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Trading the Cable swings via averages

  • #6,661
  • Nov 28, 2020 9:24am Nov 28, 2020 9:24am
Hi, I entered Alpari with a 1,500 leverage, and every 0.01 lot I make involves about $ 2.7 of my capital. Can you calculate that?
The next question is, I do not understand what our base currency needs to calculate.
Thank you for your patience
  • #6,662
  • Nov 28, 2020 9:16pm Nov 28, 2020 9:16pm
Quoting mohamasolgi
Hi, I entered Alpari with a 1,500 leverage, and every 0.01 lot I make involves about $ 2.7 of my capital. Can you calculate that? The next question is, I do not understand what our base currency needs to calculate. Thank you for your patience
OK slowly but surely we are getting there.

You now have:

$500 in your account (I am guessing you have set your account up in US dollars so this is USD500) If this is the case then there will be no conversion per trade the conversion will take place as you upload or download from your trading account to your bank into the currency you use in your country.

1:500 leverage is better than mine at 1:400 and looking at the margin used of $2.7 convinces me more the account is in USD. Therefor for each pip made you should have made 10c. Is this correct? Multiply the pips you made by 10c to verify this.

You have enough capital in your account to purchase 185 micro lots i.e. 18.5 mini lots or 1.85 standard lots.

Now we have the beginnings of something to work with in forming a planned objective but we need to add into the calculation TIME and PECENTAGE GAIN.

Let me assume you want to make 100% profit on your $500 = $500

Though you can easily do this in one day I would suggest you take much longer to minimize the risk even further until you get a good understanding of the money management process. If you make 100% over 20 days (4 week month) then over a year this becomes a considerable sum, in theory, but in reality it will probably be much less. None the less the aim is to build to a point where you are comfortable with a regular outcome, then as the account grows the risk becomes proportionally less.

Digest this then we can work on the how to do aspect.

PS Let me know if these numbers are correct so far.
  • #6,663
  • Nov 29, 2020 1:39am Nov 29, 2020 1:39am
Quoting birdland
{quote} don't be sad, i made more than +100 pips yesterday;-) your statement is not really helpful, it makes not much sense to me. when i am in a position i try to follow the trend, stay in as long as possible and manage the trade with trailing stops. anyway, nice thread!
Hi Birdland,
I think you might benefit from reading some of Alan's posts about money management. See attached.
David
Attached File(s)
File Type: pdf Alan's Money Management.pdf   1.2 MB | 779 downloads
  • #6,664
  • Nov 29, 2020 3:01am Nov 29, 2020 3:01am
Quoting Nala66
{quote} The sadness comes from you not applying or understanding the money management process. To me the above reads that you have a $100,000 account and made 10c per pip for a 100 pips = $10 profit =0.00001%. Who cares how many pips the market moves, it is what you do with those pips to improve your bottom line that counts. For example 100 pips should easily triple your account if you apply money management principles. A trailing stop is not managing the trade in itself, it is only a part of the management process.
thank you Alan for your reply, now i understand you better.

i started with $1000 and traded with 1lot, so at the end of day i build it to $2002.

also i will continue to read the whole thread to speed up with the knowledge, especially with your money management process.

thanks "trade.time" for the helpful pdf, i will read it.

a lot to learn in the next months...
trading is like dancing, don't think and just listen to the music!
  • #6,665
  • Nov 29, 2020 4:25am Nov 29, 2020 4:25am
Quoting birdland
{quote} thank you Alan for your reply, now i understand you better. i started with $1000 and traded with 1lot, so at the end of day i build it to $2002. also i will continue to read the whole thread to speed up with the knowledge, especially with your money management process. thanks "trade.time" for the helpful pdf, i will read it. a lot to learn in the next months...
Cool that is much more informative 100% a great effort well done.
  • #6,666
  • Nov 29, 2020 4:29am Nov 29, 2020 4:29am
I am making the effort here to go through the process with Mohamasolgi so that others may also follow the logic.
  • #6,667
  • Nov 29, 2020 5:28am Nov 29, 2020 5:28am
Quoting Nala66
{quote} OK slowly but surely we are getting there. You now have: $500 in your account (I am guessing you have set your account up in US dollars so this is USD500) If this is the case then there will be no conversion per trade the conversion will take place as you upload or download from your trading account to your bank into the currency you use in your country. 1:500 leverage is better than mine at 1:400 and looking at the margin used of $2.7 convinces me more the account is in USD. Therefor for each pip made you should have made 10c. Is this correct?...
There is a problem that I do not understand, my business account is in dollars, and my bank account in rials, that is, 1 US dollar is equal to 250,000 Iranian rials.
You wrote in your post, enter your business account into your bank in the currency you use in your country.
I do not understand this, but you have explained the rest of the post quite clearly.
I do not know the post I leave, why does it say it will be approved after 6 hours?
Please continue your explanation and we will take full advantage of it.
Thanks
  • #6,668
  • Nov 29, 2020 10:34am Nov 29, 2020 10:34am
Greetings to the great and patient man,
If you can explain on the chart how to set up your 3 trades and where to put the loss limit for each trade and show the division of a cow or bear in the chart and also explain about Berchin.
And the main thing is how to identify the target of 40 pips?
Thank you so much for sharing this valuable system
  • #6,669
  • Nov 30, 2020 12:51am Nov 30, 2020 12:51am
Good Day to All,

I am new here and not experienced in trading at all. This thread sounds really interesting as a whole trading system is provided, so decided to follow starting from the first post. One thing I have difficulty with is the 108 bars concept. I cannot really understand where I should start counting.....
Anyone available to explain it in details please? From what I can see so far, starting from the first post, sound like this concept is crucial....

Thanks.
  • #6,670
  • Nov 30, 2020 4:18am Nov 30, 2020 4:18am
Quoting Michele2020
... One thing I have difficulty with is the 108 bars concept...
This is just the beginning of the London trading session. Since the method involves trading GBP, the 108 bar vertical line shows when this session began.
  • #6,671
  • Nov 30, 2020 4:43am Nov 30, 2020 4:43am
Quoting Pilygrim
{quote} This is just the beginning of the London trading session. Since the method involves trading GBP, the 108 bar vertical line shows when this session began.
Thanks for you kind reply. Does this means that we have to start the first line at 9am GMT? and from there count 108 bars on 5min chart.....and than again 108 bars and so on so forth?
  • #6,672
  • Edited 6:02am Nov 30, 2020 5:51am | Edited 6:02am
Quoting Michele2020
Thanks for you kind reply. Does this means that we have to start the first line at 9am GMT? and from there count 108 bars on 5min chart.....and than again 108 bars and so on so forth?
Yes. You can see how Alan himself describes it:
https://www.forexfactory.com/thread/...2#post11713432
Just align your broker's time with the London Greenvich opening time.
  • #6,673
  • Nov 30, 2020 8:05am Nov 30, 2020 8:05am
Quoting mohamasolgi
{quote} There is a problem that I do not understand, my business account is in dollars, and my bank account in rials, that is, 1 US dollar is equal to 250,000 Iranian rials. You wrote in your post, enter your business account into your bank in the currency you use in your country. I do not understand this, but you have explained the rest of the post quite clearly. I do not know the post I leave, why does it say it will be approved after 6 hours? Please continue your explanation and we will take full advantage of it. Thanks
All I am saying here is that when we set up a trading account with the broker we have the opportunity to set it in US dollars or our native currency. Whatever we choose becomes our base currency for trading with.

For the purpose of explanation lets just stick to US dollars.

So let's do some mathematics here on this basis.

We need to determine a time span which I have said = 20 days. This is the time we have allocated to double our account. (sure you can do it in less time)

So we have $500 divided by 20 days = $25 per day. So 1mini lot x 25 pips and the job is done for the day and we may opt to risk 10 pips or $10 dollars on the trade. Fair enough if we consider this is a 1:2.5 risk reward and many people choose this option. However this relies on getting a positive result every single day without loss, this I am sure people would agree is not realistic.

So I do things a tad differently as I will explain next.
  • #6,674
  • Nov 30, 2020 9:47am Nov 30, 2020 9:47am
Quoting Pilygrim
{quote} Yes. You can see how Alan himself describes it: https://www.forexfactory.com/thread/...2#post11713432 Just align your broker's time with the London Greenvich opening time.
Ok thanks a lot Pilygrim. This is clear. But how to use it? We have a vertical line every 9 hours on a 5min chart, starting at 9am GMT....18pm....3am....12noon...9pm....and so on. What is it the use of it exactly?
Please note I am studying from the beginning and currently on page 8. So this answer might have been answered already down the road. But I wish to move on step by step, once every single concept is fully grasped.

Thanks for your help.
  • #6,675
  • Nov 30, 2020 10:47am Nov 30, 2020 10:47am
Quoting Michele2020
...What is it the use of it exactly?...
In general, we really only need the London session. Therefore, you do not have to put these vertical lines at all. Just trade during these hours, as the strategy is tailored for the GBPUSD pair.

If you want, I can send you an indicator that shows only the London session.
  • #6,676
  • Nov 30, 2020 4:51pm Nov 30, 2020 4:51pm
For the benefit of any doubt I have always found trying to work out bar 108 on a five minute chart to be an arduous and somewhat superfluous exercise. For example, is it 108 bars from the US close? Is it 108 bars from midnight GMT? In a nutshell, bar 108 turns out to be 07:00hrs GMT. At this time of the year (with the UK clocks now at GMT) 07:00 is the opening of the European session. It is the ‘warm up’ hour and marks 60 minutes before the London session opens at 08:00hrs GMT. It is well known that the market tends to ‘wake up’, from the 07:00 European open carrying on to the 08:00 London open to around 09:00 GMT giving a potentially volatile and profitable two hour window. Don’t expect it to work every day though. It’s trading. It’s snakes and ladders. I hope that helps.
  • #6,677
  • Nov 30, 2020 7:19pm Nov 30, 2020 7:19pm
Hi Mayflower, also I find the 108 line if a continuous projection into the future leaks 5mins every week into the future as well , whether this is an anomaly of my broker or something that happens across all MT4 platforms I have no idea? Non the less I feel the time cycle is a very important part of the overall plan.

Any comments Alan?
  • #6,678
  • Nov 30, 2020 9:02pm Nov 30, 2020 9:02pm
Look guys don't get too hung up on the 108 bar it is just a name I give to the time I begin to check out the charts and is the approximate time of day we can expect the better action to begin following the Asia market which tends to be flattish.

This is used for the efficiency of our time spent trading. If you want to follow the charts for 24 hours a day then by all means go ahead.

We should be at least looking at the charts from the perspective of when the major trading action takes place for the few hours it exists before the market becomes more erratic throughout the rest of the session.

On my 1 hour chart the time of this shows as 0900 which is 1830 for me so a little before this I start to make my analysis of what I might expect to see. This is only an expectation, it is not written in stone. If the market starts to move in a direction my aim is the determine where it is likely to go, can I get in on this and can I make a reasonable profit with little risk.
  • #6,679
  • Dec 1, 2020 1:28am Dec 1, 2020 1:28am
Now that the 108 bar concept is quite clear (thanks to all the answers), I need to better understand the 2 bars test & stop concept. I am currently studying page 6. Saw this 2 bars test introduced but not really understood. If anyone can help with rules and examples please.

Thanks.
  • #6,680
  • Dec 1, 2020 4:45am Dec 1, 2020 4:45am
Quoting Nala66
... So I do things a tad differently as I will explain next.
Alan, can we hope to continue the publication on money management?
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