Just read through the GoomBoo Journal over the last two days after hearing about it from one of the trading bot threads
https://bitcointalk.org/index.php?topic=67591.0 Thanks very much, GoomBoo, for posting this advice and answering everyone's questions.
However, 'bomtis' above highlighted something that I'm curious about anyone's thoughts on:
2) what triggers the trends? it seems that since i uploaded fiat into my account ( nothing more then i can withstand to lose ) the market has come to a stop. Prices dabble around $122 but nowhere near anything profitable
If you made an automated trade every time the EMA 10 and EMA 21 lines crossed during the current flat period, you would very likely lose money due to the high 0.25-0.6% MtGox fees. So what's the best strategy to mitigate this effect of a very flat market?
1) Turn bot on/off when the market is flat, but you'd miss the beginning of the next volatile spike due to some new report.
2) Instead of trading exactly when the 10/21 lines cross, build some hysteresis in, for instance the two averages must be at least 0.6% apart - but you'd lag getting into or out of any large price swings, decreasing profitability.
3) GoomBoo said he's only trading daily. Perhaps at that timescale there are fewer false-positive triggers?
I feel that the current flat market is very different than the high volatility over the previous months.