Hi guys, just curios to know about the “not onmarket” function use in the position opening.
Do you use it? Why? You don’t use it? Why?
Also, from a theorical point of view, it can make the systems more overfitted or the opposite?
I know that probably it depends from system to system, but i’m curious to know in a general understanding which are you thoughts.
Turning positions from long to short or vice versa can give too many position entries in my experience. For me, it seems better to wait for a position to end up in profit (by some exit rule) or in stop loss and to open a new position only when the previous position has been closed by one of these ways. At least, this reduces the number of positions per time. Opening positions only when “not onmarket” can be a measure against steady cumulation of losses by turning positions too early. When you turn open positions, one loss can follow the other more easily.
One way against this can be to turn positions only when there is enough profit, otherwise turning should not be allowed.
Only my opinion and not to be generalized for everything.
OnMarket is a system constant returning whether a trade is open or not.
It’s often used to set or not to set variables and conditions when a trade is open or not.
I think that, like anything else, you can overfit with an extreme use of whatever, but it’s less prone to overfitting than anything else.
Opening positions only when “not onmarket” can be a measure against steady cumulation of losses by turning positions too early. When you turn open positions, one loss can follow the other more easily.
Hmm, to my way of thinking this implies that you don’t really trust your reverse conditions, in which case, why have them? If you’re not going to act on the reverse signal, maybe it’s better to run two one-way systems (separate long and short)?
I think a reversing system can work perfectly well if you get it right, but the reversal has to be seen not just as an exit but as a sensible opportunity to go the other way. Certainly in manual trading, if I see an opposite signal I take it, no hesitation … assuming that I trust the signal in the first place.
In markets moving sideways, turning positions can result in one loss occuring after the other. This is why I like to avoid losses beyond a certain threshold when turning a position, or better, I only take profits when turning. When you have big fluctuations, turning a position is usually not a problem. So, it depends on the market conditions.
Hmm, to my way of thinking this implies that you don’t really trust your reverse conditions, in which case, why have them?
By the way, I don’t think that is is possible to “trust” any entry conditions, because it is never possible to predict future prices with sufficient reliablity. The result of a single position is pure chance. Entry conditions only raise the probability a little that the next position could develop the right way.
On the other hand, what can always be stated precisely at every moment : How has an open position developed ? Is there a loss or a gain right now, and how much of it, even if only by chance ? With certain restrictions also : is there still a trend in the right direction, or has it ended ? This is why I think that exit conditions are more important than entry conditions.
