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Attachments: New Pip Pincher Method (PPM)
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New Pip Pincher Method (PPM)

  • #1
  • First Post: Edited 7:33pm May 26, 2007 7:05pm | Edited 7:33pm
Hi Folks,
I have been a silent absorber of the knowledge & experience of this wonderful forum----Atlast, I decided to share a simple but very profitable scalping method with you all---- comments, feedbacks & improvements very welcome---but I prefer to keep it simple & naked---
This method is just an improvement of the already existing one I saw somewhere--hence, real credit goes to one who originally devised it----
I'll call it Pip Pincher Method (PPM) after Linda Raschke's (my favorite)---
PPM:
1. First pull out a 5 min chart of your favorite pair (I prefer Euro/Jpy due to low spread & good volatility)
2. insert 3 EMA (weighted close, i.e., HLCC/4)
3. insert 100 SMA (close)
4. 100 SMA acts like a magnet--price tends to move away & towards this line
5. Now, watch out for swing reversals around 3 EMA
6. Entry at the close of bar which closes just outside or at the 3 EMA----(please see the chart for clarification)--- watch out price action when it approaches 100 SMA
7. SL @ swing high or 10 pips (including spread)
Exit at or before the close of 3rd bar or on trader's discretions (I aim for 3-5 pips per trade)

The success rate is very high with this method---and you will have plenty of opportunities in a trading day--so don't be greedy
Imagine 10 trades & you will earn atleast 20-30 pips a day---you are a millionaire!!

Enjoy your weekend & happy pip hunting,
Attached Image (click to enlarge)
Click to Enlarge Name: 3 ema1.jpg Size: 27 KB
  • #2
  • May 26, 2007 8:44pm May 26, 2007 8:44pm
Nice... This looks better than most 5 minute systems
i've seen. I'lll give it a shot and let everyone know
how it works out.

Chester
  • #3
  • May 26, 2007 8:58pm May 26, 2007 8:58pm
So far, on my charts, i think an improvement
could be made by changing the 3 EMA to a 5 SMMA.
  • #4
  • May 26, 2007 9:18pm May 26, 2007 9:18pm
mysticgenie,

Thanks for sharing with the forum. Looks like a good scalping method.
If I would suggest anything, I just noticed that putting some Stochs on the
chart helped me guage the trade better. My personal favorite stochs setup,
thanks to boxingislife, is 1- 5,3,3 , 2- 50,10,20, and 3- 20,10,20. The 50 and
20 generally give the trend. The 5 shows pullbacks. Just a suggestion for
others who may try this system. Seems like you found trading naked works
for you, but I thought others might want a filter or two. Congrats on the
work.
  • #5
  • May 26, 2007 9:27pm May 26, 2007 9:27pm
Thanks for sharing.
I like the use of a longer term MA like the 100 as a pivot. Maybe as good of a "line in the sand" as any!
Let's try some live demo trades this week. Check out the chart of EJ's last 3 days. Could probably pinch a few more pips per trade!
A few pips profit and a few pips spread per trade doesn't really leave any margin for error at all. :


FXS
Attached Image (click to enlarge)
Click to Enlarge Name: ej.jpg Size: 75 KB
  • #6
  • May 27, 2007 7:11am May 27, 2007 7:11am
Quoting mysticgenie
Hi Folks,
I have been a silent absorber of the knowledge & experience of this wonderful forum----Atlast, I decided to share a simple but very profitable scalping method with you all---- comments, feedbacks & improvements very welcome---but I prefer to keep it simple & naked---
This method is just an improvement of the already existing one I saw somewhere--hence, real credit goes to one who originally devised it----
I'll call it Pip Pincher Method (PPM) after Linda Raschke's (my favorite)---
PPM:
1. First pull out a 5 min chart of your favorite pair (I prefer Euro/Jpy due to low spread & good volatility)
2. insert 3 EMA (weighted close, i.e., HLCC/4)
3. insert 100 SMA (close)
4. 100 SMA acts like a magnet--price tends to move away & towards this line
5. Now, watch out for swing reversals around 3 EMA
6. Entry at the close of bar which closes just outside or at the 3 EMA----(please see the chart for clarification)--- watch out price action when it approaches 100 SMA
7. SL @ swing high or 10 pips (including spread)
Exit at or before the close of 3rd bar or on trader's discretions (I aim for 3-5 pips per trade)

The success rate is very high with this method---and you will have plenty of opportunities in a trading day--so don't be greedy
Imagine 10 trades & you will earn atleast 20-30 pips a day---you are a millionaire!!

Enjoy your weekend & happy pip hunting,

Please clarify the entry one more time.
  • #7
  • May 27, 2007 9:39am May 27, 2007 9:39am
Thanks folks for all the suggestions----very well taken--
1. Chester's 5 SMMA alteration sounds good alternative---but I will stick to 3 EMA as it works good for me for following reasons:
First of all, it helps to see how strong the trend is (lag period is much less--for me, it acts as ADX ) & also the reversal point as it slows down.
Secondly, it helps good entry--remember, the entry is when the reversal bar closes at or near the blue line preferably not crossing it (3 EMA)----only exception, if it gaps up or down---take the trade even if the bar closes above or below the blue line towards direction of gap (min 5 pips guaranteed)

2. Shatteredgently's addition of stochastics might be very useful for other member's, although personally I prefer PA & tend to shun indicators---
3. FXSurfer--thanks for your nice chart---yes, 100 SMA act as good guideline---the farther the price moves away from 100 SMA, chances of reversal increases---Also, when you are with the trend, you can hold on to your trade if 3 EMA crosses 100 SMA convincingly (i.e., sharply)

I am posting some of my trades I took on this friday (05/25/07), which should answer aelimian's query---the cross sign indicates that long trade was not profitable, but at the same time there was signal for reversal which more than compensated for the SL This chart also shows the power of gap opening (the 4th bottom arrow from left)---
I'll post some more charts next wk for better understanding & I'll request others to do the same for mastering this method----
Attached Image (click to enlarge)
Click to Enlarge Name: 3 ema2.jpg Size: 26 KB
  • #8
  • May 27, 2007 10:27am May 27, 2007 10:27am
Quoting mysticgenie
Thanks folks for all the suggestions----very well taken--
1. Chester's 5 SMMA alteration sounds good alternative---but I will stick to 3 EMA as it works good for me for following reasons:
First of all, it helps to see how strong the trend is (lag period is much less--for me, it acts as ADX ) & also the reversal point as it slows down.
Secondly, it helps good entry--remember, the entry is when the reversal bar closes at or near the blue line preferably not crossing it (3 EMA)----only exception, if it gaps up or down---take the trade even if the bar closes above or below the blue line towards direction of gap (min 5 pips guaranteed)

2. Shatteredgently's addition of stochastics might be very useful for other member's, although personally I prefer PA & tend to shun indicators---
3. FXSurfer--thanks for your nice chart---yes, 100 SMA act as good guideline---the farther the price moves away from 100 SMA, chances of reversal increases---Also, when you are with the trend, you can hold on to your trade if 3 EMA crosses 100 SMA convincingly (i.e., sharply)

I am posting some of my trades I took on this friday (05/25/07), which should answer aelimian's query---the cross sign indicates that long trade was not profitable, but at the same time there was signal for reversal which more than compensated for the SL This chart also shows the power of gap opening (the 4th bottom arrow from left)---
I'll post some more charts next wk for better understanding & I'll request others to do the same for mastering this method----
I am trying to follow this chart with your arrows, but I can't quite follow your long/short positions, and why you choose to take a long vs. short. Can you please clarify with this same chart? Also, what broker are you using because I set this up, with the same arrow placements using IBFX demo and the quotes are different sometimes than your chart.
  • #9
  • May 27, 2007 12:15pm May 27, 2007 12:15pm
There are many other entries on the chart mysticgenie provide.Why mysticgenie didn't follow them?
Quoting jeffreytp
I am trying to follow this chart with your arrows, but I can't quite follow your long/short positions, and why you choose to take a long vs. short. Can you please clarify with this same chart? Also, what broker are you using because I set this up, with the same arrow placements using IBFX demo and the quotes are different sometimes than your chart.
  • #10
  • May 27, 2007 6:05pm May 27, 2007 6:05pm
I use FXCM--I find their charting & Metatrader one almost similar----besides, their NDD offers 3-4 spread on Euro/Jpy during normal & high liquidity conditions---good for scalping on shorter time frames.
The up arrow points to long entry & down arrow points to short entry--Please read my previous posts which explain my exit strategy (upto trader's discretion)
This strategy tries to catch the swing reversals which are best noticed in shorter time frames---
Regarding 200's query, i can only say it's my discretion & I trade manually--once i reach my daily goals i don't trade for the day.
Usually any one of the sessions is sufficient to catch 20-30 pips (that's why euro/jpy as it also moves during asian session)
GL/GT
  • #11
  • May 27, 2007 9:07pm May 27, 2007 9:07pm
Quoting mysticgenie
I use FXCM--I find their charting & Metatrader one almost similar----besides, their NDD offers 3-4 spread on Euro/Jpy during normal & high liquidity conditions---good for scalping on shorter time frames.
The up arrow points to long entry & down arrow points to short entry--Please read my previous posts which explain my exit strategy (upto trader's discretion)
This strategy tries to catch the swing reversals which are best noticed in shorter time frames---
Regarding 200's query, i can only say it's my discretion & I trade manually--once i reach my daily goals i don't trade for the day.
Usually any one of the sessions is sufficient to catch 20-30 pips (that's why euro/jpy as it also moves during asian session)
GL/GT
Since when does FXCM offer Metatrader platform?
  • #12
  • May 27, 2007 9:26pm May 27, 2007 9:26pm
must be me, but i dont get entry at all on this. every bar is off the 3ema
  • #13
  • Edited 10:37pm May 27, 2007 10:17pm | Edited 10:37pm
watch the close of each bar for entry signal and direction

(above the line is sell, below is buy)

is that what is meant? wait now i'm confused too... yeah at first
he meant the crossover...whats the signal
  • #14
  • May 28, 2007 6:14am May 28, 2007 6:14am
I see big trends resulting in many losses. Taking a trade each time the bar close breaks above/below the 3 ema results in one placing several trades. As price moves farther from the 100 ema, this will happen many times, with each order becoming a loss. I only see this system working in a range.

How long have you traded this and how do you handle large trends where the 3 ema is broken many times, yet price continues going against you?

Thank you for your reply.
The market is like the matrix - it is you that must learn to bend
  • #15
  • May 28, 2007 8:26am May 28, 2007 8:26am
I trade this method with 3-5 std lots for only 3-5 pips per trade---remember, I'm not trying to ride the trend with this method---I'm trying to catch the reversals after a trend move on shorter timeframes.
To clarify entry, those of you having trouble using OHLC--may use candlestick chart to watch for reversals (i.e., hammer, hanging man etc)---the reversal candle/bar should close near or at blue line from below/up (long/short) opposite to the most recent trend move.
I hope, i clarified the entry---and exit as I said, is on your discretion.
I am trading this method for last few mths--but never had so far 2 consequetive losses.---as I said, for me, the success rate has been very high 80--100% depending on the day.
On jeffreytp's query,
FXCM does not offer any metatrader platform---I use their trading platform for execution purpose only.
I am attaching another chart with Candlestick with 2 trades I took last night on Euro/Jpy--small but profitable
(I cannot post bigger charts due to file size limitations)
I will post more charts as this wk goes on----

GL/GT
Attached Image (click to enlarge)
Click to Enlarge Name: 3 ema2.jpg Size: 30 KB
  • #16
  • May 28, 2007 8:29am May 28, 2007 8:29am
Quoting jeffreytp
Since when does FXCM offer Metatrader platform?
He said that FXCM charting software and Metatrader are very similar. Not that FXCM uses metatrader...

But it's true that posting MT4 chart might be confusing at this point ^^

Quoting mysticgenie
(I cannot post bigger charts due to file size limitations)
I will post more charts as this wk goes on----

GL/GT
Post them as zip file so you can keep the whole size (but we need then to download to view it)
  • #17
  • May 28, 2007 1:18pm May 28, 2007 1:18pm
mysticgenie,
thanks again for the system. I have enjoyed watching it live. Very good use of a long term MA scalping system
  • #18
  • May 28, 2007 6:43pm May 28, 2007 6:43pm
thank u for ur time i liked it and will try with demo ibfx and then live and i will post the results too thank u again
  • #19
  • May 28, 2007 7:23pm May 28, 2007 7:23pm
SOrry but I really have no idea how you are doing this. Looking at your second trade, why didnt you take it several bars before you took it? THZis looks completely random. Not to mention I have never sen a system that has a 1:3 ratio succeed. You are trying to make 3 pips but have a 10 pip stop loss and must overcome at least 4 pip spread as well. Sorry but this makes no sense. Good luck to you
  • #20
  • Jun 7, 2007 8:31pm Jun 7, 2007 8:31pm
u started a good thread and disapered what happen mysticgenie can u please show us more of your strategy please i was testing it demo and i liked it thank u
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