Akuma99 Not So Squeezy Journal

Hello,

Akuma, where are you? I hope you are doing well. I (we) really appreciate and learn a lot from your postings. Thank you. One dumb question... when you say that you use mostly price action as your trigger, are you referring to the basic squeeze version?

Hi all, sorry 4rex, I am still around, but am beeing kept rather busy offline at the moment with the little one so I am finding it hard to keep this journal updated .

Anyhow, recent times have been tough with some choppy markets with substantial ranges, the swings on the EUR for example have been quite decent, but are essentiall ranging between extremes. These are conditions that I have not addressed in the manual, nor here in the journal, so here is a quick rundown on how this system performs under these kind of conditions, first the hourly chart of the EUR:

http://img213.imageshack.us/img213/5961/eurusdwm7.gif

Now to me the aim of a system is to make the most of favourable conditions, like nice trending markets that we saw last month, and to limit the damage when things go wrong or unexpectedly. The past few weeks have seen neither small ranging markets, nor trending markets, which could be a problem, as the rainbow neither stays spread for long to indicate a trending market, nor does it compress for long to indicate a ranging market as the swings are so large.

It is during these times that it is important to keep your discipline with whichever system you trade. I have marked the 5 most recent substantial signals that have been generated, so let's run through them one at a time:

A - Here we have a well spread rainbow that is "folding over", it is neither indicating we are still in a strong uptrend, nor is it compressed enough to say we are in ranging conditions. So what do we do with the signal given by the blue zone?, according to the basic rules ... nothing, as price is not at the bottom of the bollinger bands to trade to the long side (and with a folding over rainbow, that should make you a little more conservative with your lot size).

B - Here we have an extended blue zone period, and the rainbow has completely folded now to indicate the possibility of a start of a down-trend, in this case we should only be trading the short side, i.e. taking entries at the top of the bollinger band. If you did this at the beginning of the blue zone, there was opportunities for small profits as we bounced between the upper and lowe BB, later in the blue zone, the 200SMA/Bollinger confluence area proved to be the perfect entry area for the short trade.

C - We are still trading on the short side as a new signal appears, this one though, if sticking to the rules is an opportunity missed, as price never gets to the upper BB, don't worry about it though, there are always plenty of other opportunities.

D - A very good example of a system not being fool proof and the need to always have stops in place, the rainbow was still spread slightyl downwards, although not expanding, but still a reason to stay on the short side. If you took the short trade at the 100SMA/Bollinger confluence then congratulations that is a perfect execution of this system, sure it didn't turn out, but that's the way it goes sometimes, be proud of your discipline, it will work more times than not.

E - Here is a strange area, almost in limbo, the rainbow is neither spread up nor down, yet it is not compressed either, so what do we do? In my case .. I did nothing, the best position I could have taken, you can see the price action has been ugly since then, sliding down but with no real authority and quite slowly, best to leave it alone and look elsewhere until it can make up it's mind.

So there you go .. a rundown of the latest EUR price action, while there have been no spectacular results, the damage has been small as well.

Hello,

For the life of me I can't find the Basic Squeeze used by Akuma anywhere on this thread...Yes, I downloaded the zip file, yes I have looked in the manual. Right now I am using version 9. What am I doing wrong? Please help

Here you go ...

Akuma,


Thank you once again for taking the time to help me. I am trying to keep my charts as simple as possible and the BB and the Squeeze are a good start and I want to incorporate price as my trigger.

Hello,

What is going on with this great thread? Very few postings except Akuma's response to my questions. I am clueless as to why this is so. Please somebody shed some light.

I have found this thread to be very valuable. I have been trading for about a year in the forex, and have not really found a system that a) worked well b) I liked and c) I had the discipline to follow. This system however seems to fit me well.


I traded last week with this system using a mini account and had a little luck. But this week has been very tough. Below is just one example.

http://img215.imageshack.us/img215/5...achmentog1.gif


I bought at 117.94. The rainbow was well-formed and the 100 SMA and 50 SMA provided support. I put my SL 5 pips below the 50 SMA. I think I followed the rules, but the trade did not work out. Any thoughts?

Also, I thought about setting up a Yahoo group for this trading system so that thoughts could be passed along realtime. I have found groups like this to be helpful in the past. Is anyone intersted?

Hi aboutusnow, well the process of your entry is perfectly fine, however you will note that in the manual the 50SMA is not used, instead you should be using the 100SMA and 200SMA. It would however of not made a difference for this trade, as the 100SMA was in the same region at the time of your trade.

You may have heard I am about to do a "part 2" in upcoming weeks that looks at some more advanced aspects of this system, one of those is the seperation between the 100 and 200SMA's, i.e., be a little more careful at the first SMA when there is a large gap between the two. This seems to apply to this trade, and you will see the second trade setup at the 200SMA a little later in the day has moved around 150 pips thanks to the NFP reaction. (see below chart).

In summary, well done on a correctly executed trade according to the rules published, that is a skill in itself, not every trade will be a winner of course, but by sticking to the rules, you can sort out what went wrong with your trade execution (if anything did).

http://img225.imageshack.us/img225/4489/usdjpyce4.gif

Hello,

Akuma, thanks for contributing during your busy fatherhood. You mentioned on last post that we need to be careful when there is a gap between the SMA's, why? Also, Aboutusnow's trade brought up another question... what do you consider to be a more predictable bounce of a band, a price touch, a candlebody touch or a full close below the band? One last question... what do you think of using Mouteki as a trigger signal instead of CCI?

Thank you

Some good questions there ... ok firstly, the gap between the SMA's seem to matter as it is a sign that the market had over-excited itself, got itself in a real tizzy and went a little too hard too early, when this happens, it can come crashing back before regaining its breath, a bit like a runner who runs to fast at the beginning of the race to get ahead, they tend to collapse in a heap for a while, filtering back through the field before getting enough energy to run well again.

In terms of your questions about the bounce of the bands, to be honest I haven't studied to that extend, but I would hazzard a guess that a price touch leaving a nice wick would be the best indication, as this shows there was some rejection of a further move below.

Finally, I don't see any reason using Mouteki as a trigger would harm the system, triggers are something I have left open in part 1 of the manual, as they can change depending on how aggresive you want to be. I will do my best to address this in part 2.

Thank you Akuma. When do you forsee Part 2 to be completed and shared with the rest of us?

Hello,

Akuma, can you tell me what you mean by the 4H and the daily momentum. Where do you see it? Do you go to a 4h and a Daily timeframe?

Hello,

Nevermind, I found the answer on post #113.

Thanks

Well I hope the followers of this system was watching the GBPUSD today, you could not get a more perfect set-up according to the manual's rules. Short at the top BB in a strong downtrend and clear of the SMA's, this was a strong one, blowing straight through the 161.8 and 200 fib extensions.

http://img167.imageshack.us/img167/4674/gbpusdyd7.gif

Akuma99,

I noticed in the thread I posted, you mentioned that the 50 SMA was not in the manual. When this thread started, you listed the 50 SMA, and then later you mentioned that you eliminated the 50 SMA because it is inherent in the Bollinger Squeeze with CCI indicator. I guess I am confused...should I not use the 50 SMA at all (it is in the squeeze indicator, right)? or just not show the 50 SMA line on my chart?

I could not help but notice the 50 SMA bounce on both of these trades.

http://img181.imageshack.us/img181/7211/eurusdgv5.gif

http://img181.imageshack.us/img181/1005/gbpusdbz5.gif

Guess I should clarify that one, yes if you use the 50CCI as a trigger, having the 50SMA on the same chart is just duplicating information, i.e. a zero line bounce on the 50CCI is the same as a bounce off the 50SMA. For this reason, I took this out of the system, and instead used the 100SMA in it's place. If you like the 50SMA on the chart then there is no real harm in leaving it there though.

Hello,


Akuma that was a beautiful setup of your system. Too bad for me since I was sleeping zzzzzzz....zzzzzzzz. Oh well, I am beginning to get a feeling for your system after reading and studying your charts for over a week. I for one need structure to help me become a disciplened trader. Looking forward to your sequel (part 2) and more charts for analysis. By the way, were you saying in your previous post that using the 50 sma is as accurate as the 50CCI? If your answer is yes, then do we get rid of the 100sma?

Thanks again

Hello,


One question....would it be correct to assume in one's analysis that if the 100/200 sma's are above price that there is a downtrend pressure on price and viceversa ?
Thank you

Hi!
I just noticed this thread and must really thank akuma for such a wonderful system, coupled with thorough analysis. That's what I call a true master. Here's a question though. I just entered a trade as shown below. Is this considered a zero line bounce and can we still enter if we see the blue zone JUST ending?

Hi kangguan, yes that is a zero line bounce and it is ok to enter at the end of a blue zone within a bar or two if no significant move has been made during that blue zone period. I note you have the 50SMA on the chart, the latest incarnation of this system now uses the 100SMA instead of the 50SMA, the reason being, as your chart shows, that the 50CCI is a representation of the 50SMA, i.e. a zero line bounce is a bounce off the 50SMA, as you can see.

Best of luck with the trade.