Magic 100

Hi Everyone,

I'm new to this forum, I just started to try out this system last week. I ended last week just above BE despite a couple of rookie mistakes, so not bad. My best trade was 120 pips on GBP/NZD :-)

I've currently got a short trade open on EUR/JPY and my put a pending order on USD/JPY after the next 1H candle closes. First trade this week as most pairs seem to have been ranging this week so not good conditions for this system right? Then the good moves I spotted were too steep and fast so there were no pullbacks to enter on. Is this why the forum is so quite at the moment? Just waiting it out?

Thanks for the system

Hey guys! My first post on FF, so hello I’ve been trading this type of system for quite a long while now on different time frames and so will give my few “tips” from my experience of trading “this” system (it’s very close and the basic concepts are the same as the OP’s) and what, at least, works for me.

Gismo - firstly, I see a lot of your trades you posted that were losers from your first “bad start day” were pretty sub-par takes IMO. You’ll probably notice most of your winning trades you posted were all during MUCH stronger trending moves. The first group you posted were taken in what I see as a very whippy market, even if they were with the “general” trend direction. I trade this style of system on the 4, 1 and also use the “style” of entry a lot intra day on the 15 min timeframe, and for me - speaking of the 1hr now - personally, it’s not just important to me that the price is above the 100 EMA or that the trend on a 4 hour chart is in an uptrend... YES, I want to be with that overall trend and direction of the HTF’s, as if you catch it well - and let’s be honest, get lucky! - you can benefit from some monster 10+ R/R trades, but I also need the 1hour chart to be showing a strong trend too. Just being below a 100 ema for me is not enough. I use a a 50 and 20 EMA and ideally, need a strong move below the 20, with at least one pull back to create a lower high (on a DT obvs), and a continuation to the downside. Then, I will look for possible entries on the next retracement.

Imagining a downtrend again here, I like to place my sell stops a few pips (depends on the pair... 3 pips on EURUSD is very different to 3 pips on GBPAUD for example when taking ATR into account) below the previous closed and printed candle. I stress the importance for me as this being a proper retracement candle.. not one that has a low the same level as the last candle of the main move. I find the best setups to have candles of a similar range retrace with higher lows on each one. IF the next retracement candle reaches lows slightly lower than the previous candle (but not low enough to trigger me in), I get a little wary and in most cases deems the trade opportunity invalid for me. This is based on using this system to enter on the 15 min TF fairly often... I find most of the time, they are not as successful.

A few other things I look for / try to avoid:

Really try to get a good feel for price action in general. Understanding market structure and considering things such as likely range below (or above) you for the market to move into is important. I won’t take trades like this into major levels. 0 point. Wait for a clear breakout or bounce if near major levels. Also, If I see a huge hammer or bullish engulfer for example, I will not take trades off the following retracement candles. I also like to see candles of a certain size - it’s hard to explain, but I won’t take huge candle entries, and am also wary of very small candles. There are enough markets and opportunities out there to be patient for the beat probability setups!

Lastly - R/R. I manage each one slightly differently to be honest. I usually move my stop to BE at 1:1. It can be frustrating getting hit out and then seeing the market go off, but u can always get back in (especially quite easily using this method), and for me, after countless backtesting and live testing and analysing my results, for me, by doing that it has SAVED me more money than it has prevented me from making. Also, on those 3/4/5 trades in a row that are break even that would’ve been losers, for me, it helps mentally. My first aim is to protect what I have! The profits follow when they’re ready

Sometimes, my other method, if I feel good about the trade and think it may need some more room to breathe, I will take 25/30% out at 1:1 and then move my stop to about half the range it was initially... it all depends on the moment. Only practice and gut feel will give you the means to decide. Even then, oftentimes you’ll get it wrong. But it doesn’t matter too much over the long haul! Taking profits - again, it depends... I aim for 1:3 on the hourly (1:4 on the 4 hour), but if the market’s flying, I’ll trail it. I find moving down to the 15 min chart is good for this, and I keep my stop two swing highs above.. sometimes I’ll take 50% out, then aim to get back in on a pull back with another 50% at a better price. But guys, really, you have to have to have to get used to and be comfortable with letting profits go. Every now and then, especially with a system like this, you can benefit from some crazy 15/20:1 Risk/Reward trades if you sit on your hands. Yeah often you’ll end up having your trailing stop (manual stop btw, not a set number of pips!!!), and thinking “ah man I could’ve had an extra 30 pips if I’d taken it out down there”... but if you’re still getting 1.5-2:1 in those scenarios, and picking good quality setups, you’ll still be doing well. And then when once every now and then, you have one run and run and run, where you can (and feel comfortable to!) add to it along the way.. it’s THOSE trades - those trades where you make 10/15% of your account in one trade - that make you really realise its worth.

Good luck! Backtest backtest backtest, note ALL variables and permutations and “what ifs” until you get the system working to suit you and your personality. And once you do, you can chill and relax knowing it will work over time. Be lucky!

Hi Intraflay,
Thanks for the post, great info. I'm new so the info helps me understand this kind of system much better. Can I ask how many trades you average per week? And how many did you get this week?
Cheers!

Hi mate, ah it really depends on what else I have going on. Some days I’m very active and in and out a lot, other days / weeks much less so and take positions based on the higher timeframes. However this week, actually, there were some amazing opportunities. Especially in GBPUSD. It’s important to understand that this strategy is an amazing way to enter the market, but as the OP meant when he said “use common sense”, it’s not just a case of, for example on a down trend, ‘ahhh, there’s a green candle, boom I’m in’. I personally use it more as an ENTRY strategy in alignment with pure, totally naked price action, rather than it just being as simple as seeing an opposite colour candle and jumping on it. Take Tues 12th this week as an example. Price had made a sharp move to the DS following a fairly bullish move. Often, when this happens, the market will be drawn back to a key level. In this instance 1.2370 ish. That was a very prominent zone all last week, and so this week, price headed back there to see what the market made of it. There was a ALOT of liquidity up there. Now, I took a short there based on that information and the way price reacted to being back at that level.. not just using this idea of trying every retracement candle on the way up there haha. But I did use this way to enter, the market, as I often do, as it’s very powerful in that sense. Especially if you can read the ebb and flow of the market fairly well too and use them together. Understand how the market has phases.. push phases and then retracement/exhaustion phases.

GBPUSD then offered multiple chances of getting in again throughout the week. If you want to have an easy (easier at least ha), way of deciding when to take the opportunities, put a 50 EMA on the hourly, and only start trying to enter the market using this strategy when price gets close to it. The 50 is particularly good in my experience. You’ll miss a lot of trades, but you’ll also sift out a lot of rubbish. Have a look back at the pound from this week and try to see and “feel” what the price action is saying whilst it was retracing. That’s v important for me. And don’t be too het up about the colour of the retracement candles too. The best entry ones are often of the same colour as the trend, especially such as a bearish pin bar, close to the 50 EMA, following a few green or mixed retracement candles. If I see that - that sellers are starting to really show signs of getting back in and jumping on the trend, that’s when I will be placing my sell stop without hesitation.

Couple of other bits of advice.. and both are important imo..

1. You asked if I had any winners this week etc. Yep - and losers. Just as the OP said, the most important thing is to be consistent. And maybe from your Qn, I get the vibe you may be a bit focused on the here and now. I often have 4/5/6 losing trades/break evens in a row. That doesn’t mean my system (and that includes this strategy) is broken. It’s how it performs over time. Not just 5 or 6 trades. So, with this in mind - for good psychology I personally really would recommend moving your stops to break even after 1:1 and maybe even taking 30/35% out then too.. JUST to begin with. It’ll help with the psychology. Take a bit out at 1:1 and move your stop to break even and then set a hard stop at 3:1 and let it go, or better still, just trail the remainder. I find with this strategy, esp if you’re getting in right back up at the 50/100 ema, that if it’s gonna win, it’s gonna win big. So trailing is the way to go. I have boatloads if break even trades that would’ve ended up being losers to be honest. And as I say, it just helps me psychologically to not see bigger than I’d like drawdowns mount up from a string of losers. Chip away, slowly but surely, and then one in every 15/20 trades you’ll catch a corker of a move which’ll give your account a boost.

2. For god sake, get rid of all the indicators. Some of the charts I’ve seen posted on here scramble my brain!! You literally can hardly even see the candles. And believe me it’s the candles that tell u the real story. And if you’re just starting out, learning to read price action and get a feeeeel for how the markets move and react at key levels etc is so so so important. Keep your charts clean. I’ll have a moving average or two on there, max, and occasionally pull up the ATR indicator to help with setting a stop loss but that, is, it. Draw in key levels, watch the price move, and look at how it reacts in those zones. It’s so valuable, it really is.

Hi intraflay

Hope you are keeping well.

I'm a long time member of FF, but due personal circumstances have been out of the action for a long time. Finally trying to dip my toes back in and get my head round FX. Really enjoyed reading your posts. Hope it's OK to ask a few things. Due to my current situation I can only check the charts in the evenings, so essentially daily TF. What would you recommend as a setup on daily for this system? What is your maximum % risk on each trade? A big ask - are you able to post some trades or better still some videos with your analysis. I know I will certainly benefit from it as I'm sure others will too. I understand, everyone is busy, so if you are unable to, no problem - your posts have been really helpful regardless and any further help will be really appreciated.

OP - thanks for starting this thread.

All the best

Hi intraflay,thank you for your beige here, helps even when you report from your experience

Hi, Do you have an EA? It's probably a good idea to ad an oscillator. And use SAR and fractals too.
Thanks

To be honest I’d say the logic with all price action / strategies is the same for every time frame. They just have different characteristics. I find the longer the time frame the more reliable, but obviously the more patient you need to be because the ranges you’re working with are so much larger. Really, I’m no expert at all - I’m not! But I’m just disciplined and trust the process. My risk per trade depends on the type of trading I’m doing. Normally 1%. If I’m scalping only 1/2 %. But if I see a setup with huge confluence - such as a retest of a major level which marries up with a long term trend line and an important EMA on the longer time frames, sometimes I’ll risk 2%, as you have a lot throwing the odds in your favour then - but never more than 2%. This OP’s strategy is really good for adding to positions. Once I’ve moved my SL to BE and am in decent profit, I’ll take another position once the setup presents itself again and add to my original position. As I said before - chip away bit by bit, but when things are going well for you, really try to take advantage of it and capitalise! Not in my office for the next few days so don’t have anything to show unfortunately at the moment. If I’m not so busy next week maybe I can upload some screenshots. But I’m a big believer in each person having to find their own way. A lot of backtesting and hard work. It’s easy to see someone’s trades they’ve taken, but to say you’d be able to replicate it is a different story. I see how my tennis coach hits the ball... like a god! It looks easy, he makes it look easy, but can I do it the same? Nah! Haha. Trading is such a personal thing in a very creative way, and it’s important to find your own way. Not what people want to hear but I think it’s true. Re analysis... there’s a guy on YouTube whose videos I watch sometimes as he trades in general in a very similar way to me. This is veering of the OP’s post to be honest as like I say, I use this “strategy” more as a means to enter rather than a standalone strategy. But if you want to learn about pure price action and see how I also trade, check out Rockzfx on YouTube. He’s a very good teacher. I’ll reiterate how much I hate indicators - they lag, and they take your focus away from the price. I do exactly as rockz does in his vids - draw a temp line of importance based on the 4hr, then also add a rectangle to highlight areas price has moved into and not been able to break through, then jump down to the hourly, and then when ready to try to enter, the 15min chart. Those rectangle areas are important to me. If price has been pushing into and beyond it for a while leaving lots of wicks and closes just below it (when I’m short biased), then it’s the market telling u something. You just need to try to work out where the bulk of buyers and sellers are. With indicators, you can’t do that, and you’re too occupied with seeing what they’re doing, not with what’s actually clearly happening in front of you!

Anyway, digressing massively from the OP so gonna leave it at that!

hello intraflay, may I ask for your video that you made. you can put it in here?

I haven’t made a video mate! Sorry... I’m just so busy this weekend!

Thanks again for your reply and insight. I will work with your tips and advice next week and see how I go. I can see how price on GBP/USD traced along the 50 EMA this week. I'll try the trailing stop idea for trades when price is close to that.
I am too focused on the here and now but it's not just that I get impatient, I am trying to reduce my trade times (when possible) for three other reasons:
- The way the market is at the moment I want to take profits and run, the longer a wining trade is open the more chance it has to reverse. Will start taking 1/3 off at 1:1.
- To free up margin for other opportunists.
- I find that trades that linger on limit me for taking conflicting or even consolidated trades on other pairs.
Don't know if anyone else worries about these things.

Great stuff. Appreciate the reply. I've seen some of rockfx's stuff...will look a little deeper.

Agree, don't want to veer away from or hijack the OP's thread. if you have time, maybe you can start your own...I'm sure many traders would be interested in your insights! :-)

Thanks again.

I also suffer from that at times mate - impatience.. and always worried about missing other opportunities etc, but actually, oftentimes, I get like that (not so much now to be fair, but I sure used to!) and would jump on something else, only to realise a few minutes or a few hours later that actually, the opportunity I missed, was the trade I was already IN. If you manage a trade badly or get out prematurely just because u want to go elsewhere to trade, that normally ends up as bad news. Often a loser on the “new” one, and seeing the winning trade you were already in run off without you. That’s annoying!! If a market’s trending strongly and you’re in it already sitting on nice profits, you have to trail it. At least a portion of it! And then u can always look for new opportunities to get into the trade you’re already in and add to it. Something nice about taking what looks like a good setup on a pair you’re already in and 30/40/50/60/100 pips, whatever, up on!

Not quite sure what you meant by “the way the market is at the moment”. This past week has seen some of the best, biggest moves in a while. A lot of pairs hunted back to that price where it roughly was at the start of the pandemic and all the madness, and I wouldn’t mind betting there’re gonna be some fairly big moves to follow. Cable, Euro, GBP/JPY all had some seriously nice moves with some clear as hell setups this week.

All the best mate and good luck and let us know how u get on with this OP strategy, but by consciously trying to pick the better times to enter

let's see if the course continues eurnzd

Magically money from your account will disappear if you follow it

Hi guys, how everyone is doing so far? I hope you killing the markets

Sorry for not posting so much in last days, i`ve been very busy. But i see great content here, many experienced traders sharing their knowledge. Excellent!

Many beautifull setups this days! I hope you catch some of them. I will show a few trades that i am take lately.

Thank you my friend and welcome!

This is pure gold. Well done. Many beginner traders (and experts as well) could benefit from this. Great one!

I took a few trades in my holidays. I just couldn't resist. Don`t blame me

Both on H4 TF, both were pure art. I think they show perfect the beauty of this style of trading. Nice and clear...

EUR/AUD



GBP/AUD