GBPJPY Daily Trend Method

Hello everyone,

I’ve been working tirelessly over the course of the last few months to develop a system that I could be proud of and I believe I have finally completed my work. I’m bringing it to Forex Factory because I am of the opinion that its membership includes the best and brightest retail Forex minds in the world! I would appreciate all of your thoughts, comments and CONSTRUCTIVE criticisms as we move forward and attempt to perfect the following method.

Please do not post any additional indicators without valid back test results. The results should be posted for everyone to see. Similar to the results I have posted below.

I would like this thread to accomplish two goals:

1) Educate new and experienced traders on the use of my trading method/system.
2) Optimize the method until it reaches its maximum potential.

Now that we have the formalities out of the way I’ll go ahead and explain the method. I have attached all of the necessary components.

Pair: GBP/JPY (we may be able to add more pairs in the future)
Time Frame: M30

Indicators:

 

1. 20 period RSI with the 50 level clearly defined
2. 14 period ADX with the 25 level clearly defined
3. Custom Trend with default settings
4. Forex Off Trend with default settings

I will explain the entry and exit parameters in the next few posts.

Please read post #250 after you have read posts 1-4.
Just a reminder, if you have not signed up for the trade signals via Yahoo IM or Skype please send me a PM with you user ID and I will add you to the list ASAP. It is much faster and easier to communicate with you all on IM. There will be additional content available to those who join such as updates to the system, a new and more aggressive system, videos and much more. Those who sign up for IM or Skype will get updates and trade alerts long before the forum will see them. For those viewing the thread who are not members, my Yahoo IM ID and Skype ID is: fxtakeover

Feel free to add me and I'll return the favor!

Alright, let’s get to it. We are only concerned with three bars. The bar that starts at 9:30 AM EST and ends at 10:00 AM EST, the bar that starts with 10:00 AM EST and ends at 10:30 AM EST, and the bar that starts at 10:30 AM EST and ends at 11:00 AM EST. On my MT4 with forex.com these bars are: 13:30, 14:00, and 14:30.


Buy Signal:

If the following parameters are “TRUE” at the close of any of the bars mentioned above we will BUY at the market price.

1) Custom Trend must be blue (teal)
2) RSI must be above 50. Any reading above 50 is acceptable.
3) ADX must be above 25. Any reading above 25 is acceptable. However, the ADX is more of a "Condition" than a trigger. If it is not above 25 at the close of the first bar there is no trade for that day.

Stop Loss = 100 pips (plus spread)
Break Even = Multi-purpose trade manager should move stop to break even at plus 100
Take Profit = 125 pips

Exit Buy Signal:

1) When Take Profit or Stop Loss is reached
2) If, on the following morning, you receive a signal in the opposite direction.
3) If you are stopped out at break even.
4) I will explain add-ons at a later point in time.


Please look at the screen shot(s).

Sell Signal:

If the following parameters are “TRUE” at the close of any of the bars mentioned above we will SELL at the market price.

1) Custom Trend must be red.
2) RSI must be below 50. Any reading below 50 is acceptable.
3) ADX must be above 25. Any reading above 25 is acceptable. However, the ADX is more of a "Condition" than a trigger. If it is not above 25 at the close of the first bar there is no trade for that day.

Stop Loss = 100 pips (plus spread)
Break Even = Multi-purpose trade manager should move stop to break even at plus 100
Take Profit = 125 pips


Exit Sell Signal:

1) When Take Profit or Stop Loss is reached
2) If, on the following morning, you receive a signal in the opposite direction.
3) If you are stopped out at break even.
4) I will explain add-ons at a later point in time.


Please look at the screen shot(s).

Add On Signal:

If your first trade hasn’t reached its take profit by the next morning and you receive a new signal in the same direction, add on to the position. If the first trade has 50-100 pips of profit move its stop to break even. The take profit for the first trade should now be placed at the same price as the add on trade.

Wow!!!! I feel like I just wrote a novel!!! Feel free to comment and/or ask questions.

Michael

Michael,

You sound like a proud papa! Can you supply your trading results with us? How long have you been trading your system?

Thanks,
BC

Thanks for posting.. Will give it a shot tomm morning

What are the other indicators in the 1st post
Multi purpose trade manager and GBPJPY daily buy/sell

This is a brand new system. I have 16 months worth of back testing data starting 01/01/09 and ending 04/30/10. I would have tested farther back but the results I've come up with are fairly consistent and manual back testing takes FOREVER! Feel free to test it beyond that point if you wish. I am definitely NOT opposed to other traders checking the data and back testing it to check for any errors I might have made. I started forward testing on a demo account this week but there have been no valid trades. Here is a spread sheet with the data.

Thanks,
Michael

The Multi purpose trade manager is an EA that everyone can use. I'm using it to move my stop to break even after the trade reaches 100 pips in profit. I'll attach the instructional pdf to my first post. The GBPJPY Daily Trend Buy/Sell are scripts for entering the market. I find that it's much faster than manual order entry but that's just my preference.

Thanks,
Michael

Hey everyone,

I just updated the Entry and Exit posts. I forgot to add a sentence about the ADX. Make sure you read it. I've also update post #1 to include the instructional pdf for the multi purpose trade manager.

Thanks,
Michael

What is the use of Gbp/Jpy Daily Trend Buy / Sell indi?????

Please refer to post #9. They are scripts.

Thanks,
Michael

Hi Michael,

Did u try this method with other currencys than G/J ?

Thanks iT

No. I haven't got that far yet. I would think the more volatile pairs such as GBP/USD and EUR/JPY would be interesting pairs to look at. Feel free to test it on other pairs and let us know what you find. I'll begin to look into it as well.

Thanks,
Michael

Less than an hour to go before trade time. Looks like a short may be setting up.

Michael

If all three bars, this morning, satisfy entrance requirements, will you open three trades, or is it just one a day?
Thanks

Just 1 trade for now. It looks like we will have a sell signal when the current bar closes. The other bars will not matter. Maybe we can look into that in the future

Thanks,
Michael

Took the sell signal @ 136.44

I think I need to review the scripts. The stop loss was a bit too high. I'll work on that for you all.

Michael

Did anybody take that trade?