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how to catch the whole move

  • Post #1
  • Quote
  • First Post: Dec 25, 2006 10:43pm Dec 25, 2006 10:43pm
well, forex is a very trendy market, and once you get in early, or get in at the very beginning, you may be on a path to many many pips, but how do you do capture most of it/ ride the trend to it's fullest? One thing I am thinking is that to look for divergences on MACD or when the 2 moving averages crosses below the zero line (if in an uptrend), that should warn of the move likely to be over...any thoughts?
price
You just have to react, no indicator has any predictive value at all.
The breaking of a wave cannot explain the whole sea.
If you can catch the "entire" move then you just took a guess to get there. You need evidence of probable events in forex. For example, if you are trading a breakout, you first need the price to move in one direction for a given amount before you recognize it as a breakout. You cant look at a flat market for 8 hours and "predict" a breakout in one particular direction without seeing it move a good deal in that direction. That's just the entry. You need the same thing on the other side (exit).

If you say price will get you the entire move, I think you're trading based on pure luck. You need the price to commit to one side before entering a probable trade. I guess you could trade a candle formation, such as a hammer, at the end of a trend expecting a reverse, but like I said, it would just be luck if it actually did reverse.

A trading friend of mine told me you have to understand you can't catch the entire move. If you try to catch the entire move, you're going to be broke in no time, so don't be greddy and leave some pips on the table for others.
Quoting Craig
...no indicator has any predictive value at all.
There are thousands of very profitable traders that would disagree.
No doubt, but since these forums are such a hotbed of personal opinion dressed up as fact, I thought I'd throw my 2 cents in
The breaking of a wave cannot explain the whole sea.
Two quotes come to mind:

1. Never get too greedy, always leave something on the table for someone else.

2. Pigs get fed, hogs get slaughtered.
Quoting Craig
No doubt, but since these forums are such a hotbed of personal opinion dressed up as fact, I thought I'd throw my 2 cents in
True story!
Quoting twinchell
True story!
it's true. Waiting for a trend to establish before jumping in is much better risk/reward for the trade. Thanks for the reality check that "one must see the price commit in a direction" in order to justify a simple, yet very important concept that there are indeed more buyers than seller or vice versa.

Yes, price action does tell a lot-if not everything. For example, say if you caught a very strong up trend, and it stops making higher highs, than it is time to be cautious if not exit.
Quoting Craig
No doubt, but since these forums are such a hotbed of personal opinion dressed up as fact, I thought I'd throw my 2 cents in
If this statement was true, then it should have been deleted by a moderator by now...I am a moderator by the way, but I don't have any intention to do anything, because I believe that this is a free forum where everyone can say his/her opinion without suggesting it as a fact of life and without offensing any other member or degrading their opinions as well..

Also remember that there are very few facts in the world of trading, including your opinion, mine & everyone else...


Thanks,

Nader
Quoting Trader1580
well, forex is a very trendy market, and once you get in early, or get in at the very beginning, you may be on a path to many many pips, but how do you do capture most of it/ ride the trend to it's fullest? One thing I am thinking is that to look for divergences on MACD or when the 2 moving averages crosses below the zero line (if in an uptrend), that should warn of the move likely to be over...any thoughts?
In my opinion, I don't think anyone can be able to consistently catch complete trends...You might get lucky & buy at the exact low & sell at the exact high once in your life and it might not even happen...To be frank, it happened with me 1 time but only half way, I bought wheat at the exact bottom a couple of days ago, but I haven't sold yet & I don't think I will be able to sell at the exact top, I know I wouldn't be able to, so I will be happy whatever the point I would get out at is...


Thanks,

Nader
Believe it or not, there's one person in FF that I come across. Master Jedi Orange Roshan. SRDC

Still remember last few weeks, while others are taking 50-80 pips, this guy swept 482 pips.

After I studied his method, it is possible to 'eat pips' both way. But it took him half of the decade (exaggerate a bit) to master that skill and he always mentioned..practise, practise.....n practise. It's like a kung-fu skill. When you are good, you can fight anybody.....

That's my aim....Dancing with the TREND.

After this you can me Panjan the TREND DANCER....hehehe
Shah For every action there is an equal and opposite reaction.....
Currently with his method, I'm dancing with GU at + 50pips......maybe take half of the profit at quadrant two Q2.......
Shah For every action there is an equal and opposite reaction.....
Quoting Trader1580
it's true. Waiting for a trend to establish before jumping in is much better risk/reward for the trade. Thanks for the reality check that "one must see the price commit in a direction" in order to justify a simple, yet very important concept that there are indeed more buyers than seller or vice versa.

Yes, price action does tell a lot-if not everything. For example, say if you caught a very strong up trend, and it stops making higher highs, than it is time to be cautious if not exit.
Thanks for posting this! I couldn't have said it any better!
  • Post #15
  • Quote
  • Edited Dec 31, 2006 5:05am Dec 30, 2006 8:12pm | Edited Dec 31, 2006 5:05am
I know that it is possible. But not by ordinary means. But it doesn't matter, because you don't need to be able to call the ends of big trends accurately, which is extremely difficult.

So, whether it is possible or not, everyone should operate within their limits. Search for a good system that suits your temperament, skills, time, knowledge, etc. Then master it as best you can. Then trade within your skill level.

You don't need to make more than 5% of the available pips in a trend to make a fortune in Forex. GBP/USD trends average about 400 pips. 5% is 20 pips. If you make 20 pips with a 20 pip risk once a week, and risk 10% of capital each trade, then your return per trade will be 10% X 1.0 (Risk Factor times Reward / Risk Ratio) which is 10% return on capital. Repeat weekly for 1 year. Your initial capital will grow by 10% per week for 52 weeks, which means your capital will multiply 142 times. If you start with $1,000, then your capital will increase to $142,000. Assuming you win 100% of your trades, which is possible, but unlikely.

It would be easier to trade with a 40 pip stop (including the spread), so it would be better if you could learn how to enter trades with a 40 pip or better reward, and a 40 pip stop. If you can win them a high percentage of the time, then you can employ a higher risk factor, up to 30%. An increase in risk factor produces an exponential increase in return on capital. (Note: The danger of too high a risk factor is losing all your capital if you lose a large number of trades in a row.)

Try to find a system to enable you to make such trades, and you will become rich. You don't primarily need pips, you need trade setups with a decent reward / risk ratio which win most of the time. That's the ticket to wealth.

I just read the thread in the Classified Area of the Readers Lounge called "GTS signal release (C)fxtrader777.com"

The person who created that thread, fxtrader-777, is selling a trading system which seems to perform about as described above. There are many other trading systems discussed in the Trading System forum on this site. The James16 system is the most famous. Can anyone tell us what the performance statistics are for any of the systems which are explained on Forex Factory?
Quoting itme
I know that it is possible. But not by ordinary means. But it doesn't matter, because you don't need to be able to call the ends of big trends accurately, which is extremely difficult.

So, whether it is possible or not, everyone should operate within their limits. Search for a good system that suits your temperament, skills, time, knowledge, etc. Then master it as best you can. Then trade within your skill level.

You don't need to make more than 5% of the available pips in a trend to make a fortune in Forex. GBP/USD trends average about 400 pips. 5% is 20 pips. If you make 20 pips with a 20 pip risk once a week, and risk 10% of capital each trade, then your return per trade will be 10% X 1.0 (Risk Factor times Reward / Risk Ratio) which is 10% return on capital. Repeat weekly for 1 year. Your initial capital will grow by 10% per week for 52 weeks, which means your capital will multiply 142 times. If you start with $1,000, then your capital will increase to $142,000. Assuming you win 100% of your trades, which is possible, but unlikely.

It would be easier to trade with a 40 pip stop (including the spread), so it would be better if you could learn how to enter trades with a 40 pip or better reward, and a 40 pip stop. If you can win them a high percentage of the time, then you can employ a higher risk factor, up to 30%. An increase in risk factor produces an exponential increase in return on capital. (Note: The danger of too high a risk factor is losing all your capital if you lose a large number of trades in a row.)

Try to find a system to enable you to make such trades, and you will become rich. You don't primarily need pips, you need trade setups with a decent reward / risk ratio which win most of the time. That's the ticket to wealth.

for sure.
Hmmmm. Picking Bottoms to Enter Long is akin to catching Falling Daggers.
The best way to handle this is to open two positions, let position one hit your take profit. Allow position two to go all the way with a S/L that B/E - this position will be no cost to you, its a free trade. Don't know how to explain this, but I hope you get the idea. As to how far the market can go, your guess is as good as mine, maybe use RSI on higher TF to determine the exit.
Quoting et_phonehome_2
The best way to handle this is to open two positions, let position one hit your take profit. Allow position two to go all the way with a S/L that B/E - this position will be no cost to you, its a free trade. Don't know how to explain this, but I hope you get the idea. As to how far the market can go, your guess is as good as mine, maybe use RSI on higher TF to determine the exit.
wow, there's an idea! So open two positions, set a take profit, and if the trend goes there and beyond, you will have made money on the first position, and then move the stop loss of the second position to the take profit of the first position and let it run? Is my understanding correct? What is B/E?

One thing that I may look into is that on higher timeframes, look for a trend divergence as those usually signal the end of a trend. On higher timeframes, that may have some merit.
Quoting Trader1580
wow, there's an idea! So open two positions, set a take profit, and if the trend goes there and beyond, you will have made money on the first position, and then move the stop loss of the second position to the take profit of the first position and let it run? Is my understanding correct? What is B/E?

One thing that I may look into is that on higher timeframes, look for a trend divergence as those usually signal the end of a trend. On higher timeframes, that may have some merit.
you can also put two stop orders - but stop and sell stop (straddle strategy) and avoid loss on one position
Quidquid latine dictum sit altum viditur
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