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Quoting Jurrasic
trading on smaller time frames (including m1) is more reliable because of the high liquidity.
Not sure I follow you here... How does liquidity tie in with the "reliability" of a timeframe? If anything, lack of liquidity is more likely to screw you on lower timeframes.

techtrader, I noticed you say you want people to tell you what you're doing wrong, but you don't want us to dissect your system... Isn't that kind of contradicting yourself? What if your system is what you're doing wrong?

I don't think there is anything wrong with trading lower timeframes per se, but you'd better be damned sure you know exactly what you're doing, that is, don't rely blindly on a mechanical system.

Longer timeframes tend to be more forgiving to inexperienced traders and of course they are less stressful, just be patient with them... The trigger-happy ways of the 15 min. charts might make you antsy but ignore the little voices.
Quoting fierceman
Not sure I follow you here... How does liquidity tie in with the "reliability" of a timeframe? If anything, lack of liquidity is more likely to screw you on lower timeframes.
Not sure I follow you.. your second sentance is precisely the answer to the question before that. Just what I meant, on E/U you don't have lack of liquidity, plot a random sma/ema pair and compare behaviours with other pairs on any TF. Plus, for small TFs the small spread's an advantage.
On the path to Enrichment.
Quoting Jurrasic
Not sure I follow you.. your second sentance is precisely the answer to the question before that. Just what I meant, on E/U you don't have lack of liquidity, plot a random sma/ema pair and compare behaviours with other pairs on any TF. Plus, for small TFs the small spread's an advantage.
OK I think I misunderstood. I thought you were saying that liquidity is somehow better on lower timeframes. I didn't realize you were referring to EUR/USD liquidity in general.
I started about 4 months ago...I guess 5....4 trading demo and 1 live. 3 months I did nothing but lose. My system was fine and my predictions hit targets most of the time. My biggest problem was trading with 15 min charts. I was extremely susceptible to fundimental announcements AND my stops got hit very often because they were tight.

What I did was move to a larger time frame. Mostly 4 hour and used the daily (even weekly) to back up the direction choice. I also don't use stops now. I set an order to hedge at just outside the AB boundary on my fib. Since I've done that I've been more successful. I've had 2 profitable months now. 1 on demo and 1 live. Demo I did better because I risked a little more and came out about 90%....This month live I came out 20% on my 5k account. I'm ok with that.

I would suggest moving to a larger time frame. A lot of the times a system is fine but we get stopped out because we don't have the stomach for the large pullbacks. I spent 2 weeks in the negative on a trade (pulling some money in the opposite direction from hedging) and FINALLY it came back to break even. I am up on that one becasue is was hedging. Now I will leave it to hit its original target.

Anyway, give your system a chance before you give up on it.
The ForEx giveth and the ForEx taketh away. (more taketh than giveth).
Quoting ApneaBlue
I started about 4 months ago...I guess 5....4 trading demo and 1 live. 3 months I did nothing but lose. My system was fine and my predictions hit targets most of the time. My biggest problem was trading with 15 min charts. I was extremely susceptible to fundimental announcements AND my stops got hit very often because they were tight.

What I did was move to a larger time frame. Mostly 4 hour and used the daily (even weekly) to back up the direction choice. I also don't use stops now. I set an order to hedge at just outside the AB boundary on my fib. Since I've done that I've been more successful. I've had 2 profitable months now. 1 on demo and 1 live. Demo I did better because I risked a little more and came out about 90%....This month live I came out 20% on my 5k account. I'm ok with that.

I would suggest moving to a larger time frame. A lot of the times a system is fine but we get stopped out because we don't have the stomach for the large pullbacks. I spent 2 weeks in the negative on a trade (pulling some money in the opposite direction from hedging) and FINALLY it came back to break even. I am up on that one becasue is was hedging. Now I will leave it to hit its original target.

Anyway, give your system a chance before you give up on it.
"Hedging" in this way is a bad idea. Read this and you will understand why:
http://www.forexfactory.com/showthread.php?t=68598
Quoting ApneaBlue
I started about 4 months ago...I guess 5....4 trading demo and 1 live. 3 months I did nothing but lose. My system was fine and my predictions hit targets most of the time. My biggest problem was trading with 15 min charts. I was extremely susceptible to fundimental announcements AND my stops got hit very often because they were tight.

What I did was move to a larger time frame. Mostly 4 hour and used the daily (even weekly) to back up the direction choice.
Where do people get this idea that if you move to a larger time frame the price action somehow becomes more reliable ? The only thing I feel it may do is give you more breathing space - but then you have to catch much bigger moves also, and you have a lot more time to handle trades so you don't have to be by the computer much. But on the smaller scales price action is often just as ordered and even more than on the larger scale (at least on E/U) and if you're profitable in general then you should be making profit a lot quicker - compare risking even twice less on several trades per day (but using bigger leverage for smaller moves so also earning well) to entering a trade once per week.. Sure it's less work but also less profit accordingly.
On the path to Enrichment.
Quote
Where do people get this idea that if you move to a larger time frame the price action somehow becomes more reliable ?

Well for one it can. It's not only slightly more likely to go in the called direction (5 minute pinbars are more or less a crapshoot), but also much more likely to allow a graceful exit. If you're trading on smaller time frames exits become a lot trickier since you may or may not be around your computer when it comes.

Yea smaller TFs can generate more profit... but you have to focus more tightly too, it's hard to monitor the M15 on 5 different pairs. While I can use the daily to wait for a strong entry across a handful of correlated pairs and get 5 strong positions without spending my entire day in front of the computer. In other wards there's a psychological element to it.

IMO I prefer a "mixed" approach. I like long term trades for their stability, but that doesn't mean I never scalp. I grabbed 2 quick 15M scalps this morning (U/J and G/J) during the early euro sesson and both went well, but I was done by 6am and off for breakfast. I'm typing this message now and have 4 profitable long term trades and 1 BE (dang eurcad slowness)... I'll check back before swap, but I suspect I won't have to babysit them much this week. It's nice not having to worry. And I think that's helped me learn a lot quicker.
  • Post #48
  • Quote
  • Edited at 10:09am Mar 31, 2008 9:52am | Edited at 10:09am
Quoting Jurrasic
Where do people get this idea that if you move to a larger time frame the price action somehow becomes more reliable ? The only thing I feel it may do is give you more breathing space - but then you have to catch much bigger moves also, and you have a lot more time to handle trades so you don't have to be by the computer much. But on the smaller scales price action is often just as ordered and even more than on the larger scale (at least on E/U) and if you're profitable in general then you should be making profit a lot quicker - compare risking even twice less on several trades per day (but using bigger leverage for smaller moves so also earning well) to entering a trade once per week.. Sure it's less work but also less profit accordingly.
Larger time frames mean you are less likely to be affected when Nike sends a heap of money to China for more shoes. ...if that makes sense.

Trades based on price action in the larger time frames will get you more reliable outcomes. And I'm all for that.

By shifting down to shorter time frames you are wanting to make more trades to reach your goals faster. Nothing wrong with that I suppose, but a beginner has no idea what he's getting into does he? He's making things harder for himself. In my opinion stupidly harder. He gets caught out with more stop hunting and just normal money market transfers that large corporations need to make regardless of the technicals / fundamental currency outlook. .....etc

I only screw down to lower time frames to get an even better entry. Which trade I take or watch for, if there IS one, is based on higher time frames. You can make pretty tidy returns on the 4hr and above too you know.

Different strokes for different folks. ....I'd argue still, though, that you get stronger , higher probability trades the higher you go up in the time frames. At least up to daily and weeklies anyway.
Bundy's status today: "Waiting..."
How did this thread turn into a short vs. long timeframe debate? We have enough threads on this already no?

Suffice it to say that they each have their advantages and disadvantages and move onto giving the original poster the insight he is asking for.
Quoting fierceman
How did this thread turn into a short vs. long timeframe debate?
I am mostly responsible I guess. The gentleman asked for help and I gave him the information that helped me become a more successful trader. IMHO, longer timeframes are more reliable. I'm not sure why most new traders start on the shorter frames. I did as well. I started demoing back in August using a MA crossover system that would have made many of you rich and me broke. Also, it depends on your situation. I have to run another business right now. I don't have the time to sit at a pc all day for 25 pip moves at a pop.
Quoting KissFan
I'm not sure why most new traders start on the shorter frames.
It's the excitement. Trading daily charts doesn't give you the same adrenaline rush that 5 min. highly leveraged trades do. It appears that greater profits can be made on shorter timeframes, and that's true, but it is more difficult due to a host of reasons, and most new traders don't realize the difficulties. They only see the rush they get every time the market moves a few pips in their direction.
Quoting fierceman
It's the excitement. Trading daily charts doesn't give you the same adrenaline rush that 5 min. highly leveraged trades do. It appears that greater profits can be made on shorter timeframes, and that's true, but it is more difficult due to a host of reasons, and most new traders don't realize the difficulties. They only see the rush they get every time the market moves a few pips in their direction.
You know, I forgot about the excitement aspect. You hit the nail on the head. Now it's just a routine for me. I really hate sitting at the desk all day so it's not my way of trading.
Quoting techtrader10
I am having some difficulty trying to figure out what I'm doing or see wrong, or maybe it's just my thinking. I would like some help trying to figure out which it is. Here is the problem, I am losing more trades than I profit from. I'll put up my charts so everyone sees what I see and put in my trade journal so everyone can see what my line of thinking is. If anyone has suggestions they would be greatly appreciated. Now the charts I'll be posting are mt4 charts which are slightly different from mine because I can not save them as pics or graphics they are through GFT but all indicators and stochastics are set up the same. I use Pivot Points to set my targets and will have them on the charts also. I use 15 min. charts with entry and exit points marked. If anyone has questions please feel free to ask. Thanks to everyone for the help.
Have you ever considered Fibs?
Quoting forexmoments
Have you ever considered Fibs?
Hey no need to get excited like that.. Maybe I was rash with that argument, it takes a strict system with discipline to make something out of it for short TFs alright. And definetly takes a lot more time invested. Most moves are rather unpredictable also, just occassionaly you can get pretty good shots. Bigger moves on the other hand are easier to trade, at least for e/u (I don't know how you guys can reliably trade other pairs when e/u easily messes them up unless you coordinate things with it) and don't require a lot of time.
On the path to Enrichment.
Ok now let me get this straight on the longer time frame. I have watched the 1 hr on the GU and the candles are about 33-45 pips long plus 4 pip spread, that equates to 37-50 pips for my stop correct? If that is to be assumed and I have a 30 pip limit which is my 2% risk per trade for my stops, that would not be good money management on my part. It would seem that I would blow up my account in a rather short time. With me looking at it that way, I am wondering who is trying to make money. I'm going to try the 1hr on demo (of course) just to see what happens. Now the other thing was my original question (my trading plans). I never got feedback on my trading plans I posted and I won't expect any. Just to let everyone know I am getting a different system because I have dropped my old mentor and am picking up new ones so I will be quite busy learning it. Hopefully it will solve my problem.
  • Post #57
  • Quote
  • Edited at 10:08pm Apr 2, 2008 9:30pm | Edited at 10:08pm
Quoting fierceman
"Hedging" in this way is a bad idea. Read this and you will understand why:
http://www.forexfactory.com/showthread.php?t=68598
I guess everyone will use hedging differently. I have had good success with it. I use technical analysis and find my target with fibs...I get in the trade and set my target and set a hedge just outside the AB boundary so it acts like a stop....HOWEVER...while i'm in the trade and I see a signal of a strong retracement I hedge and get some money in the opposite direction of my original trade while holding the original position. I close the hedge in the positive and when it heads back to the original target I have more pips than I had bargained for. It doesn't work everytime but mostly works...There are times where you get stuck in a position where you are hedging against your original position, then you close the hedge where you think it will turn back and it keeps going in the direction of the hedge....then you jump in and out and it keeps going. When it has broken the AB boundary this is where I cut both the hedge and the original trade and call it a loss...Out of 100 trades I have been stuck like this about 7 times out of a hundred. The other 93 times it worked in my favor...

It's not definitely not for everyone but I find it works for me....On my original post I was up 20%...now I'm up 26%....I consider myself a newbie at trading and trying to get a handle on it as I go along. There may be something I am overlooking and it will just come and bite me in the @$$ at some point but for now I can live with 26% a month. This system seems to be working for me so far.
The ForEx giveth and the ForEx taketh away. (more taketh than giveth).
Quoting ApneaBlue
I guess everyone will use hedging differently. I have had good success with it. I use technical analysis and find my target with fibs...I get in the trade and set my target and set a hedge just outside the AB boundary so it acts like a stop....HOWEVER...while i'm in the trade and I see a signal of a strong retracement I hedge and get some money in the opposite direction of my original trade while holding the original position. I close the hedge in the positive and when it heads back to the original target I have more pips than I had bargained for. It doesn't work everytime but mostly works...There are times where you get stuck in a position where you are hedging against your original position, then you close the hedge where you think it will turn back and it keeps going in the direction of the hedge....then you jump in and out and it keeps going. When it has broken the AB boundary this is where I cut both the hedge and the original trade and call it a loss...Out of 100 trades I have been stuck like this about 7 times out of a hundred. The other 93 times it worked in my favor...

It's not definitely not for everyone but I find it works for me....On my original post I was up 20%...now I'm up 26%....I consider myself a newbie at trading and trying to get a handle on it as I go along. There may be something I am overlooking and it will just come and bite me in the @$$ at some point but for now I can live with 26% a month. This system seems to be working for me so far.
Have you read the linked thread? If you do, you'll see that when you "hedge" this way, you are in effect closing your position, but at the cost of an extra spread payment. Remember it's your equity that counts, not your account balance, so don't throw away your pips. I'm not saying you can't make money with "hedging", it's just that you'll make more once you stop.

BTW Apnea, are you a diver?
Quoting fierceman
Have you read the linked thread? If you do, you'll see that when you "hedge" this way, you are in effect closing your position, but at the cost of an extra spread payment. Remember it's your equity that counts, not your account balance, so don't throw away your pips. I'm not saying you can't make money with "hedging", it's just that you'll make more once you stop.

BTW Apnea, are you a diver?
Hi Fierceman, I think maybe I don't explain my hedging system well...When I have my original position open, I stick with it if I have several indicators/trend lines/s saying "it's going that way" If for some reason it goes the opposite direction I get in just outside the AB boundary (based on fibs) BUT I keep the original position open. I follow the hedge until i get a signal it will turn back in my original direction (keep in mind my original trade is still open going deep in the negative while riding out the hedge)....Now the hedge is in the positive and I close it making some pips. At this point the original trade is still open and starting to head back in the direction it's supposed to....When it hits target I will have two successful trades on the same pair in opposite directions. The idea is to be conservative on your TP on the hedge...Every once in a while you get stuck where you think the hedge is turning back and it keeps going and going away from where your analysis said. At that point I usually close both the original trade and the hedge. I will lose only the pips between my open position of the original trade and where I opened the hedge.

It's been working but I have to say that it does require quite a bit of your time watching the charts. Lately I've been lazy and just increased my tolerance for when a trade that goes against me and just let it ride if I "feel" good about my original decision. I only trade 1:1 so never any huge losses. You'd be surprised how much tolerance you have for huge pip movements against you when you trade 1:1.

On a month and a half now live. First month 31% and two weeks into the second month i'm up 19% on the closing total of the first month...So there's got to be something good about it Another couple months if I can manage at least 10% each month I will throw some more capital at my account.

About the diving, yes. I did some freediving back in the day. check out my website if you have some spare time www.apneablue.com

Happy trading folks.
The ForEx giveth and the ForEx taketh away. (more taketh than giveth).
Quoting techtrader10
I am having some difficulty trying to figure out what I'm doing or see wrong, or maybe it's just my thinking. I would like some help trying to figure out which it is. Here is the problem, I am losing more trades than I profit from. I'll put up my charts so everyone sees what I see and put in my trade journal so everyone can see what my line of thinking is. If anyone has suggestions they would be greatly appreciated. Now the charts I'll be posting are mt4 charts which are slightly different from mine because I can not save them as pics or graphics they are through GFT but all indicators and stochastics are set up the same. I use Pivot Points to set my targets and will have them on the charts also. I use 15 min. charts with entry and exit points marked. If anyone has questions please feel free to ask. Thanks to everyone for the help.

Check out any Forex trading tutorials. The tutorials are everywhere online and they are free to explore, read, and download. Just do a search online. Do not fall into paying sites and commisions, etc.
I've done some research and found this free site:

Forex Trading Education, Tutorial, and Systems Online

It has answers to questions you have and you can also post questions there as well. You can also sign up for a free download of Forex trading tips and techniques for new beginners like you.
Enjoy!
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