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Trend Cycle Entry

  • #101
  • Feb 8, 2022 2:00pm Feb 8, 2022 2:00pm
Quoting WickedDaddy
{quote}
Trading done well is an intensely focused endeavor and takes a lot of energy and grit. It's nice to walk away from it as often as possible.
Would you like your children to be somehow involved in trading?
  • #102
  • Feb 8, 2022 10:30pm Feb 8, 2022 10:30pm
Quoting oohoo
Hello WickedDaddy! Do I get it right that this kind of multiple touches of BB are disqualified? {image}
It does not matter how many times price intersects the BB. The trigger is the candle that pulls away AND changes color (HA) thereafter.
  • #103
  • Feb 8, 2022 10:34pm Feb 8, 2022 10:34pm
Quoting ewebb205
hello wickeddaddy, here's a question, how could i handle drawdown in the event that the heiken ashi colors change back against me in a trade? i know that you have a mental stop loss but from visual backtesting the heiken ashi candles will change colors back and forth sometimes before the trade goes into profit. how do you deal with that?
I stay in it unless the loss exceeds my tolerance. I don't use so of my account on a trade that I can't tolerate some drawdown. But it's rare and has not been enough to coax me out of the trade.
  • #104
  • Feb 8, 2022 10:36pm Feb 8, 2022 10:36pm
Quoting oohoo
{quote} Would you like your children to be somehow involved in trading?
One of them did and asked me to teach him. I spent a lot of time teaching him, starting with the basics. He very quickly decided he was an expert, dumped a load of money in an account and lost it all in a matter of days.

That was the end of that.
  • #105
  • Feb 8, 2022 11:57pm Feb 8, 2022 11:57pm
Quoting WickedDaddy
{quote} It does not matter how many times price intersects the BB. The trigger is the candle that pulls away AND changes color (HA) thereafter.
I had an impression from previous discussion that price consolidating at BB (touching it more than once) would count as more than 1 touch, whereas rules say that trade should be after the 1st touch only. But I could be wrong.
  • #106
  • Feb 9, 2022 12:02am Feb 9, 2022 12:02am
Quoting WickedDaddy
{quote} One of them did and asked me to teach him. I spent a lot of time teaching him, starting with the basics. He very quickly decided he was an expert, dumped a load of money in an account and lost it all in a matter of days. That was the end of that.
same incident happened with one of my grand children.
Practice makes a person perfect
  • #107
  • Feb 9, 2022 9:06am Feb 9, 2022 9:06am
Quoting oohoo
{quote} I had an impression from previous discussion that price consolidating at BB (touching it more than once) would count as more than 1 touch, whereas rules say that trade should be after the 1st touch only. But I could be wrong.
I see. "First touch" means the first time price intersects the BB after the 15/50 cross in unison with that touch being the first cycle down/up (retrace).

Remember, the set-up to enter is the candle that 1. changes color AND 2. has pulled away from the BB. Enter on the next candle. See my next post for a refresh...
  • #108
  • Edited 10:12am Feb 9, 2022 9:33am | Edited 10:12am
Here is a trade I took yesterday at 0900 Central Time (U.S.) on a 1 HR chart. It is "Textbook" perfect. Let's review:

1. 15 EMA crosses 50 SMA up (first arrow)
2. Price retraces and touches the BB (second arrow)
3. StochasticRSI cycles down below 20%
4. Candle following the red candle that touches the BB is green and is NOT touching the BB (set-up)
5. Enter on next candle (white crosshair)

Added bonuses:

  1. good separation of the 15 over the 50
  2. Price has broken above the 100 SMA and is bouncing on it for support
  3. StochasticRSI is rising

I held this trade for the day and set a TP for 40 pips, expecting it to continue after I went to bed, but experience some volatility and possibly a retrace at the London open. It closed at 2200 Central Time - just before I went to bed. It has continued to run to the upside today but 40 pips is a stellar trade in my book.

One thing that I do that helps me focus on the rules is to save a picture of a trade like this, print it out and have it on my desk. when I see a trade setting up, I look at my "textbook" trade and ask myself, "does it look like this?" It's a good tool for a quick, visual check.

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  • #109
  • Feb 9, 2022 10:10am Feb 9, 2022 10:10am
Trade Journal:

In my first couple years of trading, I did not keep a journal. Like most, I searched for the holy grail, the bulletproof method that would fast track my trading success and make me rich. I was trying to take short cuts. I didn't believe a journal was valuable - I'll just remember stuff.

I lost a lot money for all the same reasons everyone else does: anxious trading, revenge trading, changing methods every time I lost, having a method but not following it - not trusting it. Setting stops too close, too far, getting nervous and exiting with tiny profits while letting losers run wild, convinced that it will return and at least breakeven. Etc Etc Etc...

I developed my method through all that experience. I read books about how indicators actually work, so I could understand that they are more than just a squiggly line on a chart, but what the math is and how it works. I tested methods live with real money so that I could strengthen my confidence as opposed to using a demo account that gives (IMO) a false sense of safety. I traded tiny making only pennies and sometimes a dollar or two, also losing those amounts. It taught me patience. I sought to simplify as mush as possible, so there would be only a few solid rules to follow, with minimal analysis and confusion.

Even when I started doing well I still refused to keep a journal. There was no record of my trades other than my account statement. No record of why I entered, what the conditions were, why I exited or why the trade succeeded or failed. Finally, when my rules were "set" I decided to make a checklist. I would check the list for each trade and keep that checklist for the results. That was the beginning of a journal. I have since created a journal that incorporates the rules checklist that I have to fill out for each trade, all the details of the trade conditions, results and notes of the why, what and any factors that were influential (including dumb decisions).

It has become the MAJOR difference in my trading success. The "Trend Cycle Entry" method works well. But only because I have a detailed, mechanical procedure for every trade that I take and a detailed history of each as well.

If you are not keeping a trade journal, I strongly suggest it. It will change the way you think about trading.
  • #110
  • Feb 9, 2022 10:23am Feb 9, 2022 10:23am
Thank you WickedDaddy!
I think I understand your approach. There was a nice trade recently on Charles Schwab, so it works with stocks too.

What I asked a few posts above is whether price touching the BB several times in a consolidation phase is alright. From my short experience and what I've read above it is not a safe trade. That's what I was willing to confirm.
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  • #111
  • Feb 9, 2022 10:53am Feb 9, 2022 10:53am
Quoting oohoo
Thank you WickedDaddy! I think I understand your approach. There was a nice trade recently on Charles Schwab, so it works with stocks too. What I asked a few posts above is whether price touching the BB several times in a consolidation phase is alright. From my short experience and what I've read above it is not a safe trade. That's what I was willing to confirm. {image}
Multiple touches to the BB are perfectly OK. Ideally each of those candles that are touching are the same color and the reverse of the trade you want to take. I have included a picture of this:

  1. After the cross of the 15/50 there is a retrace (cycle down)
  2. The red HA candles intersect the BB and remain intersected for 2 candles. It's OK if it were 3, 4, etc
  3. Then a green candle forms and it IS NOT intersecting the BB. This sets up the end of the retrace and you would enter on the open of the next candle.
  4. The StochasticRSI shows the bottom of the cycle as well and has began to rise at the point of your entry.

Often you will see that when price stays attached to the BB for more than just a few candles headed in a direction (up or down), it will negate your trade because the 15 will cross back over the 50 and nullify the rule. But if contact is consistent over several candles during a consolidation and all other rules are met as well, that is a strong trade.

BTW, nice trade in your post. Yes, the method is based on market behavior, which is relatively the same for every market.

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  • #112
  • Feb 9, 2022 11:33pm Feb 9, 2022 11:33pm
Quoting WickedDaddy
{quote} Thanks for making that your first post at Forex Factory. Welcome. Everyone loves a goldmine. You should start a discussion on it so others can learn.
I plan to. Right now collecting data, but since I have appliedd this method my account grew by 60%
  • #113
  • Feb 10, 2022 6:33am Feb 10, 2022 6:33am
Wicked Daddy, sorry I didnt reply to your last post from a few days ago as I was traveling, but you did answer my question in other newer posts.

1. Its very obvious that this is a 100% mechanical system, and in light of that fact why dont you automate it ??

2. Because you dont use a stop loss as per say, roughly how many pips do you let trades go against you on an average, 40-60, 80-100 or more ?? I am trying to get an idea as to what your risk tolerence is.

3. What would be the percentage of all your trades break down be (476 trades) for D1, H4 and H1 be ?? For example, would 50% come from the D1 chart or would it be greater than than 50% ??

4. You also mentioned that most of the time you only trade the EU & AU, and sometimes the UJ. Have you tried any other pairs like Gold or GBPJPY or GBPUSD ??
  • #114
  • Feb 11, 2022 11:23am Feb 11, 2022 11:23am
Quoting sick35
MT4 Indicator built for this system. + Alerts (Not tested yet) It does not depend on external indicators. Use discretion regarding MAs separation Will update indy soon, bugs found Updated New fixes {file}
Thank you v much, much appreciated for the indi, sick35!
  • #115
  • Feb 11, 2022 1:44pm Feb 11, 2022 1:44pm
Quoting pipsquick16
1. Its very obvious that this is a 100% mechanical system, and in light of that fact why dont you automate it ??
First of all, I'm not that smart. I'm not a programmer. But even if I was, the only mechanical part is the entry rules. What happens after that is individual to the market conditions of the trade. The variables are many and I treat each trade according to the market dynamics, schedule (including mine), and other influential conditions at the time. I have seen many automated systems in which the exit criteria is the flaw that ultimately causes losses when there could have been profits.

Besides, I enjoy trading and like being in control and having that feeling of winning every time I bank profits. Why spoil the fun?

Quoting pipsquick16
2. Because you dont use a stop loss as per say, roughly how many pips do you let trades go against you on an average, 40-60, 80-100 or more ?? I am trying to get an idea as to what your risk tolerence is.
I think the deepest I have a let a trade go against me was ~200 pips. It was a good trade but I pulled the trigger too early, had to deal with some political rhetoric, compliments of our former President, and had to wait it out. It took a few days to break even and I exited the trade at a tiny profit only because I was emotionally exhausted at that point and wanted to take a break from trading, reassess my strategy and execution errors, and get my head straight. Typically I am comfortable with 10 to 50 pips, depending on the timeframe.

Quoting pipsquick16
3. What would be the percentage of all your trades break down be (476 trades) for D1, H4 and H1 be ?? For example, would 50% come from the D1 chart or would it be greater than than 50% ??
A glance at my journal reveals approximately 20% daily, 40% 4HR, and 40% 1HR. This is not planned this way. It just so happens to be a rhythm I seem to have adopted naturally. BTW, that was 467, but it's 471 now.

Quoting pipsquick16
4. You also mentioned that most of the time you only trade the EU & AU, and sometimes the UJ. Have you tried any other pairs like Gold or GBPJPY or GBPUSD ??
I've traded GBPUSD a few times but I have not taken the time to really learn its "personality". I don't need to so why dedicate the time? When I had my CTA business, I traded S&P futures for my clientele. I still do in my IRA account. I've only been curious about the rest but again, not smart enough or perhaps too lazy to always have to figure out exchange rates for pip values of the trade. USD backed pairs are easy.
  • #116
  • Feb 11, 2022 11:39pm Feb 11, 2022 11:39pm
Hi WickedDaddy.
Does it bother you when I want to ask a question? Why don't you make a trade at arrow number 1 (yellow). I see that the 1st arrow is very similar to the 2nd arrow trade you made.
Is the trade with arrow number 3 valid?
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"Successful investing takes time, discipline and patience."-Warren Buffet
  • #117
  • Feb 11, 2022 11:53pm Feb 11, 2022 11:53pm
Good day WickedDaddy,

Do you trade 4h exactly the same as Daily chart or do you add any confirmation (sort of MAs) as you do for 1h chart?
  • #118
  • Feb 12, 2022 10:55am Feb 12, 2022 10:55am
Been coming to this site for years and really haven't posted much. I come here looking at different strategy's that people post. This is very interesting strategy and thank you WickedDaddy for coming back and posting your strategy . The knowledge that you have gained over the years show's that your hard work and countless hour's of days gone by has more that paid your hard work.
Subscribed!!!
  • #119
  • Feb 12, 2022 12:07pm Feb 12, 2022 12:07pm
Quoting drsun
Hi WickedDaddy. Does it bother you when I want to ask a question? Why don't you make a trade at arrow number 1 (yellow). I see that the 1st arrow is very similar to the 2nd arrow trade you made. Is the trade with arrow number 3 valid? {image}
My 2 cents
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  • #120
  • Feb 12, 2022 12:30pm Feb 12, 2022 12:30pm
Quoting parisboy
{quote} My 2 cents {image} {image}
Thanks parisboy! Do you have an indicator composite or wave a,b,c or all of them.
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