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1991issue C011-2

Constructing steppable currency games with stop alerts

A currency worksheet holds named cells for size, stop, and commission, opens with a directional rule, and then advances one stored price at a time so a stop-loss alert can be confronted before the next fill.

  • Named cells hold series identity, point-spread size, unit size, stop distance, and a fixed per-trade commission before a run starts.
  • A series-start prompt and a yes-or-no directional choice set the first position long or short the quoted currency.
  • A step gate advances one stored price at a time so a stop-loss alert can be inspected before the operator keeps or closes the game.
  • Each completed game stores commission cost, peak capital committed, peak drawdown, and return on maximum investment, and the next game can resume from the last remembered price.
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Named cells hold the mechanical inputs

A currency worksheet is laid out with a date column, a rate column, and named input cells for series identity, point-spread size, unit size, stop distance, and a fixed per-trade commission. The trading series is the labeled sequence of exchange rates against which successive games are tested. The point spread is the up-or-down price increment used both to size a trade trigger and to set the stop distance.

Those stored fields make the sheet a mechanical trading system: a complete entry, hold, and exit procedure stored as named inputs and a repeatable worksheet run.

A directional rule opens the first position

A run opens with a series-start prompt and a directional yes-or-no choice that determines whether the first position is long or short the quoted currency. That opening is a rule-based entry: an opening decision taken from explicit prompts and stored prices rather than from an unstated discretionary impulse.

Stop-loss raises an alert before the next action

The stop input is defined as a loss distance in point-spread units and is wired to raise an on-screen alert when that distance is reached. Stop-loss, in this construction, is that pre-set loss distance. It raises an alert so exposure can be bounded before the next action is taken.

The step gate holds every later fill

After the opening trade, the operator can advance one stored price at a time and either keep the game open or close it, including after a stop alert appears. That one-price-at-a-time advance is the step gate. It lets the operator inspect the last fill, any stop alert, and other analysis before continuing.

The stored size, stop, and commission fields make the procedure mechanical, while the step control lets the operator apply other analysis and decide whether to continue the current game.

Completed games store results and can be chained

A completed game is one opening position plus the stepped trades that follow until the operator or the rules end that run. Each finished game stores total commission cost, peak capital committed during the game, peak drawdown during the game, and return measured against that peak commitment. That stored return is return on maximum investment: a completed-game return measured against the largest capital committed during that game, with an annualized counterpart also stored.

Further games on the same series can be restarted from the last remembered price location so completed games can be chained without resetting the series.

Educational research material, not investment advice. Historical source context does not establish present-day performance.
3 of 14 in the Rule-based entry track
19951-17 pp.Next on Rule-based entryTrading as a business: a case study of preparation and rule-based entryEarly training in the case study emphasized mental preparation, discipline, and treating trading as a business before technique.
All readings on this track · 14 readings
  1. 1990Moving-average direction, range penetration, and a dollar stop
  2. 1990Rally and reaction day signals as a mechanical stock system
  3. 1991Constructing steppable currency games with stop alerts
  4. 1995Trading as a business: a case study of preparation and rule-based entry
  5. 1997Bond timing rules as one testable procedure
  6. 2000Rule-based moving average commentary as a testable filter
  7. 2004Constructing a fifteen-bar trend trigger as a next-open system
  8. 2005State-locked rules for mechanical trading
  9. 2007Same-session long entry from a moving-average filter
  10. 2012Liquidity, share count, and stop-trigger costs
  11. 2012Monthly eight-bar average entry and exit rules
  12. 2012Constructing a simple moving average filter with fixed crossing rules
  13. 2014A two-average brick crossover is not yet a trading system
  14. 2020Reject long-bar entries driven by volatility fear of missing out
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