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Black Dog System

Hello to all fellow traders.

I have here something that I've been looking at, on and off, for the last two years or so, but I had a closer look last weekend after finding it tucked away in a folder and thought that it may be of some use to guys who are starting out on their forex journey, and anyone else for that matter. There's nothing new here, just my slant on using moving averages, keeping things simple, a clearish screen, and definitely no fibs, elliot, or EAs. Fibs and Elliot, to me, are equivalent to when my granny has wind! Burps - I go long, when she farts - I go short. Not really much use.

So, why call it Black Dog? Well, I was thinking of 'Black Arrow Trading' - BAT; but we already have that. Even thought of 'Bad Ass Trading', ditto. 'Trading in Tandem'.... nah. On the CD was Led Zep playing, you've guessed it, Black Dog. Plus I have a black dog asleep under my chair, and a golden (retriever) dog snoring in his bed. Golden Dog Trading just doesn't have that ring to it.

Anyway, let's move on. I traded this solely on the signals generated on three pairs all last week and made a shedful o pips. EJ, GU, EU. Yeah I know last week was a good one, trendy, moving, but I'll let you make your own mind up when you pull the charts up. I normally have nine pairs open but the signals can start coming thick and fast, and take some managing, for me at least.

Right, two dogs to feed, and my expanding waistline needs fuel. We'll get to the nitty-gritty shortly. In the meantime, look at the juicy moves on the GC here. How can we safely get into those moves with the minimal risk?
Dave
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To continue...

Personally, I like moving averages; they tell a story pictorially albeit a little late. But do we really need a laser guidance system to get us in? I find indicators notoriously difficult to interpret. Nevertheless, we'll be using one as a filter. Hopefully to keep us on the right side of the market. Most successful traders take the meat out of a move i.e., the middle third. Thats what I aim for. Your targets may be different.
This little system will also prevent you from overtrading and fishing for tops and bottoms. (If the rules are strictly adhered to). Both detrimental to the thickness of your wallet.

Back to the charts. I'll stay with the GC, above, to get my message across. Incidentally, that last swing down hit my trailing and netted me 56 pips!
I have an affinity for the 50ema, a la Effi and others. This is my 'line in the sand' and dictates my direction of trade. For our purposes we need to overlay a 50ema high and a 50 ema low channel, so to speak. As per chart.
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Those ema's are obviously not enough to trade from but they keep us on the right side of the market nontheless. But Dave, what about entries? I hear you ask.
Steady... no rush. You really need to know where you're going to exit before you get in, but we'll come to that later. Just for you we'll concentrate on entries.

Black Dogs

These, as I call them, are simply two more ema's coloured black, or rather the signal arrows are. We don't actually need the ema lines on the chart, just the arrows. Let's have the chart.
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Attached Files
File Type: mq4 EMA Crossover Signal.mq4   4 KB | 1,317 download
File Type: ex4 EMA Crossover Signal.ex4   4 KB | 928 downloads
Moving on...

Golden Rule No 1

IF YOU MUST TRADE, THEN ALWAYS TRADE IN THE DIRECTION OF THE LAST BLACK DOG



This rule alone will save you lots of pennies. It will keep you away from trying to find the tops and bottoms, where all the money is lost.

Now we need to fine-tune things just a tad. Before we do, please bear in mind that these are my settings that I use on a 15 min chart. I haven't got the patience for longer time frames so settings may (will) be different. Similarly, you may require earlier or later signals so you are going to have to experiment.

Next we add another two ema's using the same EMA crossover signal thingy. This one is set at 3 and 50. These I colour red and yellow, I use these to give an audio alarm to draw my attention to the PC. I apologise, I forgot to mention that the Black Dogs are set at 20 and 100. Chart coming up.
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Nearly there...

Ok, this is where things may get complicated. Filter.

I use two macd's. The first is set to 10.20.1 The only interest we have in this is when it crosses its' zero line. If we are thinking of going short then we really want to see it below zero. See chart.
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This is the last one for your chart set-up.

Another macd set at 10.20.1 But this is MTF macd set at 60 mins.
I'll explain this the best I can.

I have the MTF macd in the same window as the normal macd. This is not a necessity, you may have two windows open at the bottom of your charts. It's just that I like less clutter on screen. Then set the colour to 'none'. Next, overlay a 5 ema of this MTF macd colour red.

Now, the macds will probably not occupy the same zero line and this is really desired. So, bring up 'Macd properties' and check the 'Fixed minimum' and 'Fixed maximum' check boxes after entering the same values in each. My settings for GBPCHF:

Macd -0.007 and 0.007
MTF Macd -0.02 and 0.02

The MTF Macd tells us what the one hour chart is doing and we are looking to trade long if above zero etc.
Well, that's it for your charts.

I hope this is clear. Chart.
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Attached File
File Type: ex4 MTF_MACD_inColor.ex4   4 KB | 928 downloads
Hi, could you please post your template? thanks
Sure Jack,
if I can. I'm no PC whizz. Is this it?
Attached File
File Type: tpl 50 hl.tpl   7 KB | 1,100 download
Acko, thanks for this...and I agree the 50 MA Hi and Low are the draw in the sand for me too (I use SMA). Does not matter how many systems I tried, I always add them on the chart.
I do use them on the 30 min/1hour TF and I use the TOPTREND indi with them but I must confess even though I absolutly love them and can not leave without them, I still did not "perfect" a system that's profitable based on them. Do you use it at all? ( you said you just found it tucked away in a folder :-))
Please elaborate the Entries, SL, TP etc...
(I ussually have a MTF MA from the 1hour on my 30 min chart...I wait for these 2 to kind of overlap...the SL if I buy is a closed candle under the lower MA)-the guy that wrote this long time ago (it was tucked in my folder for long time too did not exit till the move reverse so sometimes he catched 100-200 pips and made up for his losses...I can not find his thread anymore...so please, I am interested to hear your in's and out's...etc

THANKS AGAIN
sweet MACD + MA combination, but the 20 and 100 Black Dog is too slow, you need make money now

i see you got the 3 , but 50 is lazy...

good luck man
Quoting Acko
This is the last one for your chart set-up.

Another macd set at 10.20.1 But this is MTF macd set at 60 mins.
I'll explain this the best I can.

I have the MTF macd in the same window as the normal macd. This is not a necessity, you may have two windows open at the bottom of your charts. It's just that I like less clutter on screen. Then set the colour to 'none'. Next, overlay a 5 ema of this MTF macd colour red.

Now, the macds will probably not occupy the same zero line and this is really desired. So, bring up 'Macd properties' and check the 'Fixed minimum' and 'Fixed maximum' check boxes after entering the same values in each. My settings for GBPCHF:

Macd -0.007 and 0.007
MTF Macd -0.02 and 0.02

The MTF Macd tells us what the one hour chart is doing and we are looking to trade long if above zero etc.
Well, that's it for your charts.

I hope this is clear. Chart.
I think this MTF MACD is the wrong indicator. It's a bar with no TF settings.
Quoting Acko
This is the last one for your chart set-up.

Another macd set at 10.20.1 But this is MTF macd set at 60 mins.
I'll explain this the best I can.

I have the MTF macd in the same window as the normal macd. This is not a necessity, you may have two windows open at the bottom of your charts. It's just that I like less clutter on screen. Then set the colour to 'none'. Next, overlay a 5 ema of this MTF macd colour red.

Now, the macds will probably not occupy the same zero line and this is really desired. So, bring up 'Macd properties' and check the 'Fixed minimum' and 'Fixed maximum' check boxes after entering the same values in each. My settings for GBPCHF:

Macd -0.007 and 0.007
MTF Macd -0.02 and 0.02

The MTF Macd tells us what the one hour chart is doing and we are looking to trade long if above zero etc.
Well, that's it for your charts.

I hope this is clear. Chart.
ok, I see you posted obne more wile I was typing...so with the color set none on the MTFMacd...what are you looking at?...the red EMA5 to cross or to be above the zero line?

TP? SL? Any other ideas/suggestions, pittfalls

thanks
Hi hbrandt and Waterflame,
thanx for your replies. If I may answer Waterflame first.
Yes, I've tried the faster ma's for quick money, in fact just about every combination. But just think, how many times have you gained a few pips just to watch them disappear as a move continues instead of in your direction. I prefer to let the trend (short term as it is) become established. I did consider 10 and 75 for the Black Dogs but I think the settings as they are provide less risk. Hope that explains that for you.

Hbrandt - if you don't mind I'll discuss entries in detail later as I'm sure there will be lots of questions about the set-up first. Will not forget ya.
Dave
im anxious to see your rules!
Care to elaborate Bill. Its one I requested in the Meta forum supplied by magnumfreak.
Quoting Acko
Care to elaborate Bill. Its one I requested in the Meta forum supplied by magnumfreak.
There isn't a TFsetting. There is no way to set it to 60M, unless it's already programmed for 60M.
The display is in the form straight bars that change colors.
I don't know where the problem is. Mine shows a time frame setting. Anyone having problems with the MTF Macd. Apologise in advance.
Dave
Quoting Acko
I don't know where the problem is. Mine shows a time frame setting. Anyone having problems with the MTF Macd. Apologise in advance.
Dave
all worx perfect, im already in a buy on usdchf, having some cute pips of 3/50, wating for macd confirmation to hold stronger
Quoting Acko
I don't know where the problem is. Mine shows a time frame setting. Anyone having problems with the MTF Macd. Apologise in advance.
Dave
Have you checked the MTF MACD that you posted?

My guess is it is different from the one you're actually using.
I think you're right Bill. Could this be the beast?
Thanks
Attached File
File Type: ex4 MTF_MACD_inColor.ex4   4 KB | 648 downloads
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