Monthly Profit - Daily Trading using SMA

How do you determine your take profit levels

Guys I need a review on calculating stop loss and take profit levels.
Thanks

Hi Vcezeilo,
No big mystery: high/low of candlestick crossing SMA5 +/- 15 pips.
You can use this level for regular stop-loss or for hedging stop orders.
In the example below S/L for short setup on EURGBP entry on March 9 is at 0.8972 (high of March 8 CS 0.8957 + 0.0015).
Happy trading.

P.S. As recommended by BK8 you should trail your S/L after the close of each daily CS that closed in the direction of the setup.
Regarding exit it's quite open but I adhere to BK8's view to take profit on half of the global position at the first profitable closing or 1:1 and let the other half running until you have an inverse signal.

I have not come yet to the stop and take the profit part after the system yet. So when I think we are coming to the tide, and think the price will go in the opposite direction in a day or two, I will snap it, and wait. I know I am not getting the full profit out of the setuo. 1. I for the most part go in after the second confirming candle and 2. And have for some trades gone out to early. Bk8 did and Fillipo1 does take it all the way.. I am trying to learn when he writes about that. Please return if this is not clear.
Take care.
Oddbjørg.

Hi everyone, two signals, let’s see if Oil will break the resistance line which looks likely after bears failed to take control yesterday.

EURUSD is sending a signal (timber! or not timber?...)

Filipo, first, you are certainly among the most successful followers of BK8's strategy, and you have continued to generously share of your knowledge and experience with this system.

Having said that, I am wondering if YOU really get much out of the RSI? OK, if it is at or above 70 for some time it is more likely to revert to mean and fall, BUT that doesn't help with entries (for me). I personally would prefer to see the red dotted trigger line on the MACD bend toward the direction of a possible entry, but it may be a bit late of the sma 5 signal.

Trading is an art and not science and the BBs and TLs do give more information. More than most of us, you have successfully processed these several inputs to regularly make profitable trades.

Just curious what you are getting from the RSI?

Best regards, FS

I think more than a few of us are victims of too tight SLs and the +/- 15 pip 'rule.' Doesn't take much to get stopped out on the D1.

HOWEVER, I am really thinking about your use of the hedging stop order. They are placed logically as opposed to the random use of the 15 pip beyond the candle extreme which is appealing to me. If the hedge takes you out, so be it. It was time to close.

I will try to work this in my trading.

Best regards, FS

Hi Forest-Sea, thanks for your kind appreciation. Like you I prefer MACD cross to confirm setups however as it is a lagging indicator (all are some would say...) I also like to check what RSI tells me and more specifically if it stands above or below the 50 middle band.

I hope this doesn't sound like a dumb question as I'm new to this system and trying to master it, but I'm curious regarding time of entry after the Daily candle closing with a Long or Short signal (crossing 5 MA following trend). I've seen BK8 state that he enters immediately after a Daily signal, but I have a hard time with that.

One thing I've done that has helped me is to set up Daily alerts with TradingView. I do this by using the Add Alert function with settings as follows. Here's a Short Signal Alert: [Currency Pair - Crossing Down - MA(5, Close) - Once Per Bar Close]. This sends me an alert about 1-minute after the Daily close for every pair that meets the requirements of a 5 MA cross on a Daily candle. Of course I then have to examine the trend and possibly where it is on the BB.

The real question I have (for those having success) is when are you then entering the trade after the Daily close? I obviously don't want to enter in the hour immediately following (5-6pm EST) because the spreads are often a great deal higher. A 1-pip spread is sometimes 12 or more then. That said, I wonder if anyone could provide some clarification to the "Enter immediately after close" instruction? Are you waiting until a half hour after the Tokyo open to enter? Some other time perhaps? Maybe waiting for a pullback and 5MA confirmation on the 1-Hour timeframe? What's the strategy for entry?

Any feedback is greatly appreciated. Thanks!

Hi ekjinvests, good remark nothing dumb here. Living in Switzerland I usually sleep (except tonight ) at the time of US close so I usually check the market in the early European morning and most of the times there is little change from previous close. Asian session is known for being the most quiet unless there are some specific releases/speeches involving Pacific Rim currencies.
Besides if the previous day's candlestick was clearly bigger than usual you will often see a nice retracement that could offer a much better entry point than right after the close. Also it is important to beware of candlesticks with wicks that are as big as a third or more of the daily range. In such case it is advisable to monitor and refine entry on lower timeframe like H4 or even H1. The important point in this strategy is to identify setups on the daily price action.

A question for all but especially the 'old pros' on this forum.

If you wait for the SMA 5 to slope toward your entry (turning up for a long, etc) do you feel the angle of the slope is important? If yes, then a small, gentle angle up/down may not be enough for you to enter and you may wait for the next candle to suggest direction.

Oddbjorg in particular waits for a second confirming candle, I believe. Her win % is probably pretty far up there, too.

I am trying to make sense of optimal entry time.

The conservative among you will likely wait a day at least for confirmation while the bold jump in for what could be extra pips.

Your thoughts are appreciated.

reference to post 9930

The Chikou span is really in the clear here with price comfortably under the kumo. Ichimoku followers have received the message.

Hi everyone, EURCAD sent a signal.

Here is a weekly perspective. It will be interesting to see which will take the lead: inverse H&S or double resistance?

Hello
Thank you for the good call.
Oddbj.

You are welcome Oddbjorg, many thanks for yours as well.

Good morning, thanks to everyone and especially to the inventor of the method. I do not know if this indicator Macolor 5/0 and the other sma 2/2 could be useful. Tell me if they can help. Thank you https://i.imgur.com/6eoouAr.png

Just have to throw out a mega kudos to everyone that has contributed and keeps this thread going. Thanks especially to Filipo1 for being so responsive! And Oddbjorg as well. I just started trying to learn this system a couple of weeks ago and am optimistic. You can say I have a bullish outlook about it.

Filipo1, thanks for the feedback regarding entry time after the Daily close. I played around with something yesterday and it appeared to work quite well. I'll have to do some more backtesting, but it would have garnered some very positive results. Testing for now, but I kinda wish I went live. I'd be up about 200 pips at the moment, aargh!

I'm using TradingView because I can set up like 100 alerts. So I set up my Daily alerts to notify me when a Daily signal is made as such:
Daily Long Signal: Currency Pair - Crossing Up - MA(5, Close) - Once Per Bar Close
Daily Short Signal: Currency Pair - Crossing Down - MA(5,Close) -Once Per Bar Close (see attached photo)

This then sends me an alert right after the Daily close (5pm EST) for any pair that meets the parameters. You still have to evaluate trend and whether the candle has a big wick. Could be a bearish green candle or a bullish red candle, which should be cause for some hesitation. And then there's also BB if you're using it, etc.

What I was really struggling with after that (and per my last post) was when to make the entry. I'm planning to essentially ignore the first 2-hours after close (5-7pm EST), because it seems the market is typically all over the place (and margins are higher). But then I set up another alert....this time based on the Hourly timeframe for the pairs that gave me the Daily signal alert. So if AUDCAD gave me a DAILY Short Signal Alert at 5pm EST, I then set up an HOURLY Short Signal Alert after 7pm EST. And if/when this triggers, I'll consider entering the trade.

I've attached some photos of how I set up the alerts. Don't ask me about success rates and if this is the best way to do this, because I honestly don't know yet. I'm just trying to set up a plan that A) Works a majority of the time, B) Keeps me out of getting into a trade too soon or when it reverses direction, C) Is easy to replicate, and D) Isn't too time consuming. This should take no more than an hour a day.

You could also obviously alter the second alert from 1 hour to half-hour, 2-hour, 3-hour, or 4-hour. I'm not sure what would work best, but for now I'm going with 1-hour.

I don't work for TradingView or anything, so if you can set up alerts elsewhere, that's entirely up to you (it's just what I've been using and what I know). I figured I'd share my plan and see if anyone had any feedback. And if it works, great. I'll try to follow up and let you know in the future. THANKS AGAIN!!

NOTE: In regard my above post and to clarify. If the 1-Hour closes in the direction of Daily signal and trend after 5 or 6pm (without any reversal), then I'll consider jumping in without the 1-Hour confirmation. Why, because you won't get one if there any pullback after close. Just figured I'd point that out. I'm doing it more because I've noticed that when there is a reversal, it usually starts right after the Daily close. And the 1-Hour Signal is my sign to consider entry when it does that, that's all.

And one last question. Is anyone avoiding EURUSD with this strategy. Maybe it's just me, but in backtesting, it doesn't seem all too friendly. I'm considering just avoiding and wonder if anyone has an opinion on this?