Thread: Review - London Forex Open (Set Time)

LONDON FOREX OPEN (Set Time)

WHAT IT SAYS ON THE WEBSITE

Website : London Forex Open Website
Cost : ?139 via Paypal
Author : London Forex Open
Review Date : October – December 2009

London Forex Open claims to be a “Forex Trading System based on the well known and respected Asian market range principle combined with the opening of the London Forex Market”. A system which “looks to exploit the fact that on many occasions the London market ... will continue the trend set prior to the Asian session, when it re-opens”.

The system claims to be “fundamentally sound”, requires “little time commitment, 10 minutes a day around 08:00 UK time”, “100% mechanical”, has “reliable indicators” and is “fully supported”. Additionally, all trades are reported on the website.

There is a diagram of an example trade (from 7th December 2009) on the website showing some kind of trend indicator, a seemingly bulk standard Asian range highlighter as well as detailed Trade entry details, including Entry, Stop and Target(s).

The London Forex Open strategy has been published to “provide those seeking to capitalise on the Asian market range principle / London Forex Market Open concept with a reliable means of doing so”. The system trades only GBP/USD at 08:00 UK Local time and “takes just 10 minutes each day!”, “no second guessing, no emotions, no fear, no greed!”.

The deliverables include a Trend indicator, Asian market range highlighter, a (MT4) template, illustrated trading guide and full email support.

There is a link to a Results page. This provides an overview and then a breakdown of all trades to date, from October 2009, based on a risk of 3% per trade.

The FAQ (only other page on this website) answers a few questions as to what other currencies and timeframes can be traded as well as why there is not a money back guarantee with this system.

THE PURCHASE

?139 via Paypal, ?79 to end January 2010, no money back guarantee or offer.

THE MATERIAL

A concise 27 page manual which is very well written. Also supplied is one (MT4) indicator and an MT4 template. As a note, the one indicator includes the Trend indicator and the Asian Market Range highlighter. The “advanced” (which is really just the false breakout) strategy is explained in a separate supporting document.

The first 12 pages of the main manual describe the strategy, the installation and the set-up process. About a 10 minute process, to read and set-up assuming you have an existing MT4 platform and a little knowledge of MT4.

The Entry rules as well as the Stop and Target(s) rules are well explained and are complimented by the fact they are all displayed on your trading screen anyway, each time a trading opportunity exists. The calculations it seems are included in the manual for completeness and as a reference point. There are two Risk approaches, a Conservative one offering staggered Targets and a Risk:Reward of 1:1, and an Aggressive approach which uses one Target and a Risk:Reward of 1:2.5.

The Order & Trade Management section appears quite complicated, at first, and certainly indicates that more than 10 minutes a day will be required, especially on days when a “Red” GBP News event occurs between 08:00 and 10:00. This looks even more complicated if trading the Conservative strategy as there are 3 trades to manage.

As there is only ever one trade per day on one currency pair (GBP/USD) a risk of 3% of account balance is used.

There are 5 trade examples, well documented, and some FAQ’s at the back of the manual. Apart from that, as mentioned above, a well written, clear to understand manual backed up with what appears to be clear and easy to read indicators which provide the exact trade details each day.

The “advanced” manual is a simple read and explains the concepts behind the false break-out strategy, which seem logical to us. As with the main strategy, the indicator displays all the trade details on the same screen and some examples are again illustrated.

THE SYSTEM IN THEORY

Set up is easy, in Meta Trader 4, as there is only one indicator and only one template (both supplied) to apply.

Entry is clear, as are Stops and Targets once you have decided which Risk approach best suits you, we chose the Conservative approach. There is no room for discretion here, when there is a trading opportunity all Entries, Stops and Targets are clearly displayed on your MT4 chart. All you do is place your trades.

The timing and effort sounds good, 10 minutes a day around 08:00 GMT. Some time and effort is also required to manage open orders/trades when “Red” GBP news is due out, perhaps more than 10 minutes a day!

THE SYSTEM IN PRACTICE

We traded this system using the Conservative Risk profile on GBP/USD (the only pair recommended) during November and December.

Firstly, it is rare that the system requires just 10 minutes a day, at least not initially. There is “Red” GBP news out between the hours of 08:00 and 10:00 quite frequently and as un-executed orders are removed around these news times some form of management is required more often than not. After a week or so, using IG Index, we did manage, most days, to spend less than 10 minutes a day on this system, but it takes a little practise and experience. This was made possible because we used the order “Good til” time available on IG Index orders, as well as the Trailing stop facility. Nonetheless, for those with less experience than us, this will take some getting used to, we feel.

In terms of Order entry though, at 08:00 GMT it is easy enough to be in place and ready as it is crystal clear whether a trade is on or not. Entry, Stop and Target(s) are all clearly displayed so it’s a matter of getting the orders in and then a double check of those orders against the information displayed on your MT4 screen.

All un-executed orders are deleted at 10:00 GMT, again, the IG Index order “Good til” function meant we handled this automatically. The trailing stop function was also invaluable, as we were trading the Conservative approach which has 3 staggered Target(s) and some degree of Stop moving.

We also traded the “advanced” (false break-out) strategy alongside the main system. It seems to us “advanced” is a strange word to use because, once you get used to the concept, it is no more easy or difficult to understand or trade than the main system.

CAN IT WORK

During the 2 month period we had just 9 trades trigger, as per the London Forex Open website. This is not many but we are not disappointed with this so long as, at the end of the month, we are showing a reasonable return for our efforts. And we did.

Of the 9 trades we placed using the main system (remember, we used the Conservative approach (3 different Targets)), 7 resulted in a positive return and 2 were negative. We had an average net gain of 300 pips per month, with a set Stop loss (across 3 trades) of 120 pips. The 3% risk per trade proves a return of around 7.5% per month, for very little effort.

The “advanced” strategy got us into 6 trades during the 2 month period and we ended up with a net loss of -60 pips (4% down, based on a 45 pip Stop and 3% risk per trade). Not so “advanced” but a strategy we will stick with as it does seem sound to us. Note: Yes, we were a little disappointed, to say the least, that we missed out on the 390 pip return in October.

We really liked this system and based on the effort required and %age return (albeit over a short period of time) it is enough for us to choose this system over and above the other systems we have used in the past to trade the Asian range/London open. The system is profitable (albeit over a short period of time), the indicators are reliable, the Trade details are crystal clear, all trades are reported, there is a method for false break-outs and full email support is provided. London Forex Open has thus been added to our Systems We Use list and we will also open up a new trading journal to report all our trades.

SUPPORT

Not the fastest but always within 24 hours and typically responses were accurate.

CONCLUSION

PRO's
• Sound principles.
• Ten minutes a day (most days (after a little practice)).
• 100% mechanical.
• Profitable (albeit over a short period of time).
CON's
• It may take some more than 10 minutes a day to start with.
• Limited results, just 3 months at the time of writing.
• No Money back guarantee or offer.


ReviewTeam - www.systemsfortraders.com