bringin sexy back - stochastics

Melpheos how has your trading been lately? doing good I hope.

What a boring day! First "live" day with the new baby and all I got was one miserable entry for +15 pips! Lessons learned:

- Rule (1) & (2) is an almost sure-fire thing, but the opportunities are as rare as rocking-horse shit.

- My rules work best in H1 and H4 timeframes. M30, M15 and M5 are not much use. Problem is trading is SO BORING!!! I don't want to open an H4 trade and wait 5 candles (ie 20 hours) to bag my pips!! If I can't get an EA working to do this for me, then my real life is going to have to take precidence!!

But well done to Dan and JD who captured mucho pips :-))

CB.

Code breaker - I think you are on to something and I would urge you to rethink. If you are trading for excitement/entertainment, be prepared to pay for it. If you kept doing what you are doing and got 15 pips everyday you would outperform most traders. I would wait for your rocking horse and trade only that if I were you. Winning trading is the act of applying discipline and is therefore very boring. In the trading world, boring is good. Try setting up some alerts so you dont have to watch every minute of the day and go do some exciting things in between your set ups. Or scalp on the 5 minute chart for excitment using 10% of the trade size you use on your rocking horse shit

Doug

Very much appreciate the comments from an (obviously) seasoned trader! I am aware of the "trading for entertainment" problem and WILL try to be a good boy and avoid it!!

Have just bunged in some code into my indicator/EA to send me an SMS text message to my phone when there is a "heads up" situation. That should, at the very least, allow me to lead a semi-normal life between bouts of fainting excitement.

CB.

Codebreaker, so what is your plan now? By the way, I guess I missed a post but what exactly are rules 1 and 2?

Hi Madito.

Can you post the results of backtesting this system? I did some backtests on this system but I couldn't get more than 35% of Winning Trades and no more than 45% if I add an ADX filter.

I tested other systems and I got more than 60% of winning trades. Although this system seems visually to work it fails constantly on my backtests.

Thanks,

I'm with ya on giving precedence to real life! I definitely need something else to keep the mind occupied while i'm trading. Don't give up though, steady hunting with a sniper rifle is the way to go . However...

jdcompute: ... I was trying to wean myself off the 5 minute chart and here I am again trying to get sexy stochs to work out on a slightly smaller time frame. Perhaps hunting with a sniper rifle for smaller prey. Good on you guys for keeping me thinking.

Go Team Sexy!!

Guys, I think I have a decent understanding of the entry signal. (Well as good as I can after being exposed to this thread for 24 hours) I am currently back-testing data with the old F12 key and I came across this trade and I am curious to learn how you would have handled it.
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Here is how I viewed this chart. I will attempt to talk through this and give my thoughts here and please feel free to explain how you would have handled this with all your experience.

First off we were in an uptrend approaching the trend line that defined the previous uptrend's bottom. This is the HOUR chart by the way. The fast stoch ticked up after the good size up candle was drawn and consequently gave a (1) signal to buy which kind of surprises me because I would have expected to see a (2) because the 20/50 in over bought territory but whatever, doesn't matter. So first off I placed my stop below the last resistance point. The key here will be will the pair be able to break the TL up or not. Its first attempt would have given a good 10 pips profit so perhaps a portion of the trade could have been taken here but the candle was unable to break though and falls back to a level that now puts us in the red. For the next 3 hours the FAST STOCH reloads for another attempt at this TL. The question is, would it be wise to cut losses and get out and wait for the second signal for another run at it or is it wise to set in this thing and just wait it out?

Had I taken the loss and set out I would have missed the next green candle that was made that creates the FAST STOCH signal to trade on. No sooner does that signal come and there is a full retracement of that candle before there is a final move up and through the trend line. I would very much like to hear how you would handle this trade live with stops/limits/re-entry/etc. Or perhaps you will tell me that with that trend line being so close you would have never taken on this trade to begin with.

If you have any questions regarding of my description above for clarification please ask.

No need for much explanation here. Resistance broken, BB broken and sexystoch signal (not showing on this chart, i removed them for clarity )

First TP taken for a nice 150 pips, and i still have 150 pips on the residual order.

Nice One Melpheos!

It's a bit difficult to see the detail in your chart, but I''ll have a crack at answering your question. I take it we're talking about the trade on the red vertical line?

First up, without looking at other time frames for confirmation, I rarely take trades when the slower stochs are in the "zones of confusion" at the top and bottom of the chart. I've just been burned there too many times.

Also, looking at the chart historicaly, the blue line is already flattening off into a "plateau of doom". Seems the upward energy had already begun to dissipate. Two reasons, then, for me not to consider an entry, although some do. See boxin's last chart. (Also, quite common to see a spike before a retrace - that might be the last "trade opportunity" you mentioned)

Looking at the same time span on another time frame, you'd probably find a much stronger looking signal. I'd hunt around a bit until you see something that looks 100% likely to be a winner.

Incidentaly, did you take the trade i highlight with the arrow??? Probably the strongest sexy-stoch entry of the move. (It's real easy with hind-sight of course)

elchoco, thanks for the answer. did i take the trade you mentioned, no. this was just me using the F12 key and studying.

But I do have a question regarding the trade that you pointed out. Would you want to take that trade when the red and blue are in the -20 area? I thought you only wanted to trade INTO those never away from them.

Typically when I am F12ing my way along I find that every entry that I would consider is indeed recognized with a number 1 or 2 by the EA on the next candle so that makes me feel that I at least know the rules.

Hi Team

I am afraid the inability to code the entry (to say nothing of exit) rules almost drove me mad, so I decided to simplify the whole thing. Attached is a chart of my new indicator. Believe it or not, this IS a stochastic. It has just had some very fancy statistical transformations applied. I call it my "peak hunter". Seems to work on all TF from 5M to 1H, so suits my extreme lack of patience.

The "flawless" trade is like 1 or 6 with the real nice smooth line joining the entry and exit. Trades like 2 are a bit more of a rough ride. Entries 3 and 4 were quickly abandoned at stop for tiny loss.

Trade 6 I took today as I couldn't sleep with thinking about this darned business! Bagged 150 pips. This is more like it!! I am told that I should be happy with 10 to 15 pips a day, but something tells me that we can do better.

Backtesting (F12) indicates successful opportunities 3 days out of 5, so not too bad. And very easy to automate the pinger alert and SMS txt message!

CB.

Please don't ask for details -- this is a work in progress and I see no point in discussing stuff until I am sure it works.

Edit - BTW, this is the GBPUSD M30 for the last few days.

Melpheos, 150pips is just unbelievable! I'm more than impressed. One day I'll be like you and Boxing. Great job and truly an inspiration to me and I'm sure others that are trying to get a handle on this method.

Codebreaker if you want me to assist in test driving this indicator, I'm game..send it over.

Hello all,

Just a quick survey on what people's risk to reward is on this. I realised yesterday that it's rare for me to return more than 1% per trade, but that I regularly put 2.5% at risk.

Hence my risk:reward is going to be 1/2.5=0.4 at the most.

So, I'd have to have a win rate of at least three trades in four to be in profit, if i let every trade go to stop loss.

Either i'm taking profit too early (very likely), or i'm taking trades that have good set-ups but low profit potential (need to work on that one).

I haven't taken a loss for a while, but I still woke up in the middle of the night shouting "Expectancy!!!!"

Just wondered how other people feel about this.

Hey codebreaker, love the new looking fantastic stochastic Peak-Hunter indicator. Bring it on!

I'm going long if the 5stoch goes up on candle close.

Hey guys,

I just wonder how you all setup our trades, i mean there are so many different settings and entry rules in here which doesnt fit in the original boxingislife strategy.

As i understand the 20 Line is the Trendline for Long positions, and you guys enter even if the fast 5 Stoch isnt i the oversold area. The same thing with the 50 Line and short positions.

Wouldnt it be better to wait for each trendline and look for OB/OS situations?

I would appreciate it if you could explain me exactly how you manage your entries and which one of them has the highest sucess rate.

Btw.: I made some visual backtests and saw that 30 Min and 1H Timeframes seems to work well with this Strategy.

sell at the circle and currently at green pips...

it really works...but the only problem is i don't know when i should close the trade...

any suggestion guys? melpheos said about the nonlagma...maybe some of you have other techniques?

I normally close out when the 5 stoch hits the 20-line of the indicator but that's just me. Good job by the way.

Hmm, no clear signals on the 4h and 1h charts on the pairs that I trade. I guess I'll be good and stay in a wait and see mode until I get some new direction on the 4hr charts..maybe catch a little pullback of the 1hr and ride that back down.

Would have been a shame to miss this one, wouldn't it ?

Partial profit taken @ 200.5 for 100+ pips and the rest of the order it @ +160 pips atm