This strategy was taught by Richard Dennis and William Eckhardt in the s to a group of novice traders called the Turtles. Linda Bradford-Raschke inverts the reasoning behind the Turtle strategy in order to develop a short-term trading method. The Turtle strategy designed by Dennis and Eckhardt is a trend-following strategy. The profits on the winning trades are, however, sufficient to make up for the losing trades and then some.
Trend-following strategies, given their low percentage of winning trades must, per definition, have a high amount of false breakouts and short-term reversals.
Linda Bradford-Raschke wanted to develop a strategy which benefits from false breakouts and short-term reversals. This would, in her opinion, result in a high-probability strategy. The result was the Turtle Soup strategy which, in a way, is the Turtle strategy turned on its head. The Turtle Soup strategy is applied to forex pairs on minute charts. A buy signal is given when the market price hits a 5-period low.
A short sell signal is given when the market price hits a 5-period high. Positions are opened at the close of the minute period. The Turtle Soup strategy uses a stop. The stop is a fixed stop calculated as 3x the period ATR average true range.
This stop is far from the market price. It can be considered an emergency stop which will rarely be hit. Positions are also closed when the market price reaches a 5-period high or low. To be precise, a long position will be closed when the market price hits a 5-period high. A short sell position will be closed when the market price hits a 5-period low.
Open positions are closed at the close of the minute period. This example shows two buy signals. The buy signals are accepted because 1 the signals filter is positive green background and 2 the signals appear within the 06hh00 time interval.
The signals are 5-period lows. The first long position is closed with a profit when the first 5-period high appears. The second long position hits the fixed stop red line and is closed with a loss. This example also shows two buy signals. The second long position is also closed with a profit when the first 5-period high appears. This example shows a short sell signal. The short sell signal is accepted because 1 the signals filter is negative red background and 2 the signal appears within the 06hh00 time interval.
The signal is a 5-period high. The position is closed with a very small profit when the first 5-period low appears. The position is closed with a loss at the first 5-period low. These screenshots show longer term back-tests for several currency pairs.
The Turtle Soup trading strategy delivers what its author, Linde Bradford-Raschke, set out to create: These are the movements the strategy tries to benefit from. The back-tests appear to give steady results on the currency pairs tested. Your information remains confidential.
On-line fastest - By mail - Appointment. Contact Chat Call me Support link. All trading involves risk. Losses can exceed deposits. Spot forex, forex CFDs and forex futures Trading type: Day trading Trading tempo: When to open a position? The Turtle Soup trading strategy, however, does not react to all signals all the time.
It uses a signals filter and a time filter. The time filter block all signals outside the period 06h 22h When to close a position? Practical implementation In NanoTrader Full follow these steps: Choose the instrument you wish to trade.
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