Follow the prior Heiken Ashi candle for profits

I think a HA color change with a decent candle size would be filter enough for me.

Hi all,

I have a few updates for everyone. I placed 2 trades based on WEEKLY HEIKEN ASHI CHANGED COLOR. Both trades failed.

EURUSD: +4 pips (I had moved it to Break-Even after I was around +100 pips)
AUDJPY: -175.2 pips

It is interesting to note that the EURUSD was in profit for quite awhile, even up around +150 pips, but then it totally reversed.
Also, with AUDJPY, I had placed a trade earlier this week with a 30 pips TP that had WON.

In sum: Heiken ashi might not be a good indicator of trend reversal OR we might want to be conservative and take like 100 pips on a new color (or maybe even 50 pips).

Why not a trailing stop? One could set a ridiculous take Profit, say 500 pips, and follow price with a conservative TS, 25-30, maybe 50. Moving the hard stop to BE seems essential too. How did you lose 175 pips if you had a 30 hard SL? Not following your own rules perhaps?

Hi friend,

For the AUDJPY, I had a 175 pip SL and a 400 pip TP. It was different because I was trying to predict a new trend change. If trend changes to new direction, we have the potential for a big upswing.

I suggested the 30 TP and 30 SL for trades where you are just following the prior HA candle each week.

For instance, on Sunday evening when the market re-opens, I will place 10-15 trades with a 30 pip TP and SL. I might make some minor variations to try out new things, but the idea is to use conservative numbers with lots of trades (i.e., high volume). Eventually, if the system works with 10-15 trades, I will start to increase to 40-50 pairs each week. And then we can increase lot size very slowly.

Your suggestion for BE and conservative TS is a good one. It could be interesting. Anyone have an EA that can do that for us?

Cave Manager or Cave Man, something like that, can do that although it might be more difficult than others. You can find here in the FF forums but I have never used it.

Perhaps you want to Dashboard. http://www.forexfactory.com/showthread.php?t=532236

Very difficult to hold with 30p specially on weekly but anyhow you 'll soon find a good combination😊

Hi friends,

This week I shall start to test the system more thoroughly. Remember in Week 1 we had 5/5 winners just following the prior heiken ashi on the weekly chart (various SL and TP settings, but on average +34.8 pips)

This time around I will test 15 pairs and always follow the prior heiken ashi bar on the weekly charts.
I have randomly selected the 15 pairs and also randomly assigned them to various SL and TP settings:

SL TP R:R symbol
30 38 1.27 EUR/NZD
30 30 1.00 USD/HUF
30 60 2.00 CAD/CHF
30 30 1.00 USD/NOK
30 38 1.27 GBP/CHF
40 80 2.00 GBP/USD
40 120 3.00 EUR/DKK
50 88 1.76 AUD/NZD
30 30 1.00 EUR/AUD
30 30 1.00 USD/CHF
30 75 2.50 USD/DKK
30 45 1.50 USD/CZK
50 88 1.76 USD/SEK
40 60 1.50 AUD/JPY
30 30 1.00 NZD/JPY


You will notice that I have 5 following the 30/30 setup, but I also have a few other setups with various R:R. I was hoping for a few more mainstreamed pairs, but that's OK.

Random assignment is important because we need to know how good the system will work on average for any given pair on any given week.

Is big business related to trading?!

Let me share a thought with you. Imagine a big business like Costco, amazon, or Walmart. How do they make money?

Do they:
1) sell a few key items at a really steep price?
2) sell lots of things at a small profit!

I think you know the answer! They operate on the principle of volume. They sell millions of items each day at a small profit. The result is a huge increase in profits.

We are trying to apply the same principle here. Lots of small wins each week over and over again.

Don't get greedy. Don't try to shoot the moon each trade. Just keep going forward bit by bit and never stop.

Let's see if the analogy holds up!

So do you follow the prior Heiken Ashi candle each day. Or open your trades on monday and ONLY then. And not any more the days after?

Good luck, i will watch you!

My Oanda Java platform opened at 4 pm cdt/us for the Asian Monday: I will wait 2-3 hours but plan on entering the eur/usd; usd/jpy; aud/usd (questionable); usd/cad; usd/chf; eur/gbp; & chf;jpy. I am letting the market settle in so to say, & by mid-evening I may delete or add but will enter with one micro live account.

Hi all,

I placed my weekly trades. A few notes:

1) Exotic pairs might not be so good for this system. Firstly, it's hard to set TP or SL or 30 pips on many of them. I don't know why, but my broker simply won't let me I think it's because of the spread being higher. Anyways, I had two trades (USD/NOK and USD/DKK) close almost immediately after opening them. It was strange. I dunno what happened but I think my SL was like, extremely tight or something and they just lost instantly. Not sure. Anyways, maybe we should stick to the mainstream pairs or at least pairs which allow 30/30 TP and SL.

2) I think what I really should be saying is: "Follow the current Heiken Ashi weekly candle". For instance, many trades the last 3 or 4 candles are the same, so you just follow that direction. But I found that a few had a "color change" and I go with the new color. Take a look at the picture and notice that I placed a BUY order on this chart. You will see what I mean.

Why do I do this? Because the HA candles are calculated on prior candles CLOSING. So this week's candle is based on the price close of LAST week. So, we go in the current direction of the HA. I think this logic makes sense, but please understand this is what I did this time around. It applied to a few pairs but not many as most just followed the prior candle anyways.

I am placing 1 set of trades each week for whatever pairs I want to test. Today I placed 15 trades total (actually it was 14 I think because I couldn't place the one for USD/CZK for some reason; and 2 of those trades lost instantly for no reason so really it's more like 12 trades total).

We open a new set of trades each week based on HA candle.

Update 19:25 cdt - I entered one micro on the eur/usd, usd/jpy, usd/chf, eur/gbp, & chf/jpy. The aud/usd & the usd/cad was not entered. The chf/jpy is as exotic as I want to trade. Oanda has 60 plus pairs but I stick to about 18.

Hi Phantom.

Here's a couple of ideas. You want quick and accurate wins right? And lots of them? Volume?

So how about you forget trying to predict trend turns as they are always hard to find and rarely eventuate.
Instead I suggest you look at the most recent full weekly HA and note its colour if in the direction of the current trend (using whatever method of choice for that). (Especially good the previous one to this candle was opposing colour)
Then go to Daily and as an extra confirmation, when a Daily candle closes with same colour, then enter. (Especially if it the previous candle was the opposing colour).
Use the low of the most recent full Weekly candle or the Daily candle as your SL and adjust your trade size so the risk is only 1% of account.
Set TP to 2x that risk so if it comes off you win 2%.

What you are effectively doing to jumping on the impulses in the trend once they are confirmed by HA and multiple timeframes.

This way you only need to be over 33% accurate to make a profit and above 50% accurate will make a nice set of % each week.

An example

GBPUSD Weekly is in downtrend. Candle for week beginning 28/2 closes short in direction of main trend.

https://lh5.googleusercontent.com/-W...150330%2BW.jpg

Drill down the Daily chart and wait for 1st candle after that week closed to be in same direction.

https://lh3.googleusercontent.com/-i...150330%2BD.jpg

In this case I used a 2 candle high as my original SL and each day I moved it down daily as it reached new lows. A few days later my TP which was set to 2 x risk was hit.

https://lh5.googleusercontent.com/-R...50330%2BDb.jpg

Cool idea. Seems like a nice daily = week alignment. I may experiment with it in the future.

Well, my 1st experiment with this strategy crashed - 4 losses out of 5, only the eur/gbp was still open this morning and slightly in profit. I closed early just to have some small winner. I like marshallmax's thinking. Using the guppy takes some education so I would like to know the settings. I'm glad I only risked one micro on each trade.

edit: I see m.m.'s settings in his charts.

marshallmax - question: the 3d picture doesn't seem to reflect the 1st two. Is it a different TF than W. or D., maybe 4H? I like idea of confirmation.

edit: I looked at it on a different screen, seems to be the monthly