Trend Following Experiment - GBPUSD

this thread is inspired by Jacko's Forex House of Pleasure and Pain http://www.forexfactory.com/showthre...t=27286&page=1

basically I'll be trading live using Jacko's method described in the above thread. I must say that I don't yet fully understand Jacko's method. I hope practicing can gain me more understanding.

only 2 pairs, GBPUSD and EURUSD, will be traded for real with micro lots. when there are no trades, I'll practice and papertrade other pairs.

mostly I'll be posting charts with commentary to do the following:
1. determine longterm trend on weekly;
2. determine mediumterm trend on daily;
3. if 1 and 2 agree with each other, look for trading opportunities on 4hr;

I've been trading for a while and so far purely losses, no profit. I'm doing this to gain a better understaning of Jacko's method and to keep a record of my tradings for later analysis.

this is not a system discussion thread, I won't answer questions about the system I use in this thread, if you really want to know, send me an email, and I'll give you the specifications.

please only post when you have an opinion, no need to introduce yourself.

weekly trend is up ...

didn't see that price reached multi 50% fib lines last friday, will remember to draw them asap in the future.

green support line has been broken, price is heading towards support line turned resistance and a 50% Fib line from the latest leg down. price might retrace further, there are almost 200 pips between fib line and upper ma tunnel. there might be opportunities today to short the market.

strategy for the time being:
1. will look for buy opportunity if price successfully breaks above old support line and 50% fib line.
2. will look for sell opportunity if price bounces off old support line and 50% fib line.
3. if price indeed retraces, will look for buy opportunities around the tunnel area.

reason not to buy:
1. price is at a minor 50% retracement from the last leg down;
2. the major 50% retracement is 30 pips above price;
3. the old support line is very close above price;
4. price hasn't broke out of tunnel;
reason not to sell:
1. ma has crossed to the upside,
2. both weekly and daily trends are up;

strategy:
1. if price breaks above tunnel, the old support line turned resistance and major fib line, look for buy opportunity on 1hr;
2. if price bounces off the above levels, look for short opportunities on 1hr;
3. if price does retrace, look for buy opportunities again around tunnel and the old fib lines;

price is well above tunnel, but stalls around minor 50% fib line

ok, this is a bit embarrssing, but I've realised that I'm probably over-analyzing, so I'm changing my strategy now.

I had another look at the charts, and what do I see? both weekly and daily trends are up according to my rules, and MAs have crossed to the upside on 4hr chart, so what am I waiting for?

buy market @ 1.9969, 75 points SL;

I don't care which way market is going to go now, if I'm stopped out, I'll use anti-hedging to get back in, as long as the trend is still up.

let's see what happens with this trade.

this trade has been negative so far, but both weekly and daily trends are still up, ma fast is still above ma slow, price is close to lower tunnel and has been there for a while. I'm buying more.

buy market @ 1.9932, 5 micro lots, 75 points SL.

IPlay,

good excercise. But can you add a little more contrast to your charts? They are hard to see.

yeah, I agree, I just don't know how to do that ...

I use snagit to capture the screens, it does not appear to have a function that could add more contrast to the charts ...

try this site...... http://imageshack.us/

I've figured it out, thanks ...

1st GBP position stopped out @ 1.9894 ($37.50)
2nd GBP position stopped out @ 1.9888 ($22.00)

alarms set @ 1.9819 & 1.9813 respectively;

It has not even been 24 hours since you took your trade. Way too little time for the weekly or daily trend to change, therefore not enough of a reason to add to your looser (some say you never should). This could be ok to do but only if it's part of your trading plan and MM approach.
Not picking on you just trying to help!
Good luck!

Well, for Weekly Chart i think GU same like EU, will pull back to 1.9700. hope this right below, i attached my weekly chart :

FOr daily charts, there's no significant move of the price. because after break down 1.9921, the price will test again 1.9921. so in this daily chart, i'll wait the price bounce back and continue to down trend .. here's my daily chart :

Oh in 4H charts, i just wait the price pull back to 1.9921. and if there's a bounce back confirmation then i'll go short. so for now, i just wait until the price pull back and bounce back . hope it will down trend soon

well, here's my 4H chart ...

Hai iPlayGames ... nice to meet u

i hope my post match with your thread ... i agree with you about your posting yesterday. everyday i always check my Weekly, Daily and 4H to determine the trend. if all the chart have a same direction, so i'll trade, if not then i'll wait. so according to my charts Weekly GU shows a pull back, Daily not to sure, coz it will test the resistance first i think. i don't know whether it will break or bounce back. for 4H, same like Daily charts, it will test the resistance first (1.9921) .

so i'll wait for 4H confirmation ... how bout u iPlayGames?

sorry for my english, i hope u understand what i'm talking about
btw nice thread ....

Hello Sergiu, thanks for your advice. I did not add to a losing position. my 2nd trade was a separate one, it has nothing to do with the 1st. because both weekly and daily trends were still up, so I decided to buy dips at a place where price seemed to have been supported for a while. it could have made money if I locked in some profit, but I was using a trailing stop described in Jacko's thread. I'm not sure I've been using it properly so far. but I'm going to stick to it and see how it works in the long run.

I hate losses, but I'm not afraid of them, I've Jacko's anti-hedging method in place. if I understand it correctly, it should get me my losses back, sometime in the future http://www.forexfactory.com/images/icons/icon7.gif

limit buy @ 1.9900, 75 points SL;

order filled @ 1.9900, trailing stop in place ...