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Building an equity millipede

I am posting my GBP-JPY chart.(I trade only daily weekly and monthly charts)

I have 7 legs on this pair from last 4 weeks.I would like to share my experience about different currency pairs.

EUR/USD,USD/CAD these pairs have daily pip movement of about 50-70 pips.For this pair my s/l is 30 pips on daily,70 pips on weekly and 120 pips on monthly time frame.

EUR/JPY and other JPY crosses have daily pip movement of 70-100 pips.For this pair my s/l is 70 pips on daily,150 pips on weekly and 200 pips on monthly time frame.

Before starting your legs concentrate on one pair.EUR/USD is preferred.I am trading two pairs EUR/USD and GBP/JPY.
I advise people not to consider trading JPY crosses unless you are ready to use greater s/l and greater draw-down.But rewards are also high.

on 3rd week of last month,I entered both on EUR/USD and GBP/JPY. My legs are surviving till now but EUR/USD is +430 pips and GBP/JPY is +890 pips.S/l and volatility is high in JPY crosses if you can stomach some bigger losses then you returns are also high.

Mission statement is to enter low-risk entries.Let market decide either to reward or to kill the leg.But our risk is minimum.

If there are any queries i am ready to answer.

Regards
Prakash
Attached Image (click to enlarge)
Click to Enlarge Name: weekly 26thdec.(gbp-jpy).gif Size: 28 KB
I am a hunter...i kill both bulls and bears...:)
Quoting oathbreaker
I am posting my GBP-JPY chart.(I trade only daily weekly and monthly charts)

I have 7 legs on this pair from last 4 weeks.I would like to share my experience about different currency pairs.

EUR/USD,USD/CAD these pairs have daily pip movement of about 50-70 pips.For this pair my s/l is 30 pips on daily,70 pips on weekly and 120 pips on monthly time frame.

EUR/JPY and other JPY crosses have daily pip movement of 70-100 pips.For this pair my s/l is 70 pips on daily,150 pips on weekly and 200 pips on monthly time frame.

Before starting your legs...
Happy holidays to Prakash and everyone,

Thank you for sharing your trades. However when you decide to diversify. Do you start a new leg on opposite direction at the same time? What are SL for other pairs which you have not mentioned? Thanks
Quoting fxpig
Happy holidays to Prakash and everyone,

Thank you for sharing your trades. However when you decide to diversify. Do you start a new leg on opposite direction at the same time? What are SL for other pairs which you have not mentioned? Thanks
Hi fxpig..

If there is an oppurtunity,I will enter both the directions.I diversify when ever trend ends(very often i enter both the directions).Please,start with the pairs which i have presented and demo-trade for 6-months.Then you will come to know your risk and other stats.Try for low-risk entries.

Participation
Low-risk entries
Growth
I am a hunter...i kill both bulls and bears...:)
Quoting oathbreaker
Hi fxpig..

If there is an oppurtunity,I will enter both the directions.I diversify when ever trend ends(very often i enter both the directions).Please,start with the pairs which i have presented and demo-trade for 6-months.Then you will come to know your risk and other stats.Try for low-risk entries.

Participation
Low-risk entries
Growth
Hi Prakash,
My trades never went over hourly chart. This forum forces me to reconsider my method. Since GBP/JPY pair is more volatile when compared to others. What S/L do you apply for this pair? Also few other pairs with GBP, CAD,AUD, NZD and CHF denomination. Thanks
This method still depends on whether or not currencies range over time. In this zirp environment this is something that is very likely (or more so than before 2008). You will get your head handed to yourself in that case.
Quoting oathbreaker
I am posting my GBP-JPY chart.(I trade only daily weekly and monthly charts)

I have 7 legs on this pair from last 4 weeks.I would like to share my experience about different currency pairs.

EUR/USD,USD/CAD these pairs have daily pip movement of about 50-70 pips.For this pair my s/l is 30 pips on daily,70 pips on weekly and 120 pips on monthly time frame.

EUR/JPY and other JPY crosses have daily pip movement of 70-100 pips.For this pair my s/l is 70 pips on daily,150 pips on weekly and 200 pips on monthly time frame.

If there are any queries...

Hi Prakash and Others,

You are (prakash) doing well man. I also have similar results on eur/usd and usd/jpy, but my trades are based on weekly and daily charts. I started usd/jpy on 14th November and till this moment its up by +607pips.

Entered into eur/usd on 15th November and it is still running with +452pips.

Anyway i am not boasting about my trades, just sharing what i am doing with this method. I don't know what will happen tomorrow for my trades, but i am certain that, i will not go negative because i already set breakeven points.

-maaj-
-happyTrading, maaj-
Quoting fxpig
Hi Prakash,
My trades never went over hourly chart. This forum forces me to reconsider my method. Since GBP/JPY pair is more volatile when compared to others. What S/L do you apply for this pair? Also few other pairs with GBP, CAD,AUD, NZD and CHF denomination. Thanks
Hi fxpig

The main rule about this kind of trading is stick to one or two pairs.Can you hold to this method even though u stomach 20 consecutive losses .If u can then you can think of this method.It doesn't matter on which time frame you are working on.Do u have "The One Thing" which "pipeasy" was referring to.If so it is not a problem.
Please re-read the thread as many times you can.There is lot of information.I read this thread for last 8-months(10-15 times).Understand it on your own norms.

Regards
Prakash
I am a hunter...i kill both bulls and bears...:)
Quoting maaj
Hi Prakash and Others,

You are (prakash) doing well man. I also have similar results on eur/usd and usd/jpy, but my trades are based on weekly and daily charts. I started usd/jpy on 14th November and till this moment its up by +607pips.

Entered into eur/usd on 15th November and it is still running with +452pips.

Anyway i am not boasting about my trades, just sharing what i am doing with this method. I don't know what will happen tomorrow for my trades, but i am certain that, i will not go negative because i already set breakeven points.

-maaj-...
Hi maaj..

Thanks for your comment.I had 10 legs on each pair and total of 6000+ pips for time being.Last week i diversified my legs so i had less number of legs.I am learning some lessons about diversification.If i hadn't diversified i could have earned more pips.
Anyway right now EUR/USD and GBP/JPY are forming pin bar with long wick.I am expecting some retrace here.Let's see next week.
All the best for your legs maaj. Keep posting your progress,so that others can learn from it(me too).I will also post my results.

Regards
prakash
I am a hunter...i kill both bulls and bears...:)
Quoting Mjolnir17
I try to write an excel sheet, where i can input my trades, therefore can calculate net profit, largest win, largest loss, win percentage etc.
however i messed up with such statistics like average gain and loss, expectancy, largest number of consecutive wins/losses etc.

Someone can help with these excel things, or perhaps fancy sharing their own statistic-maker excel file?

Happy X-mas for all, zol.

The attached excel spreadsheet doesn't have everything you're looking for, but it does have avg pip per trade, gain, and loss. Feel free to use the formulas.
Attached File
File Type: xls trade stats.xls   154 KB | 185 downloads
Insert cliche quote here.
Hello everybody,
The power of this method resides in the way it views the market and the amount of control it provides the trader to react to its seemingly irrational behavior.
From a businessman's perspective, it is never a single sale/trade/service...that breaks even. It is the business itself, be it a brokerage firm or a lemonade stand.
When Pipeasy was in control of the flow of this thread, and given his extremely interesting professional background, his focus was on providing real life situations that invited the reader to get a better perspective and, more importantly, act on it. His gambling examples and analogies were pure gold not because they provided the steps to win a poker game but, more interestingly, because they didn't. And when he spoke of a trade breaking even, moving to BE, flying buddha...and all the rest, it was for illustration purposes more than anything else.
Hedging in a dynamic way and setting an expense limit that could not mathematically be broken while maintaining the ability to amplify a temporarily favorable run is key.
"For Sale: Baby Shoes. Never worn." Ernest Hemingway
Quoting oathbreaker
Hi fxpig..

Participation
Low-risk entries
Growth
Those 3 points are really the whole key to this method. It's NOT about whether the market is in an uptrend or downtrend, whether short term or long term. It's NOT about milking a trend for all it's worth as how does anyone know the trend that's abut to happen is going to that milkable? The best milkable trends are those that we only realise are so milkable AFTER they've happened.

This method is about TRADING, and trading everyday, longs and shorts, regardless of what the main trend is. Do that and by default you'll be able to milk those long term trends by default...

So right now, look at USD-JPY. Stunning upmove over the last several weeks so common sense would say 'only look for longs as we're in a bull trend'. yes we are, but who says that today, or tomorrow is not going to be the high. Chances are it won't but today might offer a few low risk entries on the short side - TAKE THEM and forget about what the major trends are doing. And chances are any short trades will get knocked out for scratched trades BUT AT LEAST YOU'VE PARTICIPATED....

Most have read Reminiscences of a Stock Operator but did you know there's a new version out and it's excellent. The copy is all the same but the new author delves into the background o the markets and people during that time. Like I said it's excellent and I'd advise everyone to get it (who's interested in financial history). One of the characters (not Livermore) has a saying and it's very very applicable for this method -

IF YOU DON'T BET YOU DON'T KNOW....

That does a great job of describing what you need to do with this method which is to take every low risk entry you can find and to hell with the major trends in force at that time. And as Oathbreaker rightly points out, if you cannot handle 10-20 losses on the trot then forget about this method.

Question: How can one easily handle 10-20 losses on the trot?

Answer: Risk 10 basis points per trade.....risk more than say 20 basis points and I'd bet a big pile of cash that the physcology will get ya!
Road To Wisdom? To err and err and err again, but less and less and less.
Graham will like this one.

There's an excellent book on Gambling called 'Dummy Up and Deal'. For those where English is not their first language 'Dummy Up' basically means 'shut up'.

For Graham's method we can modify this to 'Dummy Up and TRADE'. This means, shut up, don't bore yourself with any recent analysis of the markets, instead focus on the last 1-10 bars of any time period and TRADE WHAT YOU SEE RIGHT THERE AND NOW using those razor sharp entries.

Most of these entries will either lose or breakeven but every now and then you'll find yourself riding a good trend with multiple positions.

So for anyone that's struggling try to make this your new year's resoltion - DUMMY UP AND TRADE.

Anyone reckon Graham still reads this thread?

If he's still alive I reckon he pops back now and then to see how his baby is doing. Well, G, if you're reading this thanks for all the help you've given me and others and may you have a great 2013 in both your personal and trading/business life.
Road To Wisdom? To err and err and err again, but less and less and less.
nice posts, Calculus, happy new year to you !

also, I think there is a possibility that you are "pipEASY".
dont bother answering this, it's just something that has came to my mind.

Happy trading to all !
MJ, funny but I'm not G. Mods can check my IP, I'm located in sunny England and always have been.

I'm not saying anything here that I haven't been taught from G's many posts on this thread. But here's the key, and Oath found this out as well - reading this thread is not what it's all about. It's about reading the thread 10+ times because everytime you read it I can guarantee you'll pick something else up, not another 'trick' per se, rather a deeper understanding of what's going on as well as a deeper undertanding of the price action trading discussed.

Want to know what I did, I went through the whole thread and copy pasted the important parts into a Word document under important headings such as -

Entries
Diversifaction
Hindsight
Physcology etc

The summary is abut 200 pages (Verdanna 8 so there's a lot of info per page). I try to read 25% a day and even after several months of this still pick up ideas into the foundations of this method.

Now, I'm normally a generous person but please note I will NOT be sending this to anyone that asks via PM because it will hurt you more than help. It's hard work I know but you need to do the work yourself, we all know that at the end of the day this is a solitary business, others can help but most of the work has to be done by yourself.

The Dummy up and Trade concept as well as - you don't know till you bet - is just part of the deep understanding of this method that I gained by studying G's posts over and over and over.

PS. If anyone wants a tip of how to edit this whole thread here it is - forget about everyone else's posts and just concentrate on Graham's, you'll get more than 90% o the relevant information that way and it will save time. Also, no point printing off the PDFs of just G's posts unless you want something like a 1000 page document. By copy/pasting to a Word document you can only paste the best info and also get rid of all the tables and other things relating to the ForexFactory site.

Remember -

If you don't bet you won't know

and

Dummy Up and TRADE

And think hard about the 10 basis points risk per trade as that has a hidden advantage - it can make trading psychologically effortless. Now, before someone pipes up and says 'huh, 10 basis points, you'll never be able to make a decent profit wth such small risks' I have one word for you - STACKING...
Road To Wisdom? To err and err and err again, but less and less and less.
Hey Calc,

by 10 basis points you mean 0,1 % /one tenth percent/ of account equity?
youve been successful so far with millipedeing ?
Im still trying it, and my entries are better day by day, so its good

Happy trading !
Quoting Mjolnir17
Hey Calc,

by 10 basis points you mean 0,1 % /one tenth percent/ of account equity?
youve been successful so far with millipedeing ?
Im still trying it, and my entries are better day by day, so its good

Happy trading !
Sure. Do the maths yourself. But first let's try a 1% risk per trade.

To be successful with this method it's all about putting on plenty of trades. G himself said he does an average of 7 a day. I budget for about 10 trades per day, looking at around 10 markets (not 1 trade per market per day, often I don't trade 1-5 of the markets that day).

Will there ever be days when you get 10 trades that you're able to move the stop to breakeven? There sure will.

Will there ever be days when you get 10 trades wrong, ie put a trade on and within the hour you're stopped out. There sure will.

So risk 1% and that's a 10% account equity loss IN ONE DAY!

Trade with that sort of risk and either the martkets will get you or your mind will get you. It doesn't matter which one gets you because you're pretty much dead either way because if you can suffer 1 day of 10 losses there will be 2 consecutive days of the same, maybe even 3 days. Now, those 2-3 days might not come for 3 or even 5 years but they're coming I can assure you of that.

Now, cut the risk to 50 basis points per trade. The potential to lose 5% over one day or perhaps 15% over 3 days is far too much for me.

So what is the right level for potential losses per day? For me it's 1% which is how I get to the 10 basis points risk per trade. Other people might be more but I wouldn't suggest to anyone with a view to making a career out of trading risks more than 2% a day.

10 basis points isn't a lot of risk but then it's still possible to have a pretty decent sized position on with that amount because it all depends on where your stop is. Many traders use a fixed trade size for every trade so it's say a $100k trade with a maximum stop of 20-25 ticks. I prefer to see how much risk I need to take in ticks on a trade then divide that by my 10 basis points. So if 10 basis points = $100 and my risk is 20 ticks the actual trade size will be smaller than if the stop risk is 8 ticks. I cannot always get trades on with 8 ticks but sometimes I can.

Now, as G points out many times on this thread, if you trade with just one position you're never going to get that far. The trick is to be far bigger when you're right and far smaller when wrong. Perhaps $100k when wrong and a position of $1million+ when right. THis is where the stacking comes in, put a probe out, risk 10 basis points and if it works stack with another 10 basis points and then another etc. So if USD-JPY trends nicely over the next several months you might find you have 34+ different 10 basis point trades all working for you which is a pretty good position to have.

Folks, sorry to be blunt but if you aren't agressive with your stacking you haven't got a hope of doing well with this strategy. But for me, I can only get agressive with both my initial probe and then stacking if my risk is small, hence 10 basis points. Some might prefer 20 or even 25 basis points but any more and for 95% of readers you're going to run into all sorts of mind problems and self doubt assuming you're an agressive trade (when I sau agressive I mean putting plenty of trades on, not monster sized ones)

Play with the numbers yourself, but never worry about the upside, focus on your potential downside and what might/can happen. Do that and you'll find the correct amount of risk to use per trade which I suggest is somewhere under 25 basis points. Good luck.
Road To Wisdom? To err and err and err again, but less and less and less.
By the way when I say 34+ positions I don't mean to say that I trade like a madman, spraying trades like machine gun fire.

Personally I'm looking build a millepede over months and hold it for multi-months if not several years. So in turn it would probably take several months to build that position assuming the trend is kind to me, ie doesn't have any of those vicious 100% retracements which would knock out all my positions at breakeven. This by the way will happen to you with 100% certainity some of the time, please note this and mentally prepare for it.

As for one of these monster moves, what about USD-JPY going to 200+ over the next 5+ years. Anything is possible in this game...
Road To Wisdom? To err and err and err again, but less and less and less.
Quoting Calculus
...
Most have read Reminiscences of a Stock Operator but did you know there's a new version out and it's excellent. The copy is all the same but the new author delves into the background o the markets and people during that time. Like I said it's excellent and I'd advise everyone to get it (who's interested in financial history). One of the characters (not Livermore) has a saying and it's very very applicable for this method...
I'm a big fan of ROASO...what's the name of the new version?
Thanks in advance!
Quoting kokopelli
I'm a big fan of ROASO...what's the name of the new version?
Thanks in advance!
Koko

Search for on Amazon -

Reminiscences of a Stock Operator: With New Commentary and Insights on the Life and Times of Jesse Livermore (Annotated Edition)

Don't buy the Kindle version as Kindle is crap at photos and it's got loads. Like I said, the book goes into all the interesting characters on Wall Street at the time and things like all the different corner attempts and scams of the time. It really brings the book to life.


Road To Wisdom? To err and err and err again, but less and less and less.
Quoting Calculus
Koko

Search for on Amazon -

Reminiscences of a Stock Operator: With New Commentary and Insights on the Life and Times of Jesse Livermore (Annotated Edition)

[size=2]Don't buy the Kindle version as [size=2]Kindle is crap at photo[size=2]s and it's got loads. [size=2]Li[size=2]ke I said, the book goes into all the interesting characters on Wall St[size=2]reet at the time and[size=2] things like all the different corner attempts and scams of the time. It really brings the book to life[size=2]....
Just placed the order. Thanks!
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