Starting up live FX Engines GBP/USD trading

I had a really mediocre November, with very few trades going my way...and that was before I got caught flat-footed by the huge declines in the dollar around Thanksgiving. In the meantime one of my automated FX Engines was quietly cranking away earning hundreds of (demo) pips trading the British Pound. It managed to catch a lot of the action I missed while I was traveling and sleeping off turkey dinners. So I've decided to give this engine a shot at the big time (well, the pre-big time), and am allocating 20% of my trading capital for it to buy pounds with.

This particular engine looks for upward breakouts of the GBP/USD pair at the opening of US East Coast trading, and jumps on them when they happen (invariably while I'm fast asleep). Interestingly it only racks up fewer than 40% positive trades, but its risk/reward ratio works out very profitably - over 3 years of backtesting its trading performance was over 5000 pips.

The fact that this engine can help hedge against losing EUR/USD trades is also appealing - the GBP and EUR are highly correlated, so on days when my primary system gets a short EUR/USD trade wrong, this engine can help limit the damage and grab some pips going in the opposite direction. I always used to enjoy trading the GBP/USD pair and lately I've felt I'm missing out on the potential profits offered by its higher volatility by confining myself solely to the EUR/USD...so this engine could help improve that situation as well.

Of course, its success depends to a huge degree on continued downward pressure on the dollar - for the time being this seems likely to continue, but if the dollar suddenly begins to strengthen I may find myself eating these words. Yum.

Related links:
FX Engines
FX Engines Update