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MTF Stochastics

  • #661
  • May 11, 2007 4:32am May 11, 2007 4:32am
If I'm understanding post 628 and 633, the1H is the final trigger when it closes past 50 and 4H is used only for exit when it closes past 50.
  • #662
  • May 11, 2007 4:45am May 11, 2007 4:45am
Quoting bagovino
Spud,

I think I missed a few posts, so do mind clearing something up for me please?
Are we only entering now when the 4hr either comes down from the 80 (Short) and going up from the 20 (Long)? And prior to this, lets use a short for an example... The 4hr is above the 80 and price is still climbing slightly or ranging. The 15min crosses down through the 50, then the 30min crosses down through the 50, and finally the 1hr falls through the 50... Now we wait for the 4 hr to curl down and penetrate the 80 to enter short?

This is how I'm understanding it. Please correct me if I'm wrong.


Thanks!

Bagovino
Entry for a long:
The 4H stoch crosses from below 20 to above 20. The 4H must close above 20.
Prior to that or at the exact same time you should have confirmation from the 15/30/1H of doing the same. More relevant is that there are no smaller time frames below 20 and there should be at least 2 smaller time frames above 30 when entering on the 4H.
That is your entry.

Optional Entry:
Optionally and if you are conservative you can enter after you have the signal above and once one, two, three or all time frames cross the 50 level up after the entry.


Exits
There are 4 exit options. The first 3 are when the 15 min, the 30 minute or the 1H cross the 80 (in a long trade). The 4th is when the 4H crosses the 61.8 level. All can be on close or when you think the stoch has hit the high. It is a higher risk to take the 4H to 80, but can be done if the lower time frame stochs support it...this is more interpretive.
  • #663
  • May 11, 2007 10:05am May 11, 2007 10:05am
Hi Spud

As the title sugests this is my first post.. and I am new to forex.

This is a quick test post to see if images have uploaded and how it all works.!!

A BIG WELL DONE on a clear and concise post regarding MTF Stochastic!!!

I have been lured into Forex by The numerous " Make a Million over night" websites out there but not so wet behind the ears as to pay for any of thier information.

I came across ForexFactory and have found the information to very interesting and informative ( namely yours SPUD).

Having looked at some over night/ fire and forget systems I have skillfully taken my 5K demo account to less than $50 !!!! LOLLOLOL.

Having read and tried out your techniques I have picked up 48pips today.(picture hopefully attached)
Hope to try this out on a regular basis.

A bit long winded for first post-- but needed to add a few words of thanks/encouragement.

bye for now
Attached Image (click to enlarge)
Click to Enlarge Name: forex48pips2.jpg Size: 112 KB
  • #664
  • May 11, 2007 12:42pm May 11, 2007 12:42pm
Jumped into a trade early with the GBP/JPY this week. 4H was below the 20 line but hadn't closed and hadn't crossed back up over the 20 yet. I sustained a 155 pip drawdown (SL was set at 200) before the trade established itself and gave me 20 pips. The trade lasted close to 24 hours. Thanks much for all the time and work you've put into this system and shared with us Spud.
  • #665
  • May 11, 2007 1:38pm May 11, 2007 1:38pm
Thanks Spud,


I got it now!!!


Bags
"Skills pay the bill's!"
  • #666
  • May 11, 2007 4:17pm May 11, 2007 4:17pm
Quoting Spudfyre
THE SPUD MTF STOCHASTIC SYSTEM
------------------------------------
Many people have asked about an exit strategy, given this is the hardest part of trading. I've been doing some experimenting and have combined the 80/20 rule with the 50 rule to develop what I think is a very good enter/exit strategy.

All trades start with the 4H entry by the 80/20 rule. Support comes from having the 15/30/1H supporting with their 80/20 crosses before the 4H. Optionally you can enter at the Spud50 if you are more conservative. Trades should go in direction of Day stochastic.

Trades are followed through the "50 Rule" (aka the Spud50), where 15/30/1H/4H cross the 50 line.

Exits can be done by choice on the 15/30/1H or 4H chart. Exit area on a long is when the 15/30/1H cross the 20 down but before it recrosses the 20 up. This is an "area" that the trader will have to determine as optimum for exit. The 4H exit is quite different. That exit on a long is done when the 4H crosses the 38.2 line. Short exits are the opposite.

The picture below demonstrates a trade. It shows all 4 time frames (15/30/1H/4H) so that you may study the interaction of each. You will see that as we move into longer time frames, our indicators converge so that we have less vertical lines showing by the time we hit the 4H chart.

In this example the only entry confirmation was the 4H crossing the 80 for a short! There was no clear confirmation from the 15/30/1H with the 80/20 rule prior to the 4H confirmation. Probably can be classified as a high risk trade. However all time frames hit the Spud50 which would have been a good indication to ride the trade to exit.

I have backtested this on GBPJPY and will include more examples on going of using this method.
Top Down!!I like it!!
& the 50% Too I realy like !!
I go away week & the world turns up side down!!


TEB
  • #667
  • May 11, 2007 4:36pm May 11, 2007 4:36pm
Hi Spud

you are better at back testing these things then me
I have had a lot of time to think this weekon vacation

Started playing with an Idea

very simple 3 things
4 hour channel--- its the trend never go against it
4 hour stoch 533
& 30 stoch 533

& darn if it didn't work- it is simple simple

I also tried 1 hour & 15 mins - & 30 mins & 5 mins.also worked

other people want to look at it
TEB
  • #668
  • May 12, 2007 12:35am May 12, 2007 12:35am
Teb,


Isn't that your very first system? 4hr and 30 min?


B.
"Skills pay the bill's!"
  • #669
  • May 12, 2007 1:41am May 12, 2007 1:41am
Spud,
Did you trade your original system this week, or were you testing your newer methods?
  • #670
  • May 12, 2007 2:08am May 12, 2007 2:08am
Quoting bagovino
Teb,


Isn't that your very first system? 4hr and 30 min?


B.
but even simpler- (remember my goal this year is simple)
in TEB1
i. I always used a 3rd stoch - the day with the 4 hour & 30 min
(or the 4 hour 30 min & 5 min)
ii. or the 50EMA for room
to see if we had a dip or rally to get into
(you always need points)

here its the 4 hour channel
But the good thing about this is 85-90% or more
(if the 4 hour stoch is with you)
even if price drops the wrong way its going to come back
because the 4 hour trend will hold that often
this is great in news times
so you are always with the trend!!!!

TEB
  • #671
  • May 12, 2007 8:08am May 12, 2007 8:08am
Teb,


I agree, trend lines are very important. However they are very subjective. Meaning everyone draws them differently. Give 3 traders the same 4 hr chart and they will all draw their trend lines a little differently.

Would you be so kind as to share how your draw yours? I see from your charts that you are very accurate with them!


Thanks,

B.
"Skills pay the bill's!"
  • #672
  • May 12, 2007 9:35am May 12, 2007 9:35am
Quoting Spudfyre
Results from the first live trade of Spud's MTF Stochastic System

GBPJPY Short 8:00 GMT
Maximum Draw Down: 15 Pips
Entry at 4H 80 cross @ 239.41
15M Exit +40 Pips
30M Exit +69 Pips
1H Exit +61 Pips
4H Exit +81 Pips

My result: +35 Pips

Spud you know most programs have a RSI Stoch


TEB
  • #673
  • Edited 1:39pm May 12, 2007 9:36am | Edited 1:39pm
Quoting bagovino
Teb,


I agree, trend lines are very important. However they are very subjective. Meaning everyone draws them differently. Give 3 traders the same 4 hr chart and they will all draw their trend lines a little differently.

Would you be so kind as to share how your draw yours? I see from your charts that you are very accurate with them!


Thanks,

B.
Sure
Next week when I get sometime
but I will do it on mt sight

If I forget please feel to remind me
I am only going to be around next week a little

TEB
  • #674
  • May 12, 2007 11:40am May 12, 2007 11:40am
Quoting jbbb
Spud,
Did you trade your original system this week, or were you testing your newer methods?
I pulled in 142 pips on Thursday and Friday combined on GBPJPY using strictly Spud'd MTF Stochastic System And I slept in on Thursday entering late, making me miss 70 pips I could have taken extra....but I'm not complaining.
  • #675
  • May 12, 2007 11:56am May 12, 2007 11:56am
Quoting TEB63
Hi Spud

you are better at back testing these things then me
I have had a lot of time to think this weekon vacation

Started playing with an Idea

very simple 3 things
4 hour channel--- its the trend never go against it
4 hour stoch 533
& 30 stoch 533

& darn if it didn't work- it is simple simple

I also tried 1 hour & 15 mins - & 30 mins & 5 mins.also worked

other people want to look at it
TEB
The 4H stochastic is very accurate for entry so long as you don't enter too early. The last few days I have gone from yin to yang and am studying the failures more closely to see what common attributes exist. I hope to compile a more comprehensive study on this which I think will help people who utilize both systems.

Yes when I was working on the the lastest version of Spud's MTF Stochastic System and analyzing bad trade signs....I've noticed a high involvement of the 30 Minute time frame as oppose to other time frames....not sure why that would be(?).

I've also noticed a significant involvement of the 38.2 and 61.8 levels on 4H entries with lesser time frames. For example in long successful trades there is a high number of trades where one of the 15/30/1H time frames will hit the 38.2 level as the 4H breaks the 20 level.....almost the exact opposite is true of failed trades where none of the 15/30/1H time frames are at 38.2.
  • #676
  • May 12, 2007 12:04pm May 12, 2007 12:04pm
Quoting TEB63
Spud you know most programs have a RSI Stoch


TEB
I just refer to the default stochastic indicator included in MT4.

More troubling was the discovery in our chat group of the time differences between feeds. For example I am using MoneyTec and the 4H candles were closing 1H ahead of those on FastBrokers. There is alos a rather large discrepency in stoch levels. During the GJ dive on Thursday, there was a 25 point discrepency in stoch levels during the open candle! On Friday my 4H closed at 21.8 (an entry) while FastBrokers closed at around 18 (meaning they had to wait 4H's for the next candle to close above 20).

I am not sure what the overall impact of these differences between feeds has on overall statistics. I would think over the long haul it would average out.

Anyways, it now explains why people kept thinking I was trading on open candles or could not see the trade signals I saw. Lesson learned is if trading in group sessions...make sure the entire group is using the same feed!
  • #677
  • Edited 12:40pm May 12, 2007 12:37pm | Edited 12:40pm
Spud,
regarding your recent post on the SPUD MTF STOCHASTIC SYSTEM:

Entry for a long:
The 4H stoch crosses from below 20 to above 20. The 4H must close above 20.
Prior to that or at the exact same time you should have confirmation from the 15/30/1H of doing the same. More relevant is that there are no smaller time frames below 20 and there should be at least 2 smaller time frames above 30 when entering on the 4H.
That is your entry

my question is how can you enter on a smaller time frame than the 4H - is it possible to enter on the 5 or 15 min chart using this same system? I'm sure I'm missing something really simple and I apologize in advance for my confusion. thanks alot for sharing your wonderful systems and terrific teaching that has helped so many.
traderdp
  • #678
  • May 12, 2007 12:48pm May 12, 2007 12:48pm
Quoting Spudfyre
I just refer to the default stochastic indicator included in MT4.

More troubling was the discovery in our chat group of the time differences between feeds. For example I am using MoneyTec and the 4H candles were closing 1H ahead of those on FastBrokers. There is alos a rather large discrepency in stoch levels. During the GJ dive on Thursday, there was a 25 point discrepency in stoch levels during the open candle! On Friday my 4H closed at 21.8 (an entry) while FastBrokers closed at around 18 (meaning they had to wait 4H's for the next candle to close above 20).

I am not sure what the overall impact of these differences between feeds has on overall statistics. I would think over the long haul it would average out.


Anyways, it now explains why people kept thinking I was trading on open candles or could not see the trade signals I saw. Lesson learned is if trading in group sessions...make sure the entire group is using the same feed!

I am not sure it has anything to do with speed
it is more the "closing & opening" times of the companies

ie Oanda closes at 12:00 midnight
Fxdd at 5:00pm
both EST

I think it makes little diff if you are using stochs for trends
ie the old top down - that is why I can cheet

But it may well make a diff. how you use them
esp if people are trading with you. for sure

as long as someone is doing their own charts it should make no diff
to the win & lose
as to the pip count .. its luck of the draw
sometimes oanda is better some times FXDD is

But I trade only with one ...
not both or it will mess you up for sure!

TEB
  • #679
  • May 12, 2007 12:51pm May 12, 2007 12:51pm
Yes when I was working on the the lastest version of Spud's MTF Stochastic System and analyzing bad trade signs....I've noticed a high involvement of the 30 Minute time frame as oppose to other time frames....not sure why that would be(?).


What do you mean... the 30 min is the one that is off?

I've also noticed a significant involvement of the 38.2 and 61.8 levels on 4H entries with lesser time frames. For example in long successful trades there is a high number of trades where one of the 15/30/1H time frames will hit the 38.2 level as the 4H breaks the 20 level.....almost the exact opposite is true of failed trades where none of the 15/30/1H time frames are at 38.2.[/quote]


doesn't surprise me its just computers..
- its the way the banks trade-
4 hour is there time frame

TEB
  • #680
  • May 12, 2007 6:05pm May 12, 2007 6:05pm
Quoting Spudfyre
I've also noticed a significant involvement of the 38.2 and 61.8 levels on 4H entries with lesser time frames. For example in long successful trades there is a high number of trades where one of the 15/30/1H time frames will hit the 38.2 level as the 4H breaks the 20 level.....almost the exact opposite is true of failed trades where none of the 15/30/1H time frames are at 38.2.
Spud,

When you say "hit the 38.2 level as the 4H breaks the 20 level" do you mean having at least one of the TFs having crossed from 20 to 38.2 or higher and pointing up at the time of the 4H close (in the case of a long entry)?

Fish
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