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The Art of Trading with MTF Stochastics

  • #121
  • Oct 30, 2007 2:43am Oct 30, 2007 2:43am
Good Morning,

Thank you, Kermut. I will consider your strategy for harvesting pips...it is a sound approach. The fear/greed tug of war that takes place in the heat of battle is an ever present challenge! Generally speaking, I have tried to follow Spud's method of waiting for the 15 or 30 to penetrate the over bought/sold area as my TP or use a trail stop. At the present time, I am trying to stick to my 10-20+ pips as my TP, taking into consideration the volatility of the pair... A hit and run approach that helps my consistency/discipline.

Well, today I woke up to see a strong surge by the crosses. I am watching the retracement of the aud/jpy. Good luck to all!
Attached Image
Unus pro omnibus, omnes pro uno
  • #122
  • Oct 30, 2007 6:30am Oct 30, 2007 6:30am
Hi Kermut,

Thanks for your suggestion.

I'm aware of this kind of partial TP strategy but, like Moneda, I am trying to get my ducks in a row first, make a firm profit and exit, since my success rate is not yet where I want it to be.

Once I'm able to make simple positive trades with greater consistency, I will definitely bergin to apply more sophisticated TP strategies such as the one you've described.

As an aside, I also subscribe to a service where trade calls are made every evening. And, along with the calls, there is a similar TP strategy, i.e., "first target, etc." and I'm gaining additional perspective from that membership. If you're interested, you can PM me but I have no relationship or interest other than having been introduced to the service by another forex trader with much more experience than myself.

Thanks again,

Jeff

Quoting kermut
Guys, you are doing great with this. Have you tried a scaled exit, ie ext x% of position when you normally would, and leave a little on for those times when it really flies in your direction? eg. if you sl is say 20 pips, and u exit 80% of ur position at say 10 pips, bring ur remainder position to be or 5 pip sl etc. Many posibilities, but it gives you the ability to really capitalise on a really good move.

Another thing to note is the rope theory by spud. I have often found that if you look at the 1hr rope or the 4h rope, and if your trades are in the direction being pointed by the rope, you are cutting yourself short by exiting early. This is where scaled exit is really beneficial.

Have a look at it, and let me know what you think.

Regards,
K.
Jeff Singer, K2KV
  • #123
  • Oct 30, 2007 7:48am Oct 30, 2007 7:48am
Hi Bill,

I've attached the template, plus a few indicators used by the template. This will give you a main window with automatic fibonacci levels, S&R and pivot levels, and a lower window with 4-different stochs.

The multi-stochs run best in a 15M chcart.

Simply copy the .mq4 files to MT4_yourbrokerplatform/experts/indicators,

and copy the .tpl (template) file to MT4_yourbrokerplatform/templates (NOT experts/templates).

Close and restart MT4 and apply the template to your chart.

Good luck!

Quoting billbss
Do you have a template for your chart set-up?

Thanks
Attached File(s)
File Type: mq4 ###Auto Pivot.mq4   15 KB | 688 downloads
File Type: tpl #m15_2-windows+4-stochs.tpl   8 KB | 739 downloads
File Type: mq4 #MTF Multi Stochastic.mq4   3 KB | 943 downloads
File Type: mq4 #SpudFibo.mq4   5 KB | 678 downloads
Jeff Singer, K2KV
  • #124
  • Oct 30, 2007 8:03am Oct 30, 2007 8:03am
Quoting k2kv
Hi Bill,

I've attached the template, plus a few indicators used by the template. This will give you a main window with automatic fibonacci levels, S&R and pivot levels, and a lower window with 4-different stochs.

The multi-stochs run best in a 15M chcart.

Simply copy the .mq4 files to MT4_yourbrokerplatform/experts/indicators,

and copy the .tpl (template) file to MT4_yourbrokerplatform/templates (NOT experts/templates).

Close and restart MT4 and apply the template to your chart.

Good luck!

Thanks Jeff
  • #125
  • Oct 30, 2007 11:17am Oct 30, 2007 11:17am
Hello,

Well, my first entry was a short with the aud/jpy (red vertical line on the chart) ...it turned out to be a dud. I made "0" pips....guess is better than negative although I did pay $.92 commission for the trade. I entered while the 15 / 30 were below the 76.4 but it reversed and went back into the overbought area. I was down at least 30 pips but my familiarity with the situation kept me in until I had to go to work and decide to exit for no profit.

My second was a long (green vertical line) for 9.9 pips+. I came home and there it was the 15 / 30 close together heading towards the 76.4. The previous candle was very bullish so I entered and exited when the 15 penetrated the overbought area. I also keep my eyes on a 1min chart with a 1/5/15 mtf stoch for fine tuning. Okay, later tonite BOJ will release their interest rate statement. Maybe there will be some action. Now is time to relax, read, play some online chess and sit on my hands!

Until later,
Attached Image
Unus pro omnibus, omnes pro uno
  • #126
  • Oct 30, 2007 12:34pm Oct 30, 2007 12:34pm
Hi Moneda,

Nice work! And thanks for sharing your trades today. Glad you ended up with +pips!! I'm not trading at all today -- I'm going in for surgery tomorrow and the phone has been ringing all morning, so I just gave up. I'll be recuperating through the weekend, and plan to begin trading again on Monday!

But, I don't exactly understand what caused you to enter on the first trade. Looks like your 30 had not crossed down until four or five candles after your first entry (as indicated in chart below). Am I misreading your chart? Would you mind clarifying this for me?

Thanks much...


Quoting moneda
Hello,

Well, my first entry was a short with the aud/jpy (red vertical line on the chart) ...it turned out to be a dud. I made "0" pips....guess is better than negative although I did pay $.92 commission for the trade. I entered while the 15 / 30 were below the 76.4 but it reversed and went back into the overbought area. I was down at least 30 pips but my familiarity with the situation kept me in until I had to go to work and decide to exit for no profit.

My second was a long (green vertical line) for 9.9 pips+. I came home and there it was the 15 / 30 close together heading towards the 76.4. The previous candle was very bullish so I entered and exited when the 15 penetrated the overbought area. I also keep my eyes on a 1min chart with a 1/5/15 mtf stoch for fine tuning. Okay, later tonite BOJ will release their interest rate statement. Maybe there will be some action. Now is time to relax, read, play some online chess and sit on my hands!

Until later,
Attached Image (click to enlarge)
Click to Enlarge Name: 6.png Size: 69 KB
Jeff Singer, K2KV
  • #127
  • Oct 30, 2007 1:17pm Oct 30, 2007 1:17pm
Jeff,


First let me wish you a quick and healthy recovery.

But, I don't exactly understand what caused you to enter on the first trade. Looks like your 30 had not crossed down until four or five candles after your first entry (as indicated in chart below). Am I misreading your chart? Would you mind clarifying this for me?

Oh yes! the incomplete candle can do that to you! I did not wait for a candle close and at the time that I enter both had crossed the 76.4 only to jump back into the overbought area. I have to be careful with my tendency to not want to miss one minute of the party! I have been rethinking this and it might make more sense, since I am only targeting 10-20+ pips, to wait for a stronger confirmation....maybe even wait for the 60 before entering. Sometimes a party does not get going until much later in the nite. I sound like a party animal but I am really not . I just like that analogy!

Thanks for asking
Unus pro omnibus, omnes pro uno
  • #128
  • Oct 30, 2007 1:43pm Oct 30, 2007 1:43pm
Moneda,

Thanks for your kind thoughts. Fortunately my necessary surgery is not life-threatening, just life-interrupting! Although I'll be given general anesthesia, I should be home later in the day!

What will kill you, though, is entering too early! Spud said this, and I've experienced it myself. I feel much safer entering when the 15 has already made its way to 38.2, and the 30M has crossed 23.6.

Doesn't always happen like that, but I'm almost always guaranteed profit when my entry is more solid. And, like you, I'm happy with +10-20 pips or so per trade.

Thanks again,

Jeff

Quoting moneda
Jeff,


First let me wish you a quick and healthy recovery.

But, I don't exactly understand what caused you to enter on the first trade. Looks like your 30 had not crossed down until four or five candles after your first entry (as indicated in chart below). Am I misreading your chart? Would you mind clarifying this for me?

Oh yes! the incomplete candle can do that to you! I did not wait for a candle close and at the time that I enter both had crossed the 76.4 only to jump back into the overbought area. I have to be careful with my tendency to not want to miss one minute of the party! I have been rethinking this and it might make more sense, since I am only targeting 10-20+ pips, to wait for a stronger confirmation....maybe even wait for the 60 before entering. Sometimes a party does not get going until much later in the nite. I sound like a party animal but I am really not . I just like that analogy!

Thanks for asking
Jeff Singer, K2KV
  • #129
  • Oct 30, 2007 2:12pm Oct 30, 2007 2:12pm
Hi all,

It has occurred to me that explaining and describing how we define our stochastics trades might be more easily accomplished if we were to streamline our terms.

That is, we could convert our stochastic percentages into levels. So, instead of having to remember (and write) for example, 23.6, or 38.2, we could simply say, "level 1" or "L2."

And, for 76.4, we would instead write, "level 5."

So, we'd only have five levels, from bottom to top: L1, L2, L3, L4, and L5.

Seems like a simple transition to me, especially since we're only using the five specific numbers anyway, and the numbers themselves hold little meaning. Frankly, it just might be easier, and a bit more visual to follow, as most of our trades depend upon us reaching or crossing a certain "level."

I'm not committed to this idea, just throwing it out there for comments. And, if it doesn't make sense to anyone, well, please consider it just another silly thought and forget I even brought it up.http://www.forexfactory.com/images/icons/icon11.gif

Any opinions on this?
Jeff Singer, K2KV
  • #130
  • Oct 30, 2007 2:25pm Oct 30, 2007 2:25pm
Now watching EURJPY.

4H shows strong long-term uptrend.
15M is OS and beginning to turn up.
If it climbs up to break L1 (23.6) with a good angle up, I'll probably take the long trade. However, if it softens too much before rising, I might pass.

Even though it is "off-hours," I've often seen this pair trade nicely all day long, so I'll keep watching.
Jeff Singer, K2KV
  • #131
  • Oct 30, 2007 4:15pm Oct 30, 2007 4:15pm
Hello folks,

New trader here, trying lots of things. I'm having some success with MTF stochs and am enjoying the various related threads.

I'm watching GJ - see the charts below.

The H4 looks like it ready to turn down on the threads. Maybe later tonight or tomorrow.

Would you wait for the threads to break 76.4 before taking any short? And in the meantime there might be a long trade on the M15 if the H1 stoch slids a bit more and then turns back up?

Thanks

CanuckCT
Attached Image(s) (click to enlarge)
Click to Enlarge Name: gj mtf stochs m15.gif Size: 16 KB
Click to Enlarge Name: gj threads h4.gif Size: 17 KB
  • #132
  • Oct 30, 2007 4:20pm Oct 30, 2007 4:20pm
Did you take the trade and where did you get in?
Thanks,
CanuckCT

Quoting k2kv
Now watching EURJPY.

4H shows strong long-term uptrend.
15M is OS and beginning to turn up.
If it climbs up to break L1 (23.6) with a good angle up, I'll probably take the long trade. However, if it softens too much before rising, I might pass.

Even though it is "off-hours," I've often seen this pair trade nicely all day long, so I'll keep watching.
  • #133
  • Oct 30, 2007 4:59pm Oct 30, 2007 4:59pm
So, I did take that trade, soon after the 15M crossed up over the 23.6.

I could not stay at the monitor, but kept popping back into my office to follow progress. Was a slow move, but after retracing around -8 pips the price did come back up. On my last check to see how things were going, the 15M had just crossed the 76.4 and I was up +7 pips so I exited.

In at 165.56 (+3 spread), out at 165.66.

Not a big trade, but a good one. http://www.forexfactory.com/images/icons/icon10.gif

Chart below...


Quoting CanuckCT
Did you take the trade and where did you get in?
Thanks,
CanuckCT
Attached Image (click to enlarge)
Click to Enlarge Name: 71030trade_eurjpy.png Size: 73 KB
Jeff Singer, K2KV
  • #134
  • Oct 30, 2007 5:29pm Oct 30, 2007 5:29pm
Jeff,


Nice trade. Little pips become big pips! I am stuck in a short with the aud/jpy but no panic yet....there is still some breathing room but it is getting stuffy...
Attached Image
Unus pro omnibus, omnes pro uno
  • #135
  • Oct 30, 2007 5:47pm Oct 30, 2007 5:47pm
Thanks Moneda,

Funny cartoon.

Good luck with your short!

Take care...
Jeff Singer, K2KV
  • #136
  • Edited 8:10pm Oct 30, 2007 6:01pm | Edited 8:10pm
Hi CanuckCT,

Welcome aboard!

By threads, I assume you mean the rope. Unfortunately, I don't believe most of us trade the rope, though at least a couple of us do. Perhaps they can answer your questions more specifically. So, I'll just offer some general info regarding your questions:

We don't generally trade the 4H stoch. It simply guides us as to the longer term trend. Once we have established the direction of the trend, we then look at the lower TF stochs for possible trade opportunities.

You are planning to go short. But, based on your charts, it looks like your pair is in a LONG trend. Personally, I rarely trade against the trend, since price will surely head in the direction of the trend before too long, no matter how or where I place my trade. Much safer than swimming against the waves.

Hope that helps some...

Quoting CanuckCT
Hello folks,

New trader here, trying lots of things. I'm having some success with MTF stochs and am enjoying the various related threads.

I'm watching GJ - see the charts below.

The H4 looks like it ready to turn down on the threads. Maybe later tonight or tomorrow.

Would you wait for the threads to break 76.4 before taking any short? And in the meantime there might be a long trade on the M15 if the H1 stoch slids a bit more and then turns back up?

Thanks

CanuckCT
Jeff Singer, K2KV
  • #137
  • Oct 31, 2007 4:06am Oct 31, 2007 4:06am
Thanks for the feedback,

So this would be a typical setup - see attached chart. I sold at the red line and collected 14 pips.

Cheers,

CanuckCT

Quoting k2kv
Hi CanuckCT,

Welcome aboard!

By threads, I assume you mean the rope. Unfortunately, I don't believe most of us trade the rope, though at least a couple of us do. Perhaps they can answer your questions more specifically. So, I'll just offer some general info regarding your questions:

We don't generally trade the 4H stoch. It simply guides us as to the longer term trend. Once we have established the direction of the trend, we then look at the lower TF stochs for possible trade opportunities.

You are planning to go short. But, based on your charts, it looks like your pair is in a LONG trend. Personally, I rarely trade against the trend, since price will surely head in the direction of the trend before too long, no matter how or where I place my trade. Much safer than swimming against the waves.

Hope that helps some...
Attached Image (click to enlarge)
Click to Enlarge Name: usdcad 15m.gif Size: 19 KB
  • #138
  • Oct 31, 2007 4:08am Oct 31, 2007 4:08am
Hello fellow traders! This is my 1st post here, and I hope I will be able to give some little contribution and feedback to Jeff thread here. You will only need to bear with my poor english, please!
I have been interested in stochastics long before stumblin' in Spudfyre's great original thread on MTF Stochastic method. I do believe this indicator is by far the most useful among the many and indeed can be quite rewarding if we get to fully know his behavior and applications. Even Marcel Link, in his book "High Probability Trading" mentions it as his most favourite indicator.
Spudfyre has given us a terrific way of using stochastics, and I believe it is helping many of us to make more profitable trades...at least this is what we are trying to do right now.
I have made a lot of backtesting, quite a few sleepless late evenings, and then came up with my very personal method of trading..still to be fully defined, but nevertheless very close to the way Spudfyre presented it. But I still have a long way to learn, and I hope to share some intuitions and thoughts with all of you here.
Well, as it's my first post, and I dont want to seem to be too talkative or intrusive. I will certainly post more soon. For now I just attach the last trade I made just a few hours ago:

http://h1.ripway.com/Gua/Immagine.JPG

EUR/JPY is my favourite currency pair. I do most of my trades on this pair. This morning (I'm in Europe) there was a very good setup with M15, M30 and H1 all heading up with the H4 standing quietly in the OB level, (looking like it was waiting for the other timeframes to join it) M15 had just left the OS level. In about 3 hrs, I managed to get +40 pips. I had to leave home, so I closed the trade. And, as at noon GMT none of the timeframes has gone lower the 80 line yet. So there was still room for more pips.
Setups like that (aiming for 40+ pips) can be seen almost every day, and that is what I personally try to look for in my trades.

Well, that's all for now, and see you back soon!

Sedge

PS Hope your little surgery went just OK, Jeff!
SIMPLE is best! Let's make our trading and our life SIMPLER!
  • #139
  • Oct 31, 2007 3:24pm Oct 31, 2007 3:24pm
CanuckCT,

Taking profit is always the right thing to do, with no regrets. I am just curious why you got out when you did. That was nearly a text book set up to use a trailing stop loss and just keep locking in profit. Easily 20-30 more pips and you were totally safe because you just keep moving your stop south with the price. Sometimes it is hard to stay in for the ride and I leave pips on the table to, but I don't even think about getting out until things cross the 50 line in either direction and things seem to be losing "steam". Just my 2 U.S. cents worth.
  • #140
  • Oct 31, 2007 5:46pm Oct 31, 2007 5:46pm
Hello PipAV8tor,
The only reason I exited was that i had to leave for work or I would have followed it down. I do have to work on my exits though.
Cheers,
CanuckCT

Quoting PipAV8tor
CanuckCT,

Taking profit is always the right thing to do, with no regrets. I am just curious why you got out when you did. That was nearly a text book set up to use a trailing stop loss and just keep locking in profit. Easily 20-30 more pips and you were totally safe because you just keep moving your stop south with the price. Sometimes it is hard to stay in for the ride and I leave pips on the table to, but I don't even think about getting out until things cross the 50 line in either direction and things seem to be losing "steam". Just my 2 U.S. cents worth.
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