Welcome to The Killing Floor!
Please keep all chat that does not use this strategy or pair in another thread. Our the strategy may change from time to time, but for the most part, it will remain very constant. If it does change, there will be a statistical reason why. Many will say this is too simple and there is no way it works… Frankly, I don’t care because I get paid in pips, not opinions. The evidence of profitably from the entries generated by the system is provided.
Why Is It Called The Killing Floor?
Most people who step foot on the market floor each and every day die there. They spend all day sharpening their tools but never practicing their techniques. As a result, they are food for the wolves. Nine times out of ten, it’s not the strength of your weapon that matters, but your ability to maximize its utility.
The goal each day is to hit the floor as hard as you can killing as many pips as possible. Some days you get killed on the floor, but most days you should walk off the battlefield drenched in the pips of your foes.
Tools of Our System:
Pairs: EURUSD & USDJPY
Time Frame: 5 Minute
Indicators:
- 200 MA
- 50 MA
- 10 MA
Click Here to Download MT4 MA That Displays Slope Color
Risk Management:
- 36 Pip SL
- 4 Pip TP
- Max 1:1 Leverage Per Order.
- Not Having FIFO Helps. If you are in US, you can get around it using Oanda, you just need to make sure the size of each trade is different (1000, 1001, 1002, 1003)
- Ideally, Your Spreads are <= 0.5 Pips.
- - Any spreads over 1.5 pips will be very hard to overcome.
- - All Charts Below Assume 1.5 pip spread. If your spread is lower than this, expect much better results.
- Absolute Max Hold Time: 1000 Candles (Roughly 3.5 days)
- - Ideally, you should not get stuck holding a trade this long.
Additional Resources:
The Anatomy of a Loser
Don't Like The R:R? Change It!
More Data for Better Decision Making
Equity Progression Exercise
Probability of Profit in a Series
Boosting Win Rate Through Management
Good Thread to Learn a More About High Hit Rate Trading Styles
Translations:
Main Posts In Polish
Important Notes
If you try to 100% automate this system, you will get very different results. The trade management is key. You need to know when to stack entries, adjust all order TPs to the furthest orders 4 pip TP, cut losers, and most importantly, you need to know when YOU need to stop trading based on things OUTSIDE the market. Like your mood, energy level, emotional state after huge streaks of wins or a few larger losses.
If you would like to shoot for larger gains, pick up small 4 pip gains while you trade through that larger move to create some buffer for your account to handle drawdowns/reversals.
Even though we have 7 possible entries, this does not mean you need to trade every single one every single time. In fact, don't... You will eat your margins like crazy. The main principle is you have a good idea of what is likely to happen next at any given time.
The Stop Loss used is a hard stop for worst-case scenarios like you lose connection, terminal crashes, etc. You should cut your losses way before your hard stop is hit in MOST cases. That being said, it is okay to let the price run against you a bit as it will.
Consider fundamentals please! Don’t Buy EU after Draghi announces no rate hike while Fed hiked a few days before. You will lose, and you could see this scenario coming from miles away.
The slope is down if the value of the MA on the last candle is higher than the value on the MA at the close of this candle. Vice Versa if the slope is up.
Most fast moves of the market caused by news should take out your TP, however, if you get in a situation where they don’t during one of these spikes, take the time to book as much profit as you can and reduce your risk. If you can’t take everything off, take off as much as you can as the price is almost surely going to re-trace and provide you a great opportunity to re-enter.
When in doubt… Remember the data. Pretty much all 7 entries will have a 90% chance hitting your target within 1 day (288 5 minute candles) of the entry, even ONLY trading with a 10 ma slope, regardless of fundamentals, sentiment, gut feel, everything. So chances are you will hit your target a lot. The key is to maximize those hits by stacking the position to bring up your average entry and get larger wins. Lowest entry was the first obviously, all my subsequent adds target that first target and use the same SL as the first order so the R:R gets better. See image below.
How to Interpret Edge Analysis Images (EEI)
We have 4 charts in our EEIs. 
1C-50: Price Closes Above 50 MA & Slope is Up
1C-10: Price Closes Above 10 MA & Slope is Up
2C-200-50: Price Closes Above 200 & 50 MA & Both Slopes are Up
2C-200-10: Price Closes Above 200 & 10 MA & Both Slopes are Up
2C-50-10: Price Closes Above 50 & 10 MA & Both Slopes are Up
3C-200-50-10: Price Closes Above 200, 50, & 10 MA & All 3 Slopes are Up
Please keep all chat that does not use this strategy or pair in another thread. Our the strategy may change from time to time, but for the most part, it will remain very constant. If it does change, there will be a statistical reason why. Many will say this is too simple and there is no way it works… Frankly, I don’t care because I get paid in pips, not opinions. The evidence of profitably from the entries generated by the system is provided.
Why Is It Called The Killing Floor?
Most people who step foot on the market floor each and every day die there. They spend all day sharpening their tools but never practicing their techniques. As a result, they are food for the wolves. Nine times out of ten, it’s not the strength of your weapon that matters, but your ability to maximize its utility.
The goal each day is to hit the floor as hard as you can killing as many pips as possible. Some days you get killed on the floor, but most days you should walk off the battlefield drenched in the pips of your foes.
Tools of Our System:
Pairs: EURUSD & USDJPY
Time Frame: 5 Minute
Indicators:
- 200 MA
- 50 MA
- 10 MA
Click Here to Download MT4 MA That Displays Slope Color
Risk Management:
- 36 Pip SL
- 4 Pip TP
- Max 1:1 Leverage Per Order.
- Not Having FIFO Helps. If you are in US, you can get around it using Oanda, you just need to make sure the size of each trade is different (1000, 1001, 1002, 1003)
- Ideally, Your Spreads are <= 0.5 Pips.
- - Any spreads over 1.5 pips will be very hard to overcome.
- - All Charts Below Assume 1.5 pip spread. If your spread is lower than this, expect much better results.
- Absolute Max Hold Time: 1000 Candles (Roughly 3.5 days)
- - Ideally, you should not get stuck holding a trade this long.
Additional Resources:
The Anatomy of a Loser
Don't Like The R:R? Change It!
More Data for Better Decision Making
Equity Progression Exercise
Probability of Profit in a Series
Boosting Win Rate Through Management
Good Thread to Learn a More About High Hit Rate Trading Styles
Translations:
Main Posts In Polish
Important Notes
If you try to 100% automate this system, you will get very different results. The trade management is key. You need to know when to stack entries, adjust all order TPs to the furthest orders 4 pip TP, cut losers, and most importantly, you need to know when YOU need to stop trading based on things OUTSIDE the market. Like your mood, energy level, emotional state after huge streaks of wins or a few larger losses.
If you would like to shoot for larger gains, pick up small 4 pip gains while you trade through that larger move to create some buffer for your account to handle drawdowns/reversals.
Even though we have 7 possible entries, this does not mean you need to trade every single one every single time. In fact, don't... You will eat your margins like crazy. The main principle is you have a good idea of what is likely to happen next at any given time.
The Stop Loss used is a hard stop for worst-case scenarios like you lose connection, terminal crashes, etc. You should cut your losses way before your hard stop is hit in MOST cases. That being said, it is okay to let the price run against you a bit as it will.
Consider fundamentals please! Don’t Buy EU after Draghi announces no rate hike while Fed hiked a few days before. You will lose, and you could see this scenario coming from miles away.
The slope is down if the value of the MA on the last candle is higher than the value on the MA at the close of this candle. Vice Versa if the slope is up.
Most fast moves of the market caused by news should take out your TP, however, if you get in a situation where they don’t during one of these spikes, take the time to book as much profit as you can and reduce your risk. If you can’t take everything off, take off as much as you can as the price is almost surely going to re-trace and provide you a great opportunity to re-enter.
When in doubt… Remember the data. Pretty much all 7 entries will have a 90% chance hitting your target within 1 day (288 5 minute candles) of the entry, even ONLY trading with a 10 ma slope, regardless of fundamentals, sentiment, gut feel, everything. So chances are you will hit your target a lot. The key is to maximize those hits by stacking the position to bring up your average entry and get larger wins. Lowest entry was the first obviously, all my subsequent adds target that first target and use the same SL as the first order so the R:R gets better. See image below.
How to Interpret Edge Analysis Images (EEI)
We have 4 charts in our EEIs.
- The first tells us the probability of the trade ending a profit if we were to close out after x bars after our entry signal.
- The second chart shows us our Edge Ratio using the entry signal in question with a max hold time of x based on the MFE/MAE data in chart 3.
- This chart graphs our average MFE/MAE/OUTCOME if we were to take the entry signal with a max hold time of x.
- This chart shows us our Win Rate using our SL and TP based on the entry signal in question with a max hold time of x. The yellow line represents the win rate required to break even. The red line represents the win rate required to break even after paying our spread cost. <- This is the only chart that takes into account the SL and TP. The other 3 are looking at how price reacts after the entry.
Possible Entries (7 Total EEIs - Reverse Conditions for Shorts):
1C-200: Price Close Above 200 MA & Slope is Up
1C-50: Price Closes Above 50 MA & Slope is Up
1C-10: Price Closes Above 10 MA & Slope is Up
2C-200-50: Price Closes Above 200 & 50 MA & Both Slopes are Up
2C-200-10: Price Closes Above 200 & 10 MA & Both Slopes are Up
2C-50-10: Price Closes Above 50 & 10 MA & Both Slopes are Up
3C-200-50-10: Price Closes Above 200, 50, & 10 MA & All 3 Slopes are Up
You have your entries, you know their edges. Now get ready to get on that battlefield and fight!
