one interesting thing i noticed , while testing a combination in 10m tf ( after reading madan ji interview on zeordha blog )(theme is bassed on price action )(purely discretionary way ), testing on 1 lot only and testing period is 4 yrs past data , done in excel sheet ......
609 long trades and 575 short trades = 1184 total trades.
in which total 735 trades are loss making
total points earned 19996
total loosing points -33338
total gaining points 53334
in this 735 loosing trades:
1)0-30 points loosing trades are 295
2)30-60 points loosing trades are 293
3)60-100 points loosing trades are 96
4)100-200 points loosing trades are 45
5)200 above points loosing trades are 6
in this 6 trades of loosing above 200 points all are of adverse gap opening ,
and in 45 trades of lossing points above 100-200 points there are 36 cases for adverse gap opening .........
now question arise , how to handle adverse gap opening issue , in this system we have to keep position overnight , so for hedging purpose what we have to do ??
another question arise , what will be initial sl to put is 30 points is enough ? or it has to arise more ??what will be the valid sl here ..........??
another thing i noticed , if we put a fiter of candle high+3 point filter than we can avoid 65 false trades.......
so how to deal with adverse gap opening and what will be initial sl to be put here , suggestions welcomed ......