Trading With DuettoFX


This page is a starting point for all the people interested in trading with DuettoFX. Using this page you can easily go through the articles published so far and understand how to use DuettoFX in the most effective way

The post Forex Spread Trading explains what is “Spread Trading” applied to the Forex market and two possible approaches: the classical “non directional” approach using directly correlated pairs (like EURUSD and GBPUSD) and the “directional” approach using inversely correlated pairs (like EURUSD and USDCHF).

The post Average Daily Range For Spread Trading explains how to use the “Average Daily Range” for balancing the lot size of two trades opened with the “Spread Trading” technique.

The post DuettoFX Wins 90 Pips per Day shows the results of a preliminary edge-ratio analysis on DuettoFX performed over 5 months (from Sep 2011 to Feb 2012) on 8 currency pairs. The overall profit potential is about 4000 pips per month, while a basic trading strategy was able to pocket 9000 pips in the 5 months period.

The post 1000 Pips per Month with a Single Indicator is a follow-up of the previous article where the edge-ratio analysis is extended to 10 charts and 25 months. This analysis confirms the 4000 pips per month profit potential, while the basic trading strategy reported an average +1000 pips per month during the entire analysis period.

The post DuettoFX Strategy Details And Tips is a detailed explanation of the “basic strategy” introduced in the previous posts. The DuettoFX is applied to an hourly chart and using MT4’s Data Window I explain exactly when is the moment to enter long and short trades according to this strategy.

The post Trading Divergences with DuettoFX describes a special way to trade DuettoFX manually. The trick is spotting divergences between price action and DuettoFX’s spread. Although this is not an exact science, the examples of divergences over the last 6 months on EURUSD clearly show a substantial profit potential.

The post Risk Averse Approach to DuettoFX Trading describes a modification of the DuettoFX “basic strategy” introduced in previous posts. Adding a simple dynamic SL and TP to each trade (1:1 risk:reward) smooths considerably the equity lines of some pairs (EURUSD, AUDUSD, and USDCAD).

The post One Leg Trading With DuettoFX explains how to trade only one of the two pairs involved in a “duetto” (e.g. only USDCHF in the duetto GBPUSD vs USDCHF) based on the historical profit factor of our backtests. This approach can easily improve by 10% the overall profit factor, thus reducing trading risks.

The post DuettoFX Hits Again: +482 Pips After 3 Trades is another example of the SL-TP technique described in “Risk Averse Approach to DuettoFX Trading”. Over the last few months this approach has been particularly effective with EURUSD.

The post A 357 Pips Ride with DuettoFX shows how DuettoFX gave a great opportunity to ride the EURUSD downfall in the first week of March 2012 by combining Divergence Trading with a “basic strategy” entry plus the addition of a dynamic TP. It is not so difficult as it sounds :-)

The post DuettoFX Hits Again: +392 Pips After 4 Trades shows another batch of 4 trades executed with the SL-TP technique described in “Risk Averse Approach to DuettoFX Trading”. This approach continues to be very effective with EURUSD (7 trades and +874 net pips during February and March 2012).

The post DuettoFX and Hidden Divergences explains the difference between “regular” and “hidden” divergences, and also the correct way to draw divergences on your charts. DuettoFX with its standard settings is extremely good for spotting both regular and hidden divergences.

The post Another 252 Pips Ride with DuettoFX shows how DuettoFX gave a great opportunity to ride the EURUSD downfall in the first week of April 2012 thanks to a “divergence trade” plus a trade executed on autopilot by the “DuettoFX Swing Trader” EA.

The post How To Find Good New Duettos introduces the new indicator “DuettoFX Matrix” which is able to calculate the correlation between any couple of instruments that are available on the MT4 trading platform (including commodities and stock indices). The matrix can help identifying the best “duettos” (couples of inversely correlated pairs).

The post DuettoFX Swing Trader – Time to Cash in? illustrates the first month of forward testing of the DuettoFX Swing Trader EA, and suggests the use of divergences as a way to identify the right time to close manually some trades thus cashing in more profits. Anyway the EA can also run a completely on autopilot 😉

The post Correlation 101 describes how to use the DuettoFX Matrix Indicator for spotting inversely correlated currency pairs, which are the best candidates for being traded with DuettoFX. It also explains the concept of “pure pair trading” that involves directly correlated pairs.


List of DuettoFX related posts (in chronological order):

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