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4 Hour Strategy (MACD)

  • #4,301
  • May 11, 2007 11:05am May 11, 2007 11:05am
Quoting pips4uandme
Hey Mike.....
B2L....

Can I take a min. and correct your english.....You are a Jerk, and Idiot, a moron, a jackass....whatever you want to use....but the word you chose means you are a mean spirited jerk...(K...I did laugh b/c I was kinda shocked...think you meant jackass...LOL!) . BTW....I don't think you are any of these things...I think you are a nice guy!

Have a great weekend!

Pips
Hi Pips,
Sorry to all here about As????? Word, but my English is lousy I know, That's why I must stop to see too many Lousy Hollywood Films, I suppose.


P.S - I didn't read yet all posts here, let's keep reading to learn more how to write better English.
  • #4,302
  • Edited 11:29am May 11, 2007 11:14am | Edited 11:29am
Quoting jland
I took the chance and went long with gbp/usd... Open at 1.9782 and took profit at 1.9840... But honestly, i'm not really confident about this trade but RR seems to be acceptable... Watching it is scary specially whenever it drops to below the 1.9770 level... Thank god it did get close to the 21ema.

Which brings me to a question to you guys. Do you watch your trade? Or you just set it and see at the end of the day how it went through? Or perhaps you just check every 4hrs... Is it really necessary to watch our trade? Because sometimes emotions really turn a bad trade down... How many times I've thought of closing my trade today with the fear that my target profit wont be hit. But if I did I would really have turned this profitable trade into a losing one.

Any suggestions?
First, May I congratulate all the brave trader's who took MACD signals last night/today!!! & May I comment on Cable's stop level....Which has nothing to do w/Jland's trade...but has to do w/the post that came afterwards (sorry Jland).

Did you notice that the lowest point hit before your candle was lower than your stop? Maybe it didn't show on your platform...but the lowest low was 1.9769....also the 365 was at 1.9750 (part of the reason I didn't take the "real" trade)...and there was a good probability of prices tagging it since price moved through the other MA's so decisively and it was really nearby. O my chart, I had 2 converging TL's @ 1.9759 (which also coincided w/lowest low from previous candle before my "fake" entry...you guys didn't have that luxury to see...also, I rely heavily on Inside Tops and Bottoms for determining S/R....& I had a previous inside bottom high (usually acts as support) at 1.9764. With all this info...I knew the stop had to be less than 1.9755 to have a high probability of success. Anything above that level probably wouldn't survive. Remember Cable moves about 100 pips per session and can be whippy....I also seem to use a larger stop then most on the forum...I'd rather ensure that I am out of the way and if I'm hit it is b/c the market changed direction on me. Which is another reason I always subtract out the spread and a random fudge factor for buys add for sells...it gives me a bit of wiggle room...

If we look at our trades, I'd be willing to bet that our analysis is right more often than not when it comes to price direction and TP's...but our area of difficulty lies in setting our stops (and it is hard to figure out! especially if it is larger than you are comfortable with)...You can always wait for a bit of a retrace in price if the stop is too far away. You may miss a good trade, but you won't lose anything as you would by taking the trade and putting the stop in a "target" area. Go back in history on your platform and trade historically and see how your stops hold up. It is a great way to learn w/out losing any pips. (unfortunately, our stops will get hit sometimes...it's just the nature of the beast ).

Good luck and happy trading!

Pips

Holy Mollie....I totally forgot the point of this post...it wasn't stops.....Yes, I'm finding we should not watch our trades....walk away and check regularly. The ones I watch are more likely to be closed too early...the ones I let run for a while do well. Again, my backtesting has shown that trades take a lot longer to develop than we think (I always want movement immediately....but it usually takes 12 - 24 hours to get good profits!
  • #4,303
  • May 11, 2007 11:24am May 11, 2007 11:24am
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  • #4,304
  • May 11, 2007 11:24am May 11, 2007 11:24am
Hello Smikester, Thank you very much for your encouragement. I am sure that by studying more and more Phillip 4H system and be disciplined enough and strick with RR, money management and following the rules without fail and always keeping a balance between the emotions of the candles and the motion of the MAs coupled with MACD signals, we can only become very profitable withing medium to longer term time.

Forex is really not a home get rich quick but really a lenghty process of properly learning of all it fragrance and intricate details.

Maybe one clue for yesterday sharp move on pairs agains the USD was the announcement of China's intention to diversify her reserves will not indicate a large selling of her dollar assets which are in 100 of billions.

China is well known for protecting a high US$ which is very good for her trade balance but very bad for the US.

So, everytime China make an annoucement about her holding of $ and currency policies, this has a tendancy to move the markets.

Just my 2cents view.

BTW, Phillip 4H system really rock if follow properly

wishing all good day and lof of pips

shreem
  • #4,305
  • May 11, 2007 11:25am May 11, 2007 11:25am
Phil,

I have noticed that many times and not always, (I say this because the market is the market and can do as it pleases) the market will produce a candle that is opposite the direction of macd - a few candles before the best entry candle - example would be the GBP last night - there was a reasonable entry - granted the risk reward was not perfect, then the next candle was a continuation candle before the market turned. The second entry is usually a high probability trade.

I just spent the last 2 weeks reading every post in this thread - I am now certifiable and crazy.

I am using this, my first post to first; comment on the robustness of your system and second, to create an entry in the thread that is more meaningful than "wonderful system, I think I will use it", or "wish me luck" or other such posts that made reading the entire thread numbing for me.

Unfortunately, for me very few of the over 4000 posts actually moved the varasity of the 4 hour methodology forward. I do applaud your decision to not create a seperate thread while at the same time I can appreciate your desire to do so.

I look forward to experiencing the insights and trading wisdom of the participants of this thread.

Sedonapipper
I make money anywhere in the world by taking orders
  • #4,306
  • May 11, 2007 11:33am May 11, 2007 11:33am
Quoting pips4uandme
First, May I congratulate all the brave trader's who took MACD signals last night/today!!! & May I comment on Cable's stop level....Which has nothing to do w/Jland's trade...but has to do w/the post that came afterwards (sorry Jland).

Did you notice that the lowest point hit before your candle was lower than your stop? Maybe it didn't show on your platform...but the lowest low was 1.9769....also the 365 was at 1.9750 (part of the reason I didn't take the "real" trade)...and there was a good probability of prices tagging it since price moved through the other MA's so decisively and it was really nearby. O my chart, I had 2 converging TL's @ 1.9759 (which also coincided w/lowest low from previous candle before my "fake" entry...you guys didn't have that luxury to see...also, I rely heavily on Inside Tops and Bottoms for determining S/R....& I had a previous inside bottom high (usually acts as support) at 1.9764. With all this info...I knew the stop had to be less than 1.9755 to have a high probability of success. Anything above that level probably wouldn't survive. Remember Cable moves about 100 pips per session and can be whippy....I also seem to use a larger stop then most on the forum...I'd rather ensure that I am out of the way and if I'm hit it is b/c the market changed direction on me. Which is another reason I always subtract out the spread and a random fudge factor for buys add for sells...it gives me a bit of wiggle room...

If we look at our trades, I'd be willing to bet that our analysis is right more often than not when it comes to price direction and TP's...but our area of difficulty lies in setting our stops (and it is hard to figure out! especially if it is larger than you are comfortable with)...You can always wait for a bit of a retrace in price if the stop is too far away. You may miss a good trade, but you won't lose anything by putting the stop in a "target" area. Go back in history on your platform and trade historically and see how your stops hold up. It is a great way to learn w/out losing any pips. (unfortunately, our stops will get hit sometimes...it's just the nature of the beast ).

Good luck and happy trading!

Pips

Holy Mollie....I totally forgot the point of this post...it wasn't stops.....Yes, I'm finding we should not watch our trades....walk away and check regularly. The ones I watch are more likely to be closed too early...the ones I let run for a while do well. Again, my backtesting has shown that trades take a lot longer to develop than we think (I always want movement immediately....but it usually takes 12 - 24 hours to get good profits!
GbpUsd
I cannot put it any better. 365EMA was there to be tested as I said on the MP3. Stoplosses is where we get hit. It is something that have to be practised. If R:R ratio is less than 1:1 let it go, dont wingle you stoploss level rather alter your entry level to 3 different levels as in the original document to spread the risk. It is difficult to watch a trade and not step inbetween. To stick to the plan takes practise.
Have a nice weekend to all.
  • #4,307
  • May 11, 2007 11:38am May 11, 2007 11:38am
See my Chart to see how important are Trendlines, and if you use them with MACD Signal it is even more perfect, I have done it this week when I buy GPBUSD and in that trade I could won +100 pips if I would close it sooner.

Yesterday in my chart only Secondary Trendline was draw, but I skip to draw the principal one, and I could do it even before last mad trade hours.
Now see where the last candles are, just around that trendline.

My Order yesterday was a buy limit order according to that trendline at 1.3487, and some minutes after reach the other Trendline at 1.3467.
I always give limit orders with some pip gap after big drops, but I draw the principal Trendline few minutes after order was open.
With this lack of attention I did not won 20 pips!!

FOLLOW MACD METHOD WITH TRENDLINES AND YOUR SUCESS WILL BE GREATER!!
This trade was not according MACD signal, but only try to buy a order when touch for first time the Trendline.

MIKE
Attached Image (click to enlarge)
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  • #4,308
  • May 11, 2007 12:23pm May 11, 2007 12:23pm
Quoting BoredToLoose
See my Chart to see how important are Trendlines, and if you use them with MACD Signal it is even more perfect, I have done it this week when I buy GPBUSD and in that trade I could won +100 pips if I would close it sooner.

Yesterday in my chart only Secondary Trendline was draw, but I skip to draw the principal one, and I could do it even before last mad trade hours.
Now see where the last candles are, just around that trendline.

My Order yesterday was a buy limit order according to that trendline at 1.3487, and some minutes after reach the other Trendline at 1.3467.
I always give limit orders with some pip gap after big drops, but I draw the principal Trendline few minutes after order was open.
With this lack of attention I did not won 20 pips!!

FOLLOW MACD METHOD WITH TRENDLINES AND YOUR SUCESS WILL BE GREATER!!
This trade was not according MACD signal, but only try to buy a order when touch for first time the Trendline.

MIKE
hey mike, you may have to change your name to at least BoredToBreakeven! It good to see you making pips. Have a great weekend.
  • #4,309
  • May 11, 2007 12:34pm May 11, 2007 12:34pm
Quoting O'Zeeke
hey mike, you may have to change your name to at least BoredToBreakeven! It good to see you making pips. Have a great weekend.

I agree!!!!!!. Well done
  • #4,310
  • May 11, 2007 12:43pm May 11, 2007 12:43pm
Quoting O'Zeeke
hey mike, you may have to change your name to at least BoredToBreakeven! It good to see you making pips. Have a great weekend.
I know I am mad, that's why I am here to do 100% Trades according Phillip Method, but I need some time to learn to be patient.
Well, this week I won +100pips, not bad for BOREDTOBREAKEVEN. :

Bye and until next week.

P.S - you'll see in a couple of weeks my trades will be 100% MACD.
I will not write here anymore my News Trades.
  • #4,311
  • Edited 2:00pm May 11, 2007 1:25pm | Edited 2:00pm
Quoting Phillip Nel
Never buy into motion. The reason is you see the motion and get excited and buy/sell and then want to decide what the plan should be. You must allready have a plan before you open a position
Hi Phillip

This is absolute necessary information for the beginners in this system. I think it is more important than the MACD itself. After the information received last week-end and these files, I do understand this system much better. Now I do have more confidence to start using it.

I am talking about the MP3 file and all the information on the price motions.

Isn't there a way to put this on the first page of the thread?
Willem Forex recipe for success = Patience, discipline & hard work.
  • #4,312
  • May 11, 2007 1:48pm May 11, 2007 1:48pm
Hi Phillip,

Maybe SedonaPipper and Golfer are right.....Maybe our community is too cumbersome and we should have a summary thread where it is strictly your posts.....

If you decide to separate afterall....and you need any help w/anything, please let me know.

That way, we could still support each other on this thread w/out annoying those who only want the nuts and bolts. I still would think they should work through the main community b/c there is an awful lot of good trading skills input on here...like stops, different ways to see price action (for S&R), psychology, money management, high fives.... But it could be their choice.

Questions could still be posted here for simplicity sake, so you wouldn't have to check another thread.

Happy Weekend!

Pips
  • #4,313
  • May 11, 2007 1:53pm May 11, 2007 1:53pm
Quoting O'Zeeke
hey mike, you may have to change your name to at least BoredToBreakeven! It good to see you making pips. Have a great weekend.
& pretty soon, O'Zeeke will be known as Born2BeRich...

Loving seeing your growth over the thread and your positive weekly pippage!! .

& Mike.....Keep watching those "Hollywood movies," they are really fun....hehe...sure did get a good laugh at the translation

Pips
  • #4,314
  • May 11, 2007 2:11pm May 11, 2007 2:11pm
Made great recovery with the E/U and G/U today using the strategy. I took all the PDF's home and read through them, I then went back and looked at what I would have done differently. I proceeded to take a look at what was being signaled at the current time. The candles closed I bought in, even against what my opinion that the USD was going to get a little stronger to day and cause further slippage, but went against my emotion and with the market motion, and today: recovered 800 of my 1400 dollar loss!!! This strategy has been amazing, it really seems to be working.

As a side note, I am new to this forum and this strategy, but over a year ago I traded for about 3 months in the forex arena after what I thought was a great opportunity, I could not get the flow of trading on news announcements, thus after 3 months I lost all that I had invest which was only 500 dollars, but I still lost it.

Now, I have been trading this strategy for awhile and feel comfortable with it. It is definitely my style. I like it much better than trading the news. I am an analyst and majority of the time I stay true to what the numbers say. I learned a valueable lesson this week.

Ryan
  • #4,315
  • May 11, 2007 2:24pm May 11, 2007 2:24pm
Quoting Dropplan
I think that the "motion of the market" is probably one of THE best tips on trying to understand the FOREX. Once I understood that the charts and MA's that Phillip has given us represent People,Traders and human psychology, it all made much more sense to me. What I have also learned is that "I believe in what I see(charts) and not what I hear(news or opinions) ". Obviously I am not saying that the news or fundamentals are not important, but when it is all said and done the market goes right back to its own "motion". The key is to understand when the market is undecided (hanging around the 89) and that is were patience comes into play. Just my thoughts.....

Also I would like to thank Phillip once again for his generousity and also all the fine contributions by the thread participants....especially "PIPS" ( I really enjoy your thoughts and help)
Dropplan, great post! I just came across it while the market is quiet and there is some good reading on FF. For me, as a "flea on the elephant" I rather learn the motion and sentiment of the market around particular news, events than investing into particular research papers which, in majority, still prove to be wrong. Phil's method provides an excellent measurement, or, say, barometer, of the sentiment in where the price with respect to MA's. "It is not what you say, it is how you say it" - PhN.

Cable dropped, loonie dropped as the expectations were largely not met. If somebody can scientifically or statistically prove where that tipping point of the crowd's (and I am one of them) expectation is, I believe this Secret will be sealed forever in Fort Knox. I guess while a new Nostradamus is not borne, we should take advantage of this simple, yet powerful system which x-rays the underlying emotions quite reliably.

Yesterday, e.g. when Dow plunged a largely upheld expectation was "unwinding of carry trade" started! Here is one of the yesterday's analysis. There are many more to the same point which point is only to scare a man (or woman) from the street to make some small money from these moves. Then came another news this morning and Dow made another high, yen sold off again. "Carry-trade" analysts do not acknowledge they were wrong. I bought yen earlier this week and I am still ahead of these analysts. My TP's were already hit. MACD helped.

There was a chorus of analysts yesterday about the start of euro sell-off. But MACD gave a buy signal this morning and we (read MACD Company) again beat the analysts' expectation. I have a feeling euro is not done yet and we can expect some battle next week.

Have a great weekend.

P.S. I do not know why but I expect the start of carry-trade unwinding and start of Dow downtrend on May 17 (next week, i.e). And ban me from FF if I am wrong, he-he.
  • #4,316
  • May 11, 2007 2:43pm May 11, 2007 2:43pm
Quoting pips4uandme
Did you notice that the lowest point hit before your candle was lower than your stop?
Well, I'm sure I did, but the trade looked so promising that I fudged the stop to make it palatable... In retrospect, I knew better. It's amazing how we know something and we read something and we hear something but we don't really pay attention to it until it bites us in the butt I guess the painful lessons are the ones most solidly learned...

Quote
... the lowest low was 1.9769....also the 365 was at 1.9750 (part of the reason I didn't take the "real" trade)... O my chart, I had 2 converging TL's @ 1.9759
I'd like to see your chart, because I don't have those TLs and I can't see where they would come from. Also, I didn't see the 365 because as of yet I hadn't seen it's usefulness, so I wasn't drawing it (for the sake of avoiding clutter). Needless to say, I've now gone back and added it to all my charts...

Quote
...also, I rely heavily on Inside Tops and Bottoms for determining S/R....
There's something I'm not familiar with.. could you give a quick description of what an Inside Top or Inside Bottom is - or perhaps a link to a good resource?

Quote
If we look at our trades, I'd be willing to bet that our analysis is right more often than not when it comes to price direction and TP's...but our area of difficulty lies in setting our stops...
You're so right, and it's comforting to know that my decision to take this trade was sound, even if my implementation was not. As it stands, it was still a successful day with two out of three trades won and a +13 pip tally, but let's play what-if for a moment...

Since I don't have the TLs you mentioned, I'll go with the 365EMA as the basis for my SL... the 365 was at 1.9747 at that point (on my platform) so I'll set my retrospective SL at 1.9745. That's 63 pips from entry, therefore unacceptable for a straight trade. However....

I had also forgotten about Phil's trick of staged entry for cases where an attractive trade has too large a SL.. If I put 1/3 on at the market, 1/3 at 20 pips down from the market and 1/3 at 40 pips down from the market, the landscape changes dramatically:

Entry 1: 1.9808 -- TP = 46, SL = 63
Entry 2: 1.9788 -- TP = 66, SL = 43
Entry 3: 1.9768 -- TP = 86, SL = 23

Now, I have an aggregate TP of 66 and SL of 43. Not only is the SL acceptable (<= 48), but the RR is better owing to the lower entry points. From 1.31 it goes to 1.53!!

Had I used these simple techniques (which I knew of, but didn't pay attention to...) My +13 pip day would have been a +91 pip day!! That would have sent me crowing into the weekend.

Overall, I'm quite encouraged with this experience, because I was so close to great success, because the solutions to my problem are now lessons well learned, and because the great people in this thread are Sooooo helpful to me!! Thanks Phil!! Thanks Pips!! Thanks everyone!!



EDIT: Seeing as the GU never quite got to my TP, for the purpose of accuracy I should say that the best I would have done today was +79, not +91... I'd be very happy with that, though!
  • #4,317
  • Edited 3:24pm May 11, 2007 2:59pm | Edited 3:24pm
Hi DGC....Nice post....

Here's what my chart looked like at entry....I made the 2 TL's thicker than the rest so you could see them...I used my crossbar to see price of intersection.

The 365 is the thin red line poking out from the TL....looks like one of my normal TL's...Harder to see on this b/c I thickened up the TL's....

Hope it helps...

Forgot about IT's...go back and do a search on TamKras' posts...look for Nesting Dolls...IND...UND also same for me...search nesting dolls...IND, UND, & IT IB...all the same....The areas are the blue lines on my chart...
Attached Image (click to enlarge)
Click to Enlarge Name: GBPUSD4hour 051007 1AM candle.gif Size: 22 KB
  • #4,318
  • May 11, 2007 3:04pm May 11, 2007 3:04pm
I am shooting for 20 pips a day with this strategy. In using this strategy I have been able to accomplish this and more each day. Is 20 a day really sustainable with this strategy???
  • #4,319
  • May 11, 2007 3:41pm May 11, 2007 3:41pm
hi,

how would you handle a situation, when two different pairs with a high correlation like euro and swissy or euro and cable give in the same moment the same signal.
Would you buy both pairs (each one lot), take one pair with two lots, or just take one pair of them with one lot?


br
panther_trader
  • #4,320
  • May 11, 2007 4:23pm May 11, 2007 4:23pm
Quoting pips4uandme
Hi DGC....Nice post....

Here's what my chart looked like at entry....I made the 2 TL's thicker than the rest so you could see them...I used my crossbar to see price of intersection.

The 365 is the thin red line poking out from the TL....looks like one of my normal TL's...Harder to see on this b/c I thickened up the TL's....

Hope it helps...

Forgot about IT's...go back and do a search on TamKras' posts...look for Nesting Dolls...IND...UND also same for me...search nesting dolls...IND, UND, & IT IB...all the same....The areas are the blue lines on my chart...
pips4uandme,

I think the trendlines are drawn from swing high to swing highs. You might have missed out on a previous swing high. Please see my additions to the chart.
Attached Image (click to enlarge)
Click to Enlarge Name: GBPUSD4hour 051007 1AM candle.gif Size: 26 KB
AFTAB Time Will Tell & Price Will Show
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