Euro-Dollar Future: 2 Well-performing Strategies to Help You Diversify Your Portfolio

by Andrea Unger

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EuroFX, namely the Euro-Dollar future, is one of the most important currency futures in the world. This market is well suited to be traded with a mean-reverting approach, as the two strategies shown in this video demonstrate.

They make use of Bollinger bands as entry triggers and work in multiday mode, thus keeping trades open beyond the end of the session.

By watching this video you’ll learn:

- How the first strategy, which produced an average trade of $300, is structured 

- How the second strategy, which includes additional conditions to avoid overweek gaps, is structured

- What has been the real performance of these strategies over the past year and a half

Enjoy! 😎

Transcription

Hello everyone! One of the coaches of Unger Academy here again, it's good to be back, and welcome back to our usual chat about the strategies of our portfolio that have performed the best over the last period.

Okay, so this week I’d like to talk to you about the Euro-Dollar future, which is a future that has been getting a lot of attention lately. And this is because it's currently experiencing some very important downtrends. I mean, we're close to the all-time lows for this future and we've seen that when it reached those lows, in the area of 1.03-1.04, that's when the market rebounded to more or less the prices where it is now, so about $1.07.

The strategies that I want to show you today are two multiday mean-reverting strategies, which will basically keep the trades open even beyond the day's end.

The first strategy is the one that we see here above. It's a mean-reverting strategy, as I told you before, that will keep trades open beyond the end of the session, so it's a multiday strategy.

It uses the Bollinger bands as an entry trigger. The Bollinger bands are calculated using default inputs, so a 20-period moving average to which we add two positive standard deviations and two negative standard deviations.

When the prices cross under the lower band, we'll enter long, while instead, when the prices cross above the upper band, we'll enter short.

Over the past 365 trading days, so roughly we could say it’s a year and a half, this strategy has had some excellent results. The mean-reverting strategy and the mean-reverting approach in the Euro-Dollar market is certainly one of the best performers.

This strategy keeps positions open for a long time and manages to get an average trade, check this out, as high as $300.

This market certainly isn't the easiest market to approach, especially as far as the last few years are concerned, in which we have seen this market struggle along with all the other currencies. What I have shown you though, namely the Bollinger bands reversal strategy, is definitely something that's proving to work over time.

Okay, let us turn to our next strategy. This is also based on a reversal approach. It opens the short trades when the price reaches the upper band and opens the long trades when the price reaches a close below the lower band.

So this is also a reversal strategy but different from the previous one, sometimes it can close the trades at the end of the day, as you can see in this case here.

So this strategy may decide to close the trades when certain conditions are met, namely, if at the end of the day the strategy is in a loss of $600 or in a profit of $800, in those cases it will close the trades. Otherwise, the trades will be kept open for up to 3 days at most.

There's also an exit condition which has been inserted on Friday. This is to avoid overweek gaps that might arise between the Friday market close and the following Monday's opening.

This strategy also performed very well. The average trade, in this case, is obviously lower. This is because, as I told you before, the strategy could also sometimes close intraday.

And here's the equity line of the system. As you can see, over the past year this approach has been able to bring considerable benefits to our portfolio, so guys, go give it a try too! Bollinger bands can certainly help you identify some very important triggers in the Euro-Dollar market.

Alright, if there's someone among you who is interested in the world of systematic trading, I suggest that you go and click the link in the description below. From there you'll be able to access a video by Andrea Unger, or get our best-selling book by just covering the shipping costs, or even book a free call with a member of our team.

And hey, if you liked the video, please remember to leave us a Like, subscribe to our channel and click on the bell so that you can stay updated on the release of all our new videos.

Until our next video! We'll see you soon, bye-bye!

Need More Help? Book Your FREE Strategy Session With Our Team Today!

We’ll help you map out a plan to fix the problems in your trading and get you to the next level. Answer a few questions on our application and then choose a time that works for you.

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Andrea Unger

Andrea Unger here and I help retail traders to improve their trading, scientifically. I went from being a cog in the machine in a multinational company to the only 4-Time World Trading Champion in a little more than 10 years.

I've been a professional trader since 2001 and in 2008 I became World Champion using just 4 automated trading systems. 

In 2015 I founded Unger Academy, where I teach my method of developing effecting trading strategies: a scientific, replicable and universal method, based on numbers and statistics, not hunches, which led me and my students to become Champions again and again.

Now I'm here to help you learn how to develop your own strategies, autonomously. This channel will help you improve your trading, know the markets better, and apply the scientific method to financial markets.

Becoming a trader is harder than you think, but if you have passion, will, and sufficient capital, you'll learn how to code and develop effective strategies, manage risk, and diversify a portfolio of trading systems to greatly improve your chances of becoming successful.