all unless the win side trade is extremely structured and trending up and it also means that any amount of draw-down will be limited to one quad on EPIC 30 minute model (with some slippage allowed pending order flow).

The range of trade is much smaller (limited to one quad on EPIC model or channel of the model), the size is much smaller in a sequence if there is pressure at all and the frequency of trade once it starts firing will be much higher.  

In summary, you will see the software fire predominantly per the EPIC 30 minute model weighted against all other models and order flow within a much tighter size management protocol.

It is difficult to summarize over 8700 instructions but that is my best attempt at a summary.

I encourage you to read the most recent white paper update (link above) and review the new update when released.

For those asking what I expect forward, you can expect a very tight trading protocol with higher frequency and very limited downside at any given time.

When the software gets in to a sequence that is well structured and trending you can expect the previous ROI trajectory to be returned very quickly.

Do I think that will be this week? I am not totally convinced but I wouldn’t doubt it. Structure was returning to trade on Friday and when enough structure is returned to market wide trade it won’t take the software long (as we have experienced in other drawdowns since v3 inception).

In terms of changing the throttle going forward, I wouldn’t expect us to loosen the code throttle any time soon. I know in past on a number of occasions we have discussed this and this has been a challenge for us (the balance of risk vs return). HOWEVER, I can say with utmost certainty that we are at a time in our development where risk cannot be tolerated anytime soon. 

I will be sure to communicate clearly IN ADVANCE if this is going to change in future.

To be frank we have been in development for some time and we have the winning card that we can rely on – the long side win rate that is extremely high. We were simply trying to push our development to potentially garner the largest returns possible. But reality is reality and at a certain point in time you simply have to accept where you have come and let the return rate be what it is.

Watch how the software performs over the next month and we can re-look at it at a later time. Send me your thoughts after a month or so. A month of trade executions will explain much better than I can here.

For now lets enjoy some consistent returns without the stress. 2020 will be stressful enough in the markets, we don’t need to add more.

An updated oil trade report is due out for our clients later this evening also by the way. 

Any questions please send me a note via email [email protected].

Thank you.

Curt

Further Learning:

If you would like to learn more, click here and visit our Crude Oil Trading Academy page for complimentary oil trading knowledge – posts from our top crude oil traders that includes learning systems, blog posts and videos.

Welcome to NYMEX WTI Light Sweet Crude Oil Futures.

Subscribe to Oil Trading Platform:

Standalone Oil Algorithm Newsletter (Member Charting Reports sent out weekly at times in report form or updated on email regularly).

Real-Time Oil Trading Alerts (Private Twitter feed and Discord Private Server Chat Room).

Oil Trading Room Bundle (includes Weekly Newsletter, Trading Room, Charting and real-time Trading Alerts on Twitter and private Discord Chat Room Server).

Commercial / Institutional Multi User License (for professional trading groups).

One-on-One Trade Coaching (Via Skype or in person).

04
Sep 2019
Profit Loss, Machine Trading, Crude Oil

Edited Sept 5, Draw-Down Oil Daytrading Session: Question and Answer Review | EPIC V3 Crude Oil Machine Trading Software

Summary Review – Answers For Questions Received About EPIC V3 Draw-Down in Oil Trading Room Today. Please Note:

Edited Sept 5, Draw-Down Oil Daytrading Session: Question and Answer Review | EPIC V3 Crude Oil Machine Trading Software

Crude Oil Day Trading, Crude Oil Trading Room, Machine Trading , , , , , , , , , , Curt Melonopoly

Summary Review – Answers For Questions Received About EPIC V3 Draw-Down in Oil Trading Room Today.

Please Note: There is an edit revision below that includes a question and answer session for Sept 5, 2019 that provides significantly more detail.

As the trading day progressed and we broadcast our trades in the live oil trading room today we received a number of questions by way of email and direct message. Below is an oil trading room review summary.

We did not have time to respond to the questions during the trading day as we were working with the machine trading software (coding).

Today the software had a larger than normal draw-down shorting against a rally in crude oil trade. Below is the daily profit and loss chart.

For September 4, 2019 Profit & Loss Daily -$1,205 YTD +$12,559 Projected $77,696 or 78% Per Annum. v3 Oil Machine Trade 100k Sample Account (v4 period excluded) #OOTT $CL_F $USOIL $WTI $USO #machinetrading #oiltradealerts

Profit Loss, Machine Trading, Crude Oil

For September 4, 2019 Profit & Loss Daily v3 Oil Machine Trade $CL_F $USOIL $WTI $USO

The sequence the software was triggering trades to was a new sequence. When a new sequence activates the first go-round is often a loss, albeit normally less than today’s.

On the second or third go-round you will find that the software will win and continue to win better each time or it simply will not re-engage that same sequence.

The draw-down amount will normally be less as I mentioned, however, draw-downs will occur.

Nevertheless, the EPIC v3 crude oil trading software is extremely stable for a number of reasons, below are some of those reasons.

  • If you look at the ROI trajectory for the software you will find that when draw-downs occur that the software will self-adjust its risk threshold to maintain the minimum trajectory.
  • The software catalogs its trading set-ups, some set-ups it near never loses, some rarely, some not so rare. The point is, the software is coded to self adjust its minimum achieved ROI trajectory (correct it) as needed. In other words, it is coded to correct its minimum achieved trajectory by way of risk-threshold. To be more clear, it will be sure it self adjusts (wins) and how it is coded to do that is to bias its trade executions to its more probable set-ups.
  • Its current ROI trajectory is between 80% – 90% approximately, you will see the software self-adjust its trade executions to more probable set-ups until that minimum trajectory is returned.
  • Each time the trajectory is returned to the minimum average it will engage higher risk to learn trade set-ups. This process will continue and repeat over and over again. Over time the trajectory should increase on average as a result.
  • The risk threshold of v3 vs v4 is much less aggressive (draw-downs and gains are considerably less volatile) and days like today will be few and far between because (as explained above) it will self-adjust back to the minimum ROI trajectory via the most probable trade set-ups of which it has some now that literally it very never loses if at all. It can rely on the catalog of those set-ups to adjust. 

I can’t stress enough that the v3 software is not anywhere near similar in aggressiveness to the v4 version. This version is coded to avoid volatility, avoid large draw downs, and self adjust its risk threshold via high probable set-ups to snapiback to its minimum ROI trajectory as needed. 

Watch the software over the next number of days and you will see it return to its minimum average trajectory and then you will see it take new sequence trade set-ups and the process will continue to repeat over and over.

If the software did not have trade set-ups (sequences) that it wins at near 100% of the time none of the above would apply.

Any questions about the detail of code architecture feel welcome to send us questions anytime so we can publish responses for our stakeholders to review as needed.

Below is an update. After the original blog post was released we had a few more questions come in that I would add answer to below. What I have done is copy and pasted the conversation below.

September 5 2019 Update: Oil Trading Room Review: Question and Answers EPIC V3 Software Protocol

[6:54 PM, 9/4/2019] Question: I still don’t understand that in some of the big moves the software fires opposite to the direction of the move but something we can talk about on Saturday
[7:22 PM, 9/4/2019] Answer: easy answer
[7:22 PM, 9/4/2019] Answer: if you look at the chart the price has come way off
[7:22 PM, 9/4/2019] Answer: software had order flow right
[7:23 PM, 9/4/2019] Answer: execution of sequence needs tweaking
[7:23 PM, 9/4/2019] Answer: same as when it gets the bottoms in sell offs, it used to struggle with that
[7:23 PM, 9/4/2019] Answer: as far as why it didn’t trigger with the rally….
[7:24 PM, 9/4/2019] Answer: thats simple too
[7:24 PM, 9/4/2019] Answer: order flow is random in a rally like that, it will near never trigger mid rally in rally’s induced by news, no predictable order flow data
[7:24 PM, 9/4/2019] Answer: short covering and retail daytrader trade causes the majority of the rally, no structure
[7:25 PM, 9/4/2019] Answer: so the key is it triggering on the predictable wins to maintain ROI trajectory and as time goes on slowly learning other set ups
[7:25 PM, 9/4/2019] Answer: i should have put this in the original blog post report
[7:26 PM, 9/4/2019] Answer: i will do an addendum / update report
[7:27 PM, 9/4/2019] Question: I understand why it would not fire in the big moves because of lack of structure and order flow
[7:27 PM, 9/4/2019] Question: I just don’t understand why when there is a big move down it is firing long and when there is a big move up it fires short
[7:27 PM, 9/4/2019] Answer: we tried to code a trajectory trade sequence for rally’s on news but we couldn’t get the code, too random
[7:28 PM, 9/4/2019] Question: Yes that makes sense to me
[7:28 PM, 9/4/2019] Answer: because its catching the end of the move to turn the other way, next in the code is to get it to hold some size through the reversal
[7:29 PM, 9/4/2019] Answer: the essence of the development right there, step one is code the reversal step two code the middle of the move, the middle is much more complicated to code
[7:30 PM, 9/4/2019] Question: Ahhh okay
[7:31 PM, 9/4/2019] Answer: the order-flow at the reversal is where the trading edge is…. seeing the order-flow pattern of the other machine liquidity on the IDENT program starting to turn for the reversal, thats why the machine trade software nails near 100% of the turns up in price on intraday trade after a sell off, but to get the sell-off you have to get the reversal like it was trying to do today and then you’re golden
[7:31 PM, 9/4/2019] Question: Okay yes I understand that now
[7:31 PM, 9/4/2019] Answer: its all about being able to get the reversal first, thats where the predictability is
[7:32 PM, 9/4/2019] Answer: once you have the sequence for the reversal then you can start on the middle core of the trade, we have the sell off reversal perfected and now we’re working on the middle of the move
[7:32 PM, 9/4/2019] Answer: the reversal after a rally to the short side still needs work, they’re different (reversal at top and reversal at bottom intraday)
[7:34 PM, 9/4/2019] Answer: without the reversal right its impossible to get the rest, the reversal is where you have to plant your trade, start your trade for high win rate probability, nothing else provides a high probability scenario that can be duplicated time after time
[7:34 PM, 9/4/2019] Answer: hope that helps
[7:34 PM, 9/4/2019] Question: Yes I get that now
[7:34 PM, 9/4/2019] Answer: good questions for the report update, doesn’t hurt to share
[7:35 PM, 9/4/2019] Question: You want to get the top of the rally
[7:35 PM, 9/4/2019] Answer: what happens in the middle is too random so if you get the top of a rally or the bottom of a sell off for the reversal and get your size in place then you have the trend to make the next turn
[7:36 PM, 9/4/2019] Question: But what is telling the software it is at the top when it really isnt and so it keeps firing short when the rally has not ended. That’s what I wanted to understand
[7:36 PM, 9/4/2019] Answer: its the bottoms and tops that have clear predictability, hence why we have the near 100% win rate on sell off reversals, but the rally tops are a different sequence that we’re working on
[7:37 PM, 9/4/2019] Answer: it was firing in to the top today, it nailed the top of the rally, it was firing 56.12 to 56.50, and then it came off to 55.90, its the same as the sell off bottoms, it trades them the same way, same concept, different sequence
[7:38 PM, 9/4/2019] Answer: that wasn’t the problem
[7:38 PM, 9/4/2019] Question: That makes sense. Because I remember you working on the bottoms of the sell off and now have that nailed
[7:38 PM, 9/4/2019] Answer: the problem is the sequence that it uses to gain size at the top and hold for the sell off reversal after the rally is the challenge we were working on
[7:38 PM, 9/4/2019] Answer: the sequence at tops is different than at bottoms
[7:39 PM, 9/4/2019] Question: Yes that makes sense to me
[7:39 PM, 9/4/2019] Answer: we have the bottom sequence perfected for the turn up after the sell-off, in that scenario we are now working on the sizing so that it holds some in the reversal rally
[7:39 PM, 9/4/2019] Answer: but the secret is this…
[7:40 PM, 9/4/2019] Answer: the only way the code wins near 100% of the time, the only way that is possible is at the reversals, reversal of a rally or reversal of the sell off
[7:40 PM, 9/4/2019] Answer: thats how the others that are winning have done it, we can see it in the order flow, its precise and repeatable over and over again
[7:41 PM, 9/4/2019] Answer: the middle of the move isn’t that way, it is random
[7:41 PM, 9/4/2019] Question: Okay I understand much better now
[7:42 PM, 9/4/2019] Answer: so if you have an ROI trajectory at say 85% and your code is nailing every bottom the only way to increase the ROI is to nail the tops or get your size better at bottoms for more profit in the move
[7:42 PM, 9/4/2019] Answer: so slowly we’ll work on nailing the tops for reversals and slowly work on holding more size when we’ve nailed the bottom reversals to increase ROI
[7:43 PM, 9/4/2019] Answer: when we lose as we develop those scenarios those trades won’t trigger (the software learning will stop) and the predictable set ups only will trigger to keep the 85% ROI at minimum (or whatever the ROI trajectory is at)
[7:44 PM, 9/4/2019] Answer: we have more than just the bottom reversals after a sell off in the ammo, but i think you get my point
[7:44 PM, 9/4/2019] Answer: there’s daytrading set ups it triggers to all the time, small wins intraday
[7:44 PM, 9/4/2019] Question: Makes sense
[7:45 PM, 9/4/2019] Answer: its just that today was a mathematically very large rally to which you see a larger than average loss, thats why i know that scenario will be very few and far between, very rare
[7:46 PM, 9/4/2019] Question: Yes that was an unusually large move in price
[7:46 PM, 9/4/2019] Answer: so its about risk management when it goes wrong and when it does the software / development team stopping the learning and software only trades what we know wins until trajectory of ROI is back in play (returned to its regular trajectory)
[7:46 PM, 9/4/2019] Answer: 3 days of trading and the previous ROI trajectory will be back at 85% – 90% and then as it learns the trajectory will turn up because the software now has more set-ups to trigger on that it wins consistently, at current level it is maxed out at about 90% ROI so it needs to add to its catalog of set-ups to increase ROI trajectory, the learning is where you will have short term draw-downs
[7:46 PM, 9/4/2019] Question: Yes that’s good

And remember, if you are struggling with your trading and need some trade coaching go to our website and register as needed.

Email me as needed [email protected].

Best and Peace,

Curt

Other Reading:

NYMEX WTI Light Sweet Crude Oil futures (ticker symbol CL), the world’s most liquid and actively traded crude oil contract, is the most efficient way to trade today’s global oil markets. https://www.cmegroup.com/trading/why-futures/welcome-to-nymex-wti-light-sweet-crude-oil-futures.html

Further Learning:

Learning to Trade Crude Oil is Like No Other. At this link you will find select articles from our oil traders real life day-to-day experience in our oil trading room. Crude Oil Trading Academy : Learn to Trade Oil

Subscribe to Oil Trading Platform:

Oil Trading Newsletter (Member algorithmic and conventional charting).

Oil Trading Alerts (Private Twitter feed and Discord server).

Oil Trading Room (Bundle: newsletters, trading room, charting and real-time trading alerts).

Commercial / Institutional Multi User License (For professional trading groups).

One-on-One Trade Coaching (Via Skype or in person).

Company News:

Oil Machine Trade Software Development Update – v4 vs v3.

SOVORON™ Selects Compound Trading Group Machine Learning Data | Media Release

Free Mailing List(s):

Join Email List for Free Trade Charting Trade Set-ups, Deals, Podcasts and Public Webinars.

Public Chat:

Visit our Free Public Chat Room on Discord.

Follow:

Article Topics; crude oil, trading, profit loss, coding, daytrading, machine trading, $CL_F, $USOIL, $WTI, $USO, CL

25
Aug 2019
compound, trading, gains, 6 years

The Power of Compounding Returns With a Winning Systematic Machine Trading Platform.

Machine Learning is Changing Our World and Compound Gains are Powerful. This is a Short Story About How

The Power of Compounding Returns With a Winning Systematic Machine Trading Platform.

Day Trading Crude Oil, General Complimentary Newsletters, Machine Trading, Trading Profit Loss , , , , , , , , , , Curt Melonopoly

Machine Learning is Changing Our World and Compound Gains are Powerful. This is a Short Story About How Machine Trading is Changing Portfolio Return, Risk and Compound Trading Expectations.

The World is Changing Fast. The Landscape of Public Markets, Risk and Portfolio Return Along With It.

A brief search on Google brings many articles about the increase in automated machine trading and the possible future forward scenarios for public markets.

I was recently interviewed about this very topic – the future is unknown, but in my basic thinking machine learning is here to stay, I have tried to compete against it and I intend to be on the right side of the ROI trajectory.

First, A Snap-Shot of Our Brief History.

When we started our trading service we demonstrated how day trading and swing trading could net good day traders consistently 100% – 400% a year with a systematic rules-based process.

We video recorded every session live, alerted the trades to our clients and documented each trade. 

The naysayer says “I seen this or that trade that didn’t work!” – the small cross-section analyst that didn’t do their homework that is. Sure, we had our losses. But what they don’t say is that over-all we proved the returns were not only possible but probable (live recorded, time stamped, live alerted) in a systematic manner if a day trader uses a sound rules-based process, has an appropriate account size to execute various trades and sizing to spread risk (as we alerted live) and protects his/her downside. Anyone can go through our live alerts and videos to determine this to be the case. And we’re not the only day trading service that has or continues to provide these results – some even more.

What’s the point?

The point is that if you take an isolated cross-section of time, or you kinda executed the processes or kind of protected your downside or didn’t start with an appropriate account size to spread your risk then your individual scenario may have been different. But over-all, an investigation in to our processes show over 100% returns over all per annum daytrading and / or swing trading.

More specifically to the point, the same principle applies to machine trade development and testing. 

When a trader reaches this level of day trading (a winning process within an appropriate account size with protected risk), he/she can then start thinking about compounding his/her gains (the holy grail for a day trader).

Or, as we did, the successful trader may chose to turn their attention to algorithmic modeling and then on to machine trading.

In our case, we started with cracking the code to and building software for trading crude oil futures contracts.

Why go in to further risk? Because I knew what my potential returns were investing (I have over three decades of experience) and I now knew what my potential returns were day trading and swing trading. The last frontier for me was machine learning and whether we could achieve better returns in automated trade with less future forward risk and effort.

My retirement years will be as a trader, the only questions for me are; what kind of trader and what are the returns?

Day trading and swing trading equities (along with trading various ETF type instruments) is much easier to master than day trading crude oil and manifold times easier than building software to trade crude oil or any other instrument.

We knew that if we mastered the code / rule-set of machine trade that higher returns were obviously possible and that we could then build software for numerous other instruments (at will) and obviously leverage our time and compound return potential far in to the future.

The EPIC v1 machine software real-world trade test was returning a projected 20% per annum, v2 40%, v3 80% and the goal for EPIC’s version 4 was 160%.

Version 4 was too aggressive and exceeded our risk tolerance so we returned to EPIC v3 and it has been running with sound stability and very low downside risk for seven weeks at approximately 90% projected annual returns. We expect this percentage to consistently increase over time (as the software learns) with little to no additional down-side risk.

Stability of Software – downside risk vs. return is key. V4 EPIC I believe could hit 800% per year or more but the volatility and subsequent risk therein was too much for us to stomach in real-world testing (real-world is also key and required – paper-trading when testing the software doesn’t cut it).

Below is the Seven Week Real-World Trading Performance YTD for EPIC v3 Crude Oil Futures Machine Trading Software.

machine trading, returns, trades, chart

For August 23, 2019 Profit & Loss Daily +$862 YTD+$11,463 Projected $89,020 or 89% Per Annum. v3 Oil Machine Trade 100k Sample Account (v4 period excluded) #OOTT $CL_F $USOIL $WTI $USO #machinetrading #oiltradealerts

Below I provide the Compound Returns Based on our Current Oil Trading Results at 90% per annum Profit Compounded Over 3 Year Period.

The sample account starts with 100,000.00 and after 3 years has a balance of 761,651.00.

compound, gains, ROI, trading

Compound Account Returns according to Current Oil Trading Results at 90% per annum profit Compounded Over a Three (3) Year Period.

And below are the Compound Account Returns according to Current Oil Trading Results at 90% per annum profit Compounded Over a Six (6) Year Period.

The sample account starts with 100,000.00 and after 6 years has a balance of 5,801.117.00.

compound, trading, gains, 6 years

Compound Account Returns according to Current Oil Trading Results 90% per annum profit Compounded Over a Six (6) Year Period.

Will We Meet The Annual Return and Compound Trade Return Projection?

Only time will tell the story.

What I know for sure is that our v3 EPIC Crude Oil Machine Trade Software is extremely stable, has near zero down-side risk and has consistent gains.

It has been running for seven weeks as of this Tuesday, which in the machine trading world is a near life-time. At the eight week mark it is almost mathematically impossible for it to fail and at the twelve week point it is something like 99.99999% sure it will meet or exceed the expectations within current ROI trajectory. 

My guess, v3 ends up performing at 100% – 150% and easily meets or exceeds the projections, I have zero doubt about its stability and ability to protect downside loss. But as I said, all return projections are yet to be seen, time will tell.

Relative to the Top Performing Hedge Funds of 2018 we are doing well, the Odey fund came out on top of the pack, generating about 53% in returns. Also relative to the best returns of all time we’re competing; The Renaissance Technologies Medallion fund is considered to be one of the most successful hedge funds ever. It has averaged a 71.8% annual return, before fees, from 1994 through mid-2014.

I always said we would never have taken this project on if we thought there was a considerable chance we would fail. We knew it would be one of the hardest things we’ll ever try and accomplish, but we believed we would get there.

In my best estimation, we have now successfully cracked the code.

Thanks for being part of and supporting our journey. 

Curt

Subscribe to Oil Trading Platform:

Standalone Oil Algorithm Newsletter (member charting sent out weekly).

Real-Time Oil Trading Alerts (Private Twitter feed).

Oil Trading Room / Algorithm Newsletter / Alert Bundle (includes weekly newsletter, trading room, charting and real-time trading alerts on Twitter).

Commercial / Institutional Multi User License (for professional trading groups).

One-on-One Trade Coaching (Via Skype or in person).

Company News:

Important Market and Service Updates: Webinars, Reporting, Time Cycles, Live Room, P&L’s, Promos Etc…

Oil Machine Trade Software Development Update – v4 vs v3.

SOVORON™ Selects Compound Trading Group Machine Learning Data | Media Release

Free Mailing List(s):

Join Email List for Free Trade Charting Trade Set-ups, Deals, Podcasts and Public Webinars.

Public Chat:

Visit our Free Public Chat Room on Discord.

Follow:

Article Topics; crude oil, machine trading, trading, compound, returns, ROI, $CL_F, $USOIL, $WTI, $USO, CL

05
Aug 2019

Oil Machine Trade Software Development Update – v4 vs v3. 

Machine Trading, Office Memorandum , , , Curt Melonopoly

RE: Oil Machine Trade Software Development Update – v4 vs v3.

Today we reverted back to the version 3 software and have abandoned the version 4 software.

The architecture for the version 4 software has too much downside risk (it is too unpredictable in varied market action), even with the possibility of ongoing tweaks (updates). There is no guarantee that we would achieve a state of operation that minimizes downside risk to an appropriate level.

As such we will only be running version 3 going forward and discontinuing version 4 development at least until we can somehow find a way of improving our subscription management software.

Version 3 provided low downside risk with about 83% ROI in real-world testing lasting just over a month (longer duration trading will determine the exact return). In the first month of testing with v3 there was only one day with draw down and it was about -0.2%.

Version 3 also provides for low risk even in unpredictable markets because its architecture does not allow for accumulation type trade positions within a range (it does not accumulate or hold positions), which version 4 did. Version 3 hits key support and resistance with appropriate size and trails out quickly. It is a precision trade architecture design. The version 4 architecture is more designed for positioning within a range, with order flow of entities it identifies as dominant. The two versions are considerably different structurally.

Version 3 will lose sometimes, but will lose very small at all times because it is not an accumulation architecture. This was proven out in real world testing. We estimate that on average over a number of days that about 1 in 10 trading days v3 will see a draw down on average equal to or less than its average day gains.

In early testing version 1 software ran at about 20% ROI, version 2 at 40% and version 3 at just over 80%. All approximate and all short term testing lasting less than 60 days. The v4 software may have reached the ROI goal of 160%, but the road to that goal is too volatile.

Here forward version 3 of the crude oil machine trade software will run and follow-up updates will provide additional information about the architecture of the decisions the v3 software makes to trade so successfully so that our clients that trade manually can use some of the rule-set for their own trading.

And lastly, to the questions I have received about future considerations for v4, the answer is no. At this juncture we would rather enjoy the fruits of our labor as it has been a near 3 year development process (an expensive one) and at some point we must settle in with what we have, what we know works, and what provides the lowest down-side risk.

V3 at approximately 80% ROI per year is world class software and world class is better than good enough.

Again, thanks for being a part of the journey.

Any questions email us [email protected].

Curt

Company News:

SOVORON™ Selects Compound Trading Group Machine Learning Data | Media Release

Subscribe to Learn and Profit:

Click Here for Subscription Service Price Tables.

Free Mailing List(s):

Join Email List for Free Trade Charting Trade Set-ups, Deals, Podcasts and Public Webinars.

Free Swing Trading Periodical Contact Form (Complimentary Swing Trade Set-Ups to Email)

Public Chat:

Visit our Free Public Chat Room on Discord.

Article Topics: crude oil, machine, trading, software, memorandum

 

13
Jun 2019

Crude Oil Machine Trade Software Complete | Rule-Set Strategies, Alerts, Accounts Traded, What’s Next?

Crude Oil Day Trading, Crude Oil Trade Signals, Crude Oil Trading Alerts, Crude Oil Trading Algorithm (EPIC), General Complimentary Newsletters, Machine Trading, Office Memorandum , , , , , , , , , , , Curt Melonopoly

The Crude Oil Machine Trading Software Is Complete.

The information below (in advance of the official white paper) provides a summary of the development process to date, the rule-set (strategies) the code executes oil trades to, what the oil trade alerts will look like on your feed, returns expected on accounts traded and what we have planned in future.

June 13, 2019

As noted above, we have now completed the main structure of the coding for our crude oil trading.

We have previously messaged that we were either close or right at being complete only to find ourselves back down another rabbit hole. This time is actually different, we are done the primary architecture coding, we only have updates (tweaks) remaining. We expect the bulk of that to last at most ninety days.

The software includes eighteen structured algorithmic models (representing time frames from 1 minute charting to weekly), specific high probable trade set-ups, trade sequences within set-ups, order flow analysis, trend (channel) structures on each time-frame and range structures on each time-frame.

The trends (channels) and range trade structures are given the most weight within the decision process of the rule-set. The larger the structure (time-frame) the more weight for sizing and stop loss range. The models, set-ups. sequences and order flow have much less weight in the code.

This (the weights) described above will manifest in trade activity in such a way that trade will become more active and in greater size with the larger the structure. For example, the trending channel from late December 2018 to recent would be a considerable structure within the code and as such the code would size in to that channel at the support and resistance widths of range.

The white paper that we will publish soon will detail the rule-set in such a way that our clients will be able to follow along with the machine trade and understand the protocol that it is executing. This is the first stage for the architecture needed for our trader digital dash board we intend to develop soon.

As the days and weeks go on the software will fire more regularly and will begin to size considerably more than right now because it is coded to weigh decisions within trade trends, structures etc. As the trade set-ups develop the code will fire on them. Obviously the largest structures will be at the end of this start up process. The last few days it has been firing on 1 min, 5, 15 and 30 minute structures.

At first we expect the returns to be approximately .5% per day (if averaged over 30 trading days) increasing to well over 1% per day at most 90 trading days in to the launch. We have tested the code in advance and are confident with this. Depending on our success with “tweaks” the returns could escalate to near 3% per day, we are however more conservative and expect 1%-1.5%.

We are significantly more confident with this version of code simply because we have been down the rabbit hole on every time frame, in every structure, every set up, every order flow sequence on all time cycles competing with the best machines in the world.

We have been there, we went to battle in every arena, we know where we can win and where we cannot. The final version of code will only fire in arenas that we expect 80% + win rate. The larger the structure the larger the return as the software fires through the sequence with the structure.

We tested code on every time frame, in every algorithmic model, every order flow structure and so on and so on. We left no stone unturned.

There are areas of trade in the oil markets (smallest time frames) that are so competitive it would dazzle your mind. The AI’s that are firing in the smallest of time frames are doing so in a way that no trader can imagine. Every time we completed a sequence of trade in the most competitive areas (time-frames) we were schooled in the most advanced AI machine trade the world has to offer. It is manifested in a way no trader would ever expect. Here’s a hint, imagine getting beat every time, in a new way every time and every new way you got beat was a structured, logical, mathematically sound way and the ways seem endless.

Our final crude oil trade code is well outside those areas of competition.

The alerts on the Twitter client feed, in the oil trading room and on the private Discord server will continue to have “M” in the alert if it is a machine driven trade and if I (Curt) am trading I will also identify the alert detail as such. As the days go on the protocol (trade set up) detail will get more and more detailed so that our clients can follow along with clarity.

See also:

Press: SOVORON™ Selects Compound Trading Group Machine Learning Data | Media Release

What’s next?

The next ninety days is for tweaking the code – refining the execution of sequences within structures of trade.

Then near term we will be looking at the trader’s digital platform and API’s etc and then….

AND THEN…. YES, WE HAVE DECIDED to BUILD SOFTWARE FOR BITCOIN MACHINE TRADE. 

This will obviously lead our developers in to other crypto-currencies also.

Any questions send me an email [email protected].

Thanks

Curt

Oil Trading Academy:

If you would like to learn more about how to trade oil, click here and visit our Crude Oil Trading Academy page for complimentary oil trading knowledge – posts from our top crude oil traders that includes learning systems, blog posts and videos.

Welcome to NYMEX WTI Light Sweet Crude Oil Futures.

Subscribe to Oil Trading Platform:

Standalone Oil Algorithm Newsletter (Member Charting Updates Distributed Weekly).

Real-Time Oil Trading Alerts (Oil Trade Alerts via Private Twitter Feed and Discord Private Chat Room).

Oil Trading Room / Algorithm Newsletter / Alert Bundle (Weekly Newsletter, Trading Broadcast Room, Chat Room, Real-Time Trade Alerts).

Commercial / Institutional Multi User License (for professional trading groups).

One-on-One Trade Coaching (Via Skype or in person).

Click here to find all information and pricing on Oil Newsletter, Trading Chat Room, Oil Alerts and more.

Curtis Melonopoly (@curtmelonopoly) is rated Top 250 Stock exchanges authority, covering also Mathematical finance and Economy of the United States

Article Topics: AI, machine trading, trade, software, crude, oil, BTC, Bitcoin, Oil Trading Room, Oil Trade Alerts, Strategy

Follow:

05
Mar 2019

New Personal Trade Schedule, Code Updates, Machine Protocols, P/Ls, Alerts, Reports, Swing Trades, Events, On-boarding.

Machine Trading, News, Office Memorandum , , , , Curt Melonopoly

New Personal Schedule to Accommodate Peak Trading Times:

Jeremy and I have resigned ourselves to perform daily oil machine trade code updates until only weekly updates are needed (weekly wasn’t going to do it).

Until now we have found ourselves doing the code updates early morning between 3 am and 7 am (then I prep for premarket).

This time slot for updates doesn’t work.

It doesn’t work because the machine trading (and my personal trading) needs to be firing during this time. The overnight session after midnight and in to early morning are important as the global regular markets are opening – many of the daily moves start there and if we’re updating code there is no trading. It also interferes with my equity day trades in to open because I am not prepared properly and swing trade positioning as needed in the premarket session.

So we’re moving the oil machine trade code updates to the time-slot between 8 pm to 12 Midnight each night because futures are normally quiet in that time slot.

We will always be in the trading room daily from regular USA open at 9:30 AM to 2:30 PM.

From 2:30 PM – 8:00 PM we will be on our personal time break daily.

Mid day trade set-ups will normally take place in the main trading room from Noon to 1 PM daily.

Reporting:

The mid day review today went over all the swing trades for 2019 this year so far. We have done exceptionally well with our 2019 swing trades considering the funky markets. This will be an important video (mid day from today) to review when we send it out. It will include a written report. We will next be adding more swing trade set-ups we are watching over the next few days to our swing trade portfolio for 2019.

The crude oil machine trading protocols will be emailed this evening. Early morning today we completed the code updates for all the protocols and now staff are completing the client documents for review of the protocols.

Machine Trade in Oil Alerts Profit / Loss:

The February P&L will be out soon for those that have asked.

January Oil Trade Profit and Loss is here:

Oil Trading Profit/Loss Jan 2019 | +63.05% +63,049.00 41 Wins 3 Losses 93% Win Rate Large Account | Crude Oil Trade Alerts

Trade Alerts:

As of the next session (midnight tonight) you can expect the frequency to increase (up to 200 per month) for the oil trade alerts. The last few days have been riddled with updates (including today) specifically because we’re tying the actual code to the public side protocol documents – they have to match so that when you the trader see an oil alert you can the reference the trade set-up protocol that the machine or myself are trading with. This will help our clients plan their own trade. Anyway, it was a large undertaking (like most others) than we expected. We’re wrapping it all up right now and the trade alerts will reflect completion and higher frequency in to this evening’s session forward. Thanks for your patience.

Onboarding New Clients:

Most commercial and private new clients have been onboarded as I am writing this. However, specific to the newest Legacy Member Clients we have not done the onboarding. I am working on my schedule two weeks out right now and will contact each of you over the next few days to get you scheduled for the onboarding conference call I need to do with each of you. Because it is a 24 access to my trading station it requires more instruction / preparation than most onboarding scenarios. Your fees will not start until after you are successfully onboarded.

Events: Special Webinar Series and Trade Coaching Boot Camp

We have a Special Webinar Event Series starting March 24 running in to April and May of 2019.

The first webinar up is for crude oil traders, the next will be Swing Trading and then so on. Don’t miss out, it may be the only webinar series we do of this kind.

Everything I Know About Trading Crude Oil | Special Webinar Event Series | March 24: 10 AM – 6 PM

Intensive Crude Oil Trade Training Webinar.

Spend a Day With Me March 24, 2019 – I will be hosting a crude oil trading webinar. I will cover everything I know about crude oil trade in a one-time 8 hour special webinar event.

The webinar will cover my strategies for conventional and algorithmic oil trade and charting, intra-day trading, short term swing trading, longer term swing trading, trade sizing, time cycles, key set-ups and much more.

I will explain in detail how I maintain a win rate of better than 90% in crude oil trade (live recorded in our oil trading room and live alerted to our members).

Limited attendance of 25 persons to allow me to take questions and converse as needed to be sure we cover the trading concepts in detail.

Current member clients of Compound Trading Group receive 50% off. Use promo code: member

Early bird registrants prior to March 11, 2019 receive 30% off (cannot be used in conjunction with other offers). Use promo code: early.

To Register for the Crude Oil Trading Webinar Click Here.

Trade Coaching Boot Camp: 

Take your trading to the next level with our lead trader at our next trade coaching boot camp at Cabarete Beach, Dominican Republic April 19 – 21, 2019.

If you can’t attend in person you can attend the class online virtually and take part in question and answer as if you were in the boot camp live.

Register Here: Trade Coaching Boot Camp April 19, 20, 21 2019.

 

 

 

 

 

 

04
Mar 2019

Machine Learning Trade Software Advisory | Crude Oil: Trade Frequency

Machine Trading, Trade Alerts , , , , , , Curt Melonopoly

Crude Oil Trade Software Advisory:

This advisory is a follow up / adjustment to the advisory at this link:

Machine Learning Trade Software Advisory | Crude Oil: (1) Frequency (2) IDENT Program

Trade Frequency.

This is to advise that the crude oil machine trade software will now trigger all active protocols at a higher frequency as of 6:00 PM Monday March 4, 2019.

For example, on most occasions it will now fire trades at the majority of 1 minute model support and resistance and at most EPIC 30 Min Model support and resistance (quads, channels, mid channel, mid quad).

The various software trading protocols (based on specific models) will be distributed in 24 – 28 hours to stakeholders. There are a total of 42 and approximately 16 that we are currently running (on time-frames from 1 minute to 1 week charting models).

This adjustment to the software “throttle” will increase frequency considerably (approximately 160 – 200 executions or more possible per month).

The win rate will be lower than the previous two months but a higher return monthly is expected.

The minimum bar is an 80% win rate and a progressive increase in monthly return as software is tweaked, and an average draw down less than 12 ticks (3 – 16 ticks depending on the protocol). Average win greater than 12 ticks.

Staff will (when time allows) alert the trade protocol details to the trade alert feeds on Twitter and Discord private oil server.

Thank you.

 

1 2 3