BLOODY AUGUST, DISCUSSION OF TRADING SIGNALS
he month of August has passed and it has left stream of blood behind it. This post will be quite lenghty as FX Sumo will analyze MQL5's TOP 25 most-subscribed trading signals one-by-one. After that, we will look on 4 trading signals that our followers asked to analyze, and, finally, we will review our own performance.
Before diving into this pool of blood, FX Sumo would like to remind its followers (and neutral observers) that we have just recently lauched our Telegram group, link: https://t.me/joinchat/Hpt7gUyosD5JZw-BFsVN3g
The aim of this group is to share information about various trading signals and educate its members on ways of interpreting trading statistics and financial matrices of these signals.
Here is the full-list of analyzed signals:
Safety Dragon - the author of this masterpiece managed to blow up 3, well-subscribed, trading signals, created another one, called it "Dragon Recovery", and blew up that one as well. All of this within span of 2 weeks, brilliant. It is obvious that subscribers, as well as traders, after big losses try to look for aggressive opportunities to regain their funds, which usually leads to a next round of losses. This guy tried to return with a trading signal that had way way (WAY) too high risks and it suffered predictable outcome, 0 surprise there. Emotions all over this one, unfortunately.
TWILIGHTTRADE PROFIT EA/TWILIGHTTRADE HIGH TREND - these signals did get blown up as well, yet these did not suffer 100% DD, thus, the author can try to rebuild trading and re-establish her place in the market. The real question is whether the author of these signals can bounce back mentally. If these systems were entirely automatized, there would be many arguments in favour of continuing this roller-coaster ride, as past returns significantly outweight the negative effects of this last breakdown. Unfortunately, as we have described before Mid-August Outlook, the EA itself behind these systems is rather unstable and it requires manual intervention. As we are unsure about the mental condition of the author, following this signal in near future would bring much larger risks than potential gains. The author has to regain subscribers' trust before her services could be considered to be serious investment opportunities.
FXGLOW - here, story becomes much more complicated. In our previous update Mid-August Outlook, we called this signal out as one that could have manipulated it's drawdown by having large, unclosed, profitable positions before connecting to MQL5 platform. Since then, many FX Sumo followers have asked us about this signal, as it had recently closed all of its positions and opened new ones. To figure this one out, we did some digging:
The signal is based on the indicator, which belongs to the same author:
After studying this indicator, there are 2 things that are absolutely clear:
- ratings of this indicator are inflated - for those, who decide to buy this shit, another filter indicator is being offered for free if they rate the indicator with 5*; there are reviews that confirms this and after speaking with some of those customers who gave them the highest rating, we can confirm this. If we remember correctly, Twilight's EA was also promoted in the same manner. As it turns out, the combined result of initial indicator and filter indicator is rather poor;
- this indicator is not unique. There are other versions of it, for example, PipFinite Trend PRO indicator (link: https://www.mql5.com/en/market/product/26888), which currently is much more popular than this one.
The indicator behind this signal doesn't seem to be reliable, and one could question whether the author is even using it. Take a look at these trades:
If his trading would be based on that indicator, where are TPs or SLs that are such instrumental parts of this? The indicator is supposed to show not only entries, but possible levels for profit-taking and cost-cutting, yet most of these trades don't have such levels.
It is quite obvious that the indicator is useless, but how about the trading signal? - Honestly, it is quite impossible to tell, atleast, if You are not a subscriber. The latest reviews about this signal show contradiction - somehow, people are losing money while this guy manages to increase his account's size. It is clear that historical performance has been faked - 38800% growth for just 140 closed manual positions is absolutely ridicolous, no other way to put it. What is more, in July this signal had a growth of nearly 200%, while drawdown remained... 0%:
We believe that his broker could have some role in this bullshitery, however, as we stated above, it is quite impossible to determine precisely. Either way, we strongly encourage everyone to stay away from this nonsense, just stay away, be smart.
MWsclp - one more stable month for the cheapest signal out there. If You are building a portfolio that would consist of many forex signal services, devoting a small propotion to this signal would not be the worst idea ever.
AyRobotMT - one word: disapointment. What drives us crazy the most is that we gave this one a positive review in the previous month Mid-August Outlook, when this fully-automatized system looked stable and with great perspective. In August, it made dumb mistakes one after another:
- EA experienced a loss -> no biggy, happens. Just carry on and that's it. The author knew better and said "fk, no, let's regain this " and increased risks for the EA. Very soon, after prior breakdown, EA experienced problems once again and the author decided to overcome the losses by adding funds, thus, effectively keep drawdown in check.
2. As Equity did decrease, he added funds, screwed over his subscribers and survived second blow.
This signal is a combination of rather reasonable EA and too emotional owner (complete opposite of Twilight's case). Unfortunately, we can no longer recommend this signal as it has lost its calm and collectiveness that usual fully-automatized trading system possess.
REITAK Night Fast Money - don't say we didn't warn You... Mid-August Outlook ... The levels of risks were too high and it seems that the owner has not changed his risk tolerance, thus, we expect that similar breakdown could happen once again sooner than later.
Investicum - growth/drawdown ratio has been reasonable for quite a while, absolute level of drawdown is below 20%, not bad for beginning. This is a mix of algo and manual trading, it would be interesting to understand in more detail how these complement each other. The author provides updates from time to time in rather qualitative manner, which deserves a big fat +. As long as drawdown remains in check, this signal has some potential.
The Piptionary Club - manual trading, only one position open at a time, seems wierd. This type of trading is definitely not an efficient one, as diversification of positions is not applied at all. Unreasonable nature of trading, combined with rather random usage of profit-taking and loss-cutting, makes this trading service quite unattractable.
VK7777 - this fully-automatized system has lenghty history, however, it should be cut into 2 halfs:
Everything before&everything after July 2018 -> from our perspective, the trading style has changed in the recent 2 months, as it has become much more aggressive and amount of trades have skyrocketed. On top of this, the huge amount of deposits and withdrawals in this period makes us believe that the author is manipulating with his drawdown levels. We encourage readers to stay away from this trading signal.
FXLionCross - as we stated before Mid-August Outlook, there are very clear signs of growth/drawdown manipulation, May's/June's/July's results should be ignored completely. Nothing positive should be expected from this monster.
Winner - fully-automatized trading system with reasonable levels of risks and appealing growth/drawdown ratio. Despite having sub-par performance in August, this one has a ton of potential, FX Sumo will definitely keep its eyes on this trading signal. Not bad, not bad at all.
Conservative forex - 2-sided story here. In month of July this signal caused it's subscribers a ton of funds, however, during August it managed to regain everything. Everything? - Yes, damn everything -> from 44% loss in July to 90% gain in August:
Nothing wrong about this one, right? Well, actually, she managed to pull of the same move, which was unsuccessfully performed by both Dragon's and AyRobotMT's owners -> for short amount of time, she used the same old trading system, just with much (MUCH) larger risks:
For her, this risk paid off, for those guys, it didn't. This just shows that these 3 personalities are united with the same drive to regain losses as fast as possible; the same drive, which usually ends bad both for traders and their subscribers. We are happy for those who managed to regain their money -> take it and run from her, as fast as possible.
Shikari - although this trading signal has been running for quite a while, it's growth/drawdown ratios from month to month remain very low.
Profit one hundred percent - very similar story to REITAK's -> rather appealing growth/drawdown ratio, but due to unreasonably high risk tolerance, such trading style is not sustainable and will face longevity problems. The fact that the trading is fully-manual does not help here either.
HAMSTER EUR - similar problems with previous signal, just growth/drawdown ratio here is less attractive.
Curinga Forex - for the amount of drawdown that the signal takes on from time to time, growth levels are way too low. This trading strategy definitely uses some hard money-management risk policies with very tight SLs, causing this saw-effect on growth levels:
This could be caused by over-optimization in backtests, resulting in these inconsistent results in real trading. More about over-optimization risks with strategies that apply SLs can be found here Misjudgement of hedging, grid trading and use of SL.
SpartaTrader - nothing special here -> many months with unverified drawdown, and for those 5 that have legit growth and drawdown data, growth/drawdown ratios are absolutely horrible. Why there are 36 followers with 130k active funds? - Well, that's the smart nature of the average subscriber.:)
ForexGuru - ALL history is completely manipulative - only fools would subscribe. Wait, there are 35 followers with 56k active funds?
Oanda Active - throw us synonims for horrible - dreadful it is. Dreadful growth/drawdown ratio month after month. Can it get even better? - Sure it can:
What do You do when drawdown spikes and gets out of hand? - Add funds, obviously. Will someone be able to spot it? - Nah, not even 3x in a row. (y)
GBPJPY COMMUNITY - 33 positive reviews for what? only 1 legitimate month of data, and even in that drawdown surpasses growth by 3 times. They must be trolling, they must be...
Echo - a similar story to Winner's one -> fully-automatized trading system with well-controlled risks. The month of August was a disappointment, however, before that growth/DD ratios per month were very high. This signal as well has quite a potential, and we would recommend our readers to check it out.
DgEkcalC - this one is a hero. Very impressive performance in August, a positive outlier from the sea of shits arround it. A familiar story here -> fully-automatized trading system, absolutely wonderful returns and reasonable risk tolerance, it couldn't get any better. This one has a huge huge potential and very well deserved place among TOP3 performers in August. Bravo!
Just signal - here we go again... Unsustainable level of risks and past's performance can be questioned due to high amount of deposits and withdrawals:
AstonTeam Keep Cool SAFE FR - 1 month of history, during which growth has been 3,63%, while DD - 12,1%. Ah, and DD should have been higher as the author made a deposit after seeing how poorly this was playing out. 28 followers? - Show us again the picture of trolls.
After analyzing the most-subscribed trading signals, we will look on those that our followers recommended. Let us repeat - You can become a part of our community by simply joining our Telegram group here: https://t.me/joinchat/Hpt7gUyosD5JZw-BFsVN3g
EA 5 - for now, this seems to be a hidden gem -> highly profitable and fully-automatized trading system, that employs SL for each and every trade. TOP3 in August, no question about that. If the trading strategy is developped correctly and it has not been over-optimized, this one will have a ton of potential in the future. Otherwise, this could turn out similarly as Curinga Forex, with rather inconsistent performance. Either way, it's way too soon to judge, but potential is definitely there.
New Age Trading - we did call out this trading signal in one of the Telegram's chats that we were participating. Manipulation with DD all over this one:
As soon as equity drops down, just add to the balance to cover Your dumb ass. And if that was not enough, this signal still managed to blow up in August. What else can be said here?
Pallada - interesting concept, however, the floating level of DD is just too high and this one will very soon face longevity problems. A similar story to those that we described before. Unfortunately, we would not recommend this service.
ChickenPips - this has been a great start for the signal. Although trading is 100% manual, the author has managed to keep his drawdown in check; performance in both July and August has been nothing else than exceptional, ranking this signal among TOP3 performers in the month of August. Because of these types of trading signals, we urge our followers to look beyond most-popular trading signals. This one is a diamond - unshapped one, but still a diamond.
Finally, it is time to analyze our own performance in this crazy crazy month. To give a general idea of our performance and how it measures against the very best, here is a visual interpretation:
Millionaire Signal - from our perspective, this was a TOP5 performer out of all that we analyzed previously. Although no major problems were experienced, we had a situation when GBPUSD's basket of trades went in wrong direction, resulting in 140 pips loss of an opening position and a few others that were struggling at a time. This situation was the one that provoked 2,67% DD level; otherwise, DD would have remained below 2% for the whole month.
Despite the very positive performance in August, we must remain realistic -> most probably, we won't be able to keep drawdown below 3%, as backtests confirm that. It is possible that at some point in the future we will face divercity and higher levels of DD, even 20%-30% should not surprise us, as these types of situations had been simulated in the backtests. The only positive aspect from this is that larger DD situations usually bring in larger growth levels, as this strategy employs grid-type trading elements.
We remain cautiously enthusiastic about our performance and future prospects.:)
FX Sumo STeady - much was said in the previous, mid-August update Mid-August Outlook . Since then, our DD levels have kept decreasing:
We clearly understand that growth/DD outlook remains horrible, and month of September, most probably, won't change this significantly. As of now, we are considering another trading strategy that could be intergated in this trading signal and would perform on daily basis next to the already existing one. The correlation of results of these 2 strategies is close to 0, thus, by having both of these onboard, our growth prospects could be improved significantly, while risk levels should not suffer too much. Either way, this one needs to be fixed, and we are up for a challange!
During the month of July our site was visited from 2/3 of all existing countries, which is absolutely tremendous accomplishment. We feel very satisfied with the level of trust displayed by our followers and we would love to maintain the high quality of standards that we have set here:
That's all from our side. Guys, if You feel that this content brings value to both potential and existing subscibers of different forex trading signals, share our content with other investors as well. FX Sumo is here to educate and raise awarness, however, we are still building up site's recognition, and You could help us with this tremendously. If You have any suggestions or You disagree with some of the ideas, feel free to leave Your comment below! Otherwise, we would be happy to chat with You on our Telegram group!
Best of luck,