Crude Oil After Hours had some nice trades this week and the trends in Crude Oil have helped the portfolios bounce back this week after a tough April.
How can we improve this strategy? This strategy is one of the bonus strategies in our Algorithmic Trading Systems Membership site and is in the portfolios. It is a basic strategy that usually has some adverse excursion on the entry. As soon as we get it, it can go against us.
Can we improve the entry?
Using Rule 6 in the Money Management Algorithms, also known as the Pinpoint Entry Algorithm, we run a test to see if we can improve the entry for this strategy by entering at $100 better per contract on a closed bar basis. This boosts the average trade profit by $20 and reduces the drawdown by almost $1500 on the backtests.
The pinpoint entry algorithm is one of the main reasons I developed the Money Management Algorithms. It is not easy to program these simple ideas (for me at least) into the original strategy, to keep track of when it would have entered and then add your new entry price. The Money Management Algorithms allow us to do this quickly. We show the results in the video below.