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Weekly Trading With Nip And Ropes

  • #1
  • First Post: Edited 8:55am Oct 29, 2006 8:42am | Edited 8:55am
This thread will be used to post trades that learningtheropes and I analyse by the weekly range trading strategy...with some modifications we mutually agreed on:

Quoting Pip Rage
I wanted to design a method so simple that my tend year old son could trade it and didn't take much time. I have visually backtested it and it seems to work most weeks or else doesn't produce a trade.I'm wondering if it's just too mechanical to work long-term. I would love some feedback and any suggestions for improvement would be greatly appreciated
Weekly Range Method – Version 1

Tested on GBP/USD.

After the market closes for the week, mark the past 2 weekly ranges(high/low) and the halfway point of the most recent weekly range(which I’ll refer to as the weekly median).

Your directional bias is determined by comparing these weekly ranges

FADE: If the most recent week’s range is greater than the previous week’s range, then look to fade the most recent weekly direction. Trade it in this way:

If last week was bearish, Buy at Friday’s median, place your limit at the weekly median and place your stop at the weekly high.

If last week was bullish, Sell at Friday’s median, place your limit at the weekly median and place your stop at the weekly low

TREND: If the most recent week’s range is smaller than the previous week's range, then look to trade in last week’s direction. Trade it in this way:

If last week was bullish, buy at the weekly median, place your limit at the weekly high and place your stop at the weekly low.

If last week was bearish, sell at the weekly median, place your limit at the weekly low and place your stop at the weekly high. Do not chase the price. If it doesn't pullback to the median, just let it go and don't trade. The idea when trading with the trend is to enter on a pullback and avoid whipsaws.

The whole method in one sentence: if last week was an expansion week, trade in from the outside and if last week was a contraction week, trade out from the inside.
I hope this makes sense. I'll follow with examples if anyone's interested.



Ken
One of the main modifications made is the price on the next week must be going in the direction of the trade. For example, if we are going short on a trade at 1.8790 and the price closed at 1.8780 we must wait for the price to go ABOVE 1.8790 and then COME BACK DOWN to 1.8790.

We are also working on an alternative way to take profit.

Refer to this thread for the discussion on this method: http://www.forexfactory.com/forexfor...ead.php?t=8053

All of our threads will be projections on trades for the next week on 8 currency pairs. Hope you enjoy.
Nothing is hard, some things just take more time and discipline.
  • #2
  • Oct 29, 2006 1:05pm Oct 29, 2006 1:05pm
Quoting learningtheropes
GBP/USD Long:
Projected Entry- 8837 (only enter if next weeks price retraces below target 1st)
T/P goal - 9002 (165 pips potential gain)
S/L max - 8662 (175 pips risk)

EUR/USD Short:
Projected Entry- 2706 (enter as soon as price goes down to target)
T/P goal - 2637 (69 pips potential gain)
S/L max - 2760 (54 pips risk)

USD/JPY Long:
Projected Entry- 117.92 (enter as soon as price goes up to target)
T/P goal - 118.39 (47 pips potential gain)
S/L max - 117.12 (80 pips risk)

USD/CHF Long:
Projected Entry- 1.2518 (enter as soon as price goes up to target)
T/P goal - 1.2585 (67 pips potential gain)
S/L max - 1.2467 (51 pips risk)

One, and all, please check my assumptions and math to verify....
These are the four projections that learning the ropes calculated
Nothing is hard, some things just take more time and discipline.
  • #3
  • Oct 29, 2006 1:51pm Oct 29, 2006 1:51pm
EUR/CHF Long:
Projected Entry- 1.5909 (enter as soon as price goes up to target)
T/P goal - 1.5943 (34 pips potential gain)
S/L max - 1.5874 (35 pips risk)


AUD/USD Short:
Projected Entry- .7660 (enter as soon as price goes down to target)
T/P goal - .7628 (32 pips potential gain)
S/L max - .7697 (37 pips risk)

USD/CAD Short:
Projected Entry- 1.1250 (enter as soon as price goes up to target and comes back down to entry price)
T/P goal - 1.1178 (72 pips potential gain)
S/L max - 1.1321 (71 pips risk)
*This trade i am iffy on but we will see what happens
NZD/USD Long:
Projected Entry- .6594 (enter as soon as price goes down to target and comes back up)
T/P goal - .6608 (14 pips potential gain)
S/L max - .6530 (64 pips risk)
*Really odd trade


I am also going to be fooling around with trailing stops and partial take profits to secure profits and also let profits run since in the past there have been trades that surpassed target by a long shot. And also ones which didnt quite make target and ended up being a looser

Happy week of trading...any comments appreciated.
Nothing is hard, some things just take more time and discipline.
  • #4
  • Nov 3, 2006 3:00pm Nov 3, 2006 3:00pm
Rough week, especially for 2 new pairs I've volunteered to report on:

For the GBP/USD the trigger price did not hit as the price never dipped to that level, but the price did reach the take profit level of 9002 if a Long position was taken without waiting for a dip from the 10/27 closing price, as an FYI. (not encouraging this, just pointing it out)

EUR/USD- trigger was hit, but fell short (but not short enuf ) of the t/p goal of 2637. Entry was 2706 and the pair worked down to a low of 2677 (29 pips total movment) before retracing up to a high of 2734, but not yet hitting the max stop area? Perhaps my entry analysis for the upcoming week would keep this trade in play (I will try to comment on this later)

USD/JPY- as mentioned, not a nice welcome! Long trigger of 117.92 was hit and only made it to 118.04 b/4 stopping completely out at 117.12, approx 4 hrs after the high price was hit.

USD/CHF- same story as the JPY. This long trade hit a high only 10 pips above entry at 1.2528 and slide down passed the S/L within 4 hours time.

**On the bright side for the JPY and CHF trades....if you were one to ignore stop losses (again, not a recommendation), both pairs bounced back into profit this morning and both sit a little shy of the T/P area.....Perhaps these will be Long trades this week again?
  • #5
  • Nov 5, 2006 1:02am Nov 5, 2006 1:02am
GBP/USD Long:
Projected Entry- 9043 (enter as soon as price goes up to target)
T/P goal - 9134 (91 pips potential gain)
S/L max - 8942 (101 pips risk)

EUR/USD Short:
Projected Entry- 2737 (enter only if price goes above target and retraces back short again)
T/P goal - 2677 (60 pips potential gain)
S/L max - 2807 (70 pips risk)

USD/JPY Long:
Projected Entry- 117.36 (enter only if price goes below target and retraces long again)
T/P goal - 118.18 (82 pips potential gain)
S/L max - 116.44 (92 pips risk)

USD/CHF Long:
Projected Entry- 1.2486 (enter only if price goes below target and retraces long again)
T/P goal - 1.2569 (83 pips potential gain)
S/L max - 1.2393 (93 pips risk)
  • #6
  • Nov 5, 2006 4:28pm Nov 5, 2006 4:28pm
Hi!

Without wanting to say something stupid, but isn't having almost all trade outlooks being 1:1 or even lower than 1.0 risk/reward a bit dangerous?
Just saying, at 50% wins a 1:1 pips outlook means break even, and you need to tilt one of either sides to your favor for profit by simple mathematical logic, no?
No offence, just asking tentatively if this is taken into account(literally *smiles*).

My best wishes and good luck,

SeekingLight
Trust price. Know yourself.
  • #7
  • Nov 5, 2006 4:33pm Nov 5, 2006 4:33pm
Quoting SeekingLight
Hi!

Without wanting to say something stupid, but isn't having almost all trade outlooks being 1:1 or even lower than 1.0 risk/reward a bit dangerous?
Just saying, at 50% wins a 1:1 pips outlook means break even, and you need to tilt one of either sides to your favor for profit by simple mathematical logic, no?
No offence, just asking tentatively if this is taken into account(literally *smiles*).

My best wishes and good luck,

SeekingLight
Not stupid at all

Ive noticed this this week also...it seems as if this weeks calculations was kinda messed up

I think I am going to change my trading approach drastically to something i am testing now...sinec this method gives such odd numbres
Nothing is hard, some things just take more time and discipline.
  • #8
  • Last Post: Nov 6, 2006 11:52am Nov 6, 2006 11:52am
Quoting NipthePips
Not stupid at all

Ive noticed this this week also...it seems as if this weeks calculations was kinda messed up

I think I am going to change my trading approach drastically to something i am testing now...sinec this method gives such odd numbres
Hey Nip,
did the calculations you were supposed to do on your 4 pairs look funny, so you did not post anything?

In reference to Seekingthelight's observation; I said a long time ago when this was Pip Rage's original thread, I thought these 1:1 R/R's were a little out of whack. I'm sure there are many adjustments that could be made, but I have not had time to do more with this method other than report the projection and results, strickly off the original rules.

Any suggestions are welcome. By no means has anyone proclaimed this to be a perfected system.
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