Synergy CRS

~Welcome to Synergy CRS~

I have been working on a new system I've developed and to see if any of the coders extraordinaire wanted to have a challenge in coding this monster.

The method was constructed using a few basic fundamentals of the strategies I had developed on FF and from a few other threads that had peaked my interest from a long time ago, the SRDC I and the Indicator Free trading - Skunny threads. The goal was to create a system that would balance itself out utilizing different styles of trading and types of trades all in one strategy. This strategy is pretty complex with multiple entry possibilities, various trade types and sizes, and multiple exit strategies. Unless an EA can be developed, this strategy will require some screen time. I also utilize some of my semi-martingale progressions in this strategy, so if you follow my MM, make sure to use a properly capitalized account for trading.


First, let's break down the name : Synergy CRS

Synergy is defined in the dictionary as:

Syn-er-gy -noun- the interaction of elements that when combined produces a total effect that is greater than the sum of the individual elements, contributions, etc.

This basically means that each individual part of the strategy works in conjunction with the others to make the strategy flow smoother and promotes better profitability.

The CRS is an acronym of the three types of trades that make up the overall strategy:

C= Counter Trend Trade
R= Regular Trade
S= Scalp Trade


The main tool of the strategy that everything else is based around is the OHLC Indicator with Fib Extensions. This indicator determines the OHLC of the previous day and plots those lines into the current day. The indicator also helps you determine if the previous day's candle was Bullish or Bearish by coloring the Open and Close lines to match the candle color, Blue is Bullish and Red is Bearish. When the current day closes, the indicator takes the current day's OHLC data and redraws the values for the next day's trading. Any previous day's OHLC data is left on the charts for visual testing going back a full 365 days (default) and can be changed in the parameters. The template I added only shows 250 days to limit the size to be able to upload it. The OHLC indicator also plots up to 4 Fibonacci extensions on both sides to be used as targets for the Regular and Scalp trades.

The other two indicators are the Counter Trend Fibs and the Scalp Fibs indicators. The Counter Trend Fibs indicator places lines at key Fibonacci retracement areas, which are the 23.6, 38.2, 50, 61.8, and 76.4 levels. The Scalp fibs indicator is basically the same indicator, but the color is modified and set at the 14 and 86 retracement levels and is basically only used for the Scalp trade Stoploss (more will be explained later). All three indicators are also modified to merge Friday's and Sunday's data for those who have a criminal with a Sunday candle (thanks goes to Miyagi for all the indicators).

The Regular trades are based on the SRDC I strategy where we are looking for breakouts of the previous day's High or Low and to take advantage of the Fibonacci movements that occur as discussed in Skunny's thread above. The Scalp trades are added in as a quick "in and out" trade to enhance the Regular trades as they're placed at the same time as the Regular trades with a much shorter target, hence the "Scalp" moniker. The Counter Trend trades are there to counter act the losses occurring from the reversals that we will encounter from time to time from the Regular trades, and occasionally, the Scalp trades.

I will be going over each type of trade individually to show how each works and then show everything completely on one chart. On January 1st, 2012, I will be logging trades in an Open Office trade tracker spreadsheet and show every possible trade that could have been taken, whether in profit or a loss. I will be using a Eur/Usd chart using Go Markets for all trade examples after the 1st and have added all the indicators being used for this strategy along with my template for those who wish to be on the same page.

If anyone attempts to make an EA, this one is going to be tricky as the NFA's FIFO and hedging rules are going to play havoc as Scalp and Regular trades will open and close at different times and Counter trend trades will be opened and closed in between Regular trades. Good luck to the coder who wants to tackle this one and I hope everyone enjoys it and can use all or part in their own trading.

***In order to keep true to the original premise of the strategy, please do not post any other indicators or suggestions here on the thread. If this is to be coded, we do not need a wrench to be thrown into the mix. If you have an improvement that works for you, please experiment with it on you own time. This is to lessen any confusion that may occur from clogging the thread with too much additional content. Please make sure to read the whole thread in it's entirety before asking questions as most answers are already in the thread and have been answered, thank you.***

***1/9/2012- I've added the ADR range indicator that Erebus has posted. He is successfully using it in his own way to help with entry points and target calculations and is worth a look. It is not a direct part of the strategy, so if you have any questions on specifically how he uses it in his trading, please PM or e-mail him directly.***

The first part of this trade is going to be the Regular Trade. The goal of this part of the trade is to capture the break of either the High or Low of the previous day. The only indicator needed for this part is the OHLC indicator. As I mentioned above, the indicator has four (4) fib extensions that can be utilized in various ways. In this example, we are going to use Fib 2, Fib 3, and Fib 4 as Fib 1 is use for the Scalp trade which I will go over later. I have determined to use these levels as my targets:

Fib 2= 123.6
Fib 3= 138.2
Fib 4= 161.8

These are the most common fib extensions used by the majority of traders and are the most likely targets to be hit. I did a quick glance at several pairs from the first of the year to now to see how often a target would be reached. When visually checking the charts, on average, we would at least hit our first target anywhere from 79-83% of the time (depending on the pair) within 24 hrs. Out of that 17-21% that didn't reach target in 24 hrs., 30-35% would reach target within 48 hrs. By knowing these rough numbers, you can attack the Regular trade several ways. I will list them by least risk to highest risk.

A) Place a single trade and shoot for the first target at the 123.6 extension.

B) Place a single trade and move the stops at each target level until completed or stopped out.

C) Place multiple trades targeting each individual fib extension, closing the individual trades at each target, moving the stops as we go.

Each option has it's advantages and disadvantages, but for simplicity's sake we will use option "B" in the middle. Feel free to PM me with your e-mail if you want me to send you the trade tracker and experiment with all three ways to see which work out best for your type of trading.

It's not required, but you can place buy stops and sell stops at both the high and the low and when one set of trades are triggered, you just cancel out the opposite orders that were not triggered.

In this trade example below on the Usd/Cad, you can see we breached the high of the previous day @ 1.03481 and our buy stop was triggered. The trade size is up to you, but I would only recommend no more than .01 lots for every $1000 as we may possibly use a semi-martingale type of MM as a optional feature. The stoploss for the Regular trade is the 50 retracement level from the previous day (If you have the Counter Trend Fibs indicator on the chart, you would use the CT Trade 3 level). The stop may seem a bit large, but our Counter Trend part of the strategy tackles this concern and I will go over that later.

On this particular trade we hit our first target at the 123.6 extension @1.03756. If you used option A, you would've closed out the trade for +27.5 pips (not including spreads or slippage) and waited for the next opportunity. Once target 1 is hit, we also move the stop up to 1.03531 to lock in +5 pips (I use BE +5, but you can use the 107 fib extension as well) and then wait to see if target 2 gets hit. Once target 2 is reached, we now can move the stop up to the 123.6 extension @1.03756 to lock in that +27.5 pips and we can now let the trade ride until target 3 is hit or we stop out at the 123.6 extension. Luckily, our target 3 was hit in this case @ 1.04206 for a total of +72.5 pips. This is obviously a picture perfect trade and is not going to be the norm, but the key is to lock in the profits so you don't turn a winning trade into a losing one.

There are also times where we can re-enter another trade and capitalize on the support and resistance the the high and low can provide. The requirement to re-enter a trade is simple. Once a Regular trade is fully closed, we must wait for a candle to close within the boundaries of the high and low. We can only re-enter during the current day because once a new day starts, the indicator has re-drawn using the current day's data. So in this example we must wait until the candle closes below the high of 1.03481 before we can place new pending orders and catch another trade. Sometimes this will work in our favor, sometimes it won't.

We also will run into situations where we have gaps from weekend trading from on Monday. The same principle applies, if price opens outside the high or low, a candle must close within the high/low area to initiate a new trade. Most of the time, gaps will fill back to Friday's close, but not always. It is better to be strict and follow the rules exactly than to get in a bad trade situation.

Okay, let's talk about the Scalp trade. The Scalp trade is very simple and is the easiest of the 3 types to handle. The Scalp trade is a mini version of a Regular trade except we only place a single trade here with a fixed target which is much shorter and easier to reach. This is the type of trade that is closest in nature to the original SRDC I concept and can actually be used as an optional part of this strategy. It is designed to provide a small boost to the overall profitability of the strategy because of the higher hit rate and can be used in conjunction with either Regular or Counter Trend trades. I use it with slightly higher lot sizes and I will occasionally use my semi martingale strategy with them as we very rarely see multiple losses in a row, so I am not too concerned with reaching extreme levels. Also, refrain from using pairs with high spreads like Gbp/Jpy as the Scalp Trades works best obviously with lower spread pairs.

In pic 1 below we can see our breach of the high like in the Regular trade from above @ 1.03481. I use a fib extension target of 107 because it is half the distance from the stoploss to the entry point. When we hit the target, we would close out the trade @ 1.03563 for +8.2 pips. It may not seem like much, but when you use larger lots or enter multiple times (like in pic 2), the profits will add up over time.

For re-entries, we follow the same rules as the regular trades by waiting for a candle to close below the high and then we can take another trade. Pic 2 shows that there were 4 possible Scalp trades with 3 winners and 1 loser. Using a martingale and doubling up on the losing trade would've cancelled out the loss. Optionally, you can take a single trade and be done for the day or you can take as many trades before the end of the day as you can handle, it's up to the trader.

Now that we got the first two out of the way, it's time to go over the Counter Trend trades. To me, this is the most important part of the strategy because if a Regular trade reverses and has been stopped out, we are guaranteed that our Counter Trend trade sequence made money, helping to offset the losses of the Regular trade.

The Counter Trend indicator has 5 levels as it's default- 23.6 (CT Trade 1), 38.2 (CT Trade 2), 50 (CT Trade 3), 61.8 (CT Trade 2), and 76.4 (CT Trade 1). We are going to use these levels to our advantage with a staggered lot size setup to make our money. Because the Counter trend fibs do not stay on the chart like the OHLC indicator does, I've modified the MT4 fib tool to mimic what it would look like for this example, so I apologize if it confuses anyone (Pic 1 is what they normally look like). With the Counter trend strategy, we are going to enter three trades in the opposite direction of the Regular trade, one at CT Trade 1, CT Trade 2, and finally CT Trade 3. Each trade will target the next level above (if long) or below (if short). You can place pending orders like the Regular trades, just make sure to specifically put the correct take profit and stop levels before you place them. The initial trade, CT trade1, will have it's initial stop at the low of the day (if long) or the high of the day (if short). The other trades will use the previous trade's entry as a stop. So CT Trade 2's stop is the entry point of CT Trade 1 and so on. Remember I mentioned a staggered lot size? In order to ensure a profitable sequence, we will use a staggered lot sequence to guarantee the three trades total will make money. I use a 4-2-1 method with the lots, so if a trade opens then reverses immediately, the previous trade(s) will make up the loss.

In this example below in pic 2 on the Gbp/Usd, we had a breach of the low @ 1.56093 and went on to close out a Scalp trade for +11.2 pips. The price never continued to reach our first target and reversed on us. As you can see, price made a really strong move upward and triggered our first Counter trend trade (CT Trade 1) @ 1.56470. Say we use 1 standard lot as a base, using the 4-2-1 method above, we entered here with 4 lots with a target of the CT Trade 2. Price reversed a little bit, but never hit our initial stop @ 1.56903. Price continue up and hit the CT Trade 2 level. Here we close out CT Trade 1 for +23.3 pips and CT Trade 2 is triggered using 2 lots (the next number in the 4-2-1 sequence). As you can see already, if price now reverses, we still make a profit due to the larger lot size used in CT Trade 1. As price moved up again, we now hit the CT Trade 3 level. Here we closed out CT Trade 2 for +18.9 pips and we also trigger the final trade in the sequence, CT Trade 3. As you can see by the Red square that our Regular trade has stopped out at this point (50 fib retracement), but we have already closed out 2 Counter trend trades to help offset the loss. Finally, CT Trade 3 did hit it's target @ 1.57080 for another +18.9 pips.

Again, this is a perfect example of how the trades flow and will not always be the case. Sometimes only two trades or even just a single Counter trend trade will trigger, we just never know. In this scenario below, we could have had several more Regular, Scalp and Counter Trend entries, but I just wanted to show the basics of the Counter Trend trades and later on I will get into showing all the possible trades.

Before we are done here, there is one difference with these Counter Trend trades regarding re-entries that is different from the Regular and Scalp trades. Because these trades are opposite of what a Regular or Scalp trade is, we must follow one major rule:

Counter Trend trades are only placed if there is an active open Regular trade

This basically means that if a Regular trade hits any Target then reverses, it is a dead trade and no Counter Trend trades are needed. The Counter Trend trades are reliant on the active Regular trade reversing and stopping out without hitting any targets.

I wanted to note a few things about how to employ a semi martingale approach to this system. Because there are multiple facets involved in this strategy, you just can't double up on your lot sizes on every single loss you because you would run the risk of blowing an account quicker than you can say "criminal".

As you all know if you've read any of my threads, I go about using semi-martingale progressions as a way to diminish or recoup losses which lowers the risk involved compared to a true martingale. We all know losses will occur, but why not capitalize on a high probability strategy where losses of 5 or 6 or more in a row are very, very rare.

***Warning! Using any martingale technique involves a higher risk and is not recommended unless you have sufficient capital to safely trade with this type of Money Management.***

Regular Trades- The Regular trades are simple, especially if you use a single trade because you have less risk in the market which allows you the option to employ a riskier progression by increasing lots at a steeper rate say, 1, 2, 5, 13, etc.. than you would if you'd open multiple trades at once. To keep the risk down, I just add the same lot size as the original trade to each new trade that occurs after a loss. If I started with 1 lot and have a loss, I go to 2 lots, if another loss, then 3 lots, an so on and so on. Past visually testing has shown that very rare cases never get more than 5-6 losses in a row. If you use the multiple trade technique (Option 3 in post #2), you have to approach it a little differently. If you open 3 trades at 1 lot each for a total of 3 lots and you incur a loss, how do you increase? Do you just make every trade 2 lots straight across the board? No! Lower targets (123.6) are more likely to hit than the higher targets (161.8), so you want to stagger the lots where it will accomplish the most good. I stagger them in a 3-2-1 ratio, emphasizing the first target which has a higher probability to get hit. It doesn't matter if you get stopped with this configuration because whether you have a 2-2-2 or a 3-2-1 ratio, the total loss is still totaling 6 lots.

Scalp Trades- I don't use very high lot sizes with my Scalp trades due to the whipsaw effect that the market shows at lower time frames. If I'm using 1 lot on a Regular trade, I may only use .1 lots or less on a Scalp trade. Using the lower lot size initially allow more room as we can have up to 3-6 Scalp trades in a session, which can add up pretty quick if you are increasing lot sizes. Because Scalp trades use a 1:2 R/R ratio (stop is twice as big as the take profit level) on Scalp trades, doubling up on a loss will basically cancel out any previous loss, which is acceptable as it is not as significant to the strategy as the other sections. Even if we only win 60% of the time, we are still coming out ahead. Because we are using a drastically smaller lot size to start, a normal or progressive martingale can be used here.

Counter Trend Trades- Counter Trend trades are a little different as 80-85% of the time we are always dealing with multiple trades with smaller take profit targets and shorter stops. Now because we do not always initiate all 3 trades, we must treat each trade that's triggered as an individual trade. Hence, I treat Counter Trend trades like Regular trades, adding only the lot size of the original trade. For example, If we have a Counter trend sequence where the first 2 trades hit target but the 3rd trade immediately reverses and gets stopped out, it would go like this:

CT Trade 1- 4 lots- Win
CT Trade 2- 2 lots- Win
CT Trade 3- 1 lots- Loss

On the next Counter Trend sequence we would enter the lots like this:

CT Trade 1- 4 lots
CT Trade 2- 2 lots
CT Trade 3- 2 lots (1 lot + the 1 lot on the Previous loss)

Now say we only triggered 2 Counter trend trades, CT Trade 1 and CT Trade 2, and the third trade never was initiated as price reversed at CT Trade 2. We would have:

CT Trade 1- 4 lots- Win
CT Trade 2- 2 lots- Loss

Now let's say all 3 Counter Trend were triggered on the next sequence, this is our lot sizes we'd use:

CT Trade 1- 4 lots
CT Trade 2- 4 lots (2 lots + the 2 lots on the Previous loss)
CT Trade 3- 1 lots

By doing this way, we do not get too far out of control by having to increase lot sizes on all three trades, only on the trades that show a loss.

I will show more on this as I start tracking trades on the 1st of January as it will be easier to see with actual setups.

I am going to put up a few charts so everyone can see the trade setups. I will show the Eur/Usd, Gbp/Usd, Aud/Usd, & Nzd/Usd charts from Friday and put them in my trade tracker and see how we fared for the day.

I will be placing 3 Regular trades (T1, T2, & T3) of 1 lot each targeting each fib extension, moving the stops to the 107 fib extension on the remaining trades once Target 1 is hit. I will start with .1 lots on all Scalp trades targeting the 107 fib extension using a progressive sequence of 1, 2, 5, 13, 34, 89, etc.. on any losses. Since I have 1 lot each in play on my Regular trades, using the 4-2-1 ratio, I will use 4, 2, and 1 lots respectively on the Counter Trend trades (CT1, CT2, & CT3). Pip totals do not include the spread.

Here are the charts for the Eur/Usd, Gbp/Usd, Aud/Usd, & Nzd/Usd

Eur/Usd

Scalp Trades

[email protected] +7 pips

Regular trades

[email protected] +22 pips
[email protected] +7 pips
[email protected] +7 pips

No Counter Trend trades taken

Gbp/Usd

Scalp Trades

[email protected] +7 pips @.1 lots
[email protected] -14 pips @.1 lots
[email protected] +7 pips @.2 lots

Regular trades

[email protected] +22 pips
[email protected] +7 pips
[email protected] +7 pips

Counter Trend Trades

[email protected] -23 pips @ 4 lots (next CT1 will be 8 lots)
[email protected] +14 pips @ 8 lots
[email protected] -14 pips @ 2 lots (next CT2 will be 4 lots)

3 Regular trades currently open as of Friday's close

Aud/Usd

Scalp Trades

[email protected] +9 pips @.1 lots
[email protected] -18 pips @.1 lots
[email protected] +9 pips @ .2 lots
[email protected] -18 pips @.1 lots (next Scalp will be at .2 lots)

Regular trades

[email protected] +30 pips
[email protected] +9 pips
[email protected] +9 pips

Counter Trend Trades

[email protected] +19 pips @ 4 lots
[email protected] -19 pips @ 2 lots (next CT2 will be 4 lots)

Nzd/Usd

Scalp Trades

[email protected] +7 pips

Regular trades

[email protected] +22 pips
[email protected] +36 pips
[email protected] +58 pips

No Counter Trend trades taken

Total for the day on 4 pairs

$2703.60
25 wins, 6 losses
Win%-80.65%
Total Pips- 246
Total Lots Traded- 36.6

I saved the Open Office Trade Tracker in .xls format since I can't upload .ods files, so hopefully Excel will open it okay. Any blank spaces are trades that are still open and have not hit target or stopped out.

I've had several pm's asking if this is the same method used by Dean Malone and I want to be clear that this has nothing to do with his system. This is a totally new system that is brand new from scratch. Any questions? Please feel free to ask.

iam not a coder, but this looks good.

Interesting @ subscribing.

Very good explanation of the strategy.

Don't worry, no coding experience required .

Welcome, any questions let me know.

You're welcome, I try to be as thorough at the start as possible.

Just a quick update on the open Gbp/Usd trades from Friday. The active open Regular trades made a reversal and were stopped out at 1.54918. The good news is that since we were still in an active trade from Friday, we were still able to open a Counter Trend sequence in which all 3 CT trades hit their targets (see pic).

Normally, I would use the 4-2-1 ratio for the Counter Trend trades with only one Regular trade being placed and then use higher lots when I have multiple trades open, like maybe 8-4-2 or 6-3-1.5 instead. I'm not going to change that until the first of the year as I want to keep the setup as simple as possible so not to confuse anyone.

With the 3 Regular losses from Friday plus the Counter Trend trades, we only lost $538 instead of $1431. That is how the Counter Trend trades help alleviate the losses and depending how proportionate the Counter Trend trades are in relation to how many Regular trades you use, losses can be fully recouped in most cases. For example, if I would have used 8-4-2 instead of 4-2-1, we would've recouped all of the loss +$355 ($1786 -$1431).

I'll see you all later and see how tonight goes.

hi do you take the counter trend trades within the same account are you ever long and short at same time within same account?

Anytime you have a Counter Trend trade, there is always an open Regular trade in the opposite direction, so yes, there are times where we are going to be long and short at same time. That is part of the issue we are going to try and address within the EA. I know with FIFO and hedging issues with some brokers, you might have to search for one that allows both or you can use multiple accounts and transfer balances between them to protect the margin on the account. I know there are numerous EA's out there that accomplish this but time will tell us whether or not it's possible.

I'm in

Hi Mer071898

A very unique system and very well documented and explained. Great start.
I like the RG and SC trade combination. A good entry method using multi-lot trading strategy.
The CT trade method use with the RG trade is a good idea.
I think this trading system which uses a combination of position sizing and smart money management methods has potential to be further develop and will be an edge to winning.
Thank you for sharing.
Regards

I appreciate the comments and thanks for following along.

Here are the charts for the Eur/Usd, Gbp/Usd, & Aud/Usd for Monday. There were no trades triggered on the Nzd/Usd. A lot of whipsawing action today, but as you all know that there will be days like this. Tomorrow we will see how the open trades have fared along with the new trades.

Eur/Usd

Scalp Trades

[email protected] +6 pips

Regular trades

[email protected] -44 pips (next T1 will be 3 lots)
[email protected] -44 pips (next T2 will be 2 lots)
[email protected] -44 pips (next T3 will be 1 lots)

[email protected] -44 pips @ 3 lots (next T1 will be 6 lots)
[email protected] -44 pips @ 2 lots (next T2 will be 4 lots)
[email protected] -44 pips @ 1 lot (next T3 will be 2 lots)

Counter Trend Trades

[email protected] +13 pips @ 4 lots
[email protected] -13 pips @ 2 lots (next CT2 will be 4 lots)
[email protected] +11 pips @ 4 lots
[email protected] -11 pips @ 1 lots (next CT3 will be 2 lots)
[email protected] +11 pips @ 2 lots
[email protected] +10 pips @ 2 lots

Gbp/Usd

Scalp Trades

[email protected] +5 pips @.1 lots

Regular trades

[email protected] +17 pips
[email protected] +5 pips
[email protected] +5 pips

[email protected] -37 pips (next T1 will be 3 lots)
[email protected] -37 pips (next T2 will be 2 lots)
[email protected] -37 pips (next T3 will be 1 lots)

[email protected] -37 pips @ 3 lots (next T1 will be 6 lots)
[email protected] -37 pips @ 2 lots (next T2 will be 4 lots)
[email protected] -37 pips @ 1 lot (next T3 will be 2 lots)

Counter Trend Trades

[email protected] -17 pips @ 4 lots (next CT1 will be 8 lots)
[email protected] +11 pips @ 8 lots
[email protected] +11 pips @ 4 lots
[email protected] +9 pips @ 4 lots
[email protected] +9 pips @ 2 lots
[email protected] -9 pips @ 1 lots (next CT3 will be 2 lots)
[email protected] +9 pips @ 2 lots

Aud/Usd

Scalp Trades

[email protected] +7 pips @ .2 lots
[email protected] +7 pips @.1 lots

Regular trades

[email protected] +25 pips
[email protected] +7 pips
[email protected] +7 pips

Counter Trend Trades

[email protected] +16 pips @ 4 lots
[email protected] -26 pips @ 4 lots (next CT1 will be 8 lots)
[email protected] -16 pips @ 4 lots (next CT2 will be 6 lots)
[email protected] -16 pips @ 6 lots (next CT2 will be 8 lots)

I've posted 2 spreadsheets, one showing the Daily activity and one with a cumulative total. I will be checking up on the open trades and will post when they close out.

***Updated Aud/Usd trades*** 5:38 pm CST
***Updated Eur/Usd trades*** 3:05 pm CST

How about the EUR-USD today?

Straight to target if I am understanding the Regular Trade correctly, and still not made the ADR for this pair yet.

GBP-USD shoots straight up also, now this has hit the ADR and knowing where that is, you may have stay in for extra pips; not taken any trades as yet, was away from computer and just observing this new method during this time of year.

Thank you Mer for this wonderfull system. Will try tomorrow with just EUR/USD untill I feel more familiar with it.

Just one question: since we need a candle closed above/below for a reentry, you trade that on M15?

It would be great to have an EA because multiple entries on multiple pairs could be really hard. Do you want I ask Steve if he would be interested in coding such monster?
Regards