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Part Time Wealth Building Trading System

  • #1
  • First Post: Edited 8:43am Nov 22, 2006 8:21am | Edited 8:43am
I am new to this ForexFactory but bring a lot of experience from an extensive trading background. Became addicted to the currencies because of the long sweet trends. Yes, I am a trend trader. OK. Enough of that.

Here is my trading strategy which is great for people who work full time but want to build a very lucrative part time trading addiction into full time profession from the comforts of their job:

1. 30 Min chart

2. 5 Period SMA

3. 45 RSI

4. 21 Average True Range (This is a volatility metrics to help determine lot size)

5. Use a 50 PIP stop.

Very simple. Long when the price exceeds the SMA by 5 PIPS for the first time and the RSI is greater than 50. Short when the price fall below the SMA by 5 pips for the first time and the RSI is less than 50. My target for this system is always 200 PIPs (which I am currently enjoying with the GBP/USD).

I have attached a Power Point to illustrate my current GBP/USD trade. Went long at 1.8176

The ATR is used to determine lot size. There is a formula which I will share with you later. Lot size or Money Management is by far the most important concept to trading.

I only trade the GBP/UDS pair becuase I love the trends and volatility. This system is 100% mechanical and must be followed blindly.

I hate fundamentals (which I refer to as funny-mentals) because it leaves too much to the imagination and emotions. I am a pure technical devotee and would not know how to change.

Enjoy,

Tkimble
Attached File(s)
File Type: pdf GBP_UDS.pdf   202 KB | 11,272 downloads
  • #2
  • Nov 22, 2006 8:25am Nov 22, 2006 8:25am
Sorry for the typo. My GBP/UDS entry point was 1.8876.
  • #3
  • Nov 22, 2006 8:32am Nov 22, 2006 8:32am
TKIMBLE,

Thanks for sharing. First of all there was no attachment. ALso, can you give us an idea of the kind of success you have? Overall winning percentage? Thank you!

SirWolf
Believe and Achieve!
  • #4
  • Nov 22, 2006 8:32am Nov 22, 2006 8:32am
Quoting tkimble
Sorry for the typo. My GBP/UDS entry point was 1.8876.
Welcome to the Factory!

Thanks for sharing your method. I'm looking forward to seeing your MM formula.

You can edit your posts by clicking the little blue button in the lower right corner of your posts up to 24 hours after creation.

Again, welcome to Forex Factory.

Dial
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  • #5
  • Nov 22, 2006 8:38am Nov 22, 2006 8:38am
Thanks very much for sharing the system with us. Could you also post some past results and probably the presentation you mentioned on the first post?


Good Luck,
Al
  • #6
  • Nov 22, 2006 8:41am Nov 22, 2006 8:41am
I am also interested to see that attachment, sounds like a simple way to determine an entry point.

Thank you
Steve
  • #7
  • Nov 22, 2006 9:24am Nov 22, 2006 9:24am
My apologies to all. I have attached the GBP/USD screenshot. Just achieved my 200 pips as I am typing on this trade.

Thanks to all for Factory Forex user instructions....

Tkimble
  • #8
  • Nov 22, 2006 9:30am Nov 22, 2006 9:30am
Quoting sirwolf
TKIMBLE,

Thanks for sharing. First of all there was no attachment. ALso, can you give us an idea of the kind of success you have? Overall winning percentage? Thank you!

SirWolf
Success full trading ratio is approximately 40 - 45%. Can get choppy around entry points. But again, I am looking for the long trends (100 - 200 PIP) such as the GPB/USD trend that I am currently enjoying...
  • #9
  • Nov 22, 2006 9:54am Nov 22, 2006 9:54am
do you have a set position size or do you compound?
Same Whore .... Different Dress
  • #10
  • Nov 22, 2006 10:12am Nov 22, 2006 10:12am
Quoting johnedoe
do you have a set position size or do you compound?
I use two money management systems. One is a derivative of the Average True Range (ATR) indicator which basically lowers position size during broad or volatile price patterns and raises the position size during narrow or less volatile price movement patterns. I never increase of decrease positions during the middle of a trade. Only during transition from long to short or vice versa. The other money management system I use is called the "Year to Earn" approach.

The Yearn to Earn approach basically will only increase your lot size if you earn x amount of profit. The X amount of profit can be adjusted to personal risk compatibility levels. For example, your personal risk comfort zone me lead you to use a $1,000 "Yearn to Earn" lot adjustment factor. This simply means that the future trading lot sized would only be increased if the current "Yearn to Earn" profit trigger has exceeded the $1,000 on a per unit basis.

This is the first time I have tried to explain my system and it seems confusing but realy isn't and again is completely caculated.

I will provide some examples in future postings...
  • #11
  • Nov 22, 2006 10:29am Nov 22, 2006 10:29am
Quoting tkimble
I use two money management systems. One is a derivative of the Average True Range (ATR) indicator which basically lowers position size during broad or volatile price patterns and raises the position size during narrow or less volatile price movement patterns. I never increase of decrease positions during the middle of a trade. Only during transition from long to short or vice versa. The other money management system I use is called the "Year to Earn" approach.

The Yearn to Earn approach basically will only increase your lot size if you earn x amount of profit. The X amount of profit can be adjusted to personal risk compatibility levels. For example, your personal risk comfort zone me lead you to use a $1,000 "Yearn to Earn" lot adjustment factor. This simply means that the future trading lot sized would only be increased if the current "Yearn to Earn" profit trigger has exceeded the $1,000 on a per unit basis.

This is the first time I have tried to explain my system and it seems confusing but realy isn't and again is completely caculated.

I will provide some examples in future postings...
If u don't mind, I wanna know how to read the ATR.

Thanks a lot..
  • #12
  • Nov 22, 2006 10:43am Nov 22, 2006 10:43am
Quoting c1ro
If u don't mind, I wanna know how to read the ATR.

Thanks a lot..
I will post the Money Management fomula that I use and show the ATR' component's impact.
  • #13
  • Nov 22, 2006 11:13am Nov 22, 2006 11:13am
Quoting c1ro
If u don't mind, I wanna know how to read the ATR.

Thanks a lot..
I have attached the actual formula that I use to manage my dollars. This may or may not be compatible with your trading emotions but again is 100% mechanical and protects your account during broad price patterns...
Attached File(s)
File Type: zip ATR.ZIP   2 KB | 13,169 downloads
  • #14
  • Nov 22, 2006 12:49pm Nov 22, 2006 12:49pm
While evaluating and back testing systems is important, nothing compares to acutal results. I joined the Forex Factory this morning and I am stunned at all the great ideas. This is a fantastic forum.

I will post my actual trading results as threads based upon the system that I detailed this morning.

Tkimble
  • #15
  • Nov 22, 2006 12:53pm Nov 22, 2006 12:53pm
Ho tkimble, Welcome to FF. For posting your trades, there is a Journal Forum
You can start a thread that can be your journal, if you would like...

Regards, Scott


Quoting tkimble
While evaluating and back testing systems is important, nothing compares to acutal results. I joined the Forex Factory this morning and I am stunned at all the great ideas. This is a fantastic forum.

I will post my actual trading results as threads based upon the system that I detailed this morning.

Tkimble
  • #16
  • Nov 22, 2006 1:07pm Nov 22, 2006 1:07pm
hi tkimble,

Thanks kindly for sharing your system.

Just had a question on entry, when you say 'price exceeds/falls below the SMA by 5 PIPS for the first time and the RSI is greater/lesser than 50'

Do you mean that after the RSI has recently crossed the 50 mark (up or down) then wait for the prices to extend above/below the 5SMA by 5 pips to make a long or short entry? If so how many periods would you wait after the 50 rsi mark is crossed for the price to exceed/fall below the 5SMA by 5 pips - i.e. is there an expiration or a window that if the prices does not acheive the required level the entry in invalidated.

I guess I am having difficulty understanding 'the first time' part of the entry rule.

Thanks very much for your time,
Ah.
  • #17
  • Nov 22, 2006 1:49pm Nov 22, 2006 1:49pm
Quoting Achilles heel
hi tkimble,

Thanks kindly for sharing your system.

Just had a question on entry, when you say 'price exceeds/falls below the SMA by 5 PIPS for the first time and the RSI is greater/lesser than 50'

Do you mean that after the RSI has recently crossed the 50 mark (up or down) then wait for the prices to extend above/below the 5SMA by 5 pips to make a long or short entry? If so how many periods would you wait after the 50 rsi mark is crossed for the price to exceed/fall below the 5SMA by 5 pips - i.e. is there an expiration or a window that if the prices does not acheive the required level the entry in invalidated.

I guess I am having difficulty understanding 'the first time' part of the entry rule.

Thanks very much for your time,
Ah.
This can be tricky and requires close attention. The RSI is updated real time time as the market moves. When the RSI is greater than 50 on a real time basis and the price moves higher than 5 pips above the 5 min SMA, I go long. When the RSI is below 50 on a real-time basis and the price is 5 pips below the 5 min SMA, I enter a sell order with 50 PIP stops in both cases. You can sometimes get banged around but not that often before you will catch the trend.

Hope this helps...

Tkimble
  • #18
  • Nov 22, 2006 2:00pm Nov 22, 2006 2:00pm
Hi Tkimble,

Thanks for the info, maybe an example might help me understand better, I will also learn the RSI indicator as thsi might be the source of my confusion.

The RSI is at 45 in period 1 and in period 8 it has moved up across the 50 barrier, I watch this and in period 10 the price is 5 pips above the 5 min SMA so I enter long. This seems like a vaild entry?

However in this example lets say that the RSI then dips below the 50 mark in period 15, and then the price also dips to 5 pips below the 5 min SMA in period 18, do I close my long and go short? Or ride it out until the stop is hit or the trend goes back in the long direction?

Thanks again for your time,
Ah.
  • #19
  • Nov 22, 2006 2:08pm Nov 22, 2006 2:08pm
Hi Tkimble,

Also do you put any merit into the slope/steepness of the RSI or additional distance the price might exeed/fall below the 5SMA when you make your decision to enter?

Thanks again,
Ah.
  • #20
  • Nov 22, 2006 2:08pm Nov 22, 2006 2:08pm
Quoting Achilles heel
Hi Tkimble,

Thanks for the info, maybe an example might help me understand better, I will also learn the RSI indicator as thsi might be the source of my confusion.

The RSI is at 45 in period 1 and in period 8 it has moved up across the 50 barrier, I watch this and in period 10 the price is 5 pips above the 5 min SMA so I enter long. This seems like a vaild entry?

However in this example lets say that the RSI then dips below the 50 mark in period 15, and then the price also dips to 5 pips below the 5 min SMA in period 18, do I close my long and go short? Or ride it out until the stop is hit or the trend goes back in the long direction?

Thanks again for your time,
Ah.
Yes. Valid entry for you first question.

No. Always obey the indicators. In the case above, when the RSI goes equates to less than 50 and the price is 5 PIPs below the 5 SMA, take the short signal. In rare cases this can happen several times during the 30 min bar but very seldom and your subsequent losses would be minimized...

Hope this helps...

Tkimble
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