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Attachments: Trend Hugger System
Exit Attachments

Trend Hugger System

Quoting Lincoln10
I'm no expert but it sounds like he's saying that if the current bar is down (but hasn't closed) and the previous two bars are of equal value (in this case 0.396 I think) then he will exit because normally the second bar of the two will readjust lower due to the lagging calculations of the OSMA and MACD.

TK am I in the ballpark with this answer?
This is an excellent example of entry management. You now see that the last bar in fact confirmed the short signal. Had you waited till the end of the last bar, you would have went short at 228.18 instead of taking the short position when the previous bars were equal at a price of 228.48 and you would now have been stopped out since the market has passed the 228.68 mark which is where your stop would have been placed.

While this trade is currently position unfriendly, at least we are not yet stopped out and still have a chance for a profitable trade...

TK
Quoting tkimble
This is an excellent example of entry management. You now see that the last bar in fact confirmed the short signal. Had you waited till the end of the last bar, you would have went short at 228.18 instead of taking the short position when the previous bars were equal at a price of 228.48 and you would now have been stopped out since the market has passed the 228.68 mark which is where your stop would have been placed.

While this trade is currently position unfriendly, at least we are not yet stopped out and still have a chance for a profitable trade...

TK
If you get stopped out, do you have a method of reentry?
Or do you wait until a trend change?
OK, here's an example that I need help interpreting, please.

A classic long entry on the OsMA, yes? And yet price just continues to fall and fall....

Is this simply a case of taking the 50pip stop-out on the chin and moving on? Or am I misinterpreting the rules?

Many thanks.
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Quoting billbss
I learned a trick today that kept me out of that particular trade.

Read nanningbob's posts on this thread.

http://www.forexfactory.com/showthre...t=35860&page=9
Hi Billbss....What exactly was the trick u learned. Maybe i am missing something...

Thanks..

ALso have been following your posts on the hi /low trade as well. Appreciate all your help.

Thanks.

Jimno
Fiveshorts, looks to me like a valid entry and if it hadn't moved up at least 150 pips prior to continuing its downtrend then it looks like you would have had a 50 pip loss. Oh well, next trade!
Quoting james275
Hi Billbss....What exactly was the trick u learned. Maybe i am missing something...

Thanks..

ALso have been following your posts on the hi /low trade as well. Appreciate all your help.

Thanks.

Jimno
It's a little too complicated to go into here.
Basically after you get the signal to enter the trade (in this case tonight it was a lower OSMA bar), you use a 1MA and 5MA on the 1M or 5M chart to actually enter.
Using that method tonight would have gotten you in at 228.64.
Quoting billbss
It's a little too complicated to go into here.
Basically after you get the signal to enter the trade (in this case tonight it was a lower OSMA bar), you use a 1MA and 5MA on the 1M or 5M chart to actually enter.
Using that method tonight would have gotten you in at 228.64.
So essentially it is another method of going short since you enter your position before a short signal was given on this time frame?

Honestly, after i refine a system, i have had a tendancy to figure out how to get into trades earlier, but ultimately i concluded that what i am really doing is adjusting the system and thus skewing results. It makes total sense to use different timeframes to get in earlier, i just haven't been able to do it consistently, plus i don't have as much confidence in the trade as i don't have a true signal from the system that i tested.

Good trading,

Jimno
Quoting james275
So essentially it is another method of going short since you enter your position before a short signal was given on this time frame?

Honestly, after i refine a system, i have had a tendancy to figure out how to get into trades earlier, but ultimately i concluded that what i am really doing is adjusting the system and thus skewing results. It makes total sense to use different timeframes to get in earlier, i just haven't been able to do it consistently, plus i don't have as much confidence in the trade as i don't have a true signal from the system that i tested.

Good trading,

Jimno
I wouldn't have been getting in earlier, I would have been getting in later- on the following bar that retraced.

Using that tonight would have gotten you a 40 pip better entrance price.

I don't mind skewing the results, at all, as long as it's in my favor.
Quoting billbss
I wouldn't have been getting in earlier, I would have been getting in later- on the following bar that retraced.

Using that tonight would have gotten you a 40 pip better entrance price.

I don't mind skewing the results, at all, as long as it's in my favor.
There you go! Thanks Bill

Jimno
billbss

Sounds like it could be a good filter for the new "two equal bars" rule. Though I don't know if I would use a 1 MA and 5 MA on such a volatile pair as GBP/JPY. Maybe a 3 SMA and 8 SMA based on HLC/3 (pivot point moving averages) would be a little smoother. I'd also look at prior price action to see if price is finding support/resistance at the 3 SMA.

If you notice the prior uptrend before the short signal, the price stayed right on top of the 3 SMA the whole move up. Thats what I like to see.

Also it's nice if price stays away from the 8 SMA.
Quoting Lincoln10
billbss

Sounds like it could be a good filter for the new "two equal bars" rule. Though I don't know if I would use a 1 MA and 5 MA on such a volatile pair as GBP/JPY. Maybe a 3 SMA and 8 SMA based on HLC/3 (pivot point moving averages) would be a little smoother. I'd also look at prior price action to see if price is finding support/resistance at the 3 SMA.

If you notice the prior uptrend before the short signal, the price stayed right on top of the 3 SMA the whole move up. Thats what I like to see.

Also it's nice if price stays away from the 8 SMA.
Go read the thread I posted. It's not as simple as the two moving averages. There's more to it than that.
Gotcha. I just finished reading his posts throughout the entire thread. I like what he says. Essentially, when applied to this method we would wait for the OsMA signal (color change) then drop to the 1 or 5 minute chart and look for a 1 MA to cross the 5 MA (Linear Weighted, HL/2) in the direction of our signal. We would enter at the market and place our stop at the 5 MA. Once we were in profit an amount equal to our spread (7 pips), we would move our stop to breakeven. Thus minimizing our risk on any trade to a few pips (about 8 pips in tonights case).

I like it. We would need to adjust our TP levels. If we had waited for a reverse cross of the 1 MA and 5 MA we would have taken a 7 pip profit (when our max profit was 42 pips). I should also note that if we didn't take a profit at the cross we would have been stopped out at 07:55 (if stop was placed at 228.50).

May be a good way to scalp some pips on few trades while the longer term trade plays out.

Also my prices may differ from yours, I'm using MT4 on Alpari.
Additionally, had we been stopped out from first trade and re-entered on next downward cross we would have been stopped out on the next bar and finally on the third downward cross at 228.18 we would have re-entered and would now be sitting on a 57+ pip profit. Not bad. Not to mention the previous 2 trades were stopped out at breakeven.

Only downside to this is having to sit at the monitor watching for crosses.
Quoting Lincoln10
Gotcha. I just finished reading his posts throughout the entire thread. I like what he says. Essentially, when applied to this method we would wait for the OsMA signal (color change) then drop to the 1 or 5 minute chart and look for a 1 MA to cross the 5 MA (Linear Weighted, HL/2) in the direction of our signal. We would enter at the market and place our stop at the 5 MA. Once we were in profit an amount equal to our spread (7 pips), we would move our stop to breakeven. Thus minimizing our risk on any trade to a few pips (about 8 pips in tonights case).

I like it. We would need to adjust our TP levels. If we had waited for a reverse cross of the 1 MA and 5 MA we would have taken a 7 pip profit (when our max profit was 42 pips). I should also note that if we didn't take a profit at the cross we would have been stopped out at 07:55 (if stop was placed at 228.50).

May be a good way to scalp some pips on few trades while the longer term trade plays out.

Also my prices may differ from yours, I'm using MT4 on Alpari.
I don't exactly follow you. Tonight our entry would have been at 0522 GMT @ 228.63. We would still be in the trade. It was downhill from there.

You don't just wait for the MA cross on the 1M chart. The stoch has to hit 100 then turn down with a cross.
Hmm. On my chart I get the stochastics dropping from overbought levels at 6:30 GMT (after the close of the first down OsMA bar). At that time the moving averages crossed and the 5 MA was at 228.50. According to nanningbob we would place our stop there until we had a profit equal to our spread (7 pips) then we move our stop to breakeven (which we eventually would have in this case).

Now, according to my chart, at around 7:55 GMT, price hit 228.50 which would have activated our stop. Right?

Then I was thinking we could have re-entered after the next downward cross as the stochastics approached the 80 line and reversed. If we had placed our stop at the 5 MA again we would have been stopped.

On the third downward cross (8:00 GMT), the stochastics didn't quite reach the 80 line but if you draw a trend line along the stochastic highs you could see a downward trend. I took this as a bearish indicator and took the third trade which proved profitable (and still is).

Again my charts my differ from yours. Im using the GBP/JPY 1H for long term signal and 5M for entry. Im also using the MT4 Stochastic Oscillator.

Whatever the case may be though, I appreciate the link to the thread.
Bill/Lincoln ; I just put together a screen with all time frames on them and the simple OSMA indicator. When i look at all of them it gets very confusing unless you know how to properly trade different time frames. When to get in, when to get out... Some show long, some show short.

Bill, if we simply used the 30 minute chart, this system would have gotten us in "early" compared to the 1 hr chart. my IBFX chart shows a short of 228.64 on the 30 minute chart. If you had traded the 15 minute chart, you would have shorted at 228.84 after one stop out. The 5 min is another entry. So IMO the real question is, "What time frame are you REALLY trading?" Seems to me u are trading the equivalent of the 30 min system and bringing in another system to enter.....Honestly very confusing why you would make such a simple system so complicated to trade.

Personally, i am trading the 4 hr charts and am still long. Now for me to trade anything else if fine, but i better have back or forward tested it to understand how it works.

I find that so many of us tend to take a simple system and want to make it so complicated. TK's system (S) are so simple, and work. Like all systems, you take your lumps, but they are profitable. They certainly can be refined and adjusted and TK encourages all traders to make it work for them.

Just my 2 cents, but the simpliar and clearer rules the better, but nothing stops us from adjusting them together or for ourselves.

Thanks..

Jimno
Quoting Lincoln10
Hmm. On my chart I get the stochastics dropping from overbought levels at 6:30 GMT (after the close of the first down OsMA bar). At that time the moving averages crossed and the 5 MA was at 228.50. According to nanningbob we would place our stop there until we had a profit equal to our spread (7 pips) then we move our stop to breakeven (which we eventually would have in this case).

Now, according to my chart, at around 7:55 GMT, price hit 228.50 which would have activated our stop. Right?

Then I was thinking we could have re-entered after the next downward cross as the stochastics approached the 80 line and reversed. If we had placed our stop at the 5 MA again we would have been stopped.

On the third downward cross (8:00 GMT), the stochastics didn't quite reach the 80 line but if you draw a trend line along the stochastic highs you could see a downward trend. I took this as a bearish indicator and took the third trade which proved profitable (and still is).

Again my charts my differ from yours. Im using the GBP/JPY 1H for long term signal and 5M for entry. Im also using the MT4 Stochastic Oscillator.

Whatever the case may be though, I appreciate the link to the thread.
I used the 1M for entry.
The OSMA bar that gave the short signal closed at 0500 GMT.
Stochastics (1M chart) crossed down from 100 at 0521 GMT.
The MAs crossed down at 0522 at a price of 228.63. That would have been the entry. That price was never threatened after it made 9 pips profit (my spread).
It never ceases to amaze me how quickly so many of you are prepared to start modifying a system once it has been posted.As with most of TKimble's systems he stresses, #25 "simply follow the signals", but now we have MA's, Stochastics etc all in an attempt at perfection. I assume most of you are on demo because you wouldn't mess with this if you were for real.I've followed all of TKimbles threads and I believe he knows what he's on about and he is one of the few practitioners that has a simple approach to this difficult pursuit that actually works (if you don't mess with it).Just my 2 cents worth, probably all it's worth,but I really believe simple is best.
I definately agree. TK's system works fine as it is. The purpose of using nanningbob's strategy is to minimize the risk. (i.e. the 50 pip stop). According to nanningbob, he will enter a trade with a very small stop loss (10 pips) as long as his indicators line up. If he's wrong he is usually stopped out at breakeven (free trade). But when he's right he makes a decent profit with very limited risk.

I think that should be the goal of every trader regardless of the system traded.

In a nutshell, if you can make most of your wrong trades - free trades - then no matter what system you use you should come out on top.

I also agree that we're gettin off topic, so I'll stop posting on this particular matter. Plus I'm going to bed.
Don't fix it if it ain't broken!

I was reading hundreds or thousands of posts in the last weeks of great trading systems and setups here and in other forums.
So many peoples putting their brains here, trying to find a way to beat the difficult Forex market. Tough enemy.
So there are so many systems - better or worse - with different ways to attack the market depending of the temperament of each trader. Some like it hot and aggressive hanging 16 hours in front of their screens, some trade on dailies with a quick look on the charts in the morning.

But one thing I have been observing is the following:

* There is someone posting a new thread about a system he is using personally and successfully.
* Then the thread gets busy and a lot of qualified guys (thats not ironic!) try to help and make the whole thing better.
* After 1,000 post you barely have the originator of the system posting anymore as he still has his original chart and setup from post #1 still trading successfully.
* After reading post 1,500 the whole system has changed to something completely different and nobody remembers the basic idea anymore and more post from peoples coming in asking what the hell is the right and best setup for this as there are soooo many different in the thread!

Please, this is not to criticize the work and effort of all the great guys here trying to improve the trading methods. My personal conclusion is nevertheless:
Choose a system which fits your trading style and temperament, read the post #1 of the thread and apply it. You will be fine!

This thread is a perfect example. Read post #1. The rest is just fixing something that ain't broken!

Thanks TKimble

Good luck all...
"The only successful substitute for brains is silence."
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