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Part Time Wealth Building Trading System - Weekly Scalping

  • #1
  • First Post: Edited Apr 9, 2007 2:48pm Jan 3, 2007 2:54pm | Edited Apr 9, 2007 2:48pm
OK. I have decided to start a new thread and preview a weekly system that I use which has proven to be more profitable than the trending system. There are many similar systems at this website but I strive for simplicity. The system is again very simple.

Create a weekly chart. Place trades 50 PIPS above or below the close for the previous week. Use a fixed 30 PIP stop. No profit targets. Let the trade run for the entire week and close during the final 30 minutes of the market for the week. The great feature of this system is that more often than not the weekly trend will establish itself and stay in tact from the Monday or Tuesday of the trading session for that week.

GBP/USD Example:

Previous weekly close: 1.9597
Buy: 1.9647
Sell: 1.9547

The following rule is a bit different than most trading systems of this style:

If the "Buy" is executed, move the sell up to the previous weeks close (1.9597 in this case)

If the "Sell" is executed, move the buy down to the previous weeks close (in this case likewise 1.9597)

These two rules permit a more robust and agressive entry after losing trades.

Recommend volatile markets (USD/CHF, GPB/USD, etc.)

Here is the current trade that I am in using the GPB/USD:

Short 1.9597 after a 30 PIP loss on the "Buy" trade.

Use fixed 30 PIP stops.

This system averages approximately 150 pips per week in the GBP/USD market without any intervention. I am a big believer that most people over trade the market. This system will minimize your trades by its very nature.

Happy Trading.

Tkimble
  • #2
  • Jan 3, 2007 3:20pm Jan 3, 2007 3:20pm
Hey Tkimble:


This is a great strategy..in fact I was just chatting with a professional trader who uses this same type of set-up. He runs a hedge fund. Has been doing this type of trading for over 10 years now in Forex and Futures market.
  • #3
  • Jan 3, 2007 3:40pm Jan 3, 2007 3:40pm
Can you just explain your trailstop, wouldn't you just put a stop instead of a trail stop?
Thanks..

Marc
  • #4
  • Jan 3, 2007 3:43pm Jan 3, 2007 3:43pm
Looks great, do you open your trades on Sunday?

Dave
  • #5
  • Jan 3, 2007 3:43pm Jan 3, 2007 3:43pm
Any limits on how many times to reverse your position if the week ranges tremendously to stop out several positions?

If a trade is up 100 pips, then gets stopped out on a retrace, then resumes again do you ever reenter in the same direction or just say thats enough for the week?

As your trade gets into the +100 and up range do you ever move the reverse order off of the close of the week? So say you enter a buy. You move your sell to the previous close. Your buy gets stopped out after +120 pips. It's now 120 pips from the sell trigger. Ever considered to then move the sell trigger to within 50 pips of where you got stopped out or some other point? Thanks. Matt
  • #6
  • Jan 3, 2007 3:47pm Jan 3, 2007 3:47pm
You took a 30 pip loss on the buy, but should't we take some profit, especially since you went over 100 pips?

Dave
  • #7
  • Jan 3, 2007 4:00pm Jan 3, 2007 4:00pm
Actually in this system if you had gone to +100 pips you would have gotten stopped out at +70 pips. It's a trailing stop. Although halfway down his post he says to move the stops every 30 pips. Not sure which he really said to use then. Trailing or stepped?
  • #8
  • Jan 3, 2007 4:17pm Jan 3, 2007 4:17pm
tk, thanks for sharing.. you post incredibly simple systems and i think i speak for all when i say thanks.

in this system, you place a buy AND sell at the same time dont you?



Quoting tkimble
OK. I have decided to start a new thread and preview a weekly system that I use which has proven to be more profitable than the trending system. There are many similar systems at this website but I strive for simplicity. The system is again very simple.

Create a weekly chart. Place trades 50 PIPS above or below the close for the previous week. Use 30 PIP trailing stops. No profit targets. Let the trade run for the entire week and close during the final 30 minutes of the market for the week. The great feature of this system is that more often than not the weekly trend will establish itself and stay in tact from the Monday or Tuesday of the trading session for that week.

GBP/USD Example:

Previous weekly close: 1.9597
Buy: 1.9647
Sell: 1.9547

The following rule is a bit different than most trading systems of this style:

If the "Buy" is executed, move the sell up to the previous weeks close (1.9597 in this case)

If the "Sell" is executed, move the buy down to the previous weeks close (in this case likewise 1.9597)

These two rules permit a more robust and agressive entry after losing trades.

Recommend volatile markets (USD/CHF, GPB/USD, etc.)

Here is the current trade that I am in using the GPB/USD:

Short 1.9597 after a 30 PIP loss on the "Buy" trade.

Use 30 PIP stops.

This system averages approximately 150 pips per week in the GBP/USD market without any intervention. I am a big believer that most people over trade the market. This system will minimize your trades by its very nature.

Happy Trading.

Tkimble
  • #9
  • Jan 3, 2007 4:43pm Jan 3, 2007 4:43pm
Quoting coolshades
tk, thanks for sharing.. you post incredibly simple systems and i think i speak for all when i say thanks.

in this system, you place a buy AND sell at the same time dont you?
Yes. Buy and sell at same time. Adjust one of the trades back to the previous weeks close when either trade is executed...

Happy Trading,

Tkimble
  • #10
  • Jan 3, 2007 5:18pm Jan 3, 2007 5:18pm
Quoting tkimble
Yes. Buy and sell at same time. Adjust one of the trades back to the previous weeks close when either trade is executed...

Happy Trading,

Tkimble
TK

thanks for the new thread.

How many times do you reverse the position, if stopped out, is it only once?

Stop is very tight, there is a chance of being stopped out fairly quickly.

Regards

howard
Regards
  • #11
  • Edited Jan 6, 2007 3:17pm Jan 3, 2007 5:26pm | Edited Jan 6, 2007 3:17pm
Hi Tkimble could you please make it clear are you useing a 30 pip trailling stop or a normal 30 pip stop loss.

Thanks David-T

Quoting tkimble
OK. I have decided to start a new thread and preview a weekly system that I use which has proven to be more profitable than the trending system. There are many similar systems at this website but I strive for simplicity. The system is again very simple.

Create a weekly chart. Place trades 50 PIPS above or below the close for the previous week. Use 30 PIP trailing stops. No profit targets. Let the trade run for the entire week and close during the final 30 minutes of the market for the week. The great feature of this system is that more often than not the weekly trend will establish itself and stay in tact from the Monday or Tuesday of the trading session for that week.

GBP/USD Example:

Previous weekly close: 1.9597
Buy: 1.9647
Sell: 1.9547

The following rule is a bit different than most trading systems of this style:

If the "Buy" is executed, move the sell up to the previous weeks close (1.9597 in this case)

If the "Sell" is executed, move the buy down to the previous weeks close (in this case likewise 1.9597)

These two rules permit a more robust and agressive entry after losing trades.

Recommend volatile markets (USD/CHF, GPB/USD, etc.)

Here is the current trade that I am in using the GPB/USD:

Short 1.9597 after a 30 PIP loss on the "Buy" trade.

Use 30 PIP stops.

This system averages approximately 150 pips per week in the GBP/USD market without any intervention. I am a big believer that most people over trade the market. This system will minimize your trades by its very nature.

Happy Trading.

Tkimble
  • #12
  • Jan 3, 2007 5:34pm Jan 3, 2007 5:34pm
Quoting David-T
Hi Tkimble could you please make it clear are you useing a 30 pip trailling stop or a normal 30 pip stop loss.

Thanks David-T

le]OK. I have decided to start a new thread and preview a weekly system that I use which has proven to be more profitable than the trending system. There are many similar systems at this website but I strive for simplicity. The system is again very simple.

Create a weekly chart. Place trades 50 PIPS above or below the close for the previous week. Use 30 PIP trailing stops. No profit targets. Let the trade run for the entire week and close during the final 30 minutes of the market for the week. The great feature of this system is that more often than not the weekly trend will establish itself and stay in tact from the Monday or Tuesday of the trading session for that week.

GBP/USD Example:

Previous weekly close: 1.9597
Buy: 1.9647
Sell: 1.9547

The following rule is a bit different than most trading systems of this style:

If the "Buy" is executed, move the sell up to the previous weeks close (1.9597 in this case)

If the "Sell" is executed, move the buy down to the previous weeks close (in this case likewise 1.9597)

These two rules permit a more robust and agressive entry after losing trades.

Recommend volatile markets (USD/CHF, GPB/USD, etc.)

Here is the current trade that I am in using the GPB/USD:

Short 1.9597 after a 30 PIP loss on the "Buy" trade.

Use 30 PIP stops.

This system averages approximately 150 pips per week in the GBP/USD market without any intervention. I am a big believer that most people over trade the market. This system will minimize your trades by its very nature.

Happy Trading.

Tkimble
[/quote]

I use a 30 PIP stop from the very beginning and let the trade evolve. My trading style permits the 30 pip true loss as opposed to a 30 pip reduction and prevention of what could have been a 200 - 300 pip run. More times than not, the 30 pip stop will not be hit if the trade survives through Tuesday of the 5 day period. Aslo remember that if I am stopped out, I am sliding the next entry point 30 PIPs closer with the idea of hastening the return to a profitable position...

Happy Trading,

Tkimble
  • #13
  • Jan 3, 2007 7:02pm Jan 3, 2007 7:02pm
So then you do move the trigger past the initial entry? You move the stop in 30 pip increments as well as move the reverse entry trigger at some interval as well to keep it close to current price? Still unclear of what you're saying you do. In the last post you said you slide the trigger 30 pips closer, but in the original post when you move the trigger to the close price that is a 50 pip move. Do you continue to move the trigger at 50 pip intervals or 30?

That last paragraph was confusing. I'll give an example.
Previous close - 1.800
Triggers for buy/sell are 1.8050 and 1.7950 respectively. Buy trigger is hit and price goes to 1.8150. The SL is now at 1.8110 if you're using a 30-step SL and 1.8120 if you're using trailing. Is the trigger for a sell order still only at 1.8050 or have you trailed that along with price as well?

I offered a similar idea in my non-hedge grid style trading thread. No one seemed to think it would work. It was an always in system, and I don't understand why this one is that much different. My strategy involved pyramiding into a position every 20 pips or so and reverse all positions and start with only one lot on the first trade again if a stop on any of the pyramid lots is hit.

Would that have worked then if I didn't pyramid into the position and somehow made a system where it wasn't always in such as how you have a SL of 30 but a trigger of 50? So get stopped out of a long then place another 50 pip trigger straddle from the stop out price, or something similar. Matt
  • #14
  • Jan 4, 2007 8:27am Jan 4, 2007 8:27am
TKimble - I'm not sure I understand the 30 pip trailing stop. My recent experience with the 50MA method has shown me that 50-60 pips trailing is needed to stay with a long trade in gbpusd - would a 30 pip stop not cash out way too soon in some cases? Or is the close and reverse the way the method is supposed to work?

Perhaps I've not spent enough time analyzing the workings of this or I am not able to visualize it clearly. Could you elucidate, perhaps with an example?

Thanks,
Lou
Old Benjamin was right
  • #15
  • Jan 4, 2007 4:05pm Jan 4, 2007 4:05pm
As I analyze this method another question occurs to me - in a week such as the current one in which both close+50 and close-50 have been crossed, are any future trades this week to be opened at the previous week's close?

Thank you,
Lou G
Old Benjamin was right
  • #16
  • Jan 4, 2007 4:54pm Jan 4, 2007 4:54pm
Very interesting system tkimble! Thanks for sharing. I will be adding this to my long-term forward testing...




Quoting Lou G
As I analyze this method another question occurs to me - in a week such as the current one in which both close+50 and close-50 have been crossed, are any future trades this week to be opened at the previous week's close?

Thank you,
Lou G
Lou, place your buy/sell orders 50 pips up/down from last weeks close not at it. Hope this helps!

Thanks again tkimble,
  • #17
  • Jan 4, 2007 5:17pm Jan 4, 2007 5:17pm
But the rules say to move the next entry up or down to last weeks close after a trade is triggered....not above or below it.
  • #18
  • Jan 4, 2007 6:33pm Jan 4, 2007 6:33pm
Quoting drayco
But the rules say to move the next entry up or down to last weeks close after a trade is triggered....not above or below it.
Yes, that's what I read too - let's hang loose until the author replies. There are a few questions outstanding regarding repeat entries during the week, trailing stop movement, etc. which I'm sure he will address.

I did some limited backtesting using the system rules as I interpret them. I used a 30 pip trailing stop, initiated all trades after the first of the week (which was initiated at close plus or minus 50 pips) at the close rather than above/below and allowed multiple trades in the same direction. The results were extremely positive. The possibility of multiple trades does not come up every week but it does happen, hence the question.

Great stuff, tkimble...
Old Benjamin was right
  • #19
  • Jan 4, 2007 7:17pm Jan 4, 2007 7:17pm
Quoting Lou G
As I analyze this method another question occurs to me - in a week such as the current one in which both close+50 and close-50 have been crossed, are any future trades this week to be opened at the previous week's close?

Thank you,
Lou G
My trades in the GBP/USD market for this week were as follows:


Buy: 1.9607
Sell: 1.9507

Buy was executed at 1.9607. I adjusted my sell from 1.9507 to 1.9557 (last weeks close) after the "Buy" was executed. I was stopped out at my 30 PIP stop and went short at last weeks close of 1.9557 which I am currently short.

As of this typing a am up 193 Pips - the 30 PIP loss for a net of 163 PIPS. This system has averaged since June of this year approximately 151 PIPS of profit per week.

My stop is a fixed stop, not stepped or trailiing. This is the simplicity of the system. I simply am not comfortable trying to figure out where the trailing stop should be set so I do not use it. In my mind it is more painful to be prematurely stopped out of a great move then to take a 30 PIP loss. Like a surfer, sometimes I lose but many times a catch the wave and ride it like a lazer beam. That is where I get my ultimate trading thrill.

Again, the psychology of trading is extremely important. My psychology is comfortable with risking only 30 PIPs knowing that during that risk I may earn upwards of 300 - 400 pips on one trade.

Hope this helps,

HappyTrading,

Tkimble
  • #20
  • Jan 4, 2007 7:22pm Jan 4, 2007 7:22pm
Quoting Daemien
Very interesting system tkimble! Thanks for sharing. I will be adding this to my long-term forward testing...






Lou, place your buy/sell orders 50 pips up/down from last weeks close not at it. Hope this helps!

Thanks again tkimble,
As I state in my other thread, I am not a big fan of excessive testing. With this system, it is easy to see the results by looking at a weekly chart. Create a weekly chart of the GBP/USD. Just look at it. That should be all the testing you need. This endeavor matches my trading psychology.

Keep in mind that it is very rare that the price pattern will retrace and entire weeks worth of price movement once the weekly trend has been established. During the last six months, there were some 400 and 500 pip weeks...

Happy Trading,

Tkimble
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