MTF Stochastics Trading

Slick looking system, Bobby2 - it makes sense. I use Jforex so I can't use the MTF indicator and I can't seem to be able to replicate the higher time frame with the J-forex stoch indicators. Any insights on how to get the daily stoch on the 4 hour chart?

In this post https://www.forexfactory.com/showthr...1#post11159791 olvus suggested a setting of 44,12,12 applied to a standard stochastic might be used to ALMOST replicate the MTF Stochastc 2.1. It is pretty close. It's smoother, but it is also different and tends to signal entries later than we might find with MTF Stochastic 2.1. To be honest, I have never used that setting to trade. You might want to have a look at it.

I mentioned that the signal on the Standard Stochastic 44,12,12 is smoother than MTF 2.1 One of the things I like about MTF Stochastic 2.1 is that I can usually see the breaks in the lines as the indicator prints a permanent record of the time period it represents. Those breaks have saved me a few pips. In the Trading Made Simple thread started by eelfranz, who unfortunately is no longer with us, his trading method used the Trader's Dynamic Index (TDI) to navigate trend direction. One of his constant reminders to his followers was to learn to interpret the various breaks that occur in the TDI's Price line. You still needed to wait until until a HA candle closed, but a break in that line on an H4 chart was cause enough to merit at least considering an entry or exit. The TDI is a little too sensitive for me, and IMO is better suited for higher time frames.

I mention this because some traders hint that a smoother signal is better. For our purposes here I disagree. I hate a jerky fast signal on any time frame, especially the lower TFs. But MTF Stochastic v2.1, because we need to wait the required time for it to finish its cycle to see the real signal, and because it usually shows me exactly where price began to strengthen or weaken, IMO I am better able to make a more informed decision without flipping round from TF to TF. The smoother signal leaves me with some questions when I look at it, questions I don't have with MTF Stochastic v2.1

But, if I didn't have access to this indicator there are a couple of things I might try if I really wanted the signal.
1) I would demo a Standard Stochastic setting like 44,12,12 and see how it works out. I might need to alter my rules a little, but it might work out.
2) Set up an MT4 demo with a some broker. Get one that will not terminate the demo as long as you log in at least once a month. Set up our template on the MT4 chart and make your trades on your brokers platform. If you trade the same pairs regularly, it's not a big inconvenience. If you scan for currency strength among a large group of pairs, put a pair selector like this one below your MTF Stochastic on your MT4 chart so you won't have like 28 pairs on your monitor. If you have a one monitor set-up, just split the screen between the 2 platforms.

Here are some possible differences between the 2 indicators with our rules. You could possibly make it work. Better give it a test run first though. Hope this helps Good luck.
Here is what the symbol changer looks like on the chart.

Thanks for that detailed reply, Bobby2. I had the very same thoughts about the clear breaks when the higher time frame finishes - very useful indeed. I could always take the signals from MT4 and just place the trade in JForex. Trading the four hour charts doesn't take a lot of time to do such a thing.

im having a problem with mtf stochastic indi... im using h4 tf, and input 60 at the indi tf, it shows H4 on the indi.. but if i input 30, it shows H1 tf on the indi..
is this normal?

and about MA methode, 0 mean simple right?

The third option would be to put the 11/3/3 stochastic on the next higher time frame and use the data from two charts side by side.
Would this work? Maybe not as convinient as having the CTF and the HTF on one chart but at a push workable?

In "Inputs" the top Variable is "Next Higher Auto". Change the "Value" to "False". When that value is False, the The Time Period you manually designate will not change when you switch time frames on your charts.

There is an option to "use next higher TF" make sure it is set to false. The default is true

I agree that it can be done. Aside from the logistical inconvenience, the visuals are different, but it can be done.

My first execution, right after reading entire thread. Maybe I should read the thread several times!

In retrospect, maybe I should of opened 1 bar back and closed 3 bar back...?!

I would appreciate any feedback especially on the open and closing?!

Thank you bobby2, for sharing and for being so active on your thread!

IMO you never had a chance on that UJ short trade. Like you said, it was probably possible to enter 1 bar earlier and exit 1 bar earlier, but it wouldn't have mattered much You might have been able to shave maybe a pip or half a pip off of that -2.4 pip loss. In hindsight you did the right thing because so far at least, price has continued up. If you took the next long signal you got your pips back plus some.

thanks... it works

You say this because I missed something before entering the trade, or was it just a losing trade?
I guess what I'm trying to ask is, overall, was it a good trade execution according to the rules?

All I really want is to learn the "method" well, give it a chance, feel comfortable with it, see if it's right for me....pips will come naturally.

I have bounced around to a few methods, some are way too complicated, some the creator is no longer present and the thread runs amok, some the creator develops a God complex, some are nothing but smoke and mirrors and others just die gracefully.

Anyway, this thread appears to not fit any of the above, actually it feels like a breath of fresh air!

Hey there, how's it going?

I'm back from vacation, just catched up with the thread and I gotta say thanks again Bobby for your dedication, even in August! Those "training wheels" you suggested made me create a new "test" template I will further study live once I'm sharp again and see if my current trading style can benefit from it.

During my vacation (yes I know.. I can't help it) I came up with the idea of not using so fixed TP/SL, and use them only as "maximum" levels for an operation to reach and then use the MTF action to close the operations manually when those levels aren't reached (most of the times), so it's a mixture between your way to adapt to market with the stochs while I keep my psychological need to have "limits" in an operation (to calculate risk and help myself controlling emotions), ideally the best of both worlds for me, we'll see!

Gonna use this week to clearly define how I'll use my latest idea and re-sharp my skills in demo. Next week I'll start posting and trading normally.

"You say this because I missed something before entering the trade, or was it just a losing trade? I guess what I'm trying to ask is, overall, was it a good trade execution according to the rules?" You didn't miss anything. It was just a losing trade. IMO It was a good trade because you followed the rules. And because you followed the rules you only lost a couple of pips. As I write this, if you had held on believing it would come back your way, you'd be 20 pips in the hole right now.

When you hear experienced traders say "Losing is unavoidable. It's part of the business. You have to learn to accept it." They're not just saying it to explain away their failures. The trick is to win more than you lose. That's it. That's all of it!! And I don't necessarily mean you need more winning trades than losing trades. 5 losing trades of 4 pips each is a 20 pip loss. 2 trades of 20 pips each is a 40 pip gain. When the dust settles you are 20 pips ahead. Even long-term traders who hold a position for more than a day need to take a loss within the trade they have running. Price doesn't travel in a straight line and during the course of their trades they will lose some of the profit that they already made. It's called "draw down". If they have a profit target of 100 pips on H4 or D1, they have to sit and watch 60 pips shrink to 30 or 40 pips, or more, while they play out their strategy, follow their rules, and patiently wait for price to hit their target. It's not easy to do and it takes a ton of confidence in a plan to do it.

One of the points that I have been trying to make on this thread, and if you only learn one thing here, this is the most important of all:
You will lose some and you will win some, but if you follow the rules your winners will out-produce your losers. You may not realize it right now, but being able to see that a trade is a loser, and managing the loss to a non-threatening level where it's no big deal, in other words it doesn't threaten the account, and terminating the trade with that loss, knowing that there are going to be much more profitable trades coming up after the loss. And when they tally the pips at the end of the week or month you will be a winner. "Trading isn't a sprint. It's a marathon."

Welcome back and good luck.

i think this strategy also work on higher tf, currently im using it on H4 tf.. it because im personally not into scalping, im kinda into swing trading..
i use H1 and H4 for MTF stoch.. all that we need is to find the correct setting for the indicator that will give a good signal..

in my experience.. sometimes, every tf can have the same settings, but sometimes it cant because it cant give a good signal..
my setting for H1 and H4 can be the same.. but it cannot be used on D1

below trade i enter, when stoch H1 and H4 was crossing, and the trend still bearish.. so i go short... and i close my position when H1 / H4 stoch hit oversold.
btw, the MACD just for confirmation for trend strenght..

Nice trade , nice explanation bobby2 thanks ,
my didn't go so well I could have enter earlier , both stochs were going opposite directions was waiting till CTF will follow , after entering didn't make new high , CTF went in 50 zone , and then didn't break trough resistance CTF again in 50 zone , MTF lines started to twist I thought was price rejection .
a)did I choose poorly resistance ?
b)did I need to give second chance?
c)did I follow the rules?
d)what I did wrong?
At the end no lose no win .

+29 pips today. 5 trades all on EURUSD. 1 loss for -2 pips. In retrospect the losing trade was not a good trade. At the time I was trying to enter late on a downtrend and got caught at the bottom. Without exit rules it would have been much more expensive than 2 pips. I also had one bad winning trade. That's right. The entry was borderline OK, but the management of that trade was a mess. I got lucky That 's nice, but it is a dangerous habit that can have vey ugly results. I don't even remember why I stayed in that trade. Anyway, I'm finished for today. I hope you all had a profitable trading day.

My first two trades using this system. +2 pips at the end of the day - better than a kick in the pants I guess!