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SRDC Episode I

  • #261
  • Nov 7, 2006 3:59pm Nov 7, 2006 3:59pm
Quoting Ziggy43
Hey Orange,

Just started testing this method out last night and man I must say what a great system. I did the 3 pairs you suggested in your documention.

eur/usd: +15 pips
gbp/usd: +15 pips
aud/usd: +15 pips
total: +45 pips
I set them with a low t/p to see how it would work. Thanks for this great simple system.
Im glad you are making pips like most of us here. Its a pipastic world with SRDC..

Pipsfully yours,
OrangeRoshan
Change Your Thinking. Change Your Life - JD
  • #262
  • Nov 7, 2006 5:24pm Nov 7, 2006 5:24pm
Quoting OrangeRoshan
Ok Shah, I read your document 3x and i still didnt get it. You know la, after years of fighting the darkforce, i tend to be a bit slow nowadays... or maybe you were afraid, your boss at the bank might catch you writing this post...

Can u explain again in more details, dear jedi....
ok..let me try to explain it again..as we all know..there is a CORRELATION CURRENCY between GBP/USD n EUR/USD..and this GBP with CHF...if gbp is trend is up..eur will go up also..and chf will be going south..

so,if the high of yesterday is break by gbp..the eur will follow and the chf will be breaking the low of yesterday..isnt it?but mostly the time of breaking will be different most probabaly a gap of a couple minute

for example..on yesterday the chf breaking low yesterday at 4.15 while on that time gbp currency is still not breaking the ysterday high but just near to the high(around 12 pips near the ysterday high)sure enough,the gbp break the high at 4.30..meaning..we have extra pips(arnd 12 pips+5pips)..instead we wait the high(gbp) being break..why just open position(GBP/USD..LONG) during that 4.15(based on breaking low by chf)instead of waiting occur on 4.30..

if still dnt understand.thst my limit of expalination and english..hehe

from jar jar bink..
  • #263
  • Nov 7, 2006 5:43pm Nov 7, 2006 5:43pm
cakap melayu saja mun kan sanang :
  • #264
  • Nov 8, 2006 12:34am Nov 8, 2006 12:34am
to be clear what are the exact long / short prices on this example from the 11/7/06 EUR/USD daily candle:

R=1.2817, Buy Stop 1.2822, Sell Limit 1.2827
S=1.2722, Sell Stop 1.2717, Buy Limit 1.2712

My question on the Resistance, the order will not trigger until 2822 therefore after spread = 2825, then limit = 2727 for only 2 pips??

My question on the Support, the order will not trigger until 2717, spread is calculated on the buy, so a buy limit at 2712 becomed 2715 after the spread for only 2 pips again??

How should these orders be entered? I use GFT. Thank you in advance!
  • #265
  • Nov 8, 2006 2:50am Nov 8, 2006 2:50am
Quoting shahfx
ok..let me try to explain it again..as we all know..there is a CORRELATION CURRENCY between GBP/USD n EUR/USD..and this GBP with CHF...if gbp is trend is up..eur will go up also..and chf will be going south..

so,if the high of yesterday is break by gbp..the eur will follow and the chf will be breaking the low of yesterday..isnt it?but mostly the time of breaking will be different most probabaly a gap of a couple minute

for example..on yesterday the chf breaking low yesterday at 4.15 while on that time gbp currency is still not breaking the ysterday high but just near to the high(around 12 pips near the ysterday high)sure enough,the gbp break the high at 4.30..meaning..we have extra pips(arnd 12 pips+5pips)..instead we wait the high(gbp) being break..why just open position(GBP/USD..LONG) during that 4.15(based on breaking low by chf)instead of waiting occur on 4.30..

if still dnt understand.thst my limit of expalination and english..hehe

from jar jar bink..
Written by John Kicklighter, Currency Analyst
The following is our monthly correlations update for October. As we have mentioned time and again before, correlations between different currency pairs will inevitably shift over time, therefore it is of utmost importance to keep abreast of these changes. Below are the one-, three-, six- and twelve-month correlations for the seven major currency pairs. Additionally, we have included the six-month trailing correlation versus the EURUSD as further confirmation of the correlation.

In order to be an effective trader, it is important to understand how different currency pairs move in relation to each other. There are a few reasons why this is significant, but most importantly, it allows traders to understand their exposure. That is, having a portfolio that consists of the EURUSD and GBPUSD is different than having a portfolio comprised of GBPUSD and USDCHF. As indicated in the tables below, over the past month, the GBPUSD has had a strong positive correlation (+0.89) with the EURUSD and a strong negative correlation with USDCHF (-0.91). Therefore having a long GBPUSD and long EURUSD exposure would generally lead to negated or nearly zero profit or loss because when the GBPUSD rallies, USDCHF will sell off the majority of the time. Of course, these two currencies have different pip values and the correlation is not perfect, so the P/L may not be exactly zero. On the other hand, holding long GBPUSD and long USDCHF exposures would be similar to nearly doubling up in one of the pairs since the correlation is so strong. Furthermore, we can tell from our tables that correlations shift with time. For example, the NZDUSD has historically held a statitistically weak negative correlation to the USDJPY (-0.28) over the past year. Just this past month, however, this relationship has developed to more relavant levels (-0.61). Shifts such as these can be partially explained by changes in the severity of monetary policy or changes in unique domestic conditions. Overall, having this knowledge will allow traders to effectively diversify and manage their portfolios.

Regardless of your trading strategy and whether you are looking to diversify your positions or find alternate pairs to leverage your view, it is very important to keep in mind the correlation between various currency pairs and their shifting trends.

FX Correlations (data as of 11/01/06)

http://www.dailyfx.com/export/sites/....11.07img1.gif
http://www.dailyfx.com/export/sites/....11.07img2.gif

http://www.dailyfx.com/export/sites/....11.07img3.gif


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Messa think this will helps.
Change Your Thinking. Change Your Life - JD
  • #266
  • Nov 8, 2006 3:14am Nov 8, 2006 3:14am
Quoting cbrock5000
to be clear what are the exact long / short prices on this example from the 11/7/06 EUR/USD daily candle:

R=1.2817, Buy Stop 1.2822, Sell Limit 1.2827
S=1.2722, Sell Stop 1.2717, Buy Limit 1.2712
My High is 1.2819 and my low is 1.2723. Im not clear why you use Sell/buy limit, maybe GFT uses different terms or messa clearly dont understand your points. In MT4, limits are use for reverse trade only.
My question on the Resistance, the order will not trigger until 2822 therefore after spread = 2825, then limit = 2727 for only 2 pips??
My IBFX platform gives me EURUSD spread of 2pips and Dukas 0.5 pips.
My question on the Support, the order will not trigger until 2717, spread is calculated on the buy, so a buy limit at 2712 becomed 2715 after the spread for only 2 pips again??
Some platform includes spread in their order whilst some doesnt. MT4 i notice doesnt, therefore you have to add them manually when issuing pending orders. I dont know about GFT, i havent use my live account since last month. Im actually fedup with their execution policy and PR (Messa dont want to elaborate here)
How should these orders be entered? I use GFT. Thank you in advance!
Just remember this:

R:1.0000

Therefore Add spread + 1 to 2 pips. I sometimes even add 5pips. For this example, Spread is 2 and Margin is 2.

Pending buy stop is now: 1.0004. Your orders will be activated when it hits 1.0002 which when you check including spread at your orderbox is 1.0004.
They activate your orders on the actual price but on the order sheet is spread included. I suppose thats why we get -2 as we entered the trade.

When messa think this sounds complicated, do wat my 14yr old son did, just add 10pips on normal majors!! He is now the most loaded selfmade businessboy in his school with starting account of only USD500 last few months. He made an average of 350pips a month on the 3 pairs. Setting pending orders before he goes to school.

Who needs a job (Just Over Broke)? <---- he said!!

May the pending orders be with you!!
Change Your Thinking. Change Your Life - JD
  • #267
  • Nov 8, 2006 4:21am Nov 8, 2006 4:21am
Sorry to interrupt. When is yr start time for the day ?
The future depends on what we do in the present.
  • #268
  • Nov 8, 2006 6:06am Nov 8, 2006 6:06am
Quoting compro99
Sorry to interrupt. When is yr start time for the day ?
Its Platform dependent. Im using IBFX, so its GMT 00:00 for me and my local time is 8am.

trading? When I wake up, thats my trading start time. afternoon!

Jedi needs good rest!!
Change Your Thinking. Change Your Life - JD
  • #269
  • Nov 8, 2006 7:46am Nov 8, 2006 7:46am
I was thinking, why not we calculate the avg day range of last week and use it to adjust the close order limit at about 10-15% of the range.

Well, abit extra work to do...
The future depends on what we do in the present.
  • #270
  • Nov 8, 2006 9:16am Nov 8, 2006 9:16am
Hi OrangeRoshan,

Thanks for sharing great technic for newbie. I bit late to joint your thread. In your statement you have said carefull if price reach high/low at weekly chart (something like that if i not mistaken).

could u please tell me ...how to identify these proper high/low at weekly chart.

thanks for your help.
  • #271
  • Nov 8, 2006 9:33am Nov 8, 2006 9:33am
I'd like also to thanks our Orange Master Pip-Jedi for sharing his system and help little padawan-newbie to acquire more forex knowledge day after day

  • #272
  • Nov 8, 2006 9:44am Nov 8, 2006 9:44am
I'm enthusiastic about this method. I've written an EA for it that works very well but need some help in developing a good exit strategy. I live in the Chicago area and need to sleep during the Asian/London overlap and this is where many good price moves take place.

Any suggestions will be much appreciated.

Thank you,
Lou G
Old Benjamin was right
  • #273
  • Nov 8, 2006 9:44am Nov 8, 2006 9:44am
Quoting compro99
I was thinking, why not we calculate the avg day range of last week and use it to adjust the close order limit at about 10-15% of the range.

Well, abit extra work to do...
Yes, ADR & ATR can help. But the problem with thse things, like fundamental studies, when you interprete and understand it wrongly, the result may be that you can get sucked to the darkside.

Compro99, when you want, you may add your AR studies here and everyone can benefit and apply whereever possible.

Mesa think good!
Change Your Thinking. Change Your Life - JD
  • #274
  • Nov 8, 2006 9:46am Nov 8, 2006 9:46am
Quoting iwanqf
Hi OrangeRoshan,

Thanks for sharing great technic for newbie. I bit late to joint your thread. In your statement you have said carefull if price reach high/low at weekly chart (something like that if i not mistaken).

could u please tell me ...how to identify these proper high/low at weekly chart.

thanks for your help.
Open a weekly or daily chart. Zoom out as much as you can and draw the High and lows of previous candles. This way you know when yesterday's and todays H&L are near...

Mesa think ez...
Change Your Thinking. Change Your Life - JD
  • #275
  • Nov 8, 2006 9:52am Nov 8, 2006 9:52am
Quoting skyline
I'd like also to thanks our Orange Master Pip-Jedi for sharing his system and help little padawan-newbie to acquire more forex knowledge day after day

aaaaaa.... ex squeeze me, mesa your humble servant.
Change Your Thinking. Change Your Life - JD
  • #276
  • Nov 8, 2006 10:01am Nov 8, 2006 10:01am
Quoting Lou G
I'm enthusiastic about this method. I've written an EA for it that works very well but need some help in developing a good exit strategy. I live in the Chicago area and need to sleep during the Asian/London overlap and this is where many good price moves take place.

Any suggestions will be much appreciated.

Thank you,
Lou G
The blockade is finish, i dare not go against this jedi....

Anyway, excellent suggestion. There are many ways around this. One could be:

Taking profits as T1, T2, T3

T1 == x%, T2 == y% and T3 == Final take profits. Sl will be moved, to T1 when T2 is reached and so on. Defensive Trading.

We must accelerate our plans, get the landing troops....
Change Your Thinking. Change Your Life - JD
  • #277
  • Edited 4:49pm Nov 8, 2006 3:45pm | Edited 4:49pm
Orange, thank you for your answer, this is very helpful. So, a couple more questions for me to understand:
"Im not clear why you use Sell/buy limit ..... R:1.0000 .... Spread is 2 and Margin is 2. Pending buy stop is now: 1.0004. Your orders will be activated when it hits 1.0002 which when you check including spread at your orderbox is 1.0004."

Regarding the 5 pip method only: after the Buy order is placed for 1.0002 which equals 1.0004 with spread, do I place a contingent Sell (not limit) at 1.0009? Also, congratulations on your son's progress. A great Bible quote "I have no greater joy than to hear that my children walk in truth." Thank you in advance!
  • #278
  • Nov 8, 2006 7:49pm Nov 8, 2006 7:49pm
I just want to say thanks to Orange for this.

Also to Skyline for the EA. I have just started to test it.

A few questions and points:

1) for any one looking in to this look at MATAF for some info on daily movement.
2) Skyline, are you able to add two ideas to your EA?
i) A Magic number
ii) A weekly calendar so you can add extra lots on Mondays opening after the short weekend candle.
3) Has any one looked at the optimal settings for the EA's for each currency? for TP and SL etc.

Thanks
Labrat407
  • #279
  • Nov 9, 2006 3:28am Nov 9, 2006 3:28am
Hi,
Dear orange roshan
It seems that method is very simple and interesting but I have a question
how we should draw trend line?from where to where?
I`m a newbie in forex and maybe my question to be very simple
excuse me about that
Regards
  • #280
  • Nov 9, 2006 7:10pm Nov 9, 2006 7:10pm
Hi OrangeRoshan Kenobi, Great idea, I tried the method with 5 pairs (added USD/CHF and USD/JPY) 5 for 5 successful trades.

Looks like we can adjust the # of pips to the currency pait, 5 works for all, good base for AUD/USD, 8-9 for USD/JPY, USD/CHF & EUR/USD and 10-12 for GBP/USD. This thought is based on average daily volatility.

Thanks for an approach worth persuing.


BTW did you play with Abdul Tatlomi, using the Alligator as a filter to avoid whipsaw? From what I have seen it is an effective filter.

Happy pipping!
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